Representing Insureds Since 1970

News & Events

Ambiguous Policy Exclusions Insufficient to Protect Insurers in Actions Stemming from Damage due to Collapse of World Trade Center

Weg & Myers P.C. was successful in having the Second Circuit Court of Appeals reverse a decision by the District Court for the Southern District of New York that granted summary judgment to the insurer of a building damaged by debris from the collapse of the World Trade Center. In Parks Real Estate Purchasing Group v. St. Paul Fire and Marine Insurance Company, the District Court, while rejecting arguments asserting that the claim was excluded based upon the "mechanical breakdown" and "wear and tear" exclusions in the policy, granted summary judgment to the carrier based upon an exclusion of coverage for "contamination". The Second Circuit Court of Appeals reversed, holding that the word "contamination" was ambiguous as it was used in the exclusion to an all-risk policy. The Court found instead that the meaning of the term "contamination" was an issue of fact to be determined by the trier of fact, and reversed and remanded case. Click here for a copy of the Second Circuit's decision.

Judge Rules Insurer's Failure To Pay Initial Repair Costs, Estops Its Defense On Replacement Value Claim; Jury Rejects Arson Allegation In $1.22 M Award

A jury in New York Supreme Court, Richmond County has awarded $1.22 million, with interest bringing the total to approximately $1.9 million, in a suit brought by a homeowner whose house was destroyed by fire on August 6, 1994. Read the full article here.

W&M Hits Carrier with Verdict in Excess of $1 Million Plus Damages for Bad Faith

On Tuesday, May 21, 2002 a New York jury returned a verdict against Colonial Cooperative Insurance Company in which it found that the carrier acted in bad faith by failing to pay an insured's claim for damages to its inventory stemming from a burst pipe. Click here to read more.


In an underlying trademark infringement action, the insurer, Diamond State, refused to assume a defense on behalf of its insured, Century 21. Challenging its duty to defend, the insurer argued that the term "marketing" alleged in the underlying pleading did not fall squarely within the definition of an "advertising injury" under the subject policy. After the insured moved for summary judgment and the insurer cross-moved, U.S. District Court Judge Gerard E. Lynch exonerated the insurer, Diamond State Insurance, from its duty to defend and reasoned that the pleadings in the underlying action did not trigger an obligation to assume a defense. Persuaded by the insured'scharacterization of the term "marketing", the District Court determined that the omission of the express term "advertising" in the underlying complaint allowed the insurer to disclaim coverage because the "advertising injury" coverage contained in the subject policy was not triggered.

Reversing a District Court ruling, granting the carrier summary judgment, the Second Circuit held that allegations that the insured infringed on the trademark of another by improperly "marketing" these suspect goods, was sufficient to trigger the "advertising injury" coverage provided for in the Commercial General Liability policy issued by the carrier. Click to read the decision. Century 21, Inc. v. Diamond State Insurance Company

For more details on the Court's decision, click here.


In a successful appeal handled by Weg & Myers, the Appellate Division First Department held that notice from an insured's liability carrier notifying another carrier who insured the same entity as an additional insured of a claim and tendering the defense to that carrier constituted good notice, requiring the liability carrier to disclaim in a timely manner pursuant to New York State Insurance Law §3420(d). Because Atlantic failed in this obligation, the Appellate Court reversed the Motion Court and granted the insured summary judgment. In Industry City Management, et. al., v. Atlantic Mutual Insurance Company, the First Department held that a March 2005 letter which was authored and sent by Industry City's own insurer's claims administrator on behalf of Industry City to Atlantic Mutual seeking defense and indemnification coverage for Industry City properly constituted notice. The Court further held that Atlantic Mutual's disclaimer of coverage which was based on late notice and was issued seven months after the March 2005 letter was untimely as a matter of law. Consequently, Atlantic Mutual was obligated to indemnify Industry City in connection with the settlement in the underlying personal injury action.

In connection with the settlement of an underlying personal injury action in which Industry City was named as a defendant, Atlantic Mutual had earlier refused to provide indemnification to Industry City pursuant to the terms and conditions of a policy of insurance which was issued by Atlantic Mutual and named Industry City as an additional insured. The Supreme Court, New York County, granted summary judgment to Atlantic Mutual holding that Industry City had failed to provide timely notice of the underlying occurrence to Atlantic Mutual. In so doing however, the Supreme Court failed to recognize that the March 2005 letter served as notice for the underlying action and was not merely a request for coverage between insurers. As a result, Atlantic Mutual was compelled to reimburse its insured the settlement amount of $250,000 paid by it plus pre-judgment interest pursuant to CPLR 5001. Click here to see a copy of the decision.

Property Damage Claims, Business Interruption Claims And Presenting The Claim

When reviewing coverage under a policy, you must first determine what type of insurance policy the inured maintains and what types of risks that policy insures against. For the most part, risks are covered in two different ways. Click here to read the article in its entirety.

