Trans-Resources, Inc. v Nausch Hogan and Murray

Trans-Resources, Inc. v Nausch Hogan & Murray 2005 NY Slip Op 10029 [24 AD3d 271] December 22, 2005 Appellate Division, First Department Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. As corrected through Wednesday, February 15, 2006

Trans-Resources, Inc., et al., Appellants,
v
Nausch Hogan and Murray, Respondent and Third-Party Plaintiff-Appellant. RFC Intermediaries, Inc., Third-Party Defendant-Respondent.

—[*1]

Order, Supreme Court, New York County (Louis B. York, J.), entered June 1, 2005, which granted defendant's motion for summary judgment dismissing the complaint, unanimously affirmed, with costs. Appeal from order, same court and Justice, entered May 13, 2004, which, inter alia, granted third-party defendant's motion for summary judgment dismissing the third-party complaint, unanimously dismissed as academic, without costs.

Subsequent to our remand (298 AD2d 27 [2002]), disclosure was conducted and the motion court, upon defendant broker (Nausch)'s motion for summary judgment, found that the identity of the reinsured, or fronting company, was not material to the reinsurer (St. Paul)'s decision to underwrite the risk, and accordingly dismissed the action. No issues of fact exist warranting a different result. The record, in particular, St. Paul's own underwriting file and the numerous admissions of its wholly owned intermediary and agent (RFC), clearly shows that St. Paul's underwriting concerns did not in the least involve the identity of the fronting company. The motion court properly rejected St. Paul's present efforts to distance itself from RFC, and [*2]aptly noted that St. Paul's position is "belied" by its reinsurance of the same fronting company in connection with a similar risk adjacent to the one involved here and for precisely the same policy period. The finding of immateriality has further support in the admission of plaintiff insureds, St. Paul's assignors in whose names it brings the instant action, that the reinsurance policy contained cut-through and claims control clauses that effectively rendered the reinsurer irrelevant with respect to claims processing (see id. at 32-33). In view of the foregoing, Nausch's third-party action against RFC is academic. Concur—Buckley, P.J., Mazzarelli, Andrias, Saxe and Sullivan, JJ.