Opinion
Index No. EF2022-70203
09-26-2023
In the Matter of the Application for an Order Staying Arbitration between Farmers Direct Property and Casualty Insurance Company, Petitioner, v. Stephen K. Duell, Respondent.
Abamont & Associates, Garden City (Susan L. Cicio of counsel), for petitioner. Marshall, Dennehey, Warner, Coleman & Groggin, P.C., New York (Richard D. Lane of counsel), for petitioner. McPhillips, Fitzgerald & Cullum, LLP, Glens Falls (Daniel J. Hogan of counsel), for respondent.
Unpublished Opinion
Abamont & Associates, Garden City (Susan L. Cicio of counsel), for petitioner.
Marshall, Dennehey, Warner, Coleman & Groggin, P.C., New York (Richard D. Lane of counsel), for petitioner.
McPhillips, Fitzgerald & Cullum, LLP, Glens Falls (Daniel J. Hogan of counsel), for respondent.
ROBERT J. MULLER, J.S.C.
The issues in this action having been submitted to the Court at a term thereof, held in and for the County of Warren Supreme Court at Lake George, New York on April 20, 2023 concerning all issues and the petitioner having been represented by Abamont & Associates, (Susan L. Cicio, of counsel) and Marshall Dennehey Warner Coleman & Goggin, P.C. (Richard D. Lane, of counsel) and the respondent having been represented by McPhillips, Fitzgerald & Cullum, LLP (Daniel J. Hogan, of counsel), and upon careful review of petitioner's Exhibits A1" and "2", and respondent's Exhibits AA" through "F" all of which were received into evidence and the Court also having had an opportunity to observe the demeanor of the witnesses called to testify and having made determinations on issues of credibility with respect to each of these witnesses - Petitioner offering one witness at this "framed issue hearing" designed to satisfy its burden of proof and respondent Stephen K. Duell also testified. Claudine Millar, a senior account underwriting specialist employed by Farmers Insurance Company ("Farmers") testified on behalf of petitioner.
NOW, after reviewing the submissions and evidence I do hereby make the following findings of essential facts which I deem established by both a preponderance of the evidence as well as clear and convincing evidence standards and reach the following conclusions of law which the Court deems established by the evidence.
1. Farmers issued Automobile Insurance Policy Number XXXXX ("policy") to Stephen J. Duell and Annette M. Duell for policy period June 16, 2021 to June 16, 2022. (Petitioner's hereinafter "Pet.," Exhibit 2; Respondent's, hereinafter "Resp.," Exhibit A.)
2. Stephen J. Duell and Annette M. Duell are the named insureds. (Pet. Ex. 2; see the attached Trial Transcript, hereinafter "Tr.," pp. 10 - 11 ll. 20 - 2.)
3. The policy lists the following vehicles: 2017 Acura MDX, 2010 Honda Civic, 2018 Nissan Titan, 2020 Jay Flight trailer, 2016 Volkswagon Jetta. (Pet. Ex. 2 pp. 1-2; Tr. p. 18 ll. 16-22.)
4. Stephen J. Duell is the owner of all of the vehicles listed on the policy. (Tr. p. 12 ll. 19 - 21; p. 11 ll. 10 - 13; see also the NYS DMV Registration System List of Vehicles attached as Pet. Ex. 1.)
5. All of the vehicles listed on the policy are registered to Stephen J. Duell. (Tr. p. 12 ll. 10 - 18; Pet. 1).
6. The household drivers listed on the policy are Stephen J. Duell, Annette Duell, Alyssa Duell and Steven K. Duell. (Pet. Ex. 2 p. 3)
7. Steven K. Duell is the son of Stephen J. Duell and Annette M. Duell. (Tr. p. 18 ll; 3 - 15; pp. 44 ll. 8-10; p. 45 ll. 12-15.)