Judge rules insurer can not escape liability based on an assignment of a policy of insurance to an insured's successor in interest

At the conclusion of a bench trial in a declaratory judgment action brought by One Beacon Insurance Company the court awarded damages to the insured totaling $2.5 million. The bench trial followed the Court's denial of the carrier's motion for summary judgment based upon an alleged improper assignment of the insurance policy. One Beacon Insurance Company v. Old Williamsburg Candle Corporation, 386 F.Supp.2d 394. At trial, the Court in awarding damage of $2.5 million, found that the carrier's reduction in the limit of insurance to $1.5 million was ineffectual. To read the Court's entire decision and verdict Click Here

Jury Awards $1.2 M In Water Damage Claim; Finds Insurer Acted In Bad Faith

A jury in Supreme Court, New York County, after a one week trial and one hour of deliberation, found that Colonial Cooperative Insurance Company had failed to sustain its allegation that its insured-claimant had been engaged in a fraud by intentionally and grossly exaggerating the claim and by submitting false documentation in support of the amount of damage, delivered a verdict awarding plaintiffs $1.2 million including interest. The jury also concluded that the defendant insurance company had acted in bad faith, and awarded the plaintiffs consequential damages in the form of attorneys' fees. Read the full article here.

Jury award against the New York City Transit Authority and its contractor for construction related damages upheld by Appellate Division

In an action brought by a landowner against the Transit Authority and its contractor, Weg & Myers P.C. was successful in obtaining a jury returned a verdict of $631,327.06 for damage sustained to the plaintiffs building due to neighboring construction. The defendants appealed, requesting a new trial on liability and reduction of damages. In Skordilis v. New York City Transit Authority, the Appellate Division, Second Department denied the appeal, holding that defendants were not entitled to a new trial. The Court also held that the damages were not excessive because they did not deviate "materially from what would be reasonable compensation". Click here to read a copy of the Second Department's Decision.

First Party Insurance Consequential Damages are here to Stay in New York

The Court of Appeals has upheld a first-party insured's right to obtain an award of consequential damages as a result of a carrier's failure to handle an insurance claim in good faith. In Bi-Economy Market, Inc. v. Harleyswille Insurance Company, ( click here to read) plaintiff's building and inventory were destroyed by fire. However, the carrier only agreed to pay the insured $163,000 in damages. The insured had to wait another year before receiving an additional $244,000 through an alternative dispute resolution procedure. It also only paid the insured for 7 months of business interruption when the fact indicated that the full 12 months should have been paid. Under this backdrop, the insured sued the carrier for its bad faith handling of the claim. It was this claim that the Court of Appeals has now recognized in the State of New York. In so doing, the Court of Appeals reversed both the Motion Court and the Appellate Division and denied defendant's motion which sought to assert a defense based upon the exclusion of "consequential damages" from coverage and then went on to reinstate the consequential damage claim that had been stricken by the lower courts. The Court of Appeals held that the business interruption coverage provided under the policy made Harleysville aware that it would be liable for business loss damages if it breached its agreement. As a result, the Court held that consequential damages allegedly stemming from the carrier's failure to properly adjust the loss was recoverable. A Federal Court in New York has recently held in Quick Response Commercial Division, LLC v. Travelers Property Casualty Company of America that such consequential damages include interest payments made by the insured and attorneys fees expended.


In 84 Drive Homes, Inc. v. Admiral Indemnity Company, Weg & Myers was successful in having Justice Doris Ling-Cohan of the Supreme Court, New York County, grant summary judgment in favor of the insured, holding that the insurance carrier is obligated to defend and indemnify 84 Drive Homes in connection with an underlying personal injury action. Although it was undisputed that 84 Drive Homes provided late notice of the underlying occurrence to Admiral, 84 Drive properly asserted that Admiral was nonetheless still obligated to defend and indemnify 84 Drive since Admiral's declination of coverage was untimely as a matter of law and thus violated Insurance Law § 3420 (d) which provides that an insurance carrier must deny coverage under a liability policy "as soon as is reasonably possible". In so holding, the Court acknowledged that while the law in New York State provides an insurer with an opportunity to conduct a prompt and reasonable investigation, the Court held that following an interview with a member of board of 84 Drive, the factual information which formed the basis of Admiral's disclaimer based on late notice should have become apparent. Thus, Admiral's subsequent declination letter nearly two months after the interviews were conducted was held to be untimely. Click here to see a copy of the decision.

Loss Executives Association Meeting

In what has been billed as a first for the Loss Executives Association, this firm has been asked to speak at this "insurance company only" seminar and will speak on "How the Insured's Attorney will Get You". Click here for a schedule of the entire meeting and the topics and speakers who will be attending.