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Coverage Pointers - Volume VII, No. 8

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10/20/05          Rodrigues v. N & S Building Contractors, Inc.

New York Court of Appeals
General Description of Work Sufficient to Trigger Defense and Indemnification Provision

This appeal centers on whether the parties' agreement satisfied statutory requirements for a viable indemnification claim. New York’s high court concludes that it did in this case.
 

The indemnification provision in the parties' agreement applied to the "performance of subcontracted work" between them. The insurance provision similarly did not specify any particular job site or duration, without reference to any job site or time frame. In addition to the words of the Agreement, N & S Vice President Philip Neidermier testified at his deposition that the Agreement "refers to all of our sites that [Caldas] would work on . . . . [i]ncluding that one [Jansen Road]."
 

The Court of Appeals finds that the language of the contract, as well as the testimony, make clear that the Agreement was purposely intended to apply to all jobs for which the subcontractor, including the subject site. In that no site is mentioned, the argument that the Agreement should not apply here because it does not specifically mention the site in question would render it inapplicable to any site or job subcontracted. An agreement should not be construed so as to render it meaningless.
 

The Appellate Division interpreted the written-contract exception to the Workers' Compensation Law § 11 to require that an indemnification provision specify the sites, persons and the types of losses covered. The Court of Appeals disagrees and reiterates their reluctance to impose specificity requirements not in the statute (see Flores v Lower East Side Service Center, Inc., 4 NY3d 363 [2005]). So long as a written indemnification provision encompasses an agreement to indemnify the person asserting the indemnification claim for the type of loss suffered, it meets the requirements of the statute. That standard was satisfied here.
 

10/20/05          Transcontinental Insurance Company, v. The State of New York

Appellate Division, First Department

Courts Confused:  If Carrier Refuses Wrongfully Refuses to Defend, is it Bound by Determination in Underlying Lawsuit, or Not?

The State Insurance Fund provided Employers Liability Coverage for an insured employer and Transcontinental provided contractual liability coverage. A Third Party Action was commenced against the employer, alleging both contractual indemnity obligations (the responsibility of Transcontinental under its policy) and common law contribution and indemnity based on a  “grave injury” (the obligation of the State Insurance Fund).  Transcontinental assumed the defense of the employer, seeking contribution from The State Insurance Fund.  The State Fund refused to defend, a hearing was held in the underlying lawsuit, and it was determined that the plaintiff did, indeed, suffer a grave injury.  Transcontinental commenced a declaratory judgment action seeking a determination that the State Fund had to contribute to both the defense of the lawsuit and, since a “grave injury was established, it sought a ruling that the State Fund had to share in the indemnity obligations.

 

The Appellate Division held that the State Fund had to share in the cost of defense but that it was entitled to a de novo hearing on the question of whether or not the plaintiff suffered a grave injury.  The Court held that the State Fund was “not collaterally estopped from challenging the finding inasmuch as defendant's interests were not represented in the underlying action.”

 

Just recently, the Court of Appeals in Lang v. Hanover Insurance Company, 3 NY2d 350 (1994) in dicta, took a contrary position, in dicta, holding that a carrier that has wrongfully declined an invitation to defend will, in fact, be bound by the underlying determination.  In a decision we noted as “the most significant high court decision on liability coverage in several months” in Volume VI, No. 6, of CP, we noted the Court’s warning:

 

Finally, we note that an insurance company that disclaims in a situation where coverage may be arguable is well advised to seek a declaratory judgment concerning the duty to defend or indemnify the purported insured. If it disclaims and declines to defend in the underlying lawsuit without doing so, it takes the risk that the injured party will obtain a judgment against the purported insured and then seek payment pursuant to Insurance Law § 3420. Under those circumstances, having chosen not to participate in the underlying lawsuit, the insurance carrier may litigate only the validity of its disclaimer and cannot challenge the liability or damages determination underlying the judgment.

 

We commented then, that there was no precedent cited for the proposition suggesting that a carrier may not challenge the “‘liability” or “damage determination.”  However, it should give an insurer some additional pause before denying coverage and allowing, for example, a default to be entered against an insured.  

 

The Court in this case involving the State Insurance Fund’s conduct, did not cite to Lang, but instead rested its decision on Failla v. Nationwide Ins. Co., 267 A.D.2d 860 (3rd Dept. 1999), which we suggest is a misplaced precedent. In Failla. Nationwide did provide a defense to a lawsuit where a shooting was involved.  While the carrier believed the shooting was intentional, its defense counsel, of course, was charged with defending the lawsuit on behalf of the insured, since there was a claim of negligence.  In the underlying lawsuit, the court determined that the conduct was, in fact negligent (surely, there was no proof offered of intentional conduct). In the subsequent coverage lawsuit, the Court held that Nationwide would not be bound by a determination of negligence in the underlying lawsuit because it did not have the opportunity to present proof in the underlying lawsuit of intentional conduct.  After all, its ethical, assigned defense counsel could not push the case out of coverage and Nationwide wasn’t a party.

 

The difference is that in this Transcontinental case and in Lang, the courts considered a carrier that wrongfully refused to defend while in Failla the court considered a case where the carrier honored its obligation to defend.

 

Lang is still a dangerous precedent and until the Court of Appeals clarifies its dicta, carriers must proceed with extreme caution when considering whether or not to provide a defense in the “close case.”

 

10/20/05          Inwood Hill Medical, P.C v. General Assurance Company

Appellate Division, First Department

Proof of Proper Notice of IMEs Sufficient to Find Breach of Condition Precedent to Coverage

No-fault insurer moved for summary judgment arguing that claimant, by failing to appear for the IMEs, had violated a condition precedent to coverage under the No-Fault endorsement of the policy. Claimant asserted that defendant failed to submit proper proof of mailing of the IME notices.  Court finds that insurer established that after receiving oral notification of the accident, it scheduled IMEs and follow-up examinations, which claimant failed to attend, in breach of the condition precedent relating to IME attendance.

 

10/20/05          Arias v. Allstate Insurance Company

Appellate Division, First Department

Non-Permissive Use of Vehicle Grounds for Disclaimer

Insurer was entitled to judgment as a matter of law by reason of non-permissive use of the vehicle at the time of the accident. Specifically, insurer conclusively demonstrated that the insured's vehicle was stolen at the time of the accident, as reported to the police by the insured that same day and expressly conceded by plaintiff's counsel. Since insurer established as a matter of law that "there is no possible factual or legal basis on which it might eventually be obligated to indemnify its insured under any policy provision", judgment was appropriately granted to the insurer.

