Sunday, September 9, 2012

Court of Appeals Watch: Dean v. Tower Insurance Co. of New York

Dean v. Tower Insurance Co. of New York will be argued at the Court of Appeals this Tuesday.
In this insurance coverage action, at issue was an insurance policy Tower issued in March 2005 with respect to a house purchased by the Deans.  The policy stated that it covered physical loss to the "residence premises," which it defined as "[t]he one family dwelling, other structures, and grounds . . . where you reside."

After closing on their new house, the Deans discovered termite damage that delayed their ability to move in because of needed extensive renovations.  During this time, the Deans continued to reside in their old house without informing Tower. In March 2006, the policy was renewed for a second year while renovations were ongoing. Ultimately, an unrelated fire destroyed the new house and the Deans filed a claim under their policy. Tower disclaimed coverage on two grounds (1) that the insured house was not a “residence premises” under the policy; and (2) that the Deans misrepresented that they occupied the insured house. The Deans commenced an action against Tower, seeking to compel Tower to insure their loss.

The Supreme Court granted Tower's motion for summary judgment dismissing the complaint, holding that the house was not a "residence premises" under the policy.  The Court found that, "[g]iving the words 'where you reside' their 'plain and ordinary meaning,' the policy covered a dwelling where the Deans lived for a permanent or extended period of time."  Here, since the Deans never resided in the new house, the Court found that the new house was not a "residence premises."

In modifying the Supreme Court's order to deny summary judgment to Tower, the Appellate Division found that "residence premises" was ambiguous under the facts of the case, particularly where the term "resides" was undefined by the policy, and that there was an issue of fact as to whether the plaintiff's misrepresented their intention to reside at the insured house.

The Appellate Division granted Tower leave to appeal to the Court of Appeals. Arguments will be this Tuesday, September 11, 2012. The session begins at 2:30 p.m. and this matter is listed fourth on the calendar.  Based on the requested oral argument times of earlier matters, this matter should be argued, beginning at approximately 3:50 p.m.

The Court streams oral arguments live online. To watch the oral arguments, you can visit the New York Court of Appeals website on Tuesday after 2:30 p.m. and click on the "Oral Arguments Webcast" link on the right-hand side of the screen. Alternatively, on Tuesday after 2:30 p.m. you may click here to open the windows media player stream directly.

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