PROCEDURAL BACKGROUND: Two Courts have concurring jurisdiction over many of the issues originally presented in Los Angeles Superior Court Case no. BC 290354 (Peter D. Lichtman, J.) and NY Supreme Court, Oneida County Case no. CA2003-002721 (Robert F. Julian, J.). As a result of said concurring jurisdiction, counsel for Utica Mutual Insurance Company and counsel for ITT Corporation (Corporate Parent of Goulds Pumps, Inc.) mutually requested in 2004 that Judge Lichtman and Justice Julian jointly act as settlement judges to facilitate a resolution of the differences between the parties. Judge Lichtman acting pursuant to CCP § 664.6 and Justice Julian acting pursuant to rules 3217 and 3222 of the New York Civil Practice Law and Rules spent approximately 14 months judicially supervising settlement discussions between the parties which ultimately resulted in the execution of a settlement agreement dated February 20, 2007. Pursuant to an oral stipulation placed on the record on April 24, 2007 all party representatives inclusive of counsel agreed that Judge Lichtman and Justice Julian in their respective capacities as sitting judges (who each retain concurrent jurisdiction over the judicially supervised settlement agreement) shall jointly hear and determine any and all dispute(s) between the parties concerning the meaning, interpretation or application of the [*2]Settlement Agreements and the decisions of Judge Lichtman and Justice Julian shall be final and binding on the parties and shall not be subject to appeal.^[FN1]

DISCUSSION:

Utica Mutual ("Utica") disputes the number of months it had umbrella policies "in effect and not exhausted". The number of months provides the numerator of a fraction which determines Utica's responsibilities for contribution in the Gould's asbestos cases. The parties disagree whether a policy was "in effect" during a particular period, and Utica brings this arbitration proceeding requesting a resolution of this dispute. [*3]

In its March 28, 2007 "MEMORANDUM IN SUPPORT OF APPLICATION BY UTICA MUTUAL INSURANCE COMPANY (APPLICABILITY OF POLICIES ISSUED BY CNA ." Utica Mutual says: "the central question in this arbitration is this: which one (or more) of the three policies during the period January 1, 1977 through September 1, 1977, is 'in effect' for purposes of calculating Utica Mutual's and CNA's pro-rata shares? The 'other insurance' clause in the Utica Mutual umbrella policy provides the answer to this question". Would that it did. The "other insurance" provision provides that the Utica Mutual umbrella is excess to the CNA umbrella. That tells us exactly nothing about whether the Utica Mutual umbrella was "in effect". Is it the case that an insurance policy is only "in effect" if the coverage provided by it is in fact, at the moment of analysis, being tapped? Asserting that the policy is not "in effect" because it is "excess" does nothing to resolve the question, but merely begs it. Utica provides neither a policy definition nor law supporting this claim.

Utica does not dispute that an umbrella policy exists for the period in question, and certainly denies it has been exhausted; indeed, its entire argument is predicated on the fact that the coverage in question is entirely intact, untouched, and shielded by the intervening CNA policy. Following immediately upon the quotation from Utica's memo cited above, Utica goes on: "The 'other insurance' clause provides that the Utica Mutual umbrella policy is elevated to a position excess of, and not contributing with the CNA umbrella policy . . . . Thus, the Utica Mutual umbrella policy is not 'in effect' during the period January 1, 1977 through September 1, 1977 because the Utica Mutual umbrella policy is excess to that CNA umbrella policy."

The Court finds no definition in the cases or statutes of "in effect". We do, however, find many references to policies being "in effect" which appear to presume that "in effect" means there is a policy providing coverage for the period in question, regardless of whether the coverage is actually exposed in the circumstance. See, for instance, Bovis Lend Lease LMB, Inc. v. Royal Surplus Lines Ins. Co. 27 AD3d 84, 806 NYS2d 53 [1 Dept.,2005]. In Bovis the Court first notes that "Two commercial general liability insurance policies were in effect at the time of Winter's fall . . . " and then goes on to find that one of the carriers owes defense and indemnification in the case, and the other doesn't. The finding that the two policies were "in effect" neither relied upon nor required a finding of which was in fact exposed in the case. Indeed, the Court found that one of the carriers had the principal obligation of response which could have, in some circumstance, left it entirely responsible for the costs involved, even though two policies were "in effect". At least per Bovis a policy can be "in effect" though not exposed to payment.

It is also must be said that Utica's construction seems contrary to ordinary understanding, something worth attending to regarding the definition of terms so common that neither the law nor insurance policies define them, terms like "in effect". So, for instance, this Court verily believes and truly hopes that its personal umbrella coverage is "in effect" at this very moment (i.e., would provide coverage if required) even though, happily, there is presently no claim of any kind that would affect the Court's primary, let alone umbrella, coverage. It is far easier to drift [*4]off to sleep at night knowing one's insurance coverage is "in effect", even though there exists no present claim implicating it (tomorrow being another day ).

The Court finds, and rules, that the umbrella policy in question was, at the relevant times of overlap with the CNA policy, "in effect", meaning that if the policy pre-conditions for coverage were satisfied (i.e., a covered occurrence and exhaustion of underlying coverage) the coverage would be available. Accordingly, Utica does not get a "holiday" from coverage for the eight months of CNA's overlapping umbrella.

The prevailing party is directed to prepare an order on notice to adverse parties. Upon objection to the form of the order, the prevailing party shall make a motion to settle the order on notice.

The Court has not and shall not file or serve this decision or any order based hereon or contained herein; the proper party is hereby directed to do so, and serve all other parties.

Utica, NY

Dated: April 29, 2007

Los Angeles, CA

Dated: April 30, 2007