CARRIER CORPORATION ELLIOTT COMPANY AND CARRIER CORPORATION AS INDEMNITOR OF THE TRAVELERS INDEMNITY COMPANY PLAINTIFFS RESPONDENTS v. ALLSTATE INSURANCE COMPANY ET AL DEFENDANTS AND FIREMAN FUND INSURANCE COMPANY DEFENDANT APPELLANT APPEAL NO (2026)

MEMORANDUM AND ORDER

It is hereby ORDERED that the judgment so appealed from is unanimously modified on the law by vacating the award of damages of $6,585,472 for claims that accrued prior to 2017, and as modified the judgment is affirmed without costs.

Memorandum: In this action for, inter alia, breach of contract seeking damages arising from the alleged failure of defendant Fireman's Fund Insurance Company (FFIC) to pay defense costs and indemnity amounts for underlying asbestos lawsuits under certain excess liability insurance policies issued by FFIC, FFIC appeals in appeal No. 1 from an intermediate judgment that, inter alia, awarded Carrier Corporation and Elliott Company (plaintiffs) damages based on indemnity payments made from August 18, 2014, through December 31, 2016. In appeal No. 2, FFIC appeals from a final judgment that, inter alia, incorporated the intermediate judgment by reference and awarded plaintiffs additional damages for payments made after December 31, 2016, plus prejudgment interest.

At the outset, inasmuch as a final judgment has been issued, we dismiss the appeal from the intermediate judgment in appeal No. 1 (see Matter of Aho, 39 NY2d 241, 248 [1976]; Matter of Borrelli v Thomas, 216 AD3d 1433, 1433 [4th Dept 2023]; see generally CPLR 5501 [a] [1]).

Contrary to FFIC's contention, there is no basis to disturb Supreme Court's determination that subclinical injuries constituted injury-in-fact (see Jones v Town of Carroll, 225 AD3d 1271, 1272 [4th Dept 2024], lv dismissed 42 NY3d 1045 [2024]; see generally Thoreson v Penthouse Intl., 80 NY2d 490, 495 [1992], rearg denied 81 NY2d 835 [1993]). We likewise reject FFIC's contention that the court erred in concluding that defense costs for dismissed claims appropriately eroded the limits of the underlying policies (see Port Auth. of N.Y. & N.J. v Brickman Group Ltd., LLC, 181 AD3d 1, 15-22 [1st Dept 2019]).

We agree with FFIC, however, that the court erred in awarding damages for payments plaintiffs made from August 18, 2014, through December 31, 2016, inasmuch as plaintiffs failed to satisfy a condition precedent to coverage by making a “definite claim” for coverage within 12 months of payment. We therefore modify the judgment in appeal No. 2 by vacating the award of damages of $6,585,472 for claims that accrued prior to 2017.

We have reviewed FFIC's remaining contentions and conclude that none warrants further modification or reversal of the judgment in appeal No. 2.

Entered: July 24, 2026

Ann Dillon Flynn

Clerk of the Court