| Appleby v Chicago Tit. Ins. Co. |
| 2011 NY Slip Op 00170 [80 AD3d 546] |
| January 11, 2011 |
| Appellate Division, Second Department |
| Karen Appleby, Appellant, v Chicago Title Insurance Company,Respondent. |
—[*1] DelBello Donnellan Weingarten Wise & Wiederkehr, LLP, White Plains, N.Y. (Lee S.Wiederkehr and Robert Hermann of counsel), for respondent.
In an action for a judgment declaring that the plaintiff is entitled to recover, under a policy of titleinsurance, the diminution in the market value of certain premises from the date of the plaintiff's purchaseof the premises until March 23, 2006, and to recover damages for breach of contract, the plaintiffappeals, as limited by her brief, from so much of an order of the Supreme Court, Westchester County(Loehr, J.), entered October 9, 2009, as, in effect, granted the defendant's motion for summaryjudgment declaring that its obligation under the policy is limited to the sum of $59,031 and, in effectdenied her cross motion for summary judgment on the complaint, inter alia, declaring that the defendantis obligated to her under the policy for the diminution in the market value of the premises from the dateof her purchase of the premises until March 23, 2006.
Ordered that the order is reversed insofar as appealed from, on the law, with costs, the defendant'smotion for summary judgment declaring that its obligation under the policy is limited to the sum of$59,031 is denied, the plaintiff's cross motion for summary judgment on the complaint, inter alia,declaring that the defendant is obligated to her under the policy for the diminution in the market value ofthe premises from the date of her purchase of the premises until March 23, 2006, is granted, and thematter is remitted to the Supreme Court, Westchester County, for the entry of a judgment, among otherthings, declaring that the defendant is obligated to indemnify the plaintiff for her loss or damages arisingfrom the diminution in the market value of the premises from the date of her purchase of the premisesuntil March 23, 2006, and for further proceedings in accordance herewith.
In 1997 the plaintiff and her former husband became aware that the owner of premises located at49A Old Albany Post Road in Ossining (hereinafter the premises), wished to sell the premises.According to the plaintiff, the owner of the premises told her that the premises did not have directaccess to Old Albany Post Road, but was benefitted by an easement which allowed a car to be drivenacross the neighboring property at 49B Old Albany Post Road in order to reach the street. Prior topurchasing the premises, the plaintiff became aware that the owner of the property at 49B Old AlbanyPost Road did not agree that the premises were benefitted by an easement permitting vehicles to bedriven across his property in order to reach the street. Prior to the purchase [*2]of the premises, the plaintiff informed her attorney who, in turn, informedthe defendant, Chicago Title Insurance Company (hereinafter Chicago Title), of the potential issueinvolving the easement.
On or about April 10, 1997, the plaintiff and her former husband purchased the premises, andsecured, from Chicago Title, a title insurance policy (hereinafter the policy) in the face amount of$59,031. Schedule B of the policy provides, in pertinent part:
"This policy does not insure against loss or damage (and the Company does not pay costs,attorney's fees or expenses) which arise by reason of: . . .
"9. Insured premises as described in Schedule 'A' is benefited [sic] by a Right of Way asdescribed in Deed from ROBERTA FREED to SADIE P. SABRE dated July 22, 1947 and recordedAugust 20, 1947 in Liber 4549 of Deeds at Page 68.
"Policy, however, shall except from coverage the cost of any and all litigation expense, including,but not limited to attorney's fees, court costs or expenses relevant to the defense or enforcement of theinsureds [sic] rights under said Right of Way, through all courts of the State of New York,including the Appellate Division and Court of Appeals.
"Policy, however, shall insure that the outcome of said litigation shall be favarable [sic] tothe Insured and confirm a Right of Vehicular ingress and egress to the insured premises."
The policy also included a Market Value Policy Rider (hereinafter the rider) executed by ChicagoTitle which provides that, in consideration for the payment of an additional premium, "the Company[Chicago Title] insures the named homeowner [the plaintiff] against loss or damage not exceeding themarket value of the premises at the time of loss, in accordance with the conditions of the Policy notinconsistent with the provisions of this Rider." The rider also states that "[a]ll other provisions of thePolicy, not inconsistent with the provisions of this Rider, shall remain in full force and effect."Additionally, the Rider provides that "in the event of a loss, partial or total, the insured shall have theoption to elect to value such loss under the terms of this Rider or under the terms and amount of thePolicy."
