LANCER INSURANCE COMPANY v. Kevin Johnson, et al., respondents. (2009)

In an action for a judgment declaring that the plaintiff is not obligated to defend and indemnify the defendants Omar Whitfield, d/b/a Whitfield Auto Center, and Charles Whitfield in an underlying action entitled Johnson v. Whitfield Auto, pending in the Supreme Court, Queens County, under Index No. 11628/06, the plaintiff appeals from an order of the Supreme Court, Nassau County (Feinman, J.), dated June 26, 2008, which denied its motion for summary judgment on the complaint.

ORDERED that the order is reversed, on the law, with costs, the motion is granted, and the matter is remitted to the Supreme Court, Nassau County, for the entry of a judgment declaring that the plaintiff is not obligated to defend or indemnify the defendants Omar Whitfield, d/b/a Whitfield Auto Center, and Charles Whitfield in the underlying action entitled Johnson v. Whitfield Auto, pending in the Supreme Court, Queens County, under Index No. 11628/06.

The plaintiff insurer issued a garage dealer's policy of insurance (hereinafter the subject policy) to the defendant Omar Whitfield, d/b/a Whitfield Auto Center, an auto dealership.   On May 31, 2004, at approximately 1:00 A.M., an automobile owned by the auto dealership was involved in an accident.   At the time of the accident, the subject vehicle was being driven by the defendant Charles Whitfield (hereinafter the driver), Omar Whitfield's father.   The defendants Kevin Johnson and Reginald Smalls (hereinafter the respondents) commenced an underlying personal injury action against, among others, the auto dealership and the driver (hereinafter collectively the Whitfield defendants) for personal injuries they allegedly sustained in the accident.   The plaintiff commenced this action seeking a judgment declaring that it was not obligated to defend or indemnify the Whitfield defendants in the underlying personal injury action because the accident did not fall within the coverage provisions of the subject policy as the driver's use of the subject vehicle at the time of the accident was unrelated to “garage operations” as required by the policy.

The Whitfield defendants did not interpose an answer in the instant action, and by order of the Supreme Court, Nassau County (Feinman, J.), dated November 5, 2007, the court granted that branch of a prior motion of the plaintiff which was pursuant to CPLR 3215 for a default judgment against them.   By defaulting, the Whitfield defendants admitted the allegations in the instant complaint and all reasonable inferences therefrom, to wit, that the driver had borrowed the subject vehicle “to visit friends in North Babylon, and was on his way home when the accident occurred” and that at the time of the accident, he “was not operating the [subject vehicle] in furtherance of the garage business” (see Woodson v. Mendon Leasing Corp., 100 N.Y.2d 62, 71, 760 N.Y.S.2d 727, 790 N.E.2d 1156;  Matter of Gupta, 38 A.D.3d 445, 446, 834 N.Y.S.2d 23;  Lamm v. Stevenson, 276 A.D.2d 531, 716 N.Y.S.2d 576;  Fleet Bank v. Powerhouse Trading Corp., 267 A.D.2d 276, 277, 700 N.Y.S.2d 53;  see also Hermitage Ins. Co. v. Trance Nite Club, Inc., 40 A.D.3d 1032, 834 N.Y.S.2d 870;  Silberstein v. Presbyterian Hosp. in City of N.Y., 96 A.D.2d 1096, 463 N.Y.S.2d 254).   Based on the foregoing, the plaintiff established, prima facie, that the accident was not covered by the subject policy which requires it to pay damages for bodily injury caused by an accident and resulting from “garage operations” involving the ownership, maintenance or use of a covered auto (see Singh v. Allcity Ins. Co., 1 A.D.3d 501, 767 N.Y.S.2d 253;  Empire Group Allcity Ins. Co. v. Cicciaro, 240 A.D.2d 362, 363, 658 N.Y.S.2d 112;  Dumblewski v. ITT Hartford Ins. Group, 213 A.D.2d 823, 623 N.Y.S.2d 374).

Since the plaintiff, as movant, demonstrated its prima facie entitlement to summary judgment, the burden shifted to the respondents, as opponents of the motion, to provide evidence, in proper admissible form, sufficient to raise a triable issue of fact (see generally Alvarez v. Prospect Hosp., 68 N.Y.2d 320, 324, 508 N.Y.S.2d 923, 501 N.E.2d 572;  Zuckerman v. City of New York, 49 N.Y.2d 557, 562, 427 N.Y.S.2d 595, 404 N.E.2d 718).   The respondents failed to meet their burden since their opposing papers consisted solely of the affirmation of counsel in which hearsay statements of the Whitfield defendants were proffered to defeat the motion (see Zuckerman v. City of New York, 49 N.Y.2d 557, 562, 427 N.Y.S.2d 595, 404 N.E.2d 718;  Collins v. Laro Serv. Sys. of N.Y., Inc., 36 A.D.3d 746, 746-747, 829 N.Y.S.2d 168;  Salzano v. Korba, 296 A.D.2d 393, 395, 745 N.Y.S.2d 56;  Heifets v. Lefkowitz, 271 A.D.2d 490, 491, 706 N.Y.S.2d 438;  cf. Municipal Testing Lab., Inc. v. Brom, 38 A.D.3d 862, 833 N.Y.S.2d 562;  Mazzola v. City of New York, 32 A.D.3d 906, 821 N.Y.S.2d 247;  Orelli v. Showbiz Pizza Time, 302 A.D.2d 440, 441, 753 N.Y.S.2d 737;  Ritts v. Teslenko, 276 A.D.2d 768, 769, 715 N.Y.S.2d 418;  Dan's Supreme Supermarkets v. Redmont Realty Co., 261 A.D.2d 353, 354, 690 N.Y.S.2d 272;  Lukin v. Bruce, 256 A.D.2d 388, 389, 681 N.Y.S.2d 588;  Gomes v. Courtesy Bus Co., 251 A.D.2d 625, 626, 676 N.Y.S.2d 196).

Accordingly, the Supreme Court should have granted the plaintiff's motion.

Since this is a declaratory judgment action, the matter must be remitted to the Supreme Court, Nassau County, for the entry of a judgment declaring that the appellant is not obligated to defend and indemnify the Whitfield defendants in the underlying action entitled Johnson v. Whitfield Auto, pending in the Supreme Court, Queens County, under Index No. 11628/06 (see Lanza v. Wagner, 11 N.Y.2d 317, 334, 229 N.Y.S.2d 380, 183 N.E.2d 670, appeal dismissed 371 U.S. 74, 83 S.Ct. 177, 9 L.Ed.2d 163, cert. denied 371 U.S. 901, 83 S.Ct. 205, 9 L.Ed.2d 164).

The respondents' remaining contentions are without merit.