The applicants sought declarations that their former home insurer had a duty to defend and indemnify them in an underlying action for fraudulent or negligent misrepresentation regarding the sale of their property.
The insurer denied coverage, citing contractual liability exclusion, late notice, and alleged misrepresentation by the insured.
The court applied the Scalera test for duty to defend, finding that while the alleged property damage could fall within coverage, an "entire agreement" clause in the Agreement of Purchase and Sale precluded reliance on oral misrepresentations.
Consequently, the claims were, in substance, based on representations in the sales contract, which were excluded by the policy's contractual liability exclusion.
The application was dismissed.
