Snorac, Inc. v. Shura

Order and Judgment unanimously reversed on the law with costs, cross motion denied, motion granted and complaint dismissed. Memorandum: Plaintiff, a self-insured rental car agency, rented a car to defendant, who struck and injured a pedestrian while operating the car. Plaintiff settled with the pedestrian for $8,250 and thereafter sued defendant on various theories, including contractual indemnification, for reimbursement of that sum. County Court affirmed the judgment of City Court denying defendant’s motion for summary judgment dismissing the complaint and granting plaintiff’s cross motion for summary judgment on the cause of action seeking contractual indemnification. We reverse. Plaintiff’s attempt to disclaim completely the liability imposed by Vehicle and Traffic Law § 388 is contrary to public policy (see, Morris v Snappy Car Rental, 84 NY2d 21, 27; Government Empls. Ins. Co. v Chrysler Ins. Co., 256 AD2d 1212, 1213; Worldwide Ins. Co. v U.S. Capital Ins. Co., 181 Misc 2d 480, 485-486; Allstate Ins. Co. v Snappy Car Rental, 16 F Supp 2d 410, 414). Neither public policy nor the applicable statutes (see, Vehicle and Traffic Law §§ 370, 388) prohibit plaintiff from disclaiming the portion of its liability that exceeds the amount for which motor vehicle owners are required to be insured and from seeking indemnification for such sums pursuant to the parties’ agreement (see, Morris v Snappy Car Rental, supra, at 27-29; Government Empls. Ins. Co. v Chrysler Ins. Co., supra, at 1213). Here, however, the liability of plaintiff to the injured third party has been fixed by its settlement of the third party’s claim for $8,250, an amount less than the required coverage. Public policy therefore bars plaintiff from obtaining indemnification from defendant in 887 these circumstances. Thus, we reverse the order and judgment, deny plaintiffs cross motion, grant defendant’s motion and dismiss the complaint. (Appeal from Order of Erie County Court, DiTullio, J. — Summary Judgment.) Present — Pigott, Jr., P. J., Green, Kehoe and Lawton, JJ.