8. Stephen K. Duell does not own any of the vehicles listed on the policy. (Tr. p. 13 ll. 7 - 9; Pet. Ex. 1)
9. The policy premiums were not charged to Stephen K. Duell. (Tr. p. ll. 7 - 9)
10. Stephen K. Duell is listed on the policy as a child driver. (Pet. Ex. 2 p. 3; Tr. p. 11 ll. 3 - 6)
11. Stephen K. Duell operated the 2016 Volkswagon Jetta listed on the policy. (Tr. p. 38 ll. 8-13; Pet. Ex. 2 p. 2)
12. Stephen K. Duell's father, Stephen M. Duell, owned the 2016 Volkswagen Jetta listed on the policy. (Tr. pp. 44 - 45 ll. 24 - 1)
13. On or about June 14, 2021, Stephen K. Duell purchased a 2022 Honda motorcycle. (Tr. p. 36 ll. 16-18; see the certificate of sale attached as Resp. D.)
14. Stephen K. Duell was the owner of this Honda motorcycle. (Tr. p. 36 ll. 19-21; Resp. D)
15. Stephen K. Duell was issued a certificate of sales from the DMV with respect to the Honda motorcycle. (Tr. p. 36 ll. 19-21; Resp. D)
16. Stephen K. Duell was also issued a temporary certificate of registration with respect to the Honda motorcycle. (Tr. p. 37 ll. 14-23; Resp. D)
17. Stephen K. Duell insured the Honda motorcycle through Progressive. (Tr. p. 41 ll. 18 - 21; see also the Progressive policy attached as Resp. Ex. F)
18. Stephen K. Duell was the named insured on the Progressive policy that insured the Honda motorcycle. (Tr. p. 42 ll. 4 - 17; Resp. Ex. F)
19. Stephen K. Duell's Progressive insurance policy that insured the Honda motorcycle included SUM coverage. (Tr. p. 41 ll. 22 - 24; Resp. Ex. F)
20. Stephen K. Duell possessed the Volkswagen Jetta owned by his father at the time he purchased the Honda motorcycle on June 14, 2021. (Tr. p. 38 ll. 22-24)
21. The Volkswagen Jetta was never removed from the Farmers policy. (Tr. p. 46 ll. 2 - 5)
22. The license plates for the Volkswagen Jetta were never surrendered. (Tr. p. 46 ll. 6 - 10)
23. The Volkswagen Jetta remained registered during the time that Stephen K. Duell possessed the Honda motorcycle. (Tr. p. 46 ll. 14 - 17)
24. Stephen K. Duell planned to drive the Honda motorcycle in the summer and fall seasons. (Tr. p. 38 ll. 14-16)
25. It was Stephen K. Duell's intention when he acquired the Honda motorcycle in June 2021 that he would return to driving the Volkswagen Jetta in the wintertime. (Tr. pp. 45 - 46 ll. 22 - 1)
26. Neither Stephen K. Duell nor Stephen J. Duell or Annette M. Duell, or anyone else, ever notified Farmers that they wished Farmers to insure the 2022 Honda motorcycle owned by Stephen K. Duell. (Tr. p. 14 ll. 7 - 10).
27. Stephen K. Duell never notified Farmers that he had purchased the Honda motorcycle. (Tr. p. 14 ll. 7 - 10; p. 45 ll. 3 - 7.)
28. The Honda motorcycle was never listed on the Farmers policy. (Pet. Ex. 2; Resp. Ex. B; Tr. p. 22 ll. 15 - 21)
29. Neither Stephen K. Duell, nor anyone, ever paid a premium to Farmers for the Honda motorcycle. (Tr. p. 25 ll. 15 - 21)
30. Stephen K. Duell did not pay any additional premiums to Farmers for his motorcycle. (Tr. p. 45 ll. 19 - 21)
31. Stephen K. Duell did not read the Farmers policy nor did he know any of the details of the policies issued to his parents at the time he purchased his Honda motorcycle. (Tr. p. 45 ll. 12 - 18)
32. On June 17, 2021, three days after Stephen K. Duell purchased the Honda motorcycle, Stephen K. Duell was involved in a motorcycle accident with a David O'Malley while driving the Honda motorcycle. (Tr. p. 40 ll. 21-25; p. 46 ll. 11 - 13; see the accident report attached as Resp. Ex. E)
33. The accident occurred on Route 9 in front of the Five Guys restaurant. (Tr. p. 41 ll. 1 - 3)
34. As a result of the accident, Stephen K. Duell brought an action against David O'Malley, the driver of the other vehicle. (Tr. p. 41 ll. 4-7)
35. At the time of the accident with Stephen K. Duell David O'Malley was operating a State Farm insured vehicle. (Tr. p. 41 ll. 11- 17)
