| Stone Ridge Country Props. Corp. v Mohonk Oil Co., Inc. |
| 2011 NY Slip Op 03945 [84 AD3d 1556] |
| May 12, 2011 |
| Appellate Division, Third Department |
| Stone Ridge Country Properties Corporation, Respondent, vMohonk Oil Company, Inc., et al., Defendants, and W.R. Berkley Corporation,Appellant. |
—[*1] Kellar, Kellar & Javian, Kingston (Paul T. Kellar of counsel), for respndent.
Malone Jr., J. Appeal from an order of the Supreme Court (Gilpatric, J.), entered February16, 2009 in Ulster County, which, among other things, denied a motion by defendant W.R.Berkley Corporation to dismiss the complaint against it.
In November 2006, defendant James Owens, an employee of defendant Mohonk OilCompany, Inc., attempted to deliver fuel oil to a house on property owned by plaintiff, but wastold by people working there that the heating system was under construction and that acceptanceof oil was not possible that day. Owens returned to the property the following day and, afterfinding no one around, proceeded to fill the fuel oil tank. The oil flowed out of the tank andseeped into the rock, soil and groundwater under the house. Consequently, plaintiff commencedthis action against Mohonk and Owens, as well as Mohonk's automobile liability insurer,defendant StarNet Insurance Company, and defendant W.R. Berkley Corporation (hereinafterBerkley).[*2]
In a pre-answer motion to dismiss, Berkley alleged thatplaintiff had failed to state a cause of action against it, arguing, among other things, that becauseit did not issue a liability insurance policy to Mohonk, it cannot be liable under the NavigationLaw for damages related to the oil discharge. In response, plaintiff alleged, with some evidentiaryproof, that Berkley was the ultimate parent company of StarNet and, by virtue of that relationshipto the insurer, Berkley was likewise liable for damages. Based upon this allegation, SupremeCourt concluded that plaintiff had stated a cause of action against Berkley and denied the motionto dismiss. Berkley appeals.
"When assessing the adequacy of a complaint in light of a CPLR 3211 (a) (7) motion todismiss, the court must afford the pleadings a liberal construction, accept the allegations of thecomplaint as true and provide plaintiff . . . the benefit of every possible favorableinference" (AG Capital FundingPartners, L.P. v State St. Bank & Trust Co., 5 NY3d 582, 591 [2005] [internal quotationmarks and citation omitted]). Here, based upon Berkley's status as the ultimate parent companyof StarNet, plaintiff seeks to hold Berkley liable for damages resulting from the oil spill as eitheran insurer or as a "person providing evidence of financial responsibility" (Navigation Law§ 190). While generally a parent corporation's liability cannot be based solely upon itsownership of a subsidiary, here, plaintiff has alleged sufficient facts indicating " 'directintervention by [Berkley] in the management of [StarNet] to such an extent that [StarNet's]paraphernalia of incorporation' " may be ignored (SUS, Inc. v St. Paul Travelers Group, 75 AD3d 740, 743 [2010],quoting Billy v Consolidated Mach. Tool Corp., 51 NY2d 152, 163 [1980]). Whetherplaintiff will ultimately be successful on its claims against Berkley " 'is not part of the calculus indetermining a motion to dismiss' " (AG Capital Funding Partners, L.P. v State St. Bank &Trust Co., 5 NY3d at 591, quoting EBC I, Inc. v Goldman, Sachs & Co., 5 NY3d 11, 19 [2005]).Accordingly, Supreme Court properly denied Berkley's motion to dismiss the complaint againstit.
Mercure, J.P., Rose, Stein and Egan Jr., JJ., concur. Ordered that the order is affirmed, withcosts.