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Mark Patterson, Inc. v. Bowie
Citations: 237 A.D.2d 184; 654 N.Y.S.2d 769; 1997 N.Y. App. Div. LEXIS 2694
Court: Appellate Division of the Supreme Court of the State of New York; March 19, 1997; New York; State Appellate Court
The Supreme Court of New York County issued an order on November 14, 1995, reversing a prior decision that had denied the defendant insurer's motion for summary judgment and granted the plaintiff's cross motion to amend the complaint. The court granted the insurer's motion, dismissing the first and third causes of action in the amended complaint and the cross claims for implied indemnification. The first cause of action, which claimed the insurer fraudulently induced the plaintiff into procuring insurance by concealing a police investigation into a covered employee’s prior loss, was dismissed due to a lack of evidence that the broker, Stephens, acted as the insurer's agent during negotiations. Despite Stephens' failure to disclose relevant information, there was no basis to attribute his knowledge to the insurer, nor to impose a duty on the insurer to disclose independently obtained information. The plaintiff's assertion of detrimental reliance on the insurer's failure to disclose prior knowledge was dismissed, as the plaintiff had independent access to that information. Consequently, the explicit terms of the insurance contract were upheld, which excluded coverage for losses of jewelry left in an unattended vehicle—an industry-standard exclusion. The court also dismissed an alternative claim based on an implied duty of the insurer to disclose material information, finding it redundant and inconsistent with the existing contractual agreement. It emphasized that the duty of good faith and fair dealing does not extend to contradicting explicit contract terms. Finally, the court found the cross claims for implied indemnification legally insufficient, as this remedy is not available to active tortfeasors. The court dismissed the remaining contentions from the respondents as meritless.