36. David O'Malley's State Farm policy carried liability limits of $100,000. (Tr. p. 41 ll. 11- 17)
37. State Farm paid its full policy limits of $100,000 to Stephen K. Duell as a result of the accident. (Tr. p. 41 ll. 11- 17)
38. Stephen K. Duell notified his SUM carrier that insured his motorcycle, Progressive, of the settlement payment received from State Farm. (Tr. p. 41 ll. 18 - 21)
39. Following the settlement with State Farm, Stephen K. Duell submitted a claim for SUM coverage with his carrier, Progressive, which insured the Honda motorcycle. (Tr. p. 42 ll. 19 - 22)
40. The limits of SUM coverage on the Progressive policy were $50,000. (Tr. pp. 42 - 43 ll. 25 - 2; p. 44 ll. 1-7)
41. Progressive denied Stephen K. Duell's claim for SUM coverage. (Tr. p. 42 ll. 23 - 24)
42. Progressive denied Stephen K. Duell's claim for SUM coverage because the maximum SUM coverage of $50,000 under his Progressive policy was less than the amount that he received from the tortfeasor, David O'Malley, which was $100,000 (Tr. pp. 42 - 43 ll. 25 - 2; p. 44 ll. 1-7.)
43. After Progressive denied SUM coverage to Stephen K. Duell, Stephen K. Duell submitted a claim for SUM coverage under his parents' Farmers policy. (Tr. p. 44 ll. 8-10; see the Letter of Claim attached as Resp. Ex. C.)
44. Farmers denied Stephen K. Duell's claim for SUM benefits because the Honda motorcycle that Stephen K. Duell owned and was operating at the time of the loss was not insured for SUM coverage under Stephen J. Duell and Annette M. Duell's Farmers policy. (Tr. p. 44 ll. 11 - 16; see Farmers' declination letter attached as Resp. Ex. B)
45. The Honda motorcycle would not have been eligible to be insured under the Farmers policy. (Tr. p. 10 ll. 1 - 19; pp. 13 - 14 ll. 10 - 6; p. 14 ll. 11 - 16)
46. According to Claudine Millar, a senior account underwriting specialist for Farmers of 32 years, if the named insureds, Stephen J. Duell and Annette M. Duell, had notified Farmers that they wished to insure the 2022 Honda motorcycle owned by Stephen K. Duell, Farmers would have referred them back to their agency to have a motorcycle policy quoted through Farmers with Stephen K. Duell as a named insured, and the policy potentially may have been bound if the underwriting requirements could have been met. (Tr. p. 10 ll. 1 - 19; pp. 13 - 14 ll. 10 - 6; p. 14 ll. 11 - 16.)
47. Stephen K. Duell made a demand for arbitration to determine the SUM benefits under the Farmers policy.
48. Farmers commenced this CPLR Article 75 Proceeding to permanently stay the arbitration. This court issued a preliminary stay of the arbitration pending a decision on this framed issue hearing to determine SUM coverage under the Policy.
CONCLUSIONS OF LAW
49. The legal question before the Court is whether the NY Supplementary Uninsured/Underinsured Motorist's Endorsement NY 410 of the Policy excludes SUM coverage for the bodily injuries sustained by Stephen K. Duell during his June 17, 2021 accident while operating his owned Honda motorcycle.
50. Where a triable issue of fact for purposes of determining whether a claim is subject to policy exclusions in a supplementary uninsured/underinsured motorist (SUM) endorsement claim is raised, the Supreme Court, not the arbitrator, must determine it in a framed-issue hearing, and the appropriate procedure under such circumstances is to temporarily stay arbitration pending a determination of the issue. Geico v. Williams, 157 A.D.3d 953 (2nd Dept., 2018).
51. The interpretation of the language of an insurance policy is a question of law for the court. White v. Continental Cas. Co., 9 N.Y.3d at 267, 848 N.Y.S.2d 603, 878 N.E.2d 1019 (2007); ABM Mgmt. Corp. v. Harleysville Worcester Ins. Co., 112 A.D.3d 763, 764, 977 N.Y.S.2d 330 (2d Dep't 2013).
