“An insurer's duty to defend is broader than its duty to indemnify, such that an insurer may be obligated to defend its insured even if, at the conclusion of an underlying action, it is found to have no obligation to indemnify its insured”. “An insurer must defend its insured whenever the allegations of a complaint in an underlying action ‘suggest a reasonable possibility of coverage’. The duty to defend an insured is not triggered, however, “when the only possible interpretation of the allegations against the insured is that the factual predicate for the claim falls wholly within a policy exclusion”. “An exclusion from coverage ‘must be specific and clear in order to be enforced’, and an ambiguity in an exclusionary clause must be construed most strongly against the insurer”. “However, the plain meaning of a policy's language may not be disregarded to find an ambiguity where none exists”.
Here, the plain meaning of the employee exclusion invoked by defendant Insurance Company is that the policy does not provide coverage for damages arising out of bodily injury sustained by an employee of any contractor hired by or for any insured in the course of the employee's employment. In the plaintiff's complaint in the main action, he alleged that he sustained bodily injury in the course of his employment for Contracting Corp., an entity he alleged was hired to perform work on the construction project by either Fabian, an additional insured under the policy, or defendant, the named insured of the policy. The only possible interpretation of these allegations is that the factual predicate for the plaintiff's claim falls wholly within the employee exclusion. In opposition to Utica's prima facie establishment of its entitlement to judgment as a matter of law, Fabian failed to raise a triable issue of fact. Accordingly, the policy precludes coverage to Fabian and AG Masonry for the injuries allegedly sustained by the plaintiff, and the Supreme Court should have granted that branch of Utica's motion which was for summary judgment declaring that it is not obligated to defend and indemnify the defendants in the main action. Defendant Insurance Company’s remaining contention is not properly before the Court and, in any event, has been rendered academic in light of our determination.
Since the third-party action is, in part, a declaratory judgment action, we remit the matter to the Supreme Court, Kings County, for the entry of a judgment declaring that Utica is not obligated to defend or indemnify Fabian and AG Masonry in the main action of personal injury appeal dismissed.
Accordingly, the court held that the order is reversed insofar as appealed from, on the law, with costs, that branch of the motion of the third-party defendant Utica First Insurance Company which was for summary judgment declaring that it is not obligated to defend and indemnify the defendant third-party plaintiff, and the defendant third-party defendant, in the main action is granted, and the matter is remitted to the Supreme Court, Kings County, for the entry of a judgment declaring that the third-party defendant Insurance Company is not so obligated.