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Second Circuit Applies Unfortunate Events Test to Rule that Three Collisions Constitute Three Separate Accidents Under a General Liability Policy

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National Liability & Fire Ins. Co. v. Itzkowitz, et al., 624 Fed. Appx. 758 (2d Cir. 2015). In a case involving a series of collisions on Interstate 90, the Second Circuit applied the “unfortunate events” test in New York law to rule that there were three separate accidents and hence three separate limits. A dump box attached to a dump truck collided with an overpass, separated from the truck, and landed on the highway. Although there were factual disputes about the timing of subsequent events, the court analyzed the case under the assumption that 30 seconds later, a vehicle collided with the dump box, and that a “few seconds” later, a second vehicle collided with the dump box. The unfortunate events test applies in the absence of policy language indicating an intent to aggregate separate events into a single occurrence. The court found that here, policy language addressing “continuous or repeated exposure to substantially the same conditions” did not indicate such an intent. The first prong of the unfortunate events test requires the identification of the “operative incident giving rise to liability.” Here the court concluded that each collision was a separate operative incident. The second prong requires a “common sense” balancing of three elements: special proximity; temporal proximity; and occurrence in a causal continuum. Applying this test, the court found that the detachment of the dump box did not cause the damage to the first vehicle, e.g., it did not land on the vehicle. The collision with the first vehicle did not cause the collision with the second vehicle, e.g., it did not propel the dump box into the second vehicle. The court concluded that the events were part of three distinct causal chains, and thus constituted three distinct accidents. (In a footnote, the court noted that the New York Court of Appeals has found little distinction between the terms “occurrence” and “accident,” so this case, even though decided in a non-precedential Summary Order, will be frequently cited in future disputes.)