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Vbh Luxury, Incorporated v. 940 Madison Associates LLC

New York Court of Appeals


February 14, 2012

VBH LUXURY, INCORPORATED, PLAINTIFF,
v.
940 MADISON ASSOCIATES LLC, THIRD-PARTY RESPONDENT,
EXCELSIOR INSURANCE COMPANY, ET AL., THIRD-PARTY APPELLANT,
THIRD-PARTY DEFENDANT.

This memorandum is uncorrected and subject to revision before publication in the New York Reports.

MEMORANDUM:

The order of the Appellate Division should be reversed, with costs, the judgment of Supreme Court reinstated, and the certified question answered in the negative.

Third-party plaintiff/landlord 940 Madison Associates, is an additional insured under a commercial general liability policy issued by third-party defendant Excelsior Insurance Company to plaintiff/tenant VBH Luxury, Inc. "only with respect to liability arising out of the ownership, maintenance or use of that part of the premises leased to [tenant]." Although landlord would be entitled to a defense in an action commenced against it by a third party for an injury suffered on the leased premises (see ZKZ Assoc. v CNA Ins. Co., 89 NY2d 990, 991 [1997]), the policy does not provide coverage for liability to its co-insured for damage to property owned, rented, or occupied by the insured (see Insurance Corp. of N.Y. v Cohoes Realty Assoc., L.P., 50 AD3d 1228, 1229-1230 [3d Dept 2008]; Utica Mut. Ins. Co. v Watertown Indus. Ctr. Local Dev. Corp., 9 AD3d 836, 837 [4th Dept 2004], lv denied 11 AD3d 1053 [4th Dept 2004]). Thus, Excelsior was not obligated to defend landlord in the underlying action. On review of submissions pursuant to section 500.11 of the Rules, order reversed, with costs, judgment of Supreme Court, New York County, reinstated, and certified question answered in the negative, in a memorandum.

Chief Judge Lippman and Judges Ciparick, Graffeo, Read, Smith, Pigott and Jones concur.

20120214

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