Sherry-Netherland Insurance Case | Property Insurance Coverage Law Blog

Some cases linger in your mind not just because of the legal principles they clarify but because of where they unfold. Few locations are as captivating as the Sherry-Netherland Hotel. Perched at the southeast corner of Central Park, it is a nearly 100-year-old cooperative building that oozes old-world charm and timeless elegance.

I’ve always had a soft spot for the Sherry-Netherland. Its architecture is regal, the doormen are old-school New York, and the views of the park are unbeatable. But truth be told, what really draws me back again and again is the restaurant on the ground floor, Harry Cipriani. There’s just something about slipping into a seat there, watching the swirl of power brokers, tourists, and Upper East Side celebrities while sipping a perfect espresso or glass of champagne. I never leave without ordering their vanilla meringue cake. That dessert is light and creamy.

But let’s talk about a different kind of heat.

In the recent case of In re Kwok, ¹ a fire broke out in the 18th floor apartment of the Sherry-Netherland, owned by Genever Holdings LLC. The timing of the fire was dramatic, to say the least. It occurred the same day that the FBI arrested Mr. Ho Wan Kwok inside the apartment. That kind of coincidence practically begs for suspicion, and the insurance company, AIG, didn’t miss a beat. Within days, AIG issued a reservation of rights letter and later attempted to cancel the insurance policy, hinting that the fire might have been set intentionally.

Genever pushed back. The apartment was covered under an all-risk property policy, which typically covers any accidental loss unless specifically excluded. Under New York law, once a policyholder proves a covered property suffered damage and the cause isn’t excluded, the insurer must prove that an exclusion applies. The cause of the fire was investigated but ultimately deemed undetermined by fire experts. There was no evidence linking Mr. Kwok, Genever, or anyone else associated with the ownership to arson. In fact, AIG conceded it wasn’t alleging the trustee controlling Genever had anything to do with the fire.

AIG also argued that the policy should be voided because of a misstatement during the application process back in 2018, where the insurance broker told AIG that Mr. Kwok was the sole member of Genever. In truth, the company was owned by Genever Parent, a British Virgin Islands entity. However, this misstatement was not made with fraudulent intent, and importantly, it had already been disclosed back in 2015 when the policy was first placed. The court found that this wasn’t the kind of material misrepresentation that would justify rescinding coverage. AIG’s own underwriting guidelines allowed for corporate entities to be insured, if the exposure was personal rather than commercial. Genever’s sole business was holding the apartment for Mr. Kwok’s residence, which fit the bill.

Ultimately, the bankruptcy court granted partial summary judgment in favor of Genever. It found that the apartment’s fire loss, including certain fixtures and alterations, was covered under the policy. The court left open only one narrow issue, which always troubles me when the affluent put the name of their real property in a family trust or corporation. The remaining issue is whether the insured Genever had an insurable interest in the personal property contents.

There are plenty of lessons in this case. First, an all-risk policy shifts the burden squarely onto the insurer once a loss is established. Mere suspicion, no matter how dramatic the circumstances, is not enough. Insurers must back up exclusions with facts, not just speculation. The case also underscores the importance of underwriting discipline and communication. If ownership structures are unclear, the time to clarify them is before issuing or renewing the policy, not after a claim is made. And finally, this ruling is a reminder that policy language really does matter when trying to link individual actors like Mr. Kwok to coverage exclusions meant for the named insured.

I discussed this case with our New York City-based attorney, Liberty Ritchie, yesterday. I told her all about my experiences at the Sherry-Netherland. I imagined that while this legal battle was brewing upstairs, Harry Cipriani downstairs carried on as if nothing had happened. The tables were still set with white linen, the Bellinis still flowed, and somewhere near the bar, someone probably took that first forkful of the vanilla meringue cake, blissfully unaware that upstairs, a fire had set off a chain reaction of litigation. That’s the kind of contrast only New York can deliver. Chaos and elegance are stacked floor to floor when it comes to New York City insurance disputes.

So next time you’re walking along Fifth Avenue and the mood strikes, stop in for a bite. Watch the people, savor the dessert, and remember that sometimes, even in the middle of a legal firestorm, there’s a little slice of sweetness waiting to be enjoyed.

Thought For The Day

“In New York, they like winners. They don’t like second place.”

—Donald Trump

¹ In re: Kwok, Genever Holdings Corp., et al., No. 22-50073, 2025WL 1419674 (Bankr. D. Conn. May 15, 2025).