Aha v. NYMAGIC restaurant rented to a tenant.

Insurer owned a mixed use property with a restaurant rented to a tenant. A fire occurred in the kitchen of the restaurant, allegedly caused by ducts that were not properly cleaned and aggravated by the claim that the restaurant’s fire suppression system was not operable. The insurance carrier denied completely the claim stating that the insured failed to comply with the Protective Safeguard provision of the policy. Litigation was commenced in state court and after discovery was completed, Plaintiff moved for summary judgment on the basis that the protective safeguard provision was ambiguous as written and there was no way to determine with any certainty what was required of the insured. The insurance carrier cross-moved for summary judgment on the basis that the fire suppression system did not work. Plaintiff also argued in his opposition that the system was not within his control nor did he have knowledge of any impairment of the system. Both motions were denied and the Court ordered the matter to go to trial. Following the Court’s decision, the insurance made an offer to settle. Case settled prior to trial for $140,000.00.

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