Ruggerio v. Aetna Life & Cas. Co.

Court Discusses Whether the Defendant was Indemnified against Liability arising from an Accident

The plaintiff was involved in an accident with a taxi operator at a time when the operator did not possess a license to operate a taxi and his operator license was suspended as a consequence of driving while intoxicated DWI. The plaintiff had obtained judgment on a previous occasion against the insurance company of the defendant based on two separate cause of action. The first cause of action involved vicarious liability of the insurance company as a result of the negligence of one of their drivers. The second cause of involved the negligence of the insurance company in failing to determine whether the driver was qualified to operate a taxi and assigning him with a taxi when he was intoxicated. The plaintiff initiated an action pursuant to the former section 167 (subd. 1, par. [b] ) of the Insurance Law to recover insurance proceeds pursuant to a judgment obtained by plaintiff against defendant’s insured. However, the Supreme Court held that the policy which the defendant possessed contained a standard exclusion for liability arising out of the ownership, maintenance, operation or use of an automobile as such the policy was inapplicable to both causes of action. There was no harm done to the plaintiff until the driver went behind the wheel of the taxi. The plaintiff appealed the decision.

The Appellate Division of the Supreme Court affirmed the decision of the trial court as the circumstances of the accident fell within the exclusion clause of the policy contained for liability arising out of ownership, maintenance, operation or use of an automobile. An insurance policy is a contract between parties and it is interpreted with the intent of parties as expressed in the policy. The insurance company of the criminal defendant was vicariously liable through their negligence in hiring a driver who was incompetent and unqualified driver. While the injuries suffered by the plaintiff was linked it the negligence of the defendant, it was determinative of the underlying liability of the insured.

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