Court Determines Whether (Or Not) Earth Movement Policy Exclusion Applied
Robert Parisi was the owner of a house in Blue Point. A leak from a refrigerator water line saturated a layer of fill earth inside the walls of the property, which in turn caused the foundation wall to collapse. Parisi submitted a claim to his insurer, Kingstone Insurance Company. Kingstone denied coverage for the foundation damage on the ground that the insurance policy excluded damage caused by earth movement and/or water damage.
Parisi commenced an action against Kingstone to recover damages for breach of an insurance contract and bad faith in denying insurance coverage. Parisi moved for summary judgment on the complaint or, alternatively, for summary judgment on the issue of liability. Kingstone cross-moved for summary judgment dismissing the complaint. Supreme Court granted Parisi’s motion which was for summary judgment on the issue of liability and denied Kingstone’s cross-motion. Kingstone appealed.
In determining a dispute over insurance coverage, the Court first looks to the language of the policy. As with any contract, unambiguous provisions of an insurance contract must be given their plain and ordinary meaning, and the interpretation of such provisions is a question of law for the court. Generally, in a dispute over insurance coverage, the insured bears the initial burden of establishing that the loss claimed falls within the scope of the policy. Once coverage is established, the insurer has the burden of proving the applicability of an exclusion. Policy exclusions are to be strictly and narrowly construed and are not to be extended by interpretation or implication.
Here, Parisi demonstrated, prima facie, that the leak from the refrigerator water line was a covered loss. The insurance policy provided coverage for, among other things, a loss caused by the accidental leakage, overflow, or discharge of liquids or steam from a plumbing, heating or air-conditioning system or domestic appliance. In opposition, Kingstone failed to raise a triable issue of fact as to whether the foundation damage was excluded from coverage under either the earth movement or water damage exclusions of the policy. Accordingly, Supreme Court properly granted that branch of Parisi’s motion which was for summary judgment on the issue of liability on the cause of action alleging breach of an insurance contract and properly denied that branch of Kingstone’s cross-motion which was for summary judgment dismissing that cause of action.
However, Supreme Court should have granted that branch of Kingstone’s cross-motion which was for summary judgment dismissing the cause of action alleging bad faith and denied that branch of Parisi’s motion which was for summary judgment on the issue of liability on that cause of action. The cause of action alleging bad faith was duplicative of the cause of action alleging breach of contract, and there wass no separate tort for bad faith refusal to comply with an insurance contract.