52. Principles of contract interpretation apply equally to insurance policies. Gilbane Bldg. Co./TDX Const. Corp. v. St. Paul Fire and Mar. Ins. Co., 143 A.D.3d 146, 151, 38 N.Y.S.3d 1 (1st Dept. 2016), affd sub nom. Gilbane Bldg. Co./TDX Constr. Corp. v. St. Paul Fire and Mar. Ins. Co., 31 N.Y.3d 131, 74 N.Y.S.3d 162, 97 N.E.3d 711 (2018); State v. Am. Mfrs. Mut. Ins. Co., 188 A.D.2d 152, 154, 593 N.Y.S.2d 885 (3d Dept. 1993).
53. In interpreting an insurance policy, the court must determine the rights and obligations of the parties, using the specific language of the policy itself. Gilbane Bldg. Co./TDX Const. Corp. at 150-151, 38 N.Y.S.3d 1; Sanabria v. American Home Assurance Company, 68 N.Y.2d 866, 868, 508 N.Y.S.2d 416, 501 N.E.2d 24 (1986); State of New York v. Home Indemnity Company, 66 N.Y.2d 669, 671, 495 N.Y.S.2d 969, 486 N.E.2d 827 (1985); Stasack v. Capital District Physicians' Health Plan, Inc., 290 A.D.2d 866, 866, 736 N.Y.S.2d 764 (3d Dept. 2002); Stainless, Inc. v. Employers Fire Insurance Company, 69 A.D.2d 27, 32-33, 418 N.Y.S.2d 76 (1st Dept. 1979).
54. The language of the policy, when clear and unambiguous, must be given its plain and ordinary meaning. United States Fidelity & Guaranty Company v. Annunziata, 67 N.Y.2d 229, 232, 501 N.Y.S.2d 790, 492 N.E.2d 1206 (1986); Sanabria at 868, 508 N.Y.S.2d 416, 501 N.E.2d 24. In such a case, the policy should be construed in a way "that affords a fair meaning to all of the language employed by the parties in the contract and leaves no provision without force and effect. Raymond Corporation v. National Union Fire Insurance Company of Pittsburgh, PA., 5 N.Y.3d 157, 162, 800 N.Y.S.2d 89, 833 N.E.2d 232 (2005); Am. Exp. Bank Ltd. v. Uniroyal, Inc., 164 A.D.2d 275, 277, 562 N.Y.S.2d 613 (1st Dept. 1990); Fifth Ave. Exec. Staffing v. Virtual Communities, Inc., 2002 WL 398512, at *1 (App. Term Feb. 28, 2002).
55. In this case, the Policy is clear and unambiguous.
The NY Supplementary Uninsured/Underinsured Motorist's Endorsement NY 410 Excludes Coverage.
56. The Farmers policy does not afford SUM coverage for Stephen K. Duell's accident that occurred on June 17, 2021. SUM Coverage for the Honda motorcycle owned and operated by Stephen K. Duell at the time of the loss is clearly excluded by the NY Supplementary Uninsured/Underinsured Motorist's Endorsement NY 410.
57. The New York Supplementary Uninsured/Underinsured Motorists Endorsement in the Policy provides:
The UNINSURED AND UNDERINSURED MOTORISTS section is modified by the terms and conditions of this endorsement. All other provisions of the policy apply except as modified herein.
We, the company, agree with you, as the named insured, in return for payment of the premium for this coverage, to provide Supplementary Uninsured/Underinsured Motorists (SUM) coverage, subject to the following terms and conditions:
INSURING AGREEMENTS
* * *
II. DAMAGES FOR BODILY INJURY CAUSED BY UNINSURED MOTOR VEHICLES
We will pay all sums that the insured or the insured's legal representative shall be legally entitled to recover as damages from the owner or operator of an uninsured motor vehicle because of bodily injury sustained by the insured, caused by an accident arising out of such uninsured motor vehicle's ownership, maintenance or use, subject to the Exclusions, Conditions, Limits and other provisions of this SUM endorsement.
