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NIPKOW & KOBELT, INC. v. NORTH RIVER INS. CO.

April 14, 1986

NIPKOW & KOBELT, INC., PARLIAMENT TEXTILE DIVISION, Plaintiff,
v.
THE NORTH RIVER INSURANCE CO., Defendant



The opinion of the court was delivered by: TENNEY

TENNEY, J.

This action concerns the interpretation of an insurance contract. The plaintiff, Nipkow & Kobelt, Inc., Parliament Textile Division ("Parliament"), instituted this diversity action to recover on a fire insurance policy ("policy") issued by the defendant, The North River Insurance Co. ("North River"). In 1984, almost $600,000 of the plaintiff's inventory was destroyed by a fire.

The defendant now moves for summary judgment, arguing that the fire occurred at a location which was not covered by plaintiff's policy. The plaintiff contends that the policy covered its entire inventory, regardless of where it was located. The plaintiff cross-moves for summary judgment on the issue of the policy's coverage. The Court concludes that the inventory at issue here was covered by the plaintiff's policy.

 BACKGROUND

 The facts are undisputed in this matter. Parliament deals in textile fabrics, and its goods are processed at various plants. Parliament purchases unfinished fabric from various mills, has the fabric dyed or finished, and then sells the fabric to clothing manufacturers. Parliament does not own or operate any plants; its fabrics are sent to various factories to be processed.

 In March, 1984, there was a fire at Jamel Textiles, Inc. ("Jamel"), which is a printing and finishing plant located in Lebanon, Pennsylvania. Approximately one-half of the plaintiff's total inventory was on Jamel's premises at the time of the fire, and, in June 1984, the plaintiff submitted its proof of loss under the policy for $594,848.10.

 North River denied insurance coverage on the ground that the loss occurred at a location that was not specifically listed in the policy and therefore the loss was not covered by the plaintiff's policy. Parliament argues that the policy was intended to cover its entire inventory, regardless of where it was located. The parties have cross-moved for summary judgment on the issue of coverage.

 DISCUSSION

 Summary judgment may be granted if there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. ("Rule") 56(c); see generally 6 J. Moore, W. Taggart and J. Wicker, Moore's Federal Practice § 56.15 [1.-0] (2d ed. 1983). The party moving for summary judgment has the burden of showing that there are no material facts in dispute, and the court will resolve all ambiguities in favor of the party opposing the motion. See Heyman v. Commerce and Indus. Ins. Co., 524 F.2d 1317, 1319-20 (2d Cir. 1975).

 If, however, the motion for summary judgment is supported by affidavits or other sworn testimony as provided by Rule 56(e), so that the moving party makes a prima facie showing that there is no genuine issue of material fact, then the nonmoving party must adduce "specific facts showing that there is a genuine issue for trial." Id.; see Barnett v. Howaldt, 757 F.2d 23, 26 (2d Cir. 1985). Summary judgment will not be denied on the basis of mere conclusory allegations, made without factual support. See Project Release v. Prevost, 722 F.2d 960, 968 (2d Cir. 1983).

 The question in this case concerns the appropriate construction of the plaintiff's insurance policy and whether coverage is afforded under facts that are not in dispute. In this instance, the contract is clear in and of itself, so that it is not necessary to consider extrinsic evidence in order to determine the intention of the parties. The parties' intentions can be gathered from within the four corners of the instrument. The question presented, therefore, is purely one of law, to be decided by the court. See Loblaw, Inc. v. Employers 'Liability Assur. Corp., 57 N.Y.2d 872, 876, 456 N.Y.S.2d 40, 43, 442 N.E.2d 438 (1982); Stainless, Inc. v. Employers' Fire Insurance Co., 69 A.D.2d 27, 32, 418 N.Y.S.2d 76 (lst Dep't 1979, aff'd, 49 N.Y.2d 924, 428 N.Y.S.2d 675, 406 N.E.2d 490 (1980); see also National State Bank v. American Home Ins. Co., 492 F. Supp. 393, 396-97 (S.D.N.Y. 1980) (The court granted summary judgment, finding that the policy at issue was unambiguous when read as a whole.). After careful consideration of the record, the Court concludes that the plaintiff's motion for partial summary judgment must be granted.

 The Insurance Policy

 The plaintiff bases its argument on the first paragraph of the policy which ...


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