 

10/17/05          Allstate Insurance Company v. Schimmel

Appellate Division, Second Department

No Coverage for Assault Despite Attempt to Recharacterize in the Complaint

Court finds that the essence of the factual allegations in the complaint in the underlying action was an assault.  Despite labeling the action as one to recover damages for negligence, it is well settled that no cause of action to recover damages for negligent assault exists in New York.  The injuries sustained were inherent in the conduct the assailant engaged in.  The assault cannot therefore be construed as an accident within the definition of "occurrence" for which the plaintiff's policy affords coverage.   

 

10/17/05          Escobar v. Colonial Indemnity Insurance Company

Appellate Division, Second Department

Policy Exclusion for Employees of Insured Basis for Disclaimer of Coverage

The policy specifically excluded from the scope of coverage "bodily injury . . . to any employee of the insured arising out of and in the course of his/her employment by the insured for which the insured may be liable as an employer or in any other capacity."  As the provisions of the policy were clear and unambiguous, they must be given their plain and ordinary meaning.  The defendant established prima facie entitlement to judgment as a matter of law by submitting the policy and the deposition transcript of the injured party that he was injured while he was employed by the insured.

 

10/13/05          Agramonte v. Marvin
Appellate Division, First Department

Pommels Strikes Again and Gap in Treatment Inexcusable

Plaintiffs received physical therapy for three months after the accident but sought no other treatment until two years later, shortly after defendants made the first of their motions for summary judgment. This unexplained gap in treatment is fatal to plaintiffs' claims of serious injury based on the Court of Appeals ruling in Pommels.

 

10/13/05          Nagbe v. Minigreen Hacking Group

Appellate Division, First Department

As Predicted, the Courts ARE Paying Closer Attention to Serious Injury Motions

Although a herniated disc may constitute a serious injury, "a plaintiff must still offer some objective evidence of the extent or degree of [her] alleged physical limitations and their duration, resulting from the disc injury".  Plaintiff’s doctor last examined plaintiff some two years before the filing of the motion, he had no knowledge of her current condition and therefore could not offer an opinion on the duration or permanence of her injuries.  Without proof from other doctor of objective tests employed to measure plaintiff's range of motion and a failure to indicate what the normal range of motion would be and a failure to indicate that plaintiff's limitations are significant, serious injury cannot be established.

 

10/13/05          State National Insurance Co. v. Berakha

Appellate Division, First Department

Prejudice Not Found As Insurer Was Aware of Lease and Policy Provisions

Insurer, as subrogee of tenant, argued that the late amendment to landlord’s answer, coupled with the landlord's failure to disclose his own insurance policy containing the requisite reciprocal consent to waiver of subrogation, until the eve of trial, caused it prejudice. The Court found no such prejudice. The insurer failed to state what measures it could not now take in support of its position that it could have taken had the landlord timely interposed his waiver defense and timely responded to the demand for a copy of his insurance policy.  And, the insurer, aware of the lease provision waiving subrogation and of the provision in its own policy recognizing the lease waiver, could not now claim surprise that the landlord's policy contained a similar clause.

 

10/11/05          Little v. Tzong

Appellate Division, Second Department

Hey Auto Plaintiffs – Pay Attention – The Courts WILL Toss Out  “Little” Cases
Perhaps the plaintiff should have obtained an order changing his name before trying to survive a “serious injury” motion without much proof on his side.  Toure was cited by the Court in dismissing yet another case based on the lack of “serious injury.”  The Court was telling us that the plaintiff failed to come forward with object proof of a qualifying injury after the defense offered sufficient proof to shift the burden.

 

Audrey’s Angle on No-Fault

 

In this feature to the newsletter, we highlight recent no-fault arbitration awards.   The compilation and publication of these awards is not at the same level as traditional reported case law.  There is no single source to conduct comprehensive research in the area.  This feature seeks out notable current awards and judicial determinations and provides them to our subscribers.

 

We encourage the submission of no-fault awards, including Master Arbitration awards that address interesting issues.  These can be submitted to Audrey Seeley at [email protected].   With all submissions, we ask that you forward a redacted version of the award omitting the parties’ names and that the document be in PDF format.  For copies of these decisions, contact Audrey.

 

10/18/05          In the Matter of the Arbitration between the Applicant and Respondent

Arbitrator Henry Sawits, Esq.

Applicant’s Claim Against MVAIC Barred by Three Year Statute Of Limitations as Arbitration Untimely Commenced

 

Here is the Angle:      It must be noted that this case is limited in analysis to what is the statute of limitations for a claim against MVAIC for a denial or overdue claim.  The Applicant must commence the arbitration for denial or overdue claim three years from the time the cause of action accrues.  The cause of action accrues depending upon the claim one of three ways: 1. the date the initial denial of claim was issued; 2. the date of partial payment and partial denial was issued; or 3. if 30 days elapses after the bill is submitted for payment and either no payment are made or no denial of claim is issued.

 

Further, keep in mind that a statute of limitations defense on the timeframe for commencing the arbitration is not waived if not asserted in the denial.  The Insurer is not arguing that the submission of the claim to Insurer violates the statute of limitations.  The argument is that the arbitration proceeding to arbitrate the validity of a denial of claim was commenced too late thereby violating the statute of limitations.  Therefore, the defense does not need to be raised in the denial of claim.

 

The Analysis:  The Applicant sought to arbitrate medical heath care expenses that were presented to MVAIC for payment on May 15, 2000.  MVAIC did not issue a denial and did not pay the bill within 30 days.  On September 30, 2004, the Applicant commenced this arbitration by filing an AR-1.

 

MVAIC argued that the commencement of the arbitration was barred by the three year statute of limitations.  The parties agreed that the applicable statute of limitations was three years.  However, they disagreed as to the accrual date.

 

Arbitrator Sawits, in a well reasoned decision, held that the Applicant’s cause of action accrued 31 days after MVAIC received Applicant’s bills and MVAIC did not either pay or deny them.  Arbitrator Sawits further notes that if the Insurer requested additional verification then the accrual date is further delayed until 31 days after verification is provided.

 

Here, the bill for health care expenses was submitted to MVAIC on May 15, 2000, and on May 22, 2000, MVAIC requested additional verification.  Thereafter, the claim was properly delayed.  MVAIC was provided with the requested additional verification by the end of May, 2000.  Hence, MVAIC was not required to either pay or deny the claim until end of June or beginning of July, 2000.  Ultimately, the Applicant was required to commence the arbitration for this claim no later than beginning of July 2003.  However, the Applicant did not file for arbitration until September 30, 2004.  Therefore, the proceeding was barred by the statute of limitations as it was not commenced within three years.

