Duty to Defend Versus Duty to Indemnify—Question of Fact About Whether Intentional Conduct Policy Exclusion Applies

The plaintiff’s vehicle had been struck from behind by one Schwartz.  Plaintiff drove his vehicle into Schwartz and left the scene. Plaintiff was charged criminally for those actions.  In the personal injury action brought by Schwartz against plaintiff, the defendant insurance company defended plaintiff.  A $25,000 judgment was entered against plaintiff. Plaintiff then sued defendant insurance company for indemnification ($25,000).  Plaintiff moved for summary judgment, which was granted.  The Second Department reversed finding a question of fact had been raised by the insurer about whether plaintiff’s injuries were the result of his intentional conduct, a policy exclusion. In explaining the relevant law, the 1st Department wrote:

“While the duty to defend is measured against the possibility of a recovery, the duty to pay is determined by the actual basis for the insured’s liability to a third person” … . The burden to establish coverage and a duty to indemnify lies with the insured … . However, the insurer has the burden of proving facts establishing that the loss falls within an exclusionary clause of the insurance policy … .  * * *  [Here] …the insurer submitted evidence from the criminal prosecution and the underlying personal injury action, including Schwartz’s deposition testimony, which raised a triable issue of fact whether the loss fell within a policy exclusion for bodily injury “intentionally” caused by the insured…Dryer v New York Cent Mut Fire Co, 2013 NY Slip Op 03056, 2nd Dept, 5-1-13

TRAFFIC ACCIDENT, REAR-END COLLISIONS