Zodiac Petroleum, S.A. v. Race Rederiet, 392 N.Y.S.2d 862 (1977)

On a motion for summary judgment, the opposing party must demonstrate a triable issue of fact through pleadings and affidavits; arguments raised only in briefs or post-argument memoranda are insufficient to defeat summary judgment.

Summary

Zodiac Petroleum, S.A. (insurer) sued Race Rederiet (assured) to recover unpaid insurance premiums. The assured moved for summary judgment, arguing English law barred direct actions for nonpayment. The insurer countered that the suit was for breach of contract (failure to declare shipments), not unpaid premiums. The assured then asserted that, even under this theory, English law imposed no obligation to declare all shipments. The insurer failed to refute this assertion in its affidavits, instead arguing the assured’s point was irrelevant. The New York Court of Appeals affirmed the grant of summary judgment to the assured, holding the insurer failed to raise a triable issue of fact in its affidavits.

Facts

The insurer, Zodiac Petroleum, S.A., sought to recover premiums allegedly owed by the assured, Race Rederiet, under a marine insurance policy. The insurer claimed the assured failed to declare all shipments that should have been covered. The assured denied the allegations and asserted an affirmative defense based on English law. The assured contended that under English law, the insurer could not directly sue the assured for unpaid premiums but had to proceed through the procuring broker.

Procedural History

The assured moved for summary judgment based on the argument that English law barred the insurer’s direct action for unpaid premiums. The insurer opposed the motion, arguing that the complaint was for breach of contract, not unpaid premiums. The assured responded that even under the breach of contract theory, English law imposed no obligation to declare all shipments. The insurer did not refute this legal assertion in its reply affidavits. The lower court granted summary judgment to the assured, and the Appellate Division affirmed. The insurer appealed to the New York Court of Appeals.

Issue(s)

Whether the insurer, in opposing the motion for summary judgment, raised a triable issue of fact by failing to controvert the assured’s assertion of applicable English law in its affidavits.

Holding

No, because the insurer failed to controvert the assured’s assertion of applicable English law in its affidavits; arguments presented solely in briefs or post-argument memoranda cannot create a triable issue where the affidavits fail to do so.

Court’s Reasoning

The Court of Appeals held that the insurer failed to raise a triable issue of fact because it did not dispute the assured’s assertion of English law in its affidavits. The court emphasized that summary judgment is to be determined based on all the papers before the court, including pleadings and affidavits. The court stated, “Resort may not now be had to briefs or postargument memoranda to supplement the record or to import a triable issue not otherwise presented.” The court also noted that the assured’s notice of motion did not limit the grounds for summary judgment, and the insurer itself had argued that the theory of the complaint had been misapprehended. The court implicitly relied on CPLR 3212(b), which specifies that summary judgment shall be granted if “the cause of action or defense shall be established sufficiently to warrant the court as a matter of law in directing judgment in favor of any party” and requires that the motion be supported by affidavit, a copy of the pleadings, and other available proof. The court also cited CPLR 3212(f) which allows for denial of summary judgment if facts essential to justify opposition may exist but cannot then be stated. By not invoking CPLR 3212(f) and adequately rebutting the assured’s assertions in affidavit form, the insurer failed to meet its burden. The Court thus reasoned that the absence of a factual dispute shown in the affidavits justified the grant of summary judgment.