Mapfre Ins. Co. of N.Y. v. Ferrall

Citation: 2023 NY Slip Op 01082Docket: 2020-04686

Court: Appellate Division of the Supreme Court of the State of New York; February 28, 2023; New York; State Appellate Court

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Mapfre Insurance Company of New York appealed a May 18, 2020, order and judgment from the Supreme Court of Nassau County, which granted summary judgment in favor of defendants Edward J. Ferrall, James G. Ferrall, Irene M. Ferrall, and Ryan Groskopf. The case arose from an altercation in 2017, where Edward Ferrall injured Groskopf with a baton, leading Groskopf to sue the Ferrall defendants for negligence and recklessness. Mapfre sought a declaration that it was not obligated to defend or indemnify the Ferrall defendants in this underlying action. However, the lower court ruled that Mapfre was indeed obligated to do so, prompting the appeal. The Appellate Division reversed the lower court’s decision, denying the motions for summary judgment from both Groskopf and the Ferrall defendants. The court clarified that an insurer's duty to indemnify depends on the insured's liability for a loss covered by the policy, placing the burden of proof for coverage on the insured.

The insurer must prove that a loss falls under an exclusionary clause of the insurance policy. The policy defines "occurrence" as an accident resulting in bodily injury, though it does not define "accident." To determine if a loss is accidental, it is assessed from the insured's perspective, considering whether the loss was unexpected, unusual, and unforeseen. The policy excludes coverage for bodily injury expected or intended by the insured. Accidental outcomes can arise from intentional acts, meaning a loss may be unintended despite intentional actions leading to it. More than a causal link between the act and harm is necessary to show the harm was intended. However, if harm is inherent to the intentional act, it may be considered intentionally caused. 

In this declaratory judgment action, the court examines (1) whether an occurrence exists that warrants policy coverage and (2) if it falls within the expected or intended injury exclusion. The parties submitted deposition testimonies and a sworn statement from Groskopf, who described an incident where he attempted to de-escalate a verbal altercation among friends but was pushed by an unidentified individual. After backing away from a person wielding a baton, he was struck on the head and lost consciousness momentarily. Groskopf identified Edward as the assailant and stated he did not perceive Edward as aggressive. Edward, on the other hand, claimed he only intended to scare off a group of men and did not mean to hit anyone, describing that he swung the baton to create distance during the altercation.

Edward pleaded guilty in a criminal case to third-degree assault, admitting to recklessly causing physical injury, and fourth-degree criminal possession of a weapon, acknowledging he knowingly possessed a baton. In the context of a summary judgment motion, the proponent must demonstrate the absence of material factual issues. Courts do not determine credibility but identify triable issues. Summary judgment should be denied if different inferences can arise from undisputed facts. The Groskopf and Ferrall defendants did not prima facie establish their entitlement to judgment regarding whether an 'occurrence' triggering policy coverage occurred and whether it fell under the 'expected or intended' injury exclusion. Both Groskopf and Edward's depositions indicated conflicting accounts of intent during a heated altercation, and Groskopf's sworn statement against Edward characterized the act as intentional, requesting full prosecution. Mapfre, not a party in the underlying action, could not be bound by determinations made therein regarding Edward's intent, as it did not participate in depositions. The attorneys for the Ferrall defendants, paid by Mapfre but obligated to defend their clients' interests, do not create privity with Mapfre. The Supreme Court should have denied the Ferrall defendants and Groskopf's motions for summary judgment regarding Mapfre's duty to defend and indemnify. Additionally, the defendants did not prove that Mapfre's disclaimer was untimely, as a disclaimer is unnecessary if a claim is outside policy coverage. Given existing triable issues regarding coverage, the defendants failed to establish the need for a timely disclaimer. Further contentions were deemed unnecessary to address.