The plaintiff commenced an action pursuant to RPAPL article 15 for a judgment declaring that thedisputed easement is valid, and for a permanent injunction preventing interference with her use of theeasement (see Appleby v Evans, 23AD3d 323 [2005]). In a judgment entered May 18, 2004, rendered after a nonjury trial, theSupreme Court, inter alia, declared that the easement was limited solely to use as a pedestrianright-of-way (id.). In a decision and order dated November 7, 2005, this Court affirmed thejudgment insofar as appealed from (id.). In an order dated March 23, 2006, the Court ofAppeals denied leave to appeal (see Appleby v Evans, 6 NY3d 708 [2006]).
Thereafter, the plaintiff filed a claim under the policy with Chicago Title. In response, Chicago Titleasserted that the plaintiff was entitled to the sum of $59,031. The plaintiff disputed the amount offeredto her and subsequently commenced the instant action for a judgment declaring the rights of the partiesunder the policy, and to recover damages for breach of contract.
Chicago Title moved for summary judgment declaring that its obligation under the policy waslimited to $59,031, and dismissing the second cause of action. The plaintiff cross-moved for summaryjudgment on the complaint, inter alia, declaring, among other things, that she had a valid policy, and thatshe was entitled to recover the diminution in the market value of the premises from the date of herpurchase of the premises until March 23, 2006. The Supreme Court, in effect, awarded summaryjudgment in favor of the defendant declaring that its obligation under the policy is limited to the sum of$59,031, and, in effect, denied the plaintiffs' cross motion. The plaintiff appeals, and we reverse theorder insofar as appealed from.[*3]
"[A] policy of title insurance is a contract by which the titleinsurer agrees to indemnify its insured for loss occasioned by a defect in title" (L. Smirlock RealtyCorp. v Title Guar. Co., 52 NY2d 179, 188 [1981]; Brucha Mtge. Bankers Corp. v NationsTit. Ins. of N.Y., 275 AD2d 337, 338 [2000]).
"As with any contract, unambiguous provisions of an insurance contract must be given their plainand ordinary meaning . . . [A] contract is unambiguous if the language it uses has a definiteand precise meaning, unattended by danger of misconception in the purport of the [agreement] itself,and concerning which there is no reasonable basis for a difference of opinion . . . Thus, ifthe agreement on its face is reasonably susceptible of only one meaning, a court is not free to alter thecontract . . . If the terms of a policy are ambiguous, however, any ambiguity must beconstrued in favor of the insured and against the insurer" (White v Continental Cas. Co., 9 NY3d 264, 267 [2007] [citations andinternal quotation marks omitted]; see VigilantIns. Co. v Bear Stearns Cos., Inc., 10 NY3d 170, 177 [2008]; Antoine v City of New York, 56 AD3d583, 584 [2008]; see also 1 NY Jur 2d Abstracts § 48).
Chicago Title's liability to the plaintiff for her loss is determined by the terms of the rider, and not byany contrary provisions of the policy. The rider provides that the insured homeowner is insured "againstloss or damage not exceeding the market value of the premises at the time of loss." The "time of loss" isdefined in the rider as "such date as the homeowner shall have actual knowledge of facts giving rise to aclaim under the Policy."
Since the policy "insure[d] that the outcome of said litigation shall be favarable [sic] to theInsured and confirm a Right of Vehicular ingress and egress to the insured premises," the plaintiff couldnot have had "actual knowledge of the facts giving rise to a claim" unless and until the litigationconcerning the purported easement had resulted in an outcome unfavorable to her, and denied her aright of vehicular ingress and egress to the premises. Under the facts of the instant matter, the time ofloss was March 23, 2006, the date when the Court of Appeals denied leave to appeal (seeAppleby v Evans, 6 NY3d 708 [2006]). To the extent that the "time of loss," as defined in therider, presents an ambiguity, such ambiguity must be construed against Chicago Title, as the drafter ofthe language and the issuer of the policy and rider (see White v Continental Cas. Co., 9 NY3dat 267; Antoine v City of New York, 56AD3d 583 [2008]). Accordingly, Chicago Title is liable to the plaintiff for her "loss or damage notexceeding the market value of the premises at the time of loss," namely, March 23, 2006.
We note that the rider provides that arbitrators are to determine the market value at the time ofloss.
Since this is, in part, a declaratory judgment action, we remit the matter to the Supreme Court,Westchester County, for the entry of a judgment, inter alia, declaring that Chicago Title is obligated toreimburse the plaintiff for the diminution of the market value of the premises from the date of herpurchase of the premises until March 23, 2006, not exceeding the market value of the premises as ofthat latter date (see Lanza v Wagner, 11 NY2d 317, 334 [1962], appeal dismissed371 US 74 [1962], cert denied 371 US 901 [1962]). Mastro, J.P., Dillon, Eng andChambers, JJ., concur.