* * *
I. Definitions. For purposes of this SUM endorsement, the following terms have the following meanings:
A. Insured. The unqualified term" insured" means:
1. you, as the named insured and, while residents of the same household, your spouse and the relatives of either you or your spouse:
2. any other person while occupying:
a. a motor vehicle insured for SUM under this policy; or
b. any other motor vehicle while being operated by you or your spouse: and
3. any person, with respect to damages such person is entitled to recover, because of bodily injury to which this coverage applies sustained by an insured under paragraph (1) or (2) above.* * *
EXCLUSIONS
This SUM coverage does not apply:
2. to bodily injury to an insured incurred while occupying a motor vehicle owned by that insured, if such motor vehicle is not insured for SUM coverage by the policy under which a claim is made or is not a newly acquired or replacement motor vehicle covered under the terms of this policy.
58. The Endorsement definition of uninsured motor vehicle includes an underinsured motor vehicle. (See Resp. Ex. A, I.C.3. (a))
59. Coverage is clearly excluded by the NY Supplementary Uninsured/Underinsured Motorist's Endorsement NY 410 because the Honda motorcycle owned and operated by Stephen K. Duell at the time of the loss is not insured for SUM coverage under Stephen J. Duell and Annette M. Duell's Farmer's automobile policy and does not qualify as a newly acquired or replacement motor vehicle under the terms of the policy.
60. Stephen K. Duell, as an insured (child/resident relative) on the policy, was injured while occupying a Honda motorcycle that he owned, and that Honda motorcycle was not insured for SUM coverage by the policy. The Honda motorcycle was never listed on the Farmers policy. (Pet. Ex. 2; Resp. Ex. B; Tr. p. 22 ll. 15 - 21) No premium was ever paid to Farmers to insure for the Honda motorcycle. (Tr. p. 25 ll. 15 - 21; p. 45 ll. 19 - 21) Farmers never received notice of the Honda motorcycle until the SUM claim was made. (Tr. p. 14 ll. 7 - 10; p. 45 ll. 3 - 7.) Therefore, the Honda motorcycle was not insured for SUM coverage under the Farmers policy.
61. Further, the Honda motorcycle does not meet the definition of a "newly acquired or replacement motor vehicle" under the terms of the Farmers policy.
62. The general definitions in the Farmers policy provide:
UNINSURED AND UNDERINSURED MOTORISTS ADDITIONAL DEFINITIONS FOR THESE COVERAGES
The following definitions apply to these coverages only:
" COVERED AUTOMOBILE" means:
2. an automobile newly acquired by you, if:
a. it replaces a vehicle described in the Declarations; or
b. it is an additional automobile, but only if:
i. we insure all other automobiles owned by you on the date of acquisition;
ii. you notify us within 30 days of acquisition of your election to make thisand no other policy issued by us applicable to the automobile; and
iii. you pay any additional premium required by us.
63. First and foremost, the Honda motorcycle does not meet the definition of a "newly acquired or replacement vehicle" under the terms of the Famers policy because Stephen K. Duell does not meet the definition of "You" as defined in the policy.
64. "You" is defined in the Farmers policy as the named insureds, which are only Stephen K. Duell's parents, Stephen J. Duell and Annette M. Duell.
65. The policy definitions state:
" YOU" and" YOUR" mean the person(s) named in the Declarations of this policy as named insured and the spouse of such person or persons if a resident or the same household.
66. Stephen K. Duell is only identified on the Farmers policy as a child. (Pet. Ex. 2) He is not a named insured and he is not the spouse of a named insured living in the same household.
67. The newly acquired or replacement provisions apply only to automobiles newly acquired by "you", the named insured, not a child or resident relative.
68. Therefore, since Stephen K. Duell is not a "You", the "newly acquired or replacement vehicle" coverage does not even apply to him. This additional coverage for "newly acquired or replacement vehicle" is only for the named insureds, Stephen J. Duell and Annette M. Duell, which are defined in the Policy as "You."
69. This is not only clear from the Farmers policy language itself but is also logical since a motorcycle owned by the child could not replace the listed vehicles that are owned by the parent named insureds and not the child.
70. Therefore, since Stephen K. Duell is not a named insured and therefore not "You" under the Farmers policy, the Honda motorcycle does not meet the definition of a "newly acquired or replacement motor vehicle" under the terms of the Farmers policy.
