State v. New Hampshire Merchants Insurance

Mikoll and Levine, JJ.,

concur in part and dissent in part in the following memorandum by Mikoll, J. Mikoll, J. (concurring in part and dissenting in part). We agree with the result reached by the majority in relation to defendant Merchants. However, in our view, Special Term properly dismissed the State’s action against defendant Travelers on the ground there was no privity between the two. Although both insurers had an independent duty to represent Sinnamon, it does not follow that Travelers had any obligation to the State for breach of that duty owed to Sinnamon. Plaintiff was not a named insured under the Travelers policy with Albany Truck as it was with Merchants. The general rule that nonparties to an insurance contract may not sue on the policy unless a contrary result is dictated by statute is applicable here (Burke v London Guar. & Acc. Co., 47 Misc 171, affd 126 App Div 933, affd 199 NY 557; see, also, Meridian Trading Corp. v National Auto. & Cas. Ins. Co., 45 Misc 2d 847). Sinnamon was but a donee beneficiary in connection with the Travelers policy with Albany Truck. The status of the State, in contrast, is that of incidental beneficiary to that contract and it consequently lacks the standing to enforce the promise made to Sinnamon (see Zweig v Metropolitan Life Ins. Co., 73 Misc 2d 93). The order and judgment should be affirmed.