 

Finally, Arbitrator Sawits discussed and dismissed the Applicant’s argument that MVAIC waived its statute of limitations defense by failing to state it in a denial of claim.  Arbitrator Sawits dismissed this argument as MVAIC’s statute of limitations defense was based upon the Applicant’s untimely commencement of the arbitration not untimely submission of the claim to MVAIC. 

 

 

We thank in-house counsel for one of our clients for submitting the nextt two reported arbitration decisions.

 

9/19/05            In the Matter of the Arbitration between the Applicant and Respondent

Arbitrator James M. Buckley, Esq.

Yet Again, Insurer Successful in Upholding Denial Of All No-Fault Benefits Based Upon Video Surveillance

 

Here is the Angle:      Video surveillance is useful to the insurer in no-fault arbitrations in demonstrating lack of purported degree of disability.  However, as this decision demonstrates, as well as the previously reported decision, the surveillance alone may not be enough.  Rather, the Insurer should also have additional evidence to support its position – i.e., a EUO transcript, medical reports, or an IME report.

 

The Analysis:  The Applicant was involved in a March 21, 2004, two car motor vehicle accident wherein he allegedly sustained injuries to his neck and low back.

 

The Applicant was not present for the hearing but chose to submit a copy of his EUO transcript.  The Applicant’s EUO transcript revealed that he worked at a gasoline and mini-mart store as a cashier.  He was unable to return to work due to this motor vehicle accident.

 

The Insurer presented video surveillance of the Applicant in May and July 2004, demonstrating the Applicant working behind the counter, waiting on customers, and sweeping the floor.

 

Further, the Applicant’s EUO testimony revealed that he had sustained a prior low back injury in while at work.  He allegedly only treated with a physician for the injury for four months at the most.

 

The Insurer submitted the Applicant’s medical records relative to the prior low back injury.  The records revealed a lumbar disc herniations and radiculitis.  The treating physician’s records further stated that Applicant was temporarily, totally disabled because of his work related injury.  Moreover, Arbitrator Buckley noted that the records demonstrate the Applicant treated with a physician, as a result of his prior low back injury, for 17 months.

 

Ultimately, Arbitrator Buckley notes he is confined to uphold the Insurer’s denial of all no-fault benefits.  He stated that the Applicant failed to provide a reason why he was working for his employer when he was allegedly disabled from work.  Arbitrator Buckley noted that the fact that the Applicant failed to testify at the hearing indicates that his claim is questionable.

 

9/13/05            In the Matter of the Arbitration between the Applicant and Respondent

Arbitrator Thomas J. McCorry, Esq.

Insurer’s Use of Video Surveillance and IME Report Successful In Upholding Denial for Lost Wage Claim

 

Here is the Angle:     In this case, the video surveillance discredited Applicant’s testimony that he was unable to return to his usual occupation.  The Insurer’s use of video surveillance of the Applicant coupled with IME reports established that Applicant was not as disabled to the degree he claimed. 

 

The Analysis:

The Applicant sought, inter alia, lost wages as a result of a February 24, 2004, two car motor vehicle accident.  Applicant began treating with a chiropractor and contended that he was unable to work as a barber from the date of the motor vehicle accident until July 5, 2005, due to severe low back pain. 

 

The Insurer issued a timely denial for lost wage benefits on the basis that based upon the Insurer’s investigation (video surveillance) it had information that clearly demonstrated Applicant was not disabled.

 

The Insurer in support of its position offered into evidence the IME report of Dr. Timothy J. Collard.  Dr. Collard’s report dated January 19, 2005, revealed that Applicant had no disability and could return to his full duties as a barber.

 

The Insurer also submitted video surveillance of the Applicant that demonstrated the Applicant shoveling snow and shopping.  Arbitrator McCorry noted that the video established that Applicant was capable of performing ordinary daily chores during his period of alleged disability.

 

Arbitrator McCorry in upholding the lost wage benefits denial found that Dr. Collard’s report coupled with the video surveillance demonstrated that Applicant was no longer disabled to the degree that his claimed.

 

 

Across Borders

Visit the Hot Cases section of the Federation of Defense & Corporate Counsel website, www.thefederation.org  ranked among the top five legal research websites in an article published in Litigation News, a publication of the Litigation Section of the American Bar Association. Dan Kohane serves as the FDCC’s Website Editor Emeritus.


10/18/05          Farmers Mutual Insurance v. Decker

Supreme Court of
North Dakota

General Liability Insurer Only Obligated to Pay Insured’s Attorney’s Fees After the Filing of An Amended Complaint
The general liability insurer initially denied coverage to its insured based upon an exclusion in the policy. The underlying plaintiff hired an attorney to add specific language to the complaint that could possibly bring the accident within the exception to the exclusion. The insurer tendered defense to the insured until it was granted summary judgment. The Court in affirming for the insurer on the coverage issue held that the insurer was only liable to cover the cost of the insured’s defense after the duty to defend arose. Since the duty to defend did not arise until the underlying plaintiff filed the amended complaint, the court reversed the trial court’s award of attorney’s fees incurred by the insured in his own representation in the underlying action.

Submitted by: Michael J. Morrison, Robert D. Kolar


10/17/05          Sanchez v. American Independent Insurance Company

Supreme Court of Delaware

Insurance Carrier Could Legally Deny Benefits to Passenger Who Was Shot While Riding in the Insured Mother’s Vehicle
The Supreme Court affirmed the appellate court’s decision that the passenger was not entitled to the no-fault benefits since there was no genuine issue of material fact as the injuries arose out of the passenger’s “use” of the motor vehicle. The Court used a three-part test from Minnesota to determine if the injury arose out of the use of a motor vehicle and found that the passenger’s injuries did not arise out of its use. The Court reasoned the passenger’s location was the only connection between the vehicle and the injury, and there was nothing about the plaintiff’s presence in the vehicle that contributed to the shooting. This was simply a matter of unfortunately being in the wrong place at the wrong time.

