D.R. Watson Holdings, LLC v. Caliber One Indemnity Co.

Appeal from an order of the Supreme Court, Erie County (Peter J. Notaro, J.), entered December 19, 2003. The order, among other things, granted plaintiffs’ motion for summary judgment, to confirm the appraisal award and to dismiss the affirmative defenses in an action for breach of contract. It is hereby ordered that the order so appealed from be and the same hereby is unanimously modified on the law by denying that part of the motion seeking to confirm the appraisal award and by providing in the penultimate ordering paragraph that the amount of damages is the actual cash value of the heating system and as modified the order is affirmed without costs, and the matter is remitted to Supreme Court, Erie County, for further proceedings in accordance with the following Memorandum: We agree with defendant that Supreme Court erred in granting that part of plaintiffs’ motion seeking to confirm the appraisal award and in awarding plaintiffs the amount of $1,810,920 as the replacement cost of the heating system, and we therefore modify the order accordingly. Pursuant to the commercial property insurance policy issued by defendant, plaintiffs are not entitled to recover the replacement cost of the heating system “[u]ntil the lost or damaged property is actually repaired or replaced.” Because plaintiffs have not repaired or replaced the heating system, the measure of their damage is actual cash value, not replacement cost (see Harrington v Amica Mut. Ins. 970 Co., 223 AD2d 222, 228 [1996], lv denied 89 NY2d 808 [1997]). We thus further modify the order by awarding plaintiffs the actual cash value of the heating system with leave to reapply to Supreme Court for further relief upon the replacement of the heating system within 180 days of plaintiffs’ receipt of the actual cash value, and we remit the matter to Supreme Court to determine the actual cash value following a hearing, if necessary. We otherwise affirm the order for reasons stated in the decision at Supreme Court. Present — Green, J.P, Scudder, Gorski, Lawton and Hayes, JJ.