71. Even if Stephen K. Duell could possibly be considered a "You," which he is not, the Honda motorcycle still does not meet the definition of a "newly acquired or replacement vehicle" under the terms of the Farmers policy.
72. Stephen K. Duell was operating his owned motorcycle at the time of the accident. A motorcycle is not an automobile defined in the Farmers policy general definitions." AUTOMOBILE" means a private passenger automobile, pick-up truck, panel truck or van, designed for use mainly on public roads. Therefore, a motorcycle could not constitute a newly acquired or replacement vehicle on the Farmers policy.
73. Further, even if Stephen K. Duell could possibly be considered a "You," which he is not, the Honda motorcycle did not replace a vehicle insured under the Farmers policy. Stephen K. Duell still possessed the Volkswagen Jetta owned by his father at the time he purchased the Honda motorcycle on June 14, 2021. (Tr. p. 38 ll. 22-24) The Volkswagen Jetta was never removed from the Farmers policy. (Tr. p. 46 ll. 2 - 5) The license plates for the Volkswagen Jetta were never surrendered. (Tr. p. 46 ll. 6 - 10) The Volkswagen Jetta remained registered during the time that Stephen K. Duell possessed the Honda motorcycle. (Tr. p. 46 ll. 14 - 17) Stephen K. Duell planned to drive the Honda motorcycle in the summer and fall seasons. (Tr. p. 38 ll. 14-16) It was Stephen K. Duell's intention when he acquired the Honda motorcycle in June 2021 that he would return to driving the Volkswagen Jetta in the wintertime. (Tr. pp. 45 - 46 ll. 22 - 1) Additionally, no one notified Farmers of the acquisition of the Honda motorcycle and no one requested that Farmers insure it under the Farmers policy. (Tr. p. 14 ll. 7 - 10; (Tr. p. 14 ll. 7 - 10; p. 45 ll. 3 - 7.) Further, no additional premium was paid for the Honda motorcycle. (Tr. p. 25 ll. 15 - 21; p. 45 ll. 19 - 21)
74. Additionally, one cannot obtain coverage after a loss occurs. Any argument that one could provide notification to Farmers and pay the premium after the accident occurred violates the "known loss defense." The "known loss" defense holds that "an insured may not obtain insurance to cover a loss that is known before the policy takes effect." Stonewall Ins. Co. v. Asbestos Claims Mgt. Corp., 73 F.3d 1178, 1214 (2d Cir.1995), modified on other grounds, 85 F.3d 49 (2d Cir.1996).
75. For these reasons, the Farmers policy does not afford SUM coverage for Stephen K. Duell's accident that occurred on June 17, 2021. Coverage is clearly excluded under the NY Supplementary Uninsured/Underinsured Motorist's Endorsement NY 410.
76. Case law demonstrates that the subject exclusion of the NY Supplementary Uninsured/Underinsured Motorist's Endorsement NY 410 is clear and unambiguous, and that there is no SUM coverage available.
77. In GEICO v. Beltran, 992 N.Y.S.2d 69 (2nd Dept. 2014), Beltran sustained injuries as a result of a collision involving his owned motorcycle and a automobile. Beltran commenced an action against the owner of the automobile, which was later settled for $25,000, the limit of the policy. Beltran also had an automobile insurance policy through the petitioner, GEICO. Beltran sought coverage under the SUM provisions of the GEICO policy. GEICO denied coverage on the ground that the claim was subject to an exclusion on the SUM endorsement that provided, in relevant part, that it did not apply "to bodily injury to an insured incurred while occupying a motor vehicle owned by that insured, if such motor vehicle is not insured for SUM coverage by the policy under which a claim is made, or is not a newly acquired or replacement vehicle covered under the terms of the policy." Beltran made a demand for arbitration of his claim. GEICO commenced a proceeding to permanently stay arbitration of the claim. On appeal, the court held that the policy language in question was not ambiguous, must be construed according to