Fernandez v. Cigna Property & Casualty Insurance ( 1992 )

Levine, J. P.

(concurring). The policy of fire insurance on which plaintiff sues was apparently issued jointly to her and her husband, Joseph Fernandez, who owned the covered property as tenants by the entirety. Moreover, as the quoted excerpts from the policy set forth in the majority’s decision show, either insured, by committing an act with intent to cause a loss or by making a fraudulent misrepresentation or concealment regarding a loss, had the power to forfeit the other insured’s right to recover the proceeds of the policy on a loss. Notably, plaintiff has sued to recover the full value of the entire alleged fire loss. These facts, in my view, distinguish the instant case from Samhammer v Home Mut. Ins. Co. (120 AD2d 59), relied upon by the majority for concluding that there was no privity between plaintiff and her husband (see also, Krupp v Aetna Life & Cas. Co., 103 AD2d 252).

I would find that privity does exist between plaintiff and her husband at least to the extent that, in the absence of a demonstrated conflict of interest between them, the disposition on the merits of a claim under the policy by one of them would preclude the assertion of the same claim in subsequent litigation by the other (i.e., claim preclusion or res judicata). Privity in this case would arise out of the fiduciary relationship as to the covered property existing between them as tenants by the entirety (see, Restatement [Second] of Judgmerits § 41 [c], comment b), and from their relationship as coobligees under the contract of insurance (see, id., at § 53).

Plaintiff, however, is not necessarily bound by the prior determination of a factual issue (i.e., issue preclusion or collateral estoppel) against her husband in litigation unrelated to any claim under the contract of insurance (see, id., at § 53, comment b). It would be particularly inequitable to apply collateral estoppel against plaintiff here based upon her husband’s conviction on an arson-related offense as a result of an Alford-Serrano plea to a drastically reduced charge under a plea agreement providing for a sentence of probation (cf., Matter of Halyalkar v Board of Regents, 72 NY2d 261, 268-270). Consequently, I concur in the result.

Ordered that the order is reversed, on the law, with costs, and motion denied.