SPIRIT EXPRESS OF WNY INC v. HARTFORD FIRE INSURANCE COMPANY (1999)

Supreme Court properly denied defendants' motions for summary judgment.  “The insurer bears the burden of establishing that its construction is not only reasonable, but the only fair construction” (Prince v. ITT Life Ins. Corp., 89 A.D.2d 779, 780, 453 N.Y.S.2d 495;  see, Kula v. State Farm Fire & Cas. Co., 212 A.D.2d 16, 19, 628 N.Y.S.2d 988, lv. dismissed in part and denied in part 87 N.Y.2d 953, 641 N.Y.S.2d 827, 664 N.E.2d 892).   Defendant Hartford Fire Insurance Company failed to meet its initial burden of establishing its entitlement to judgment as a matter of law on the issue of coverage under the policy and could not establish that its construction of the policy was the only fair construction (see, Prince v. ITT Life Ins. Corp., supra, at 780, 453 N.Y.S.2d 495).

Defendant Matthews, Bartlett & Dedecker, Inc. (MBD) met its initial burden of establishing its entitlement to judgment as a matter of law on the issue of duty.   Plaintiff, however, raised triable issues of fact.   Plaintiff averred that it gave MBD a detailed account of its business activity by describing the nature of its business and the various types of loads that it carried.   Plaintiff contends that MBD advised it that coverage under the policy would not be limited to the four listed commodities.   Because MBD was aware of a higher risk or premium involved in insuring cigarettes, alcohol and food products, at least two of which were carried by plaintiff, a general carrier, there is an issue of fact whether it was incumbent upon MBD to verify that such products were not carried by plaintiff (see, Murphy v. Kuhn, 90 N.Y.2d 266, 271-272, 660 N.Y.S.2d 371, 682 N.E.2d 972).

Order unanimously affirmed with costs.

MEMORANDUM: