Coverage Pointers - Volume VIII, No. 25

Dear Coverage Pointers Subscribers:

 

OK, let's deal with the important question first.  I LOVED the last episode of the Sopranos and thought the ending was brilliant.  And while I don't know what happened to Tony and his family, I also don't know why the Mona Lisa is smiling.  In either case, the artist's work can surely be appreciated.  However, for the record, I still believe that Uncle Junior was in cahoots with Phil Leotardo and I'm still curious about the whereabouts of the Russian in the Pine Barrens episode.

 

I'm off to the Federation of Defense & Corporate Counsel Litigation Management College Graduate Program at Emory University in Atlanta to reprise my role as Captain Coverage and present a program entitled "Coverage College."  If any of you are students of the college or the graduate program this year, please introduce yourself to me.  We find subscribers everywhere. You can find more information about these great educational opportunities at the FDCC website, www.thefederation.org

 

I will also be on the program in New York City in December for the DRI Insurance Coverage and Practice Symposium presenting on the duty to cooperate under the liability policy.  For information on this program, visit the DRI website, www.dri.org

 

The appellate courts were raining coverage decisions upon the state's insurance professionals over the past two weeks, and interesting ones abound.  The most important of all is Fourth Department's decision in Meegan where a slim 3-2 majority disagrees with the Second Department's decision in Raffellini and holds that an uninsured motorist applicant must establish a serious injury under the No Fault law in order to qualify for SUM benefits.

 

You'll also find a case where an additional insured (and those who were seeking to recover against it) lost coverage for failure to invest in a 39 cent stamp and notify a subcontractor's insurer of a loss. 

 

There's an interesting case involving the question of whether or not a clause in a construction subcontract which incorporates the provision of the prime contract also incorporates insurance requirements.  This court says, "no."

 

And we have two guest authors this week.  Mike Perley ponies up a horse case of a different color and Chris Potenza offers a summary of a trial level decision on asbestos coverage, surely worth reading.  It's a whack job, so to speak.

 

Audrey Seeley, the Queen of No Fault, is on the road but e-mailed her column for submission.  She offers these words:

 

Usually Dan is the one saying he is greeting you from some far off beautiful destination and I am begging to get out of the office on training to one warm city.  At the time of drafting this note I am greeting you from Atlanta where I am attending an annual panel counsel meeting!  It was really nice to meet so many seasoned adjusters and attorneys that share the same philosophy on approaching and handling cases.

 

This edition brings additional cases demonstrating the evidentiary pitfalls on summary judgment.  Some were favorable to the plaintiff and some were favorable to the insurer.  In the arbitration world, there is a second decision reimbursing a physical therapist for electro-diagnostic testing.  This is an area to watch!  The physical therapist can conduct this testing but must be certified.  We would recommend verifying the certification.

 

I hope you enjoy this edition as I know that right now I am enjoying the warm sunny weather!

 

Audrey

 

 

By the way, Audrey and her husband are just completing construction of a new home.  I anticipate that she'll invite all of you to the housewarming.  Don't tell her I suggested it.

 

This week's issue includes the following cases:

 

• Policy Allocation Between Insured and Uninsured Damages Upheld and Enforced
• Claimant Breaches Cooperation Clause and Loses Coverage for Uninsured Motorist Benefits
• For Want of a Postage Stamp, Coverage is Lost
• Serious Injury IS NECESSARY to Recover Underinsured Benefits.  Fourth Department Disagrees with Raffellini
• When is a Horse Stall Not a Horse Stall?  When it's a House.
• Court Considers Whether Insured Follows it Own Fortunes in Reinsurance Claim
• Get All the Players at the Table
• Court Reaffirms No-Prejudice Rule in Late Notice Case Involving Uninsured Motorists Benefits, Where Insurer was Not Given Timely Notice of Accident; Reckemeyer Distinguished
• Dental E&O Policy Only Covers Bodily Injury Claims
• New York State Liquidation Bureau Need Not Pay Settlement Achieved in Violation of Stay Provisions
• Without Fiduciary Relationship, Insurer Not Liable for Failing to Warn of Rollover Risk
• Clause in Subcontract that Incorporates Main Contract Provisions by Reference, Does not Incorporate Insurance and Indemnity Requirements
• California Law Requires a Showing of Prejudice Before Denying Coverage on Late Notice, Even if Policy Doesn't
• Court Confuses State Fund and Liquidation Bureau;  Court Appears to Confuse Additional Insured Coverage Analysis as Well
• Material Misrepresentation Intended to Defraud Individual Health or Disability Insurer Voids Policy
• Late Notice: An Insured's Notice to a Broker is (Generally) Not Notice to its Carrier.  Failure to Document File Leads to Waiver of Late Notice Defense by Insurer
• Policyholder Wins a Big One at Trial Level in Asbestos Matters - Asbestos Claims Not Restricted to Completed Operations Limits
   

STarosieleC'S serious (Injury) Side of New York No-FaulT
Mark Starosielec
[email protected]

 

• Three Years of Post-Accident Reduced Range of Motion is Enough for Plaintiff to Survive Summary Judgment
• How Plaintiff Lost Her Fetus is a Triable Issue of Fact
• Failure to Make A Prima Facie Showing Dooms Defendant's Summary Judgment Chances
• Reversal of Fortune: Defendants' Summary Judgment is Granted on Appeal
• Motions, Admissions and Physicians. . .Oh My! Plaintiff's Verdict is Affirmed
• Upon Further Review. . .The Lawsuit Stands
• Unsworn Medical Reports = Unreliable Medical Reports
• Defendant's Failure to Address Plaintiff's Claims in the Bill of Particulars Leads to Summary Judgment Denial
• Limitations in ROM is Not Enough: It Must Be Contemporaneous with the Accident
• Plaintiff's Complaint on SI grounds is dismissed For Failing to Address Defendant's Doctor's Findings
• Failing to Put Plaintiff's Chiropractor's Report in an Affidavit Leads to Lawsuit Dismissal
• Summary Judgment Denial
• Existence of Knee Injury Not Enough: Need Objective Proof Too to Raise Issue of Fact
• Defendant in Denial (on a SJ motion) for Ignoring Plaintiff's Alleged Injuries
• No Beating Around the Bush: Summary Judgment Granted!
• Minding the Gap (In Treatment) Leads to Plaintiff's Surviving Summary Judgment
• Defendants' Doctor's Findings of Limitations Leads to Denial of Summary Judgment 

 

Audrey's Angle on No-Fault

Audrey Seeley

[email protected] 

 

Arbitration

• Conservative Care 14 Years Post Accident not Medically Necessary - You Think?
• Certified Physical Therapist can Conduct Electromyography and Nerve Conduction Testing

Litigation

• Plaintiff's Affidavit Fails to Establish Documents are Business Records Resulting in Denial of Summary Judgment
• Plaintiff can Rely Upon Defendant's Documents to Establish Prima Facie Case but Make an Effort to Establish an Admissible Business Record
• Insurer's Evidence Insufficient to Establish Lack of Standing and Eligibility for No-Fault Benefits

Well, that's it from the land of insurance coverage.  We welcome 10 new subscribers this week and hope they enjoy our regular rambling.

 

Dan

 

Hurwitz & Fine, P.C. is a full-service law firm
providing legal services throughout the State of New York.

 

Insurance Coverage Team

Dan D. Kohane, Team Leader
[email protected]

Michael F. Perley
Audrey A. Seeley
Vivian Perry Roché

Steven E. Peiper

 

Fire, First-Party and Subrogation Team
Andrea Schillaci, Team Leader
[email protected]
Jody E. Briandi
Steven E. Peiper

 

NO-FAULT/UM/SUM TEAM
Audrey A. Seeley, Team Leader
[email protected]
Vivian Perry Roché
Mark Starosielec

 

APPELLATE TEAM
Dan D. Kohane
Scott M. Duquin

 

Index to Special Columns

 Starosielec’s Serious Side of “Serious Injury”

 Audrey’s Angles on No Fault

Peiper on Property

Across Borders

  

6/14/07            Clifford Chance LLP v. Indian Harbor Insurance Company

Appellate Division, First Department
Policy Allocation Between Insured and Uninsured Damages Upheld and Enforced
The insurer is only responsible for paying a portion of the insured’s claim for reimbursement based on the terms of the policy.  Clear language in policy which provides for the allocation was enforced.

6/12/07            In the Matter of New York Central Mutual Fire Ins. Co. v. Rafailov

Appellate Division, Second Department
Claimant Breaches Cooperation Clause and Loses Coverage for Uninsured Motorist Benefits
In order to establish breach of a cooperation clause, the insurer must show that the insured engaged in an unreasonable and willful pattern of refusing to answer material and relevant questions or to supply material and relevant documents. An insured's duty to cooperate is satisfied by substantial compliance, and where a delay in compliance is neither lengthy nor willful, and is accompanied by a satisfactory explanation, preclusion of a claim is inappropriate.  A pattern of conduct here, including failure to comply with court orders compelling discovery, leads to finding of lack of cooperation and loss of coverage.

