{"id":856823,"date":"2015-07-22T06:01:08","date_gmt":"2015-07-22T12:01:08","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=856823"},"modified":"2015-07-14T12:01:59","modified_gmt":"2015-07-14T18:01:59","slug":"new-york-court-broadly-worded-flood-limit-meaningless-unless-it-applies-to-any-kind-of-loss-caused-by-flood","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/new-york-court-broadly-worded-flood-limit-meaningless-unless-it-applies-to-any-kind-of-loss-caused-by-flood\/","title":{"rendered":"New York Court: Broadly-Worded Flood Limit \u201cMeaningless\u201d Unless it Applies to Any Kind of Loss Caused by Flood"},"content":{"rendered":"<p>Dick Bennett \u00a0| Cozen O&#8217;Connor&#8217;s Property Insurance Law Observer | July 8, 2015<\/p>\n<p>Yesterday in El-Ad West LLC v. Zurich American Ins. Co., 2015 WL 4078762, 2015 N.Y. App. Div. LEXIS 5753 (Jul. 7, 2015), a unanimous panel of New York\u2019s intermediate level appellate court held that a flood sub-limit capped all loss caused by flood, without regard to whether it was physical damage to property or a \u201cdownstream\u201d financial loss such as delay in completion.\u00a0 In the words of the opinion, reading the contract of insurance in such a way as to find that the flood sub-limit did not apply to delay in completion losses \u201cwould render the flood limit meaningless with respect to that coverage.\u201d\u00a0 The panel thereby affirmed a Superstorm Sandy decision that we reported on in July of last year; it was a case of first impression in New York.<\/p>\n<p>The policyholder was a developer that was converting an office building in Tribeca in lower Manhattan into luxury condominiums when Superstorm Sandy flooded the premises in October of 2012.\u00a0 The storm caused more than $20 million in property damage and delay in completion loss.\u00a0 The insured had a builder\u2019s risk policy with a $115 million overall limit of liability, but there was a $7 million sub-limit for delay in completion and a $5 million sub-limit for \u201call losses or damages arising during a continuous condition as defined in the definition of FLOOD.\u201d<\/p>\n<p>The insured contended that it was entitled to recover $12 million, arguing that the delay in completion loss was not subject to the flood sub-limit.\u00a0 The insurer disagreed, and litigation ensued.\u00a0 On June 27, 2014, the trial court agreed with the carrier and granted partial summary judgment.\u00a0 As the judge\u2019s opinion explained, the broad definition of what kind of loss was subject to the $5 million flood sub-limit meant that \u201ca loss that would not have occurred but for a flood is subject to a $5 million annual aggregate limit, without regard to the type of loss suffered since the expression \u2018all losses or damages arising during [a flood]\u2019 clearly does not exclude non-physical losses.\u201d<\/p>\n<p>The developer took an appeal, arguing that the delay in completion coverage was effectively a separate, stand-alone contract of insurance with its own $7 million cap for economic loss.\u00a0 In support of that position, the insured pointed to the fact that compensible delay in completion loss could be sustained after the builder\u2019s risk coverage period had terminated.\u00a0 On Tuesday, however, a five-judge panel of the Supreme Court\u2019s Appellate Division disagreed, and it affirmed the trial judge.<\/p>\n<p>According to the Per Curiam opinion:<\/p>\n<blockquote><p>The plain language of the delay in completion coverage form, which incorporated the policy terms by reference, applied the $5 million flood sublimit to \u201call\u201d losses, including nonphysical damage losses, such as those resulting from a delay in completion.<\/p>\n<p style=\"text-align: center;\">*\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 *\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 *<\/p>\n<p>In light of the policy language, plaintiff\u2019s contention that the flood limit applies solely to losses resulting from physical damage, is unavailing.\u00a0 The fact that the main policy and the [delay in completion] coverage form may have separate deductibles or coverage periods pertains to the type of loss at issue, and does not preclude a single overriding flood limit.