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This opinion is uncorrected and subject to revision before
publication in the New York Reports.
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No. 187
Jannie Nesmith, &c., et al.,
            Appellants,
        v.
Allstate Insurance Company,
            Respondent.




          Mark G. Richter, for appellants.
          Barry I. Levy, for respondent.
          United Policyholders; New York Insurance Association,
Inc., amici curiae.




SMITH, J.:
             In Hiraldo v Allstate Ins. Co (5 NY3d 508 [2005]), we
interpreted a so-called "noncumulation clause" contained in a
series of successively-issued liability insurance policies.    We
held that a person suing for exposure to lead paint during the
terms of all the policies could recover no more than one policy


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limit.
          Here we interpret a nearly identical clause in a case
where members of different families were successively exposed to
lead paint in the same apartment.    We hold that, here as in
Hiraldo, the insurer's maximum total liability is only one policy
limit.
                                 I
          In September 1991, Allstate Insurance Company issued a
policy of liability insurance to the landlord of a two-family
house in Rochester.   The policy was renewed annually for the
years beginning September 1992 and September 1993.   It stated on
the declarations page a $500,000 limit for "each occurrence," and
contained the following noncumulation clause:
          "Regardless of the number of insured persons,
          injured persons, claims, claimants or
          policies involved, our total liability under
          the Family Liability Protection coverage for
          damages resulting from one accidental loss
          will not exceed the limit shown on the
          declarations page. All bodily injury and
          property damage resulting from one accidental
          loss or from continuous or repeated exposure
          to the same general conditions is considered
          the result of one accidental loss."
          Felicia Young and her children lived in one of the two
apartments in the house from November 1992 until September 1993.
In July 1993, the Department of Health notified the landlord that
one of the children had been found to have an elevated blood lead
level and that several areas in the apartment were in violation
of State regulations governing lead paint.   The Department listed


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the violations and directed the landlord to correct them.     The
landlord made some repairs, and the Department advised him in
August 1993 that the violations "have been corrected."
            After the Young family moved out of the apartment in
September 1993, Lorenzo Patterson, Sr. and Qyashitee Davis moved
in with their two children.   Again a child was found to have an
elevated blood lead level, and the Department of Health sent
another letter saying that violations had been found and
instructing the landlord to correct them.   (This letter was sent
in December 1994, but the parties seem to assume that the
elevated readings resulted at least in part from events on or
before September 29, 1994, the last day of Allstate's coverage.)
            In 2004, Young, on behalf of her children, and Jannie
Nesmith, on behalf of the Patterson children (her grandchildren),
brought two separate actions against the landlord for personal
injuries allegedly caused by lead paint exposure.   Young's action
was settled in 2006 for $350,000, which Allstate paid.   In 2008,
Nesmith settled her claim pursuant to a stipulation that reserved
the issue of the applicable policy limit for future litigation.
Allstate paid the $150,000 that it claimed was the remaining
coverage.   Nesmith then brought the present action against
Allstate for a declaratory judgment, asserting that a separate
$500,000 limit applied to each family's claim, and that her
grandchildren could therefore recover an additional $350,000.
            Supreme Court granted Nesmith the declaration she


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sought, saying it could not conclude that the children in the two
cases were injured by exposure "to the same conditions."    The
Appellate Division reversed (Nesmith v Allstate Ins. Co., 103
AD3d 190 [2013]).   The Appellate Division held that, under
Hiraldo, the renewal of the policy could not make an additional
limit available; that, under the plain terms of the noncumulation
clause, the number of claims and claimants could not do so
either; and that the injury to Young's children and Nesmith's
grandchildren resulted "from continuous or repeated exposure to
the same general conditions," so that the injuries were only one
"accidental loss" within the meaning of the policy (id. at 193-
194).   We granted leave to appeal (21 NY3d 866 [2013]) and now
affirm.
                                 II
           Hiraldo involved a single child, who had lived in the
building in question for three years while three successive
Allstate policies, each with a limit of $300,000, were in force.
The plaintiffs 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.     We
rejected the argument, relying on a noncumulation clause not
significantly different from the one involved in this case (see 5
NY3d at 512).   (The policy in Hiraldo referred simply to "loss"
rather than "accidental loss," but no one suggests that that
difference is relevant here.)   We found the argument of the


