KENT AVENUE PROPERTY LLC v. Scottsdale Insurance Company, Defendant. (2024)

Order, Supreme Court, Bronx County (Fidel E. Gomez, J.), entered May 30, 2023, which denied plaintiffs’ cross-motion for summary judgment declaring that defendant Allied World National Assurance Company (Allied) is obligated to defend and indemnify plaintiffs, granted Allied's motion to dismiss the complaint as against it, and, upon a search of the record, dismissed the complaint in its entirety, unanimously affirmed, with costs.

Supreme Court properly dismissed plaintiffs’ complaint against Allied as time-barred because plaintiffs commenced this action eight years after Allied's disclaimer of insurance coverage (see Quality Bldg. Contr., Inc. v Illinois Union Ins. Co., 2016 WL 4097847, 2016 U.S. Dist LEXIS 101925 [SD N.Y.2016]).  When Allied disclaimed in September 2013, plaintiffs “possessed sufficient information ․ to formulate the factual basis for [the] assertion” that the disclaimer was untimely under Insurance Law § 3420(d)(2), and thus, the statute of limitations began to run (2016 WL 4097847, *5, 2016 U.S. Dist LEXIS 101925, *14;  see also Vigilant Ins. Co. of Am. v Housing Auth. of City of El Paso, Tex., 87 N.Y.2d 34, 43 [1995]).  Accordingly, plaintiffs’ action commenced on October 29, 2021 is time-barred under the six-year (CPLR 213[1]) statute of limitations.

Ghaly v First Am. Tit. Ins. Co. of N.Y. (228 A.D.2d 551 [2d Dept 1996]), on which plaintiffs rely, is distinguishable because plaintiffs do not assert that Allied breached any contractual duty to indemnify or defend under the insurance policy, which precludes application of the six-year (CPLR 213[2]) statute of limitations.

Furthermore, Supreme Court properly searched the record and dismissed the complaint against the remaining defendant Scottsdale Insurance Company since the claims were similarly time-barred.

In view of the foregoing, the court properly denied plaintiffs’ cross-motion for summary judgment as moot.