its plain and ordinary meaning, and that the policy exclusion unambiguously excluded from SUM coverage compensation for bodily injuries sustained by an insured when injured in a motor vehicle accident while occupying a motor vehicle he or she owns, which vehicle was not covered under the policy. (Citing Matter of Government Empls. Ins. Co. v. Avelar, 108 A.D.3d 672, 673, 969 N.Y.S.2d 521; Matter of USAA Cas. Ins. Co. v. Cook, 84 A.D.3d 825, 826, 925 N.Y.S.2d 86; Matter of USAA Cas. Ins. Co. v. Hughes, 35 A.D.3d 486, 487-488, 825 N.Y.S.2d 531; see generally Baughman v. Merchants Mut. Ins. Co., 87 N.Y.2d 589, 592, 640 N.Y.S.2d 857, 663 N.E.2d 898; Government Empls. Ins. Co. v. Kligler, 42 N.Y.2d 863, 864-865, 397 N.Y.S.2d 777, 366 N.E.2d 865; Matter of Government Empls. Ins. Co. v. Avelar, 108 A.D.3d at 673, 969 N.Y.S.2d 521; Matter of New York Cent. Mut. Fire Ins. Co. v. Polyakov, 74 A.D.3d 820, 822, 903 N.Y.S.2d 443; Matter of USAA Cas. Ins. Co. v. Hughes, 35 A.D.3d at 488, 825 N.Y.S.2d 531; Matter of New York Cent. Mut. Fire Ins. Co. v. Polyakov, 74 A.D.3d at 822, 903 N.Y.S.2d 443). Therefore, the court upheld the Supreme Court's order granting GEICO's petition to permanently stay arbitration.
78. In Matter of New York Cent. Mut. Fire Ins. Co. v. Polyakov, 74 A.D.3d 820 (2nd Dept. 2010), Polyakov was involved in a motor vehicle accident while driving a motorcycle that he owned. Polyakov 's father had a policy of automobile insurance issued by the petitioner, New York Central Mutual Fire Insurance Company. The only vehicle named under that policy as a covered vehicle was a 2001 Nissan Maxima owned by the named insured. Polyakov made a claim for SUM benefits under his father's policy as the son of the named insured who was a member of the same household. The petitioner denied the claim for SUM benefits because the SUM endorsement excluded coverage for bodily injury to an insured while occupying a motor vehicle owned by that insured which was not insured under the subject policy. The SUM endorsement under the subject policy provided, in relevant part, that "[t]his SUM coverage does not apply... [t]o bodily injury to an insured incurred while occupying a motor vehicle owned by that insured, if such motor vehicle is not insured for SUM coverage by the policy under which a claim is made." Polyakov demanded arbitration of his claim for SUM benefits. The petitioner commenced a proceeding pursuant to CPLR article 75 to permanently stay arbitration of Polyakov's claim. On appeal, the court held that the policy language in question was not ambiguous, it must be construed according to its plain and ordinary meaning, and that the petitioner was entitled to have the provisions it relied on to disclaim coverage enforced (see Matter of USAA Cas. Ins. Co. v Hughes, 35 A.D.3d 486, 487-488 [2006]; see generally Baughman v Merchants Mut. Ins. Co., 87 N.Y.2d 589, 592 [1996]; Government Empls. Ins. Co. v Kligler, 42 N.Y.2d 863, 864-865 [1977]; Matter of USAA Cas. Ins. Co. v Hughes, 35 A.D.3d at 488; Matter of Utica Mut. Ins. Co. v Reid, 22 A.D.3d 127, 129 [2005]; Matter of New York Cent. Mut. Fire Ins. Co. [Prehoda], 231 A.D.2d 829, 829-830 [1996]).
The Grandprotect Amendatory Endorsement NY170 Does Not Provide SUM Coverage For This Loss.
79. The Honda motorcycle is not covered under The Grandprotect Amendatory Endorsement, NY170.
80. The Grandprotect Amendatory Endorsement, NY170 provides:
D. Under UNINSURED AND UNDERINSURED MOTORISTS, ADDITIONAL DEFINITIONS FOR THESE COVERAGES, "COVERED AUTOMOBILE' ', the following is added:
5. a motor home, or motorcycle newly acquired by you, if
a. we do not insure any other motor homes, and motorcycles owned by you on the date of acquisition;
b. you notify us within 30 days of acquisition and ask us to insure the motor home, or motorcycle and no other insurance policy provides coverage for the vehicle; and
c. you pay any additional premium required by us.