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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, $500,000, "[r]egardless of the
number of . . . policies involved."
             Here, Nesmith does not, and could not under Hiraldo,
argue that the annual renewals of the landlord's policy increased
the limits of the available coverage.      And the noncumulation
clause is equally clear in saying that the number of "injured
persons", "claims" and "claimants" makes no difference.
Nesmith's only argument is that the alleged injuries to Young's
children and Nesmith's grandchildren were separate losses because
they did not result "from continuous or repeated exposure to the
same general conditions."
             We reject this argument.    Young's children and
Nesmith's grandchildren 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


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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.
          Accordingly, the order of the Appellate Division should
be affirmed with costs.




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Jannie Nesmith v Allstate Insurance Company
No. 187




PIGOTT, J.(dissenting):
            The majority recognizes that this appeal presents a
different set of circumstances than those in Hiraldo v Allstate
Ins. Co (5 NY3d 508 [2005]), yet it reaches the same conclusion.
Because I cannot agree with the majority's theory that the
"noncumulation clause" limits the insurer's maximum total
liability to only one policy limit under the circumstances
presented here, I dissent.
            The "noncumulation clause" at issue in this case
provides:
            4.   Our Limits of Liability
                 Regardless of the number of insured
                 persons, injured persons, claims,
                 claimants or policies involved, our
                 total liability under the Family
                 Liability Protection coverage for
                 damages resulting from one accidental
                 loss will not exceed the limit shown on
                 the declarations page. All bodily
                 injury and property damage resulting
                 from one accidental loss or from
                 continuous or repeated exposure to the
                 same general conditions is considered
                 the result of one accidental loss."
            Fairly read, this provision provides that the policy
limit - $500,000 limit for "each occurrence" - applies to limit
the liability for lead exposure of children in one family during
the course of that family's tenancy.    Indeed, this is what we

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held in Hiraldo.    However, the insurer seeks to expand that
reasoning to a situation that was clearly unknown to the insured
at the time he procured the additional insurance:   that coverage
for liability of any kind had diminished considerably.
          For purposes of this litigation, it is undisputed that
the Nesmith children moved into the apartment during the second
renewal period and lived in the apartment from September 1993 to
September 1994.    They, like the Young children, were injured as a
result of lead paint hazards.   According to the majority, because
$350,000 was paid to the Young children, who were injured during
the policy period from 1992 to 1993, the insured had only
$150,000 coverage for the claim made by the Nesmith children.
          The majority finds that this case turns on the
interpretation of the "same general conditions" language of the
"Limits on Liability" clause and reasons that because the Young
children and Nesmith children were exposed to the same hazard,
lead paint, in the apartment only one policy limit is triggered
(see majority op, at 5).    However, this interpretation is
inconsistent with the reasonable expectations of the insured (see
generally Ace Wire & Cable Co., Inc. v Aetna Cas. & Sur. Co., 60
NY2d 390, 398 [1983] [insurance contracts must be interpreted
according to "the reasonable expectation and purpose of the
ordinary businessman"]).
          To accept that position would mean that, for purposes
of insurance coverage, the insured's alleged failure to remove


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lead paint in the building before the Nesmiths moved in was
equivalent to the landlord having done nothing at all.       In other
words, if there is any possibility of a nexus between the cause
of the injuries during policy year one and the cause of injuries
in any later policy year, even if the injuries were suffered by
different children from different families living in the
apartment at different times, coverage is only available under
the first policy year.
            It would also mean that when the insured renewed his
policy and paid his premium, he procured less protection with
respect to lead paint claims. If the insured knew that his later
policies would not cover lead paint injuries occurring after his
remediation efforts, he surely would not have continued
purchasing the insurance at essentially the same premium from the
same insurer.
*   *   *    *   *   *   *   *    *      *   *   *   *   *   *    *   *
Order affirmed, with costs. Opinion by Judge Smith. Judges
Graffeo, Read and Abdus-Salaam concur. Judge Pigott dissents in
an opinion in which Chief Judge Lippman concurs. Judge Rivera
took no part.

Decided November 25, 2014




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