Smith v. Guardian Life Insurance Co. of America

In an action to recover damages for breach of two insurance policies, in which the defendant counterclaimed to rescind the policies, the plaintiffs appeal, as limited by their brief, from so much of (1) an order of the Supreme Court, Westchester County (Adler, J.), entered July 25, 2012, as granted the defendant’s motion for summary judgment on its counterclaim for rescission and denied their cross motion for summary judgment on the complaint, and (2) an order of the same court, also entered July 25, 2012, as denied, as academic, their separate cross motion to preclude the defendant’s expert from testifying at trial.

Ordered that the orders are affirmed insofar as appealed from, with one bill of costs.

“[T]o establish its right to rescind an insurance policy, an insurer must demonstrate that the insured made a material misrepresentation. A misrepresentation is material if the insurer would not have issued the policy had it known the facts misrepresented” (Zilkha v Mutual Life Ins. Co. of N.Y., 287 AD2d 713 , 714 [2001]; see Insurance Law § 3105 [b]; Parmar v Hermitage Ins. Co., 21 AD3d 538 , 540 [2005]). Whether a misrepresentation is material is generally a question of fact for the jury (see Schirmer v Penkert, 41 AD3d 688 , 690 [2007]; Process Plants Corp. v Beneficial Natl. Life Ins. Co., 53 AD2d 214 , 216 [1976], affd 42 NY2d 928 [1977]).

“To establish materiality as a matter of law, the insurer must present documentation concerning its underwriting practices,

Here, the defendant demonstrated its prima facie entitlement to judgment as a matter of law on its counterclaim for rescission (see Meah v A. Aleem Constr., Inc., 105 AD3d 1017 , 1020 [2013]; Schirmer v Penkert, 41 AD3d 688 , 690-691 [2007]; Roudneva v Bankers Life Ins. Co. of N.Y., 35 AD3d 580 , 581 [2006]). In support of its motion, the defendant established, prima facie, that the plaintiffs’ decedent made material misrepresentations in his application for the subject insurance policies. Moreover, the defendant also established, prima facie, that, had it been properly advised, it would not have issued the subject policies.

In opposition to the defendant’s showing of entitlement to judgment as a matter of law on its counterclaim for rescission of the life insurance policies, the plaintiffs failed to raise a triable issue of fact concerning either the decedent’s misrepresentation or the materiality of that misrepresentation (see Zuckerman v City of New York, 49 NY2d 557 [1980]). Moreover, the plaintiffs did not raise a triable issue of fact concerning the doctrine of waiver, as they did not provide evidence that the defendant clearly manifested an intent to abandon its right to assert the existence of a material misrepresentation as a defense to the plaintiffs’ claim for payment of the policies (see Sulner v G.A. Ins. Co. of N.Y. , 224 AD2d 205 , 206 [1996]; see also Gilbert Frank Corp. v Federal Ins. Co., 70 NY2d 966 , 968 [1988]). Accordingly, the Supreme Court properly granted the defendant’s motion for summary judgment on its counterclaim for rescission, and denied the plaintiffs’ cross motion for summary judgment on the complaint.

We need not reach the plaintiffs’ remaining contentions. Rivera, J.E, Lott, Roman and Cohen, JJ., concur.