81. Once again, even if this definition could possibly expand coverage, it does not apply because the motorcycle was acquired by the insured as a resident relative. A resident relative does not meet the definition of "you." As discussed above, "YOU" and "YOUR" mean the person(s) named in the declarations of this policy as a named insured and the spouse of such person or persons if a resident of the same household. This provision does not apply to Stephen K. Duell.
82. Moreover, the Honda motorcycle also does not qualify as a "covered automobile" under the The Grandprotect Amendatory Endorsement, NY170 because no one notified Farmers of the new motorcycle within 30 days and an additional premium was never paid. (Tr. p. 14 ll. 7 - 10; p. 45 ll. 3 - 7; (Tr. p. 45 ll. 19 - 21) Additionally, other insurance applies to the vehicle since the Honda motorcycle was insured by Progressive. (Resp. Ex. F)
83. The policy provision in the The Grandprotect Amendatory Endorsement, NY170, if it could apply, requires all four conditions to be met (i.e., purchased by insured, notification within 30 days, no other insurance policy provides coverage for the vehicle, and payment of any additional premium) at the time of the accident. These conditions were not met.
84. Additionally, the motorcycle is also not covered as a "non-owned automobile" under the Grandprotect Amendatory Endorsement, NY170.
85. The provision states:
B. Under AUTOMOBILE LIABILITY, ADDITIONAL DEFINITIONS FOR THIS COVERAGE:
* * *
2." NON-OWNED AUTOMOBILE ", the following is added:
" NON-OWNED AUTOMOBILE" also includes:
A motor home, recreational vehicle or motorcycle which is not owned by, furnished to, or made available for regular use to you or any resident in your household, including a commercially rented motor home, recreational vehicle or motorcycle used by you or a relative on a temporary basis
86. Importantly, this language modifies the liability coverage, not SUM or even UM and it is therefore completely inapplicable. There is no SUM or UM specifically described coverage for "non-owned automobile."
87. Furthermore, even if this provision could apply, which it absolutely does not, the Honda motorcycle was owned and available for Stephen K. Duell's regular use (as an insured, resident relative). The Honda motorcycle was purchased and insured by Stephen K. Duell and was not used temporarily.
88. Therefore, the Honda motorcycle is not covered under The Grandprotect Amendatory Endorsement, NY170.
CONCLUSION
89. For the reasons discussed above, the Farmers policy does not afford SUM coverage to Stephen K. Duell for the June 17, 2021 accident. His SUM claim for injuries occurred while operating the Honda Motorcycle that he owned at the time of the loss is clearly excluded by the NY Supplementary Uninsured/Underinsured Motorist's Endorsement NY 410. This is because the Farmers policy did not insure the Honda motorcycle and the motorcycle does not qualify as a newly acquired or replacement motor vehicle covered under the terms of the Policy.
90. The Honda motorcycle is not covered under The Grandprotect Amendatory Endorsement, NY170 because the endorsement only applies to the named insured and such person's spouse living in the same household (i.e. Stephen K. Duell's parents) and not Stephen K. Duell, and the Honda motorcycle also does not qualify as a "covered automobile" under the endorsement. Further, the required conditions were not met to obtain this coverage.
91. Finally, the motorcycle is also not covered as a "non-owned automobile" under the Grandprotect Amendatory Endorsement, NY170. This language modifies the liability coverage, not SUM or even UM and is therefore inapplicable. There is no SUM or UM specifically described coverage for "non-owned automobile." Further, the Honda motorcycle does not meet the definition of a "non-owned automobile" in any event because it was available for Stephen K. Duell's regular use and owned by him.
CONCLUSIONS OF LAW
Upon careful review and consideration the testimony of the parties at trial, and upon all other exhibits offered and admitted therein, this Court reaches the following conclusions of law:
Based upon the foregoing, it is hereby:
ORDERED that Judgment shall be entered in accordance with this decision permanently staying arbitration, and it is further
ORDERED that any relief not specifically granted is denied and any pending motions are hereby resolved in a manner consistent with the foregoing.
The original of this Decision, Order, and Judgment has been e-filed by the Court. Counsel for Petitioner is hereby directed to promptly serve a copy of the Decision, Order and Judgment with notice of entry upon the respondent in accordance with CPLR 5513.