MCWG Convinces Appellate Court To Affirm Summary Judgment in Favor of Tower Ins. Co. based on a Breach of the Notice of Loss Condition

In the case of Rangoli, Inc., et al. v. Tower Insurance Company, on March 9, 2010 the Appellate Division of the Supreme Court, Second Department, affirmed the lower court's decision that awarded Tower Insurance Company summary judgment.  Tower was also awarded its costs for the appeal.  As reported in the May 6, 2009 edition of the PLRB Front Lines, on March 2, 2009, the lower court held that coverage for business interruption and property losses were barred based on the "Earth Movement" exclusion because the losses resulted from a landslide of a rock cliff.  The court was not swayed by the contention that the exclusion did not apply because the cliff was allegedly created by an excavation almost 100 years ago, and therefore, not a natural event to which the courts have limited the application of the exclusion.  The appeal was limited to the claim for alleged property damage that was reportedly discovered once the local authorities allowed the insured to reenter its business premises.  As did the lower court, the appellate court affirmed the dismissal of this claim based on the insured's breach of the insurance policy's "Prompt Notice of Loss" Condition; however, appellate court the went beyond the lower court's decision to hold that "in any event, …Plaintiff… failed to sustain its burden of proving that the loss occurred during the policy period."  The decision can be found at 2010 NY Slip Op 1946; 2010 N.Y. App. Div. LEXIS 1933.  Tower Insurance Company was represented by Kevin F. Buckley and Steven A. Torrini of Mound Cotton Wollan & Greengrass.