 

6/12/07            R.C. Dolner, Inc., v. My-Way Contracting Corp

Appellate Division, First Department
For Want of a Postage Stamp, Coverage is Lost
General contractor, entered into a subcontract with defendant My-Way for demolition work, pursuant to which My-Way procured a certificate of insurance and an insurance policy, issued by Landmark, naming My-Way and plaintiff as additional insureds. GC also obtained a separate policy, issued by US Fire, which would provide excess insurance over any primary insurance covering a loss, but otherwise would afford primary coverage.

In February 1999, during My-Way’s demo work, a piece of concrete fell damaging owner’s equipment.  The owner paid $178K for repairs and deducted the amount from the total due plaintiff. GC notified its insurer, US Fire, of the incident on February 9, and forwarded two memoranda, dated March 2 and 3, on the cause, nature, and extent of the damages. On March 17, US Fire, on behalf of plaintiff, sent My-Way a notice of claim and requested that My-Way notify Landmark. Neither plaintiff nor US Fire directly notified Landmark. Rather, on December 13, US Fire sent My-Way a second notice of claim and again told My-Way to notify its insurer. It wasn’t until December 28, when My-Way asked Landmark to process the claim

Landmark denied on late notice (10 months after the incident, nine months after My-Way was advised of a claim) by My-Way on January 24, the day its investigation was completed..

Not surprisingly, the disclaimer holds up.  The one month delay in denying coverage was surely reasonable, since the disclaimer was sent as soon as the investigation was completed.

Earlier notice to My-Way was not notice to carrier (no agency relationship) and GC knew of identity of insurer.

Editors Note:  All the GC and US Fire needed to do to preserve the coverage were to invest in a single postage stamp and notify Landmark at the outset.

6/8/07              Meegan v. Progressive Insurance Company

Appellate Division, Fourth Department
Serious Injury Finding IS NECESSARY to Recover Underinsured Benefits.  Fourth Department Disagrees with Raffellini
Back on October 28^th, your editor was so taken aback by the Second Department decision in Raffellini that a special edition of Coverage Pointers hit the newsstand.  The banner headline read:

 

10/24/06          Raffellini v. State Farm Mutual Automobile Insurance Company
Appellate Division, Second Department
Underinsured Coverage (SUM) -- Intermediate Appellate Court Strikes Down Necessity to Establish Serious Injury to Qualify for SUM Recovery
This one is a show stopper.  Halloween has come early in the Second Department.

Well, the Fourth Department, in a 3-2 decision, has disagreed, holding that the mandatory policy language in the SUM endorsement is consistent with the statute [Insurance Law Section 3420(f)(2) and the Insurance Department interpretation of the statute is to be given consideration.  Unlike the Second Department, the Fourth Department held that there is a necessity to establish a serious injury under the No Fault law in order to prove up an entitlement to underinsured motorists benefits.

 

The court also set aside a finding that an insurer could be held liable for consequential damages beyond the amount the claimant was entitled to under the SUM endorsement.

 

Editor’s Note:  Raffellini is on its way to the Court of Appeals, perhaps joined by this case.

 

6/8/07              Lista v. Newton
Appellate Division, Fourth Department
When is a Horse Stall Not a Horse Stall?  When it’s a House.
The Fourth Department extended the Labor Law Section 240 homeowner’s exemption to the construction of a horse stall.  Mary Newton, the owner of a single family dwelling hired a contractor to build a horse stall in a barn on her property.  Plaintiff (who has no recollection of the accident) was injured due to a fall from a ladder during construction.  The Fourth Department didn’t “horse around” with this case dismissing the Labor Law §240 cause of action based on the exemption for owners of one and two family dwellings; holding that the horse stall was “directly related” to the residential use of the property and, therefore, within the holding of the Court of Appeals in Bartoo v. Buell (87 N.Y. 3d 362).

In a side note; the horse got off too.  Plaintiff had claimed that the horse may have knocked him off the ladder but the Court applied the “vicious propensity” doctrine (perhaps a “first kick” rule) and dismissed that claim as well.

Editor’s Note:  Thanks to our Mike Perley for his contribution of this Labor Law case for your review and consideration.  Yes, we recognize it isn’t a “coverage case” but it’s an interesting one nonetheless.

 

6/12/07            Allstate Insurance Company v. American Home Assurance Company

Appellate Division, First Department

Court Considers Whether Insured Follows it Own Fortunes in Reinsurance Claim

Court refuses to allow an insured to change its method of calculating occurrences in its submission of a reinsurance claim.  The court rejects the insured attempts to reconfigure argument it made in underlying lawsuit on number of occurrences in order to maximize reinsurance.

 

6/8/07              David Christa Construction, Inc. v. American Home Assurance Company

Appellate Division, Fourth Department

Get All the Players at the Table

Carrier sought determination that its policy of insurance was excess over another company’s but the other company was not a party to the lawsuit.  Court, understandably, refused to declare primacy without other company in the lawsuit since the determination would not be binding on that carrier otherwise.

Editor’s Note:  This issue comes up a lot.  Who should be a party to a coverage dispute?  If it is to be binding on other carriers or on the injured party, they must be invited to participate.

 

6/8/07              Progressive Northeastern Ins. Co. v. Heath

Appellate Division, Fourth Department
Court Reaffirms No-Prejudice Rule in Late Notice Case Involving Uninsured Motorists Benefits, Where Insurer was Not Given Timely Notice of Accident; Reckemeyer Distinguished
In July 2003, Heath was seriously injured as a passenger in a two-car collision. Insurer for car in which he was a passenger denied his claim on grounds that policy had expired and vehicle was uninsured. The insurance company for the second vehicle denied the claim on the ground that there was no liability for the accident on the part of its insured. The Motor Vehicle Accident Indemnification Corporation denied respondent's subsequent application for benefits on the ground that Heath was covered by policy insuring Heath’s parents, Progressive.

On March 16, 2004, Heath filed both a claim for no-fault benefits and an uninsured motorist (UM) claim with Progressive. Progressive paid benefits on the no-fault claim but disclaimed coverage on the UM claim based on the failure to give Progressive notice and proof of the claim as soon as practicable. When Heath informed Progressive of his intent to arbitrate his UM claim, Progressive commenced an CPLR article 75 proceeding seeking to stay arbitration.

First of all, the payment of no fault benefits does not preclude Progressive’s right to deny UIM benefits on the basis of late notice.

Secondly, since Progressive has no timely notice of accident, the no-prejudice rule still applies with respect to late notice of the UIM claim.  The Court of Appeals has altered the no-prejudice rules in the UIM situation where the insurer has had timely notice of the accident but late notice of the lawsuit (Rekemeyer v State Farm Mut. Auto. Ins. Co., 4 NY3d 468, 474-475). Here, Progressive did not receive timely notice of the accident.

6/7/07              Fortress Insurance Company v. Kollander
Appellate Division, First Department

Dental E&O Policy Only Covers Bodily Injury Claims
Insurer issued a dental malpractice policy which covered claims for bodily injury arising out of professional services rendered.  The claims against the dentist here did not see to recover such damages so, the insurer had no obligation to defend or indemnify. Unclear from the decision what kinds of claims were being pursued against the dentist.

 

6/7/07              GZA GeoEnvironmental, Inc., New York State Liquidation Bureau
Appellate Division, First Department

New York State Liquidation Bureau Need Not Pay Settlement Achieved in Violation of Stay Provisions

Despite claims of estoppel on the part of the Liquidation Bureau, the state agency was not required to honor and pay settlement of case which was accomplished in violation of the stay of proceedings against insurer.

 

6/7/07              Blake v. Ford Motor Company

Appellate Division, First Department
Without Fiduciary Relationship, Insurer Not Liable for Failing to Warn of Rollover Risk

Van owner sought to amend its complaint to allege claim against its own insurer for failing to warn owner of roll-over risks.  Court refused to allow amendments.  Insurer does not have the duty to its insured to warn of risk, in the absence of a fiduciary relationship.

 

6/5/07              Adams v. Boston Properties Limited Partnership

Appellate Division, First Department
Clause in Subcontract that Incorporates Main Contract Provisions by Reference, Does not Incorporate Insurance and Indemnity Requirements
Interesting decision on a question that doesn’t come up very often.  A subcontractor moved for summary judgment to dismiss claims for contractual indemnification and for breach of contract to provide insurance.  The “promises” to provide indemnification and insurance were contained in the main contract between the owner and the general contractor.  The subcontract incorporated the main contract provisions by reference.  However, the court held that “incorporation clauses” in a construction subcontract which incorporate main contract clauses by reference bind a subcontractor ONLY as to prime contract provisions regarding scope and quality of work.  They do not incorporate indemnity and insurance provisions.

 

6/5/07              Steadfast Insurance Company v. Casden Properties, Inc.

