| Utica First Ins. Co. v Santagata |
| 2009 NY Slip Op 07620 [66 AD3d 876] |
| October 20, 2009 |
| Appellate Division, Second Department |
| Utica First Insurance Company, Respondent, v RobertSantagata et al., Appellants, et al., Defendants. |
—[*1] Finkelstein & Partners, LLP, Newburgh, N.Y. (George A. Kohl II of counsel), for appellantArthur Kelly. Farber Brocks & Zane LLP, Mineola, N.Y. (Audra S. Zane and Sherri Pavloff of counsel),for respondent.
In an action for a judgment declaring that the plaintiff is not obligated to defend andindemnify the defendants Glenn Foote, Glenn Foote, doing business as Mr. Metal, Mr. Metal,Mr. Metal Company, Inc., Robert Santagata, Stephen Santagata, and Denise Hopkins Santagatain an underlying personal injury action entitled Kelly v Santagata et al., pending in theSupreme Court, Ulster County, under index No. 3425/05, or in connection with the constructionaccident which occurred on July 1, 2005, involving the defendant Arthur Kelly, the defendantArthur Kelly appeals from (1) an order of the Supreme Court, Orange County (Owen, J.), datedApril 3, 2008, which granted the plaintiff's motion, which was opposed by him, for summaryjudgment against the defendants Robert Santagata, Stephen Santagata, and Denise HopkinsSantagata, and for leave to enter a default judgment against the defendants Glenn Foote, GlennFoote, doing business as Mr. Metal, Mr. Metal, and Mister Metal Company, Inc., and denied thecross motion of the defendants Robert Santagata, Stephen Santagata, and Denise HopkinsSantagata, in which the defendant Arthur Kelly joined, for summary judgment declaring that theplaintiff is obligated to defend and indemnify the defendants Robert Santagata, StephenSantagata, and Denise Hopkins Santagata in the underlying action, and (2) a judgment of thesame court dated June 4, 2008, which, upon the order, declared that the plaintiff has noobligation to defend or indemnify the defendants Glenn Foote, Glenn Foote, doing business asMr. Metal, Mr. Metal, Mr. Metal Company, Inc., Robert Santagata, Stephen Santagata, andDenise Hopkins Santagata in the underlying action, or in connection with the constructionaccident which occurred on July 1, 2005 involving the defendant Arthur Kelly, and thedefendants Robert Santagata, Stephen Santagata, and Denise Hopkins Santagata separatelyappeal, as limited by their brief, from so much of (1) the order dated April 3, 2008, as grantedthat branch of the plaintiff's motion which was for summary judgment against them, and deniedtheir cross motion for summary judgment, and (2) the judgment dated June 4, 2008, as, upon theorder, declared that the plaintiff has no obligation to defend or indemnify them in the underlyingaction or in connection with the construction accident which occurred on July 1, 2005, involving[*2]the defendant Arthur Kelly.
Ordered that the appeals from the order are dismissed; and it is further,
Ordered that the judgment is affirmed; and it is further,
Ordered that one bill of costs is awarded to the plaintiff payable by the appellants appearingseparately and filing separate briefs.
The appeals from the intermediate order must be dismissed because the right of direct appealtherefrom terminated with the entry of judgment in the action (see Matter of Aho, 39NY2d 241, 248 [1976]). The issues raised on the appeals from the order are brought up forreview and have been considered on the appeals from the judgment (see CPLR 5501 [a][1]).
The Supreme Court properly found that the plaintiff insurer's delay in issuing a disclaimer,which was occasioned by the insurer's need to investigate the claim to determine the relationshipamong the parties and when its insureds received notice of the accident, was reasonable underthe circumstances (see Hermitage Ins.Co. v Arm-ing, Inc., 46 AD3d 620, 621 [2007]; Halloway v State Farm Ins. Cos., 23 AD3d 617, 618 [2005];Farmbrew Realty Corp. v Tower Ins. Co. of N.Y., 289 AD2d 284, 285 [2001]; cf. Continental Cas. Co. v Stradford,11 NY3d 443, 449 [2008]).
Contrary to the appellants' assertion, the employee exclusion in the subject insurance policy,which excludes coverage in cases of bodily injury to an employee of the insured or an employeeof a contractor hired by the insured if it occurs in the course of employment, does not violatepublic policy (cf. Moleon v Kreisler Borg Florman Gen. Constr. Co., 304 AD2d 337, 340[2003]). "[W]hen statutes and Insurance Department regulations are silent, [courts] are reluctantto inhibit freedom of contract by finding insurance policy clauses violative of public policy"(Slayko v Security Mut. Ins. Co., 98 NY2d 289, 295 [2002]). There is no statutoryrequirement for commercial liability coverage which would prohibit insurers from limiting theircontractual liability in the manner done so here (cf. Slayko v Security Mut. Ins. Co., 98NY2d at 295; Joseph R. Loring & Assoc. v Continental Cas. Co., 56 NY2d 848, 850[1982]; Miller v Continental Ins. Co., 40 NY2d 675, 679 [1976]).
Finally, the Supreme Court properly found that the plaintiff was entitled to a defaultjudgment against the defendants Glenn Foote, Glenn Foote, doing business as Mr. Metal, Mr.Metal, and Mister Metal Company, Inc., because, in addition to their having defaulted, theplaintiff established that it was entitled to a judgment declaring that it had no obligation todefend or indemnify those defendants inasmuch as they failed to provide timely notice of theaccident, and the employee exclusion precluded coverage for the injuries allegedly sustained bythe defendant Arthur Kelly (cf. NewYork Mut. Underwriters v Baumgartner, 19 AD3d 1137, 1141 [2005]; MerchantsIns. Co. of N.H. v Long Is. Pet Cemetery, 206 AD2d 827, 828 [1994]; Levy v Blue Cross& Blue Shield of Greater N.Y., 124 AD2d 900, 901 [1986]). Skelos, J.P., Covello, Leventhaland Roman, JJ., concur.