 

Submitted by: Michael J. Morrison, Robert D. Kolar


10/12/05          Nationwide Mutual Insurance Co. v. Cumbie

Arkansas Court of Appeals, Division Three

Award of Penalties, Attorneys’ Fees and Interest was Upheld where there was Evidence of Insurer’s Refusal to Fully Investigate Claim
Plaintiff was injured in a motor vehicle accident, for which she was not at fault. Plaintiff settled with the tortfeasor’s insurance carrier for $25,000 policy limits, and then made a demand upon Nationwide, her automobile insurance carrier, for the policy limits under her underinsured motorist policy. Nationwide offered to settle the matter with plaintiff for less than policy limits, and plaintiff filed suit against Nationwide seeking policy limits of $50,000 plus penalties, interest and attorneys fees. Before the trial date, Nationwide agreed to tender its policy limits and allow the court to determine its liability. The lower court held Nationwide liable on all counts, and Nationwide appealed the judgment. On appeal, Nationwide argued that awarding statutory penalties was improper because there was a “material change in circumstances” after plaintiff’s lawsuit was filed which required additional surgery and incurred substantial other additional medical bills. The appellate court held that record showed that Nationwide refused to fully examine the medical records available to it. Since the trial courts ruling with respect to penalties, attorneys fees and interest was not clearly erroneous, the appellate court upheld the lower courts decision.

 

Submitted by: Bruce D. Celebrezze & Michelle M. Hancharik [Sedgwick, Detert, Moran & Arnold LLP]


10/11/05          Viola v. California Dept. of Managed Health Care

California Court of Appeal, Second Appellate District

Insureds Under Health Care Plans Are Not Entitled to a Choice of Forums Because the Legislature has Authorized Arbitration of Disputes Under Health Care Service Plans and the Governing Statutory Scheme Does Not Authorize a Choice of Forums
Plaintiffs, participants in a health care services plan, sued the California Department of Managed Care (“Department”), and its former and acting director, and alleged that the Department approved health care service plans containing mandatory binding arbitration clauses in violation of plaintiffs’ right to a jury trial. In essence, plaintiffs’ alleged that their health care service providers refused to insure them because they did not accept the mandatory binding arbitration clause in the health plan policy, or that they accepted their policy with a mandatory binding arbitration clause after objecting to it and learning that their only option was to agree to the clause or not participate in the employee health plan. The lower court sustained defendants’ demurrer and dismissed the action, finding that the binding arbitration agreements were constitutional where an agent for the employee waived the right to jury trial. The lower court concluded that there is no constitutional right to medical insurance through a health care service plan, and that plaintiffs were not compelled to sign the plans containing the waiver of jury trial. The appellate court affirmed the lower court’s dismissal. The appellate court held that the Knox-Keene Act authorizes waiver of jury trial, and Madden v. Kaiser Foundation Hospitals [citation omitted] authorizes an employer to negotiate a health care contract waiving jury trial on behalf of its employees. The court stated that, the Legislature has authorized health care service plans that include binding arbitration provisions, so long as the plan complies with disclosure requirements. As such, the appellate court held that plaintiffs failed to state a cause of action against defendants because they could not show that defendants violated either constitutional or statutory law by approving health care service plans which contained binding arbitration clauses.

 

Submitted by: Bruce D. Celebrezze & Michelle M. Hancharik [Sedgwick, Detert, Moran & Arnold LLP] -

 

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Agramonte v. Marvin


Order, Supreme Court, Bronx County (Barry Salman, J.), entered July 9, 2004, which granted defendants' motions for summary judgment dismissing the complaint as to plaintiffs-appellants on the ground that they did not sustain serious injuries within the meaning of Insurance Law § 5102(d), unanimously affirmed, without costs.

Plaintiffs received physical therapy for three months after the accident but sought no other treatment until two years later, shortly after defendants made the first of their motions for summary judgment. This unexplained gap in treatment is fatal to plaintiffs' claims of serious injury (Pommells v Perez, 4 NY3d 566, 574 [2005]; Colon v Kempner, 20 AD3d 372 [2005], 2005 NY App Div LEXIS 8124, *5).

THIS CONSTITUTES THE DECISION AND ORDER
OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.

ENTERED: OCTOBER 13, 2005

CLERK

Nagbe v. Minigreen Hacking Group


Order, Supreme Court, Bronx County (Alan J. Saks, J.), entered February 23, 2004, which granted defendants' motion for summary judgment dismissing the complaint on the ground that plaintiff did not suffer a "serious injury" within the meaning of Insurance Law § 5102(d), and order, same court and Justice, entered on or about December 30, 2004, which, insofar as appealable, denied plaintiff's motion to renew, unanimously affirmed, without costs.

The affirmed medical report of defendants' neurologist, detailing the objective tests performed, finding that plaintiff had full range of motion in her cervical and lumbar spine, and concluding that plaintiff had recovered from the sprain/strain-type injuries to her cervical, thoracic and lumbar spine suffered as a result of the accident, satisfied defendants' burden of establishing prima facie that plaintiff did not suffer a serious injury (see Gaddy v Eyler, 79 NY2d 955, 956 [1992]; Thompson v Abbasi, 15 AD3d 95, 96 [2005], lv denied __ NY3d __, 2005 NY App Div LEXIS 6849 [2005]; Copeland v Kasalica, 6 AD3d 253 [2004]). The burden thus shifted to plaintiff to raise a triable issue of fact. Although a herniated disc may constitute a serious injury, "a plaintiff must still offer some objective evidence of the extent or degree of [her] alleged physical limitations and their duration, resulting from the disc injury" (Arjona v Calcano, 7 AD3d 279 [2004]). This plaintiff failed to do so. The report of the doctor who first treated plaintiff is deficient because the range of motion tests reported were taken only two days after the accident, and, since he last examined plaintiff some two years before the filing of the motion, he had no knowledge of her current condition and therefore could not offer an opinion on the duration or permanence of her injuries (see Sainte-Aime v Ho, 274 AD2d 569, 569-570 [2000]; Kauderer v Penta, 261 AD2d 365 [1999]). The report of the doctor who later treated plaintiff is deficient because he failed to identify the objective tests he employed to measure plaintiff's range of motion, failed to indicate what the normal range of motion would be and otherwise failed to indicate that plaintiff's limitations are significant (see Shaw v Looking Glass Assoc., 8 AD3d [*2]100, 103 [2004]; Rhymer v New York City Tr. Auth., 2 AD3d 350, 351 [2003]). Indeed, his report reveals no more than that plaintiff suffered sprains and strains (see Arjona, 7 AD3d 279, 280 [2004]). Plaintiff's motion to renew was properly denied (CPLR 2221[e]; see Montero v Elrac, Inc., 16 AD3d 284 [2005]).

Little v. Tzong



In an action to recover damages for personal injuries, the plaintiff appeals, as limited by his brief, from so much of an order of the Supreme Court, Queens County (Satterfield, J.), dated December 1, 2003, as granted the defendant's motion for summary judgment dismissing the complaint on the ground that he did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

ORDERED that the order is affirmed, with costs.

The affirmed medical report of the defendant's examining orthopedist, who examined the plaintiff and determined that he sustained a lumbar sprain from which he had completely recovered, was sufficient to establish a prima facie case that the plaintiff did not sustain a serious injury (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955). The plaintiff's submissions, however, were insufficient to raise a triable issue of fact. Accordingly, the Supreme Court properly granted the defendant's motion for summary judgment dismissing the complaint. [*2]

 

State National Insurance Co. v. Berakha

 


Law Office of Max W. Gershweir, New York (Max W.
Gershweir of counsel), for appellant.
Smith, Mazure, Director, Wilkins, Young & Yagerman, P.C.,
New York (Andrew J. Funk of counsel), for respondent.

Order, Supreme Court, New York County (Karen Smith, J.), entered January 26, 2005, which, in an action for property damages by an insurer, as subrogee of a tenant, against a landlord, granted the landlord's eve-of-trial motion to amend his answer so as to add the affirmative defense of waiver of subrogation, granted the landlord's motion for summary judgment based on that defense, and denied the insurer's cross motion to preclude the landlord from offering his insurance policy as evidence at trial, unanimously affirmed, with costs.

The insurer argues that the late amendment, coupled with the landlord's failure, indeed refusal, to disclose his own insurance policy containing the requisite reciprocal consent to waiver of subrogation, until the eve of trial, caused it prejudice. We do not see how prejudice ensued, absent argument by the insurer that the action could have survived a timely interposed waiver of subrogation defense. The insurer fails to state what measures it could not now take in support of its position that it could have taken had the landlord timely interposed his waiver defense and timely responded to the demand for a copy of his insurance policy (see Loomis v Civetta Corinno Constr. Corp., 54 NY2d 18, 23 [1981]). Nor can the insurer, which was at all times aware of the lease provision waiving subrogation and of the provision in its own policy recognizing the lease waiver, claim surprise that the landlord's policy contained a similar clause.

THIS CONSTITUTES THE DECISION AND ORDER
OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.

ENTERED: OCTOBER 13, 2005

CLERK


Allstate Insurance Company v. Schimmel



Schondebare & Brown, LLP, Ronkonkoma, N.Y. (Dennis M.
Brown of counsel), for appellant.

In an action for a judgment declaring that Allstate Insurance Company is not obligated to defend and indemnify the defendant Thomas Wood in an underlying action entitled Schimmel v Six Mile Cross, pending in the Supreme Court, Suffolk County, under Index No. 18785/02, the plaintiff appeals, as limited by its brief, from so much of an order of the Supreme Court, Suffolk County (Tanenbaum, J.), dated January 7, 2005, as denied its motion for summary judgment.

ORDERED that the order is reversed insofar as appealed from, on the law, with costs, the motion is granted, and the matter is remitted to the Supreme Court, Suffolk County, for the entry of a judgment declaring that Allstate Insurance Company is not obligated to defend and indemnify the defendant Thomas Wood in the underlying action entitled Schimmel v Six Mile Cross, pending in the Supreme Court, Suffolk County, under Index No. 18785/02.

Contrary to the conclusion of the Supreme Court, based upon a reading of the factual allegations in the complaint in the underlying action, the essence of Larry Schimmel's claim against the plaintiff's insured, Thomas Wood, is assault. Schimmel cannot exalt form over substance by labeling the action as one to recover damages for negligence. "It is well settled that no cause of action to recover damages for negligent assault exists in New York" (Schetzen v Robotsis, 273 AD2d 220, 221).

The injuries Schimmel allegedly sustained were inherent in the conduct Wood reportedly engaged in. His assault cannot therefore be construed as an accident within the definition of "occurrence" for which the plaintiff's policy affords coverage (see Allstate Ins. Co. v Mugavero, 79 NY2d 153, 161; Tangney v Burke, 21 AD3d 367). [*2]

Moreover, the plaintiff demonstrated as a matter of law that the policy exclusion for "bodily injury" which is "intended by, or which may reasonably be expected to result from the intentional or criminal acts or omissions of, an insured person," precludes coverage for the incident at issue (see Peters v State Farm Fire & Cas. Co., 100 NY2d 634; Pagano v Allstate Ins. Co., 5 AD3d 576; Allstate Ins. Co. v Ruggiero, 239 AD2d 369).
S. MILLER, J.P., KRAUSMAN, GOLDSTEIN and COVELLO, JJ., concur.

ENTER:

James Edward Pelzer

Clerk of the Court

 

Escobar v. Colonial Indemnity Insurance Company

 

In an action for a judgment declaring that the defendant is obligated to defend and indemnify the plaintiffs in an underlying action, the plaintiffs appeal from an order and judgment (one paper) of the Supreme Court, Kings County (Kramer, J.), dated May 12, 2004, which denied their cross motion for summary judgment striking the defendant's answer, granted the defendant's motion for summary judgment, and declared that the defendant is not obligated to defend or indemnify them.

ORDERED that the order and judgment is affirmed, with costs.

The Supreme Court providently exercised its discretion in denying the plaintiffs' cross motion to strike the defendant's answer. The plaintiffs did not clearly show that the defendant failed to comply with the Supreme Court's discovery orders, or, if it did, that such failure was willful, contumacious, or in bad faith (see Morano v Westchester Paving & Sealing Corp., 7 AD3d 495, 496; Olmoz v Town of Fishkill, 258 AD2d 447, 448).

The Supreme Court properly granted the defendant's motion for summary judgment. The subject insurance contract specifically excluded from the scope of coverage "bodily injury . . . to any employee of the insured arising out of and in the course of his/her employment by the [*2]insured for which the insured may be liable as an employer or in any other capacity." "[W]here the provisions of the policy are clear and unambiguous, they must be given their plain and ordinary meaning, and courts should refrain from rewriting the agreement" (Government Empls. Ins. Co. v Kligler, 42 NY2d 863, 864). The defendant thus established prima facie entitlement to judgment as a matter of law by submitting the subject insurance policy, and the deposition transcript of the plaintiff Neys Lanford Escobar, which demonstrated, without contradiction, that the plaintiff in the underlying action was injured while he was employed by the plaintiff Calimia Construction Company (see Milbin Print v Lumbermen's Mut. Cas. Ins. Co., 283 AD2d 467, 468).

In opposition to this showing by the defendant of prima facie entitlement to judgment as a matter of law, the plaintiffs failed to raise a triable issue of fact (see Zuckerman v City of New York, 49 NY2d 557, 562). Although the plaintiffs argued that the underlying claim falls within the exception to the exclusion for "side track agreements," it did not raise a triable issue as to whether the claim falls within that exception (see Monteleone v Crow Constr. Co., 242 AD2d 135, 140; State of New York v Schenectady Hardware & Elec. Co., 223 AD2d 783, 785). The plaintiffs similarly failed to present any evidence raising an issue of fact that the agent to whom notice of the claim was given was an agent of the insurer, such that notice to the agent constituted notice to the insurer. In the absence of such proof, notice to the agent was not sufficient to invoke the insurer's obligation to timely disclaim coverage pursuant to Insurance Law § 3420 (see Matter of First Cent. Ins. Co., 3 AD3d 494, 495; Serravillo v Sterling Ins. Co., 261 AD2d 384, 385) and the disclaimer, given shortly after learning of the claim from another source, was not untimely.
H. MILLER, J.P., ADAMS, SPOLZINO and FISHER, JJ., concur.

ENTER:

James Edward Pelzer

Clerk of the Court

 

 

Rodrigues v. N & S Building Contractors, Inc.


 KAYE, Chief Judge:

Workers' Compensation Law § 11 prohibits third-party indemnification or contribution claims against employers, except where the employee sustained a "grave injury," or the claim is "based upon a provision in a written contract entered into prior to the accident or occurrence by which the employer had expressly agreed to contribution to or indemnification of the claimant or person asserting the cause of action for the type of loss suffered." This appeal [*2]centers on the latter exception, in particular whether the parties' agreement satisfied statutory requirements for a viable indemnification claim. We conclude that it did.[FN1]

Facts


Third-party plaintiff N & S Building Contractors, Inc. was the general contractor for the construction of a single-family house located at 284 Jansen Road in Shawangunk, New York. N & S hired third-party defendant Caldas Concrete Company, Inc. as a subcontractor to erect the concrete foundation. The two companies had a longstanding relationship, having worked together approximately 20 times prior to the Jansen Road project. In February 2000 the parties entered into a one-page "Insurance, Indemnification and Safety Agreement." The Agreement required Caldas to carry certain insurance, name N & S as an additional insured on its general liability policy and furnish N & S with a certificate from the insurer that insurance was in force. The Agreement further provided that
"[t]o the fullest extent permitted by law, Subcontractor [Caldas] shall indemnify and hold harmless N. & S. Building Contractors, Inc. and Owner against any claims, damages, losses, and expenses, including legal fees, arising out of or resulting from performance of subcontracted work to the extent caused in whole or in part by the Subcontractor or anyone directly or indirectly employed by the subcontractor."
Finally, the Agreement stated that the "[s]afety of [Caldas's] employees, whether or not in common work areas, is the responsibility of [Caldas]."

Caldas president Joaquin Januario signed the Agreement on February 7, 2000 — the same date reflected on the certificate of liability insurance naming N & S as an additional insured under Caldas's commercial general liability insurance policy. Approximately four months later, on June 20, 2000, Caldas began work at the Jansen Road site pursuant to an oral [*3]agreement with N & S. The following day, Jose Rodrigues, a Caldas employee working at the site, tripped, fell into a trench and was impaled on a piece of rebar. Rodrigues, and his wife derivatively, sued N & S alleging numerous causes of action, all subsequently withdrawn except those alleging violations of Labor Law § 241 (6).

N & S commenced a third-party action against Caldas and its insurer, Transcontinental Insurance Company, seeking indemnification based on the Agreement and claiming that Transcontinental's refusal to defend and indemnify N & S was in bad faith. Supreme Court granted Caldas's motion to dismiss that claim, concluding that, because "there was no written contract between N&S and Caldas for the work being performed at 284 Jensen [sic] Road, the site of the accident," N & S's claim could not be sustained. The Appellate Division affirmed, holding that "the agreement does not unambiguously and expressly provide that Caldas must indemnify N & S for injuries sustained by Caldas employees in the scope of their employment" (8 AD3d 876, 878 [3d Dept 2004]). The court added that "[t]he agreement specifies neither the persons covered nor types of losses covered, contains no reference to the instant job site and states only that Caldas agrees to indemnify N & S '[t]o the fullest extent permitted by law'" (id. at n 2). We granted N & S leave to appeal and now reverse.

Discussion

N & S asks us to grant summary judgment declaring that Caldas must indemnify it for any losses sustained in the underlying personal injury action. Thus, we may grant the relief sought only if N & S has established, as a matter of law, that the Agreement entitled it to indemnity under Workers' Compensation Law § 11 (see e.g. JMD Holding Corp. v Congress Fin. Corp., 4 NY3d 373, 384 [2005]).

At the outset, it is clear that, despite the Workers' Compensation Law shield of employers from liability as joint tortfeasors, a third party may recover against an employer pursuant to contract (Majewski v Broadalbin-Perth Cent. School Dist., 91 NY2d 577, 582 [1998]). Indeed, the statute expressly permits indemnification claims "based upon a provision in a written contract." Thus, there is no question that the Workers' Compensation Law allowed N & S and Caldas to enter into an agreement that would indemnify N & S for any losses it might suffer as a result of a personal injury action by a Caldas employee.

Whether the parties did in fact have such an agreement involves a two-part inquiry. First, we consider whether the parties entered into a written contract containing an indemnity provision applicable to the site or job where the injury giving rise to the indemnity claim took place. Second, if so, we examine whether the indemnity provision was sufficiently particular to meet the requirements of section 11. [*4]

Caldas argues, and Supreme Court held, that the absence of a written contract explicitly for the Jansen Road project bars N & S's indemnity claim. We disagree.

The indemnification provision of the parties' agreement applied to the "performance of subcontracted work" between them. The insurance provision similarly did not specify any particular job site or duration, and the safety provision made Caldas responsible for the safety of its workers, again without reference to any job site or time frame. In addition to the words of the Agreement, N & S Vice President Philip Neidermier testified at his deposition that the Agreement "refers to all of our sites that [Caldas] would work on . . . . [i]ncluding that one [Jansen Road]." Caldas did not refute this evidence.

The language of the contract, as well as the testimony, make clear that the Agreement was purposely intended to, and did, apply to all jobs for which N & S hired Caldas as a subcontractor, including Jansen Road. In that no site is mentioned, the argument that the Agreement should not apply here because it does not specifically mention Jansen Road would render it inapplicable to any site or job N & S subcontracted to Caldas. An agreement should not be construed so as to render it meaningless.