Appellate Division, First Department
California Law Requires a Showing of Prejudice Before Denying Coverage on Late Notice, Even if Policy Doesn’t
Carriers in New York should rejoice in the fact that they are not in California.  This case involved a North Carolina death but apparently the parties agreed, or the court found, that California, rather than NY or NC law applied to the insurance issues.  The policy provided that late notice voided coverage but did not require a showing of prejudice.  The court found that California law would not permit a forfeiture of coverage based on late notice unless there was a finding of substantial prejudice to the insurer.  Given these principles, a policy endorsement waiving the requirement that an insurer must demonstrate prejudice in order to disclaim for untimely notice, thereby waiving the Notice-Prejudice Rule, is void as against public policy

 

6/5/07              Serio v. United States Fire Insurance Company

Appellate Division, Second Department
Court Confuses State Fund and Liquidation Bureau;  Court Appears to Confuse Additional Insured Coverage Analysis as Well
The Court confuses the Liquidation Bureau and the State Insurance Fund.  Ahh well.  The plaintiff in this case is the Superintendent of Insurance of the State of New York, as ancillary receiver of Credit General Insurance Company (Credit General). It appears that the Superintendent (undoubtedly through the Liquidation Bureau) provided a defense to an insured of Credit General and then, much later, sought to deny coverage.  The court held that the State, in this capacity, was to be treated like any other insurer.  As the insured was prejudiced by a late disclaimer (issued after liability was established and before a damages trial), estoppel set in and the State could not walk away from coverage.

The court then considered the issue of primacy between the policy issued to the insured by Credit General and one issued by United States Fire.  The court held that the insured, Magen, was an additional insured under the Credit General policy and by reason of the subcontract between Magen and the named insured under the Credit General policy,  Credit General’s coverage was primary (citing to Pecker Iron Works).

Editors Note:  The Second Department may have reached the right decision about primacy but the proper reasoning was not offered.  The appropriate analysis was to look to the other insurance clauses of the Credit and US Fire policies to determine primary v. excess (or pro-ration).  Generally, these clauses provide that if the insured (Magen in this case) becomes insured because the contract requires they be added an additional insured on a policy (e.g., the policy issued by Credit) that policy is primary. 

6/5/07              Dwyer v. First Unum Life Insurance Company
Appellate Division, First Department
Material Misrepresentation Intended to Defraud Individual Health or Disability Insurer Voids Policy

Health or disability insurer permitted to rescind policy ab initio which was in effect for two years by establishing a material misrepresentation intended to defraud the insurer. For the insurer to be entitled to rescind the policy ab initio, after it had been in existence for two years during the insured's lifetime, it must identify a material misrepresentation in the application that was intended to defraud the insurer. Here, defendants presented the affidavit of their chief underwriter, as well as the company guidelines, both of which establish that if defendants had known of plaintiff's history of chronic back pain, including his prescription medication for such pain and his hospitalization within five years prior to filling out the insurance application, they would not have issued the policy to plaintiff in its present form

Plaintiff's intent to defraud defendants may also be determined as a matter of law where, as here, it is uncontested that he knew the answers he provided to the questions on the application were false, and he provided some partial answers, omitting only information that would actually have been relevant to a determination of his insurable risk

Relevant section of insurance law provides:

 

After  two  years  from  the  date  of  issue  of  this policy no misstatements, except fraudulent misstatements, made by the applicant in the application for such policy shall be used to void the policy  or  to deny  a claim for loss incurred or disability (as defined in the policy) commencing after the expiration of such two year period.

 

5/29/07            In the Matter of Temple Const. Corp. v. Sirius America Insurance Company

Appellate Division, Second Department

Late Notice: An Insured’s Notice to a Broker is (Generally) Not Notice to its Carrier.  Failure to Document File Leads to Waiver of Late Notice Defense by Insurer
There was a July 2004 accident involving Ramos, who worked for Temple Construction Co on the Bokharian Jewish Center premises. Sirius issued separate policies to Temple and Bokharian.  Sirius received notice of the occurrence from Temple when Temple sent the original summons and complaint to the insurer in December 2004.  Bokharian notified Sirius on May 4, 2005, when by sending it an amended complaint. Both insureds knew of the accident  in July 2004.

Both Temple and Bokharian gave notice to a nonparty insurance broker, Northeastern Group, Ltd. (hereinafter Northeastern). Notice to a broker is not notice to a carrier unless there is 0roof that the broker was given authority to represent the insurer as its agent.  No such proof here

Sirius denied coverage to Temple eight days after it received notice from Temple, so its denial is sustained.  However, there was a 47-day delay in disclaiming to Bokharian  and while Sirius contended that the delay was warranted by its need to investigate the occurrence, the record is silent as to the date Sirius completed its investigation. Accordingly, the denial of coverage as to Bokharian was considered untimely and the insurer has waived its late notice defense.

