Old Republic Construction Insurance Agency of New York, Inc. v. Fairmont Insurance Brokers ( 2013 )
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Appeal from order, Supreme Court, New York County (Cynthia S. Kern, J.), entered August 6, 2012, which granted plaintiffs motion for summary judgment on the issue of liability, and denied defendant’s cross motion for summary judgment, deemed appeal from judgment, same court and Justice, entered February 7, 2013, in plaintiff’s favor, and, so considered, said judgment unanimously reversed, on the law, without costs, the judgment vacated, and the matter remanded for proceedings consistent herewith.
Even though defendant appealed from an order and not the ensuing final judgment, under CPLR 5520 (c) this Court has the discretion to address the liability issues (see Robertson v Greenstein, 308 AD2d 381 [1st Dept 2003], appeal dismissed 2 NY3d 759 [2004]). In any event, the order that was appealed incorrectly concluded that the hearing would be limited to the amounts invoiced pursuant to the agreement between the parties. Therefore this issue is properly before us.
*457 Under the parties’ producer agreement, pursuant to which defendant procured insurance for its clients through plaintiff, defendant is obligated to pay all insurance premiums, including those that plaintiff retroactively increased upon audit. Section 5.3 of the agreement states that “[defendant] guarantees to pay [plaintiff] all premium [sic] ... on any insurance placed or arranged for [defendant] by [plaintiff], irrespective of whether [defendant] has collected such premiums . . . from any customer or client of [defendant]” (emphasis added). Contrary to defendant’s contention, the term “all premium” does not refer to the “initial premium” only. Accordingly, the court properly granted plaintiff summary judgment as to defendant’s liability for the retroactive increases.But it was incorrect for the court to proceed as though the invoices were correct and hold that defendant lacked standing to challenge plaintiffs calculation of the premium amounts due. Given that the producer agreement did not provide that defendant waived any defenses and that the guarantee was unconditional, defendant was entitled to raise the insureds’ defense that the audits were inaccurate and the increases were excessive under the policies (see Restatement [Third] of Suretyship & Guaranty § 34; see also Sterling Natl. Bank v Biaggi, 47 AD3d 436, 436-437 [1st Dept 2008]). Thus, under CPLR 3212 (f), defendant was entitled to disclosure about the audits that plaintiffs used to calculate the premium increases before damages were determined. Concur — Freedman, J.E, Richter, Feinman and Gische, JJ.
The decision and order of this Court entered herein on November 26, 2013 (111 AD3d 553 [2013]) is hereby recalled and vacated.
Document Info
Filed Date: 12/10/2013
Precedential Status: Precedential
Modified Date: 11/1/2024