The Agreement, moreover, satisfied section 11's requirement of a "written contract." Workers' Compensation Law § 11 requires only that the indemnification claim arise from an indemnification provision in a written contract entered into before the injury. Here, the written agreement contained an indemnification provision, entered into before the injury.

Having concluded that the Agreement was a written contract between the parties applicable to the Jansen Road site, we next consider whether the indemnification provision was sufficiently clear and unambiguous. As we noted in Hooper Assoc. v AGS Computers, Inc. (74 NY2d 487, 491-492 [1989] [internal citations omitted]),
"[w]hen a party is under no legal duty to indemnify, a contract assuming that obligation must be strictly construed to avoid reading into it a duty which the parties did not intend to be assumed. The promise should not be found unless it can be clearly implied from the language and purpose of the entire agreement and the surrounding facts and circumstances."
Here, the Agreement directly, firmly and explicitly evidenced Caldas's promise to assume responsibility for the safety of its employees, procure insurance protecting N & S and indemnify it in the event of an on-the-job injury. That Caldas arranged for the insurance required by the Agreement is further evidence that Caldas itself recognized that it had undertaken that obligation.

The Appellate Division appears to have interpreted the written-contract exception to Workers' Compensation Law § 11 to require that an indemnification provision specify the [*5]sites, persons and the types of losses covered. We are reluctant to impose specificity requirements not in the statute (see Flores v Lower East Side Service Center, Inc., 4 NY3d 363 [2005]). So long as a written indemnification provision encompasses an agreement to indemnify the person asserting the indemnification claim for the type of loss suffered, it meets the requirements of the statute. That standard was satisfied here.

Accordingly, the order of the Appellate Division should be reversed, with costs, defendant third-party plaintiff N & S Building Contractors, Inc.'s motion for summary judgment as to the third-party action granted and judgment granted declaring that N & S Building Contractors, Inc. is entitled to indemnification from third-party defendant Caldas Concrete Company, Inc. for any judgment obtained by plaintiff against N & S Building Contractors, Inc. in the main action, to the extent that such judgment is not the result of N & S Building Contractors, Inc.'s own wrongdoing.


READ, J. (DISSENTING):

The Legislature adopted the Omnibus Workers' Compensation Reform Act in 1996 to shield employers from third-party indemnification or contribution claims except in the limited circumstances of a "grave injury," or for a claim "based upon a provision in a written contract entered into prior to the accident or occurrence by which the employer expressly agreed to contribution to or indemnification of the claimant or person asserting the cause of action for the type of loss suffered" (Workers' Compensation Law § 11 [emphasis added]). Merriam Webster's Collegiate Dictionary defines "express" as "1a: directly, firmly, and explicitly stated b: exact, precise 2a designed for or adapted to its purpose b: of a particular sort: specific " (410 [10th ed 1997]). As amicus New York State Builders Association, Inc., points out, however, the language in the indemnification provision of the Agreement between the parties in this case "is substantially similar to that used . . . in form-documents prepared by The American Institute of Architects (AIA) and widely used and accepted throughout the construction industry." To be precise, the basis for the provision is A401-1997, issued for publication in October 1997. This type of generic indemnification, drafted for use nationwide in states without any equivalent to our rule in Dole v Dow Chem. Co. (30 NY2d 143 [1972]), does not clearly and unambiguously signal an employer's express agreement for purposes of section 11. Surely the employer must explicitly agree to indemnify for claims against which it would be safeguarded by section 11 unless there is a grave injury. Otherwise, section 11's promise of relief from third-party actions is illusory for large categories of employers — such as subcontractors — that routinely enter into contracts with standard form indemnifications. The Legislature cannot have intended or contemplated this result when it [*6]created an exception from the refuge of section 11 for an express agreement to forego its protection. Accordingly, I respectfully dissent.
* * * * * * * * * * * * * * * * *
Order reversed, with costs, defendant third-party plaintiff N & S Building Contractors, Inc.'s motion for summary judgment as to the third-party action granted and judgment granted declaring
in accordance with the opinion herein. Opinion by Chief Judge Kaye. Judges G.B. Smith, Ciparick, Rosenblatt, Graffeo and R.S. Smith concur. Judge Read dissents in an opinion.
Decided October 20, 2005

Footnotes



Footnote 1: In its Answer to Third-Party complaint, Caldas asserted affirmative defenses and a counter-claim for apportionment, contribution and indemnification against N & S. Those defenses and the counter-claim were not resolved by the summary judgment motions that are the subject of the present appeal. Although we conclude that N & S has established a right to indemnification as a matter of law, we do not consider the facts. N & S, of course, would not be entitled to indemnification from Caldas for losses resulting from its own negligence.


 

Transcontinental Insurance Company, v. The State of New York



Ford Marrin Esposito Witmeyer & Gleser, L.L.P., New York
(Thomas R. Esposito of counsel), for appellant-respondent.
Powers & Santola, Albany (Michael J. Hutter of counsel), for
respondent-appellant.

Order of the Court of Claims of the State of New York, (S. Michael Nadel, J.), entered September 1, 2004, which denied claimant's summary judgment motion seeking a declaration that defendant is obligated to reimburse it for half the defense costs and indemnity payments expended on behalf of their mutual insured, and denied defendant's cross motion for summary judgment dismissing the claim, unanimously affirmed, without costs.

Claimant and defendant were co-insurers of a company whose employee was injured while installing a sign on the facade of an automobile dealership. Claimant issued general and excess liability policies to the insured and defendant issued a workers' compensation and employers' liability policy. The employee commenced an action against the owner of the premises where the accident occurred, the owner of the automobile dealership who leased the premises, and the contractor hired to manufacture the sign. These entities, in turn, commenced a third-party action against the insured seeking contractual and common-law indemnification and, in relevant part, alleging that the employee suffered a "grave injury" pursuant to Workers' Compensation Law
§ 11. When the third-party complaint was presented to claimant and defendant as joint insurers, claimant advised the State Insurance Fund that it would assume the defense of the action, but requested "a contribution towards the defense and indemnity." Summary judgment motions in the underlying personal injury action were granted and the court determined, inter alia, that the injured employee had in fact suffered a grave injury pursuant to Workers' Compensation Law § 11. Following the court's determination, claimant rejected defendant's attempts to appeal the court's finding, and the personal injury action was settled for $2.5 million, to which defendant refused to contribute.