Editor’s Note:  It may well be that Sirius has a legitimate need to conduct a “late notice” investigation which could have excused the 47-day delay in denying coverage.  However, there was no proof that it documented its file as to that investigation and there was a failure to establish when its investigation was completed (and thus, when the time to start counting days within which to timely disclaim would have commenced).

5/8/07              Continental Casualty Company v. Employers Ins. of Wausau
Supreme Court, New York County (Trial Level)
Policyholder Wins a Big One at Trial Level in Asbestos Matters – Asbestos Claims Not Restricted to Completed Operations Limits
Maybe it was prompted by the recent episode of the Sopranos, in which Tony Soprano's crew dumps a truckload asbestos into the East River, but a Manhattan trial court has "whacked" the asbestos insurance industry in the recent decision Continental Casualty Company v. Employers Insurance Company of Wausau, No. 03-601037, 2007 N.Y. Slip. Op. 27188 (N.Y. Sup. Ct. May 8, 2007).   In this class action suit of over 20,000 plaintiffs, CNA sought a declaratory judgment to classify the asbestos claims so as to implicate the aggregate coverage limits of the policy for a particular asbestos insulation defendant.  The policies contained two basic types of coverage for asbestos claims: "premises/operations" coverage and "products hazard/completed operations" hazard coverage. The Court held that the recoveries were not limited by the aggregate limits in effect under the "products hazard/completed operations" section of the policy because the claims that arose out of exposure to asbestos during the insured's asbestos installation process are "premises/operations" claims (which are not subject to aggregate limits). Thus, the individual underlying asbestos actions had to await adjudication to see whether any fell under the products hazard/completed operations aggregates.  The resulting exposure to the insurer could be infinite.  Just when you think you're out, they keep pulling you back in.

Editors Note:  Thanks to our associate, V. Christopher Potenza for his summary.  Chris handles a substantial volume of asbestos defense work. For Soprano’s fans, this Christopher is alive and well, was not in a car accident with Tony and has nothing to do with Adriana’s demise.  He has, however, been followed by an orange cat, which makes us strangely suspicious

 

STarosieleC’S serious (Injury) Side of New York No-FaulT
Mark Starosielec
[email protected]

 

6/12/07            Britt v. Goodspeed Transit, Inc.

Appellate Division, First Department

Three Years of Post-Accident Reduced Range of Motion is Enough for Plaintiff to Survive Summary Judgment
In a brief opinion, the Appellate Division affirmed the lower court order which dismissed defendants’ motion for summary judgment dismissing the complaint. Here, plaintiff’s physician’s affirmation as to a continuing 30% reduction in range of motion in lumbar extension, as well as significant left shoulder residual limitations, raise issues of fact on whether he suffered a “serious injury.” These findings, made during a physical examination three years after the accident, were compared with this doctor’s findings during his examination of plaintiff the day after the accident.

 

6/12/07            Gordover v. Balandina

Appellate Division, Second Department

Plaintiff’s Raising Triable Issue of Fact Saves the Complaint from Certain Dismissal

Denial of summary judgment is affirmed by Appellate Division. The defendants through the submission of the plaintiff’s verified bill of particulars and the affirmed medical reports of their examining neurologist, examining orthopedic surgeon, and radiologist, made a prima facie showing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) as a result of the subject motor vehicle accident. While the Court did not elaborate as to how, the plaintiff did raise a triable issue of fact in opposition.

 

6/12/07                        Jamison v. Garcia

Appellate Division, Second Department

How Plaintiff Lost Her Fetus is a Triable Issue of Fact

Here, the defendants appeal a lower court order which denied their motion for summary judgment dismissing the complaint on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d). The Court held the defendants established their prima facie showing. However, the plaintiff raised a triable issue of fact as to whether she lost her fetus due to this accident rather than as a result of a voluntary termination of pregnancy.  

 

6/12/07                        Perrotta v. Bambury

Appellate Division, Second Department

Failure to Make A Prima Facie Showing Dooms Defendant’s Summary Judgment Chances

Plaintiffs survive summary judgment in serious injury case after defendants lose their appeal of lower court order. The papers submitted in support of the defendants’ motion for summary judgment failed to make a prima facie showing that the plaintiff did not sustain a serious injury

 

6/12/07                        Tobias v. Chupenko

Appellate Division, Second Department

Reversal of Fortune: Defendants’ Summary Judgment is Granted on Appeal

Here, the Appellate Division held the defendants met their prima facie burden on their motion of establishing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) as a result of the subject accident. In opposition, the plaintiff failed to raise a triable issue of fact. The plaintiff’s examining physician failed to quantify, on the basis of objective testing, the limitations which he found in the plaintiff's lumbar spine. Moreover, while the affirmation of the plaintiff’s examining physician set forth range of motion findings with respect to the plaintiff's left shoulder, right wrist, and left knee, it failed to compare those findings to the normal range of motion.

