KENNEL DELITES INC v. St. Paul Travelers Insurance Company, et al., Defendants-Appellants. (2008)

Order, Supreme Court, New York County (Marylin G. Diamond, J.), entered on or about June 26, 2007, which, to the extent appealed from as limited by the briefs, granted plaintiff's motion for partial summary judgment and denied defendant insurer's cross motion for summary judgment dismissing the complaint as against it, unanimously modified, on the law, plaintiff's motion denied, defendant insurer's cross motion granted only to the extent of dismissing that portion of plaintiff's claim for recovery under its policy for interior property damage and business income losses, and otherwise affirmed, without costs.

Defendant Charter Oak Fire Insurance Company, initially identified incorrectly as St. Paul Travelers Insurance Company, issued a policy to plaintiff with a limitation of coverage, known as a rain exclusion, which barred recovery for interior property damage and business income losses “caused by,” among other things, rain.   This rain exclusion applies to the loss at issue, namely, water damage from a rainstorm.   Although plaintiff contends that the water damage to its interior was due to debris and mortar that fell from a neighboring building, which then clogged its roof drain, causing the rainwater to accumulate on its roof and later enter the building, the “efficient physical cause” was the rainwater itself (cf. Home Ins. Co. v. American Ins. Co., 147 A.D.2d 353, 537 N.Y.S.2d 516 [1989] ).   A reasonable business person would conclude in this case that the interior property was damaged by rainwater from the previous evening's storm, and would look no further for alternate causes (see Album Realty Corp. v. American Home Assur. Co., 80 N.Y.2d 1008, 592 N.Y.S.2d 657, 607 N.E.2d 804 [1992] ).   The claim as it might apply to roof damage should proceed.