Bennacer v. Travelers Insurance

—Judgment unanimously modified on the law and as modified affirmed without costs and judgment granted in accordance with the following Memorandum: Supreme Court erred in denying the cross motion of defendant Travelers Insurance Company (Travelers) for summary judgment on its cross claims seeking indemnification from defendant Soch Insurance Agency (Soch). Soch issued an insurance binder to plaintiff Kada Bennacer, the owner of a pizza shop. The binder provided coverage for nonowned vehicles, or at least was ambiguous regarding such coverage. The policy that was issued thereafter, however, excluded coverage for non-owned vehicles. During the 30-day period in which the binder was effective, Aaron Mistretta, for whom plaintiff Marion Mistretta is the court-appointed legal guardian, was injured when he was struck by a vehicle driven by Bennacer’s employee. Travelers is obligated to indemnify and defend Bennacer, not because it failed to disclaim coverage in a timely manner as determined by Supreme Court (see, Insurance Law § 3420 [d]), but because the binder provided for coverage of the nonowned vehicle or at least was ambiguous regarding such coverage. Even assuming, arguendo, that the language in the binder is ambiguous with respect to such coverage, we conclude that any such ambiguity must be construed against Travelers and Soch (see, Crouse W. Holding Corp. v Sphere Drake Ins. Co., 248 AD2d 932, 932-933, affd 92 NY2d 1017). Because Soch, as Travelers’ agent, exceeded its authority by binding Travelers to insure Bennacer for nonowned vehicles, Soch is obligated to indemnify Travelers (see, Fanta-Sea Swim Ctr. v Rabin, 113 AD2d 1011). We therefore modify the judgment by granting Travelers’ cross motion and granting judgment in favor of Travelers declaring that Soch is obligated to indemnify Travelers. (Appeal from Judgment of Supreme Court, Erie County, Glownia, J. — Summary Judgment.) Present — Green, J. P., Lawton, Pigott, Jr., Scudder and Balio, JJ.