Falco v. Zurich General Accident & Liability Insurance

Headnote

Insurance (liability) — refusal by company to defend action or pay judgment recovered — arrest and confinement of policyholder on body execution for failure to pay judgment — action against company to recover damages — provision in policy that action may be maintained only to recover money paid in satisfactioti of judgment.

Falco v. Zurich General Accident & Liability Ins. Co., 216 App. Div. 721 , affirmed.

Appeal from a judgment of the Appellate Division of the Supreme Court in the second judicial department, entered July 16, 1926, affirming a judgment in favor of defendant entered upon a dismissal of the complaint on the opening by the court at a Trial Term. The action was to recover upon a policy of liability insurance. The complaint alleged that defendant issued its policy

insuring against liability for accident in and about certain premises; that plaintiffs purchased the premises and the policy was transferred to them; that a third party was injured by a fall on the sidewalk and that defendant was notified to defend but refused to do so; that a judgment was recovered against plaintiff which he could not pay and he was arrested and confined under a body execution. The policy contained the following clause: “No action for the indemnity against loss provided for in Agreement 1 of this policy shall lie against the Company, except for reimbursement of the amount of loss actually sustained and paid in money by the assured in full satisfaction of a judgment duly recovered against the assured after trial of the issue.”