<\/p><\/blockquote>\n<p>via <a href=\"http:\/\/propertyinsurancelawobserver.com\/2015\/07\/08\/new-york-court-broadly-worded-flood-limit-meaningless-unless-it-applies-to-any-kind-of-loss-caused-by-flood\/\">New York Court: Broadly-Worded Flood Limit \u201cMeaningless\u201d Unless it Applies to Any Kind of Loss Caused by Flood | Cozen O&#8217;Connor&#8217;s Property Insurance Law Observer<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Dick Bennett \u00a0| Cozen O&#8217;Connor&#8217;s Property Insurance Law Observer | July 8, 2015 Yesterday in El-Ad West LLC v. Zurich American Ins. Co., 2015 WL 4078762, 2015 N.Y. App. Div. LEXIS 5753 (Jul. 7, 2015), a unanimous panel of New York\u2019s intermediate level appellate court held that a flood sub-limit capped all loss caused by&hellip; <a class=\"more-link\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/new-york-court-broadly-worded-flood-limit-meaningless-unless-it-applies-to-any-kind-of-loss-caused-by-flood\/\">Continue reading <span class=\"screen-reader-text\">New York Court: Broadly-Worded Flood Limit \u201cMeaningless\u201d Unless it Applies to Any Kind of Loss Caused by Flood<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[3],"tags":[166,11,56],"class_list":["post-856823","post","type-post","status-publish","format-standard","hentry","category-insurance-claims","tag-flood","tag-insurance-claim","tag-property-damage","entry"],"jetpack_publicize_connections":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>New York Court: Broadly-Worded Flood Limit \u201cMeaningless\u201d Unless it Applies to Any Kind of Loss Caused by Flood - Advise &amp; Consult, Inc.<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/new-york-court-broadly-worded-flood-limit-meaningless-unless-it-applies-to-any-kind-of-loss-caused-by-flood\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"New York Court: Broadly-Worded Flood Limit \u201cMeaningless\u201d Unless it Applies to Any Kind of Loss Caused by Flood - Advise &amp; Consult, Inc.\" \/>\n<meta property=\"og:description\" content=\"Dick Bennett \u00a0| Cozen O&#8217;Connor&#8217;s Property Insurance Law Observer | July 8, 2015 Yesterday in El-Ad West LLC v. 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LEXIS 5753 (Jul. 7, 2015), a unanimous panel of New York\u2019s intermediate level appellate court held that a flood sub-limit capped all loss caused by&hellip; Continue reading New York Court: Broadly-Worded Flood Limit \u201cMeaningless\u201d Unless it Applies to Any Kind of Loss Caused by Flood\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.myconstructionexpert.com\/blog\/new-york-court-broadly-worded-flood-limit-meaningless-unless-it-applies-to-any-kind-of-loss-caused-by-flood\/\" \/>\n<meta property=\"og:site_name\" content=\"Advise &amp; Consult, Inc.\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Advise-Consult-Inc-126949043996790\/\" \/>\n<meta property=\"article:published_time\" content=\"2015-07-22T12:01:08+00:00\" \/>\n<meta name=\"author\" content=\"admin\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@adviseconsult\" \/>\n<meta name=\"twitter:site\" content=\"@adviseconsult\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"admin\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.myconstructionexpert.com\/blog\/new-york-court-broadly-worded-flood-limit-meaningless-unless-it-applies-to-any-kind-of-loss-caused-by-flood\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.myconstructionexpert.com\/blog\/new-york-court-broadly-worded-flood-limit-meaningless-unless-it-applies-to-any-kind-of-loss-caused-by-flood\/\"},\"author\":{\"name\":\"admin\",\"@id\":\"https:\/\/www.myconstructionexpert.com\/blog\/#\/schema\/person\/0a11abe008083d5fb19c2b0feefe7bd7\"},\"headline\":\"New York Court: Broadly-Worded Flood Limit \u201cMeaningless\u201d Unless it Applies to Any Kind of Loss Caused by Flood\",\"datePublished\":\"2015-07-22T12:01:08+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.myconstructionexpert.com\/blog\/new-york-court-broadly-worded-flood-limit-meaningless-unless-it-applies-to-any-kind-of-loss-caused-by-flood\/\"},\"wordCount\":563,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\/\/www.myconstructionexpert.com\/blog\/#organization\"},\"keywords\":[\"flood\",\"insurance claim\",\"property damage\"],\"articleSection\":[\"Insurance Claims\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.myconstructionexpert.com\/blog\/new-york-court-broadly-worded-flood-limit-meaningless-unless-it-applies-to-any-kind-of-loss-caused-by-flood\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.myconstructionexpert.com\/blog\/new-york-court-broadly-worded-flood-limit-meaningless-unless-it-applies-to-any-kind-of-loss-caused-by-flood\/\",\"url\":\"https:\/\/www.myconstructionexpert.com\/blog\/new-york-court-broadly-worded-flood-limit-meaningless-unless-it-applies-to-any-kind-of-loss-caused-by-flood\/\",\"name\":\"New York Court: Broadly-Worded Flood Limit \u201cMeaningless\u201d Unless it Applies to Any Kind of Loss Caused by Flood - Advise &amp; 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