An insurer for Muttontown is still on the hook for damages in a suit filed against the village by a former trustee, Nassau Supreme Court has ruled.
In a victory for the village, the court determined that Arizona-based Scottsdale Indemnity Co., with which the village had a policy, was required to cover the village in a real estate dispute with the ex-trustee.
Scottsdale claimed it is not responsible for eminent domain cases, particularly in a lawsuit filed in state and federal courts by Richard Entel over an acre of land that Entel said Muttontown took away in retaliation after an acrimonious election.
But Scottsdale did not back its claims with a demonstration "that the allegations of the complaint can only be interpreted to exclude coverage under the exclusion, Eminent Domain," the court ruled last month.
The court said Scottsdale "was in fact required to provide the village with defense," Muttontown attorney Steven Leventhal, of Roslyn, said Tuesday. Scottsdale must now cover legal fees incurred by the village in fighting the case, Mayor Julianne W. Beckerman said Tuesday.
Scottsdale could be paying out even more as the Entel case moves through federal court, where Entel is seeking more than $1 million in damages for lost potential real estate earnings, his lawyer, Robert Calica, of Garden City, said.
Scottsdale's attorney, Gary Kull, of Basking Ridge, N.J., declined to comment Wednesday.
Calica said: "We are not affected by the outcome because we're going to trial in front of a federal judge this spring and it doesn't matter whether it's the village or their insurance company that pays us."
The 1.1-acre plot was first offered by a developer to Muttontown as parkland in 1972. The village gave it to Entel to add to his property in 2005, then took it away in 2007 after he lost a mayoral election to Beckerman. Muttontown has since returned the acre to Entel, who donated part of it as a conservation easement.