An insurer lost its defense in a coverage dispute without a judge weighing the policy - it missed too many discovery deadlines.
New York's Appellate Division, Second Department, ruled on August 26, 2026 that Kensington Insurance Company could not undo a default that had already cost it its answer in a breach-of-contract suit.
The policyholders sued in Kings County, alleging Kensington failed to pay a loss covered by their policy. The insurer filed its answer and the case moved into discovery - the stage where each side turns over documents and information. That is where it stalled.
In November 2023, the trial court ordered Kensington to answer all outstanding discovery requests within 20 days, warning that failure to comply would bring sanctions on a further motion unless it showed good cause. The insurer did not comply. In January 2024, the policyholders asked the court to strike Kensington's answer under a rule that lets judges penalize a party for ignoring discovery.
Kensington did not oppose the motion on time. In February 2024, the court granted it and struck the answer on default. The insurer moved to reopen the matter in March 2024, pointing to "law office failure" - an internal slip by its lawyers. The trial court refused, and the appeals court agreed.
To erase a default, a party must show a reasonable excuse and a defense worth hearing. The panel said Kensington cleared neither bar. New York law does let courts forgive law office failure, but, the judges noted, "it was not the Legislature's intent to routinely excuse such defaults, and mere neglect will not be accepted as a reasonable excuse."
The problem was not one missed filing but a run of them. The court pointed to a "conclusory excuse of law office failure, which was part of a pattern of neglect demonstrated by the defendant during discovery." Because Kensington had no reasonable excuse, the court did not reach whether it had a viable defense.
The panel also dismissed Kensington's separate appeal of the order striking its answer, holding that no appeal can be taken from an order entered on the appealing party's own default. It affirmed the Kings County judge's April 2024 refusal to reopen the default, and the policyholders were awarded costs.
