SDV Insights

Case Alert Update: SDV Case Tabbed as One of New York's Top Three Cases to Watch

Argument before the Court of Appeals has now been scheduled for February 7, 2018, in Gilbane Building Co. v. St. Paul Insurance, with a long anticipated decision by New York’s highest court to be issued shortly thereafter. In its September 18, 2017 edition, highlighted three major cases with significant implications on insurance coverage that will soon be decided by the New York Court of Appeals. Gilbane presents an opportunity for the Court to address the growing number of divergent decisions regarding the prerequisites for qualifying as an additional insured, as it considers an Appellate Division’s holding that a construction manager is not entitled to coverage as an additional insured under a contractor’s policy because the two companies did not enter into a direct contract.

According to SDV Attorney Richard W. Brown, who is heading up the appeal for the Plaintiff-Appellant Joint Venture, “The Appellate Division’s holding ignores longstanding rules of contract interpretation by reading into the policy a condition of direct contractual privity with the named insured, where no express requirement exists.” Attorney Brown, however, remains hopeful that the Court of Appeals will take the opportunity to clarify this area of the law and reaffirm that disputes about contract terms should be resolved based on the actual policy terms and in favor of coverage where ambiguities in such terms exist.

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