 

6/8/07              La Forte v Tiedemann

Appellate Division, Fourth Department

Motions, Admissions and Physicians. . .Oh My! Plaintiff’s Verdict is Affirmed
Plaintiffs commenced this action to recover damages for injuries sustained in a rear-ended motor vehicle accident. Supreme Court properly granted plaintiffs’ pretrial motion seeking partial summary judgment determining that plaintiff sustained a serious injury within the meaning of Insurance Law § 5102 (d).Defendant stipulated that he was negligent and thus the trial was limited to the issue of damages. The Appellate Division held the lower court properly refused to preclude plaintiffs from testifying concerning plaintiff’s use of antidepressant medications. Although defendant sought to preclude the testimony on the ground that it varied from plaintiffs’ bill of particulars, the testimony was properly admitted because it neither misled nor prejudiced defendant. The court also properly allowed plaintiff’s treating orthopedic surgeon to testify that he had relied on the reports of nontestifying physicians, inasmuch as “those out-of-court materials are of the kind generally accepted as reliable by experts in the medical profession.”

 

6/8/07              Carrier v. Shaw

Appellate Division, Fourth Department

Upon Further Review. . .The Lawsuit Stands
Here, plaintiff in a rear end motor vehicle accident case appealed lower court order, which granted defendant’s motion for summary judgment dismissing the complaint. On appeal, the plaintiff’s complaint was reinstated with respect to the following categories: (1) permanent consequential limitation of use of a body organ or member and (2) significant limitation of use of a body function or system. Although defendant met her initial burden, plaintiff raised issues of fact by submitting competent and objective medical evidence with respect to the nature and extent of her injuries. The affidavits of plaintiff’s treating physicians include findings based on their examinations of plaintiff as well as her x-rays and abnormal ENG findings. Submissions of plaintiff in opposition to defendant’s motion did not consist solely of her subjective complaints or her physicians’ conclusory and speculative statements, which would have been insufficient to defeat defendant's motion.

 

6/5/07              Cotto v. JND Concrete & Brick, Inc.

Appellate Division, Second Department

Unsworn Medical Reports = Unreliable Medical Reports

Here, defendants appeal lower court order which denied their motion for summary judgment dismissing the complaint on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d). The Appellate Division modified the order by deleting the provision dismissing summary judgment but allowed for lawsuit continue on the property damage claim.  The defendants satisfied their prima facie burden of showing that the plaintiff did not sustain a serious injury. In opposition, the plaintiff failed to raise a triable issue of fact. The plaintiff’s evidence was comprised of unsworn medical reports and the affirmation of the plaintiff’s physician. Further, the range of motion findings was not based on a recent examination of the plaintiff.

 

6/5/07              Figueroa  v. Dalmar Car Service Corp.

Appellate Division, Second Department

Defendant’s Failure to Address Plaintiff’s Claims in the Bill of Particulars Leads to Summary Judgment Denial

Here, the Appellate Division affirmed a lower court order which denied defendants’ summary judgment motion. The court held the defendants failed to make a prima facie showing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d). The defendants’ moving papers did not address the allegations made by the plaintiff, as contained in her bill of particulars which was submitted in support of the motion. Since the defendants failed to establish their prima facie entitlement to judgment as a matter of law, it is unnecessary to reach the question of whether the injured plaintiff’s opposition papers were sufficient to raise a triable issue of fact.

 

6/5/07              Garcia v Solbes
Appellate Division, Second Department

Limitations in ROM is Not Enough: It Must Be Contemporaneous with the Accident

On appeal, the Appellate Division reversed a lower court order which had denied defendant’s motion for summary judgment dismissing the complaint on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

The defendant met his prima facie burden that the plaintiff did not sustain a serious injury. In opposition, the plaintiff failed to raise a triable issue of fact. While the affidavit and medical report of the plaintiff’s examining orthopedist noted limitations in the plaintiff’s range of motion of her cervical spine, the plaintiff failed to provide any admissible medical proof that was contemporaneous with the subject accident which showed range of motion limitations in her spine. The MRI of plaintiff’s cervical and lumbar spine, which showed multiple bulging and herniated discs did not, alone, establish a serious injury. The mere existence of those conditions is not evidence of a serious injury in the absence of objective evidence of the extent of the alleged physical limitations resulting from the injuries and their duration.  

6/5/07              Gordon-Silvera v Long Is. R.R.

Appellate Division, Second Department

Plaintiff’s Complaint on SI grounds is dismissed For Failing to Address Defendant’s Doctor’s Findings

Here plaintiff appeals an order granting summary judgment for defendants. The Appellate Division held the defendants made a prima facie showing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d).  In opposition, the plaintiff failed to raise a triable issue of fact. The affirmation and affidavit of the plaintiff’s experts failed to address the findings of degeneration in her spine as noted in the affirmed medical report of the defendant’s examining radiologist, rendering speculative the conclusion that the injuries to her spine were caused by the subject accident. Further, MRI of the plaintiff’s cervical and lumbar spine which showed bulging discs and a herniation are not, in themselves, evidence of a serious injury.

 

6/5/07              Laguerre v Chavarria

Appellate Division, Second Department

Failing to Put Plaintiff’s Chiropractor’s Report in an Affidavit Leads to Lawsuit Dismissal

Appellate Division reversed lower court order which had denied defendant’s summary judgment motion. Here, defendants made a prima facie showing. In reply , the plaintiff failed to raise a triable issue of fact. The report of the plaintiff’s treating chiropractor was not in affidavit form, and therefore was without probative value. The remaining medical submissions were without probative value since they were neither sworn nor affirmed nor certified.

 

6/5/07              Lee v Troia
Appellate Division, Second Department

Summary Judgment Denial

Plaintiff’s doctor’s failure to address findings led the Appellate Division to affirm a lower court order which granted defendant’s motion for summary judgment. After ruling the defendant made a prima facie showing, the plaintiff failed to raise a triable issue of fact in opposition. The affirmation of plaintiff’s treating physician and the affirmed report of his examining doctor failed to address the findings of degeneration in his spine as noted in the affirmed medical report of the defendant’s radiologist, rendering speculative the findings that the injuries to plaintiff’s spine were caused by the subject accident.

 

6/5/07              Nannarone v. Ott
Appellate Division, Second Department

Existence of Knee Injury Not Enough: Need Objective Proof Too to Raise Issue of Fact

Appellate Division affirmed lower court order granting summary judgment. The defendant made a prima facie showing but the plaintiff failed to raise a triable issue of fact. The plaintiff failed to proffer competent medical evidence that was contemporaneous with the subject accident which showed any range of motion limitations in her right knee. MRI of  plaintiff’s right knee which showed, a meniscal tear did not, alone, establish a serious injury. The mere existence of such an injury is not evidence of a serious injury absent objective evidence of the alleged physical limitations resulting from the injury and its duration. The plaintiff’s self-serving affidavit was insufficient to meet that requirement.

 

6/5/07              O’Neal v. Bronopolsky

Appellate Division, Second Department

Defendant in Denial (on a SJ motion) for Ignoring Plaintiff’s Alleged Injuries

In a brief opinion, defendant’s failure to come close to reaching its burden on a summary judgment motion led to the Appellate Division’s affirming the lower court order for the plaintiff. Defendant failed to establish, prima facie, that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d). Here, the defendant failed to even address, much less satisfy, his burden with respect to the plaintiff’s allegation that he suffered a knee injury as a result of the accident. Since the defendant failed to establish his prima facie showing, it is unnecessary to reach the question of whether the plaintiff’s papers were sufficient to raise a triable issue of fact.

 

6/5/07              Park v. Herreros

Appellate Division, Second Department

No Beating Around the Bush: Summary Judgment Granted!

 In an opinion that gets straight to the point, the lower court’s order granting defendants’ motion for summary judgment, is affirmed.  The Appellate Division held: “The defendants made a prima facie showing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d). In opposition, the plaintiff failed to raise a triable issue of fact.”

 

6/5/07              Paz v Wydrzynski
Appellate Division, Second Department

Minding the Gap (In Treatment) Leads to Plaintiff’s Surviving Summary Judgment

Plaintiff’s maxing out his recovery at the chiropractor’s office led the Appellate Division to reverse lower court’s order granting defendants’ motion for summary judgment. The Court held any further treatment would be merely palliative and this sufficiently explains the gap in his treatment. Here, defendants established their  prima facie burdens that the plaintiff did not sustain a serious injury. However, contrary to the conclusion of the lower court, the plaintiff raised triable issues of fact by submitting the affirmed MRI report of a radiologist stating that plaintiff had sustained herniated cervical discