The plaintiff, Heart Zap Services Inc., sought summary judgment against its insurer, Lloyd's Underwriters, for $37,120.50 under an all-risks commercial insurance policy.
The claim arose from a fraudulent order for defibrillator units.
Lloyd's denied coverage, arguing the loss did not occur at an insured location, was not a covered type of loss (voluntary surrender to fraudster), and was excluded as a conditional sale.
The court granted summary judgment to the plaintiff, finding the loss occurred at the insured location, constituted a direct physical loss as there was no valid contract of sale due to fraud, and the conditional sale exclusion did not apply as title was not intended to be withheld.
The court declined to award punitive damages, finding the insurer's denial, while incorrect, did not meet the high threshold for malicious or high-handed conduct.