Opinion
9027 Index 41294/86
04-18-2019
IN RE LIQUIDATION OF MIDLAND INSURANCE COMPANY The ASARCO Asbestos Personal Injury Settlement Trust, Claimant–Respondent, v. Superintendent of Financial Services of the State of New York in Her Capacity as Liquidator of Midland Insurance Company, Respondent–Appellant.
DLA Piper LLP (US), New York (Aidan M. McCormack of counsel), for appellant. Anderson Kill L.L.P., New York (Rhonda D. Orin of counsel), for respondent.
DLA Piper LLP (US), New York (Aidan M. McCormack of counsel), for appellant.
Anderson Kill L.L.P., New York (Rhonda D. Orin of counsel), for respondent.
Richter, J.P., Manzanet–Daniels, Kahn, Gesmer, Oing, JJ.
Order, Supreme Court, New York County (Barbara Jaffe, J.), entered August 28, 2018, which denied appellant's motion to reject the referee's report dated November 28, 2016, unanimously affirmed, without costs.
The motion court correctly concluded that losses covered under the insurance policies at issue as a result of asbestos exposure that occurred over the course of multiple successive policy periods must be allocated pursuant to the "all sums" method, as generally required, rather than pro rata across the successive policies (see Matter of Viking Pump, Inc., 27 N.Y.3d 244, 260–261, 33 N.Y.S.3d 118, 52 N.E.3d 1144 [2016] ). This Court has determined that the language of the excess insurance policies issued by Midland Insurance Company provides that the policies follow form to, i.e., incorporate (see id. at 252, 33 N.Y.S.3d 118, 52 N.E.3d 1144 ), the language of the non-cumulation clauses of the underlying policies issued by American Home Assurance Company (see Matter of Midland Ins. Co., 269 A.D.2d 50, 64, 709 N.Y.S.2d 24 [1st Dept. 2000], abrogated in part on other grounds 16 N.Y.3d 536, 923 N.Y.S.2d 396, 947 N.E.2d 1174 [2011] ). The non-cumulation clauses "plainly contemplate that multiple successive insurance policies can indemnify the insured for the same loss or occurrence by acknowledging that a covered loss or occurrence may ‘also [be] covered in whole or in part under any other excess [p]olicy issued to the [insured] prior to the inception date’ of the instant policy," thereby rendering all sums the appropriate allocation method ( Viking Pump, 27 N.Y.3d at 261, 33 N.Y.S.3d 118, 52 N.E.3d 1144 ). Moreover, vertical exhaustion, which is consistent with an all sums allocation, is required here ( id. at 264–265, 33 N.Y.S.3d 118, 52 N.E.3d 1144 ).