Claimant commenced the instant action seeking half the settlement payment and expenses incurred in defending the third-party action, and moved for summary judgment on the ground that defendant breached its duty to defend and indemnify the insured. Defendant cross-moved for summary dismissal of the claim on the basis that it did not breach its duties and there was no [*2]covered loss since the employee had not suffered a grave injury.

There are triable issues with respect to whether defendant breached its duty to indemnify its insured, on the assertion that there is no such obligation in the absence of a covered loss. Although defendant declined to contribute to the defense and disagreed with the allegation in the third-party complaint that the employee suffered a grave injury, defendant, upon receiving the third-party complaint, did passively participate in the defense until it became apparent that claimant was assuming the defense on its own, subject to expectation that expenses would be shared.

Further concerning defendant's alleged duty to indemnify, although the motion court in the underlying personal injury action determined that the injured employee had suffered a grave injury, defendant is entitled to a de novo determination of the issue and is not collaterally estopped from challenging the finding inasmuch as defendant's interests were not represented in the underlying action (see Failla v Nationwide Ins. Co., 267 AD2d 860 [1999]).

We have considered the parties' remaining contentions for affirmative relief and find them unavailing.

 

 

 

Inwood Hill Medical, P.C v. General Assurance Company

 

Plaintiff appeals from an order of the Civil Court, New York County, entered April 26, 2004 (Arthur F. Engoron, J.), which denied its motion for summary judgment and granted defendant's cross motion for summary judgment dismissing the complaint.

PER CURIAM

Order entered April 26, 2004 (Arthur F. Engoron, J.) affirmed with $10 costs.

Non-party assignor L.L. Rainey-Williams was injured in an automobile accident in May 2002 and subsequently sought health services from plaintiff health care provider. After defendant insurer was notified orally by Rainey-Williams that he had sustained injuries, it scheduled pre-claim independent medical examinations (IMEs) to be conducted by various health providers in order to verify the medical necessity of any health services being provided. When Rainey-Williams failed to attend the IMEs or otherwise contact defendant, follow-up letters rescheduling the IMEs were mailed to him within 10 calendar days. Rainey-Williams did not attend the rescheduled IMEs. The letters scheduling and rescheduling the IMEs were mailed to Rainey-Williams to the two separate addresses he provided defendant.

Between September 16 and November 12, 2002, defendant received several claims, totaling $6,417.02, for health services provided by plaintiff to Rainey-Williams from June 6 to October 29, 2002. Defendant issued timely denials of each claim premised on Rainey-Williams' failure to attend the IMEs. Plaintiff, as assignee, commenced this action seeking judgment in the amount of the outstanding claims and thereafter moved for summary judgment, alleging that it never received any notices for the examination of Rainey-Williams. Defendant cross-moved for [*2]summary judgment, arguing that Rainey-Williams, by failing to appear for the IMEs, had violated a condition precedent to coverage under the No-Fault endorsement of the insurance policy. Plaintiff, in reply, asserted that defendant failed to submit proper proof of mailing of the IME notices.

Pursuant to the "Conditions" provision of the prescribed No-Fault endorsement in New York, 11 NYCRR § 65-1.1 (Regulation 68), an insurer may require an injured person to submit to medical examinations, "when and as often as, the company may reasonably require." The request for a medical examination constitutes a request for verification by an insurer, whether it is made before a claim is submitted or after the submission of a claim as additional verification, and as such, is subject to the follow-up provisions of Section 65-3.6(b)(see New York Insurance General Counsel Opinion No. 03-02-12 [2005], 2005 NY Insurance GC Opinions LEXIS 31).

Under the same "Conditions" provision, the section headed "Action Against Company" provides that "No action shall lie against the company, unless, as a condition precedent thereto, there shall have been full compliance with the terms of this coverage." Inasmuch as attendance at a medical examination is a condition of coverage under Section 65-1.1, it follows that an eligible injured person's failure to comply with a request for an IME precludes an action against an insurer for payment of health services provided. To the extent that the Appellate Term, Second Department in Steven Fogel Psychological, P.C. v Progressive Casualty Insurance Company, 7 Misc3d 18 (2004), held to the contrary, we decline to follow the majority's holding and find more persuasive the conclusion reached by Justice Golia in his dissent.

Here, defendant, on its cross motion for summary judgment, established that after receiving oral notification of the accident from Rainey-Williams, it scheduled IMEs and follow-up examinations, which Rainey-Williams failed to attend, in breach of the condition precedent relating to IME attendance. Defendant also submitted proof that the letters scheduling the IMEs were mailed to the addresses provided by Rainey-Williams. Plaintiff, in opposition, did not submit any evidence to raise an issue of fact as to the reasonableness of the request and/or Rainey-Williams' failure to attend the IMEs. Accordingly, defendant was entitled to summary judgment dismissing the complaint for failure to comply with a condition precedent to coverage.

This constitutes the decision and order of the court.

Decision Date: October 20, 2005

 

 

Arias v. Allstate Insurance Company

 

Plaintiff appeals from an order of the Civil Court, New York County, dated October 12, 2004 (Jeffrey K. Oing, J.), which denied his motion for summary judgment and granted defendant's cross motion for summary judgment dismissing the complaint.
PER CURIAM:

Order dated October 12, 2004 (Jeffrey K. Oing, J.) affirmed, with $10 costs.

Theft of the insured automobile and the ensuing accident occurred on October 24, 1998. The defendant insurance company disclaimed liability and denied coverage on June 16, 2000, and plaintiff sued defendant's insured in September 2001, ultimately obtaining a default judgment against him. Plaintiff's motion below sought enforcement of this default judgment against defendant insurer.

Defendant was entitled to judgment as a matter of law by reason of non-permissive use of the vehicle at the time of the accident (Villamil v Budget Rental, 281 AD2d 207 [2001]; Vehicle & Traffic Law § 388[1]). Specifically, defendant conclusively demonstrated that the insured's vehicle was stolen at the time of the accident (see Pow v Black, 182 AD2d 484 [1992]; Guerra v Kings Plaza Leasing Corp., 172 AD2d 583 [1991]), as reported to the police by the insured that same day and expressly conceded by plaintiff's counsel for purposes of the motions below. Since defendant has established as a matter of law that "there is no possible factual or legal basis on which it might eventually be obligated to indemnify its insured under any policy provision" (Allstate Ins. Co. v Zuk, 78 NY2d 41, 45 [1991]; cf. Minaya v Horner, 279 AD2d 333 [2001]), defendant was relieved of its duty to indemnify or defend its insured in the underlying personal injury action.

This constitutes the decision and order of the court. [*2]
Decision Date: October 20, 2005.

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