Union Mutual Fire Insurance Company, appellant, v. 844 LLC (2026)

Argued—January 20, 2026

DECISION & ORDER

C/

In an action for a judgment declaring, inter alia, that certain insurance policies issued by the plaintiff are void ab initio and that the plaintiff is not obligated to defend or indemnify the defendants 844 Knickerbocker, LLC, and Sanjaya Mallick in an underlying action entitled Garcia v. 844 Knickerbocker, LLC, commenced in the Supreme Court, Kings County, under Index No. 519069/21, the plaintiff appeals from an order of the Supreme Court, Nassau County (Conrad D. Singer, J.), entered July 29, 2024.  The order denied the plaintiff's motion for summary judgment on the complaint and granted the cross-motion of the defendants 844 Knickerbocker, LLC, and Sanjaya Mallick for summary judgment dismissing the complaint.

ORDERED that the order is reversed, on the law, with one bill of costs payable by the respondents appearing separately and filing separate briefs, the plaintiff's motion for summary judgment on the complaint is granted, the cross-motion of the defendants 844 Knickerbocker, LLC, and Sanjaya Mallick for summary judgment dismissing the complaint is denied, and the matter is remitted to the Supreme Court, Nassau County, for the entry of a judgment, inter alia, declaring that certain insurance policies issued by the plaintiff are void ab initio and that the plaintiff is not obligated to defend or indemnify the defendants 844 Knickerbocker, LLC, and Sanjaya Mallick in the underlying action entitled Garcia v. 844 Knickerbocker, LLC, commenced in the Supreme Court, Kings County, under Index No. 519069/21.

In 2020 and 2021, the plaintiff issued commercial insurance policies to the defendants 844 Knickerbocker, LLC, and Sanjaya Mallick (hereinafter together the defendants) based on applications they submitted.  After a personal injury action was commenced against the defendants (hereinafter the underlying action), the plaintiff rescinded the policies based on its determination that the defendants' property contained three apartment units as opposed to two apartment units, which is what had been listed on the insurance applications.  The plaintiff then commenced this action for a judgment declaring, inter alia, that the insurance policies were void ab initio due to material misrepresentations made by the defendants during the application process, and that it was not obligated to defend or indemnify the defendants in the underlying action.  The plaintiff moved for summary judgment on the complaint.  The defendants opposed the motion and cross-moved for summary judgment dismissing the complaint.  In an order entered July 29, 2024, the Supreme Court denied the plaintiff's motion and granted the defendants' cross-motion.  The plaintiff appeals.

An insurance company has a right to rescind an insurance policy if the applicant makes a material misrepresentation on the insurance application (see Union Mut. Fire Ins. Co. v. CMN Props., LLC, 216 AD3d 1049, 1050;  American Empire Surplus Lines Ins. Co. v ZNKO Constr., Inc., 214 AD3d 849, 850).  “ ‘A misrepresentation is material if the insurer would not have issued the policy had it known the facts misrepresented’ ” (Azad v. Kingstone Ins. Co., 228 AD3d 608, 609, quoting Thandi v. Otsego Mut. Fire Ins. Co., 199 AD3d 849, 851;  see Rodriguez v. Mercury Cas. Co., 207 AD3d 674, 675).  “To establish materiality as a matter of law, the insurer must present documentation concerning its underwriting practices, such as underwriting manuals, bulletins, or rules pertaining to similar risks, which show that it would not have issued the same policy if the correct information had been disclosed in the application” (American Empire Surplus Lines Ins. Co. v ZNKO Constr., Inc., 214 AD3d at 850–851;  see Azad v. Kingstone Ins. Co., 228 AD3d at 609).

Here, the plaintiff demonstrated its prima facie entitlement to judgment as a matter of law on the complaint.  The plaintiff established that the defendants made a misrepresentation in the applications for the subject insurance policies that was material by submitting an affidavit of its underwriter, as well as certain guidelines showing that a higher premium would have been charged if the correct information had been disclosed (see Azad v. Kingstone Ins. Co., 228 AD3d at 609–610).  In opposition, the defendants failed to raise a triable issue of fact.

Accordingly, the Supreme Court should have granted the plaintiff's motion for summary judgment on the complaint and denied the defendants' cross-motion for summary judgment dismissing the complaint.

Since this is a declaratory judgment action, we remit the matter to the Supreme Court, Nassau County, for the entry of a judgment, among other things, declaring that the subject insurance policies are void ab initio and that the plaintiff is not obligated to defend or indemnify the defendants in the underlying action (see Thandi v. Otsego Mut. Fire Ins. Co., 199 AD3d at 852).

BARROS, J.P., VOUTSINAS, GOLIA and HOM, JJ., concur.

ENTER:

Darrell M. Joseph

Clerk of the Court