Nesmith v Allstate Ins. Co. (2014 NY Slip Op 08217) decided on November 25, 2014 by the New York Court of Appeals dealt with the issue of lead paint exposure where members of different families were successively exposed to lead paint in the same apartment. In Hiraldo v Allstate Ins. Co. (5 NY3d 508 ), the Court of Appeals interpreted a "non-cumulation clause" contained in a series of successively-issued liability insurance policies.
Hiraldo v Allstate Ins. involved a single child who had lived in a building for three years while three successive Allstate policies, each with a limit of $300,000, were in force. The Plaintiff claimed that the child had been exposed to lead paint continuously during the terms of all three policies, and that therefore $900,000 in coverage was available to him. The Court of Appeals rejected the argument, relying on a non-cumulation clause. The Court found the argument of the Hiraldo Plaintiffs to be inconsistent with the policy's plain statement that Allstate's liability was limited to the amount shown on the declaration page"[r]egardless of the number of . . . policies involved."
Here, the Court again rejected the argument where different families were exposed to the toxic lead paint, noting the children "were exposed to the same hazard, lead paint, in the same apartment. Perhaps they were not exposed to exactly the same conditions; but to say that the "general conditions" were not the same would deprive the word "general" of all meaning. Nesmith argues that, because the landlord made an effort to correct the problem after Young's children were exposed and before Nesmith's grandchildren moved in, the "conditions" that injured her grandchildren must have been new ones. But she makes no claim, and the record provides no basis for inferring that a new lead paint hazard had been introduced into the apartment. The only possible conclusion from this record is that the landlord's remedial efforts were not wholly successful, and that the same general conditions - the presence of lead paint - that endangered children's health continued to exist. Because Young's children and Nesmith's grandchildren were injured by exposure to the same general conditions their injuries were part of a single "accidental loss" and only one policy limit is available to the two families."
Read the decision here.