Claims Against Insurer Dismissed Where Allegations Fail to Tie it to Policy at Issue

On August 11, 2016, Justice Oing of the New York County Commercial Division issued a decision in Chao Jiang v. Ping An Insurance, 2016 NY Slip Op. 31534(U), dismissing claims against an insurer where the allegations in the complaint failed to tie it to the policy at issue, explaining:

A breach of contract claim requires the existence of a contract, due performance by the plaintiff, breach of the contract by defendant, and damages resulting from the breach. Here, there was no contract between CNEP and ACE. Although generally speaking, one who is not a party to an agreement cannot be bound by it and sued for breach, a cause of action may be pleaded if there is a separate basis for the nonparty's liability such as piercing the corporate veil or some plausible manifestation of an intent to be bound.

Although Wong negotiated the Primary Policy on behalf of Huatai Limited, the argument that Wong signed the Primary Policy as representative of ACE is undermined by the notation above Wong's confirmatory signature that states he is signing for and on behalf of Huatai Insurance Company of China Limited. If Wong were signing in any other capacity, or, as plaintiff seems to imply, in his capacity as an officer of ACE, this notation would be either supplemented or unnecessary. There being no clear privity between ACE and CNEP, there can also be no contract except in extraordinary circumstances, which is absent here.

To the extent that plaintiff argues that ACE was acting as the agent of Huatai Group in the negotiation, and is somehow liable, the principle is well settled that an agent who acts on behalf of a disclosed principal cannot be simultaneously liable for a breach of contract absent unambiguous evidence of an intention to be bound. In addition, the very idea of joint liability of both principal and agent is inconsistent. Where the party contracts as an agent of a disclosed principal, he binds either his principal or himself but not both.

(Internal quotations and citations omitted) (emphasis added).