Court Opinion

ID: 8282207
Source: CourtListenerOpinion
Date Created: 2022-10-17 05:11:45.331672+00
Date Added: 2024-06-11T16:43:41.309658
License: Public Domain

PENDLETON, J.
(concurring). [1] The cause of action set forth in the complaint is for damages for breach of the covenant to defend, and I quite agree that this is not an “action to recover for loss or expenses under the policy,” and therefore not within the provisions of clause E of the policy, and is governed by the usual rules of law relating to actions for breach of contract, and the order setting aside the verdict must therefore he reversed.
[2] A cause of action for failure to pay the loss and expenses may be joined with one for breach of covenant to defend. To recover on such a cause of action, if a settlement has been made, the plaintiff must prove the liability. Mayor, Lane & Co. v. Commercial Casualty Insurance Co., 169 App. Div. 772, 155 N. Y. Supp. 75. But, where the action is only for breach of covenant to defend, the measure of damages is the cost of defending. What this would be is a question for the jury, and it is not permitted to speculate as to what such amount might be or the jury might have found. The amount paid in settlement is immaterial, except that in no event could plaintiff recover more than he paid out. The direction of a verdict for plaintiff was therefore error and the verdict should not be reinstated, if defendant is in a position to raise this question, but a new trial should be ordered. Both parties, however, having moved for the direction of a verdict, defendant, not having asked to have the question of the amount of damages submitted to the jury, must be held to have conceded that there was no question of fact involved, and cannot now be heard to the contrary.
Order setting aside the verdict reversed, and verdict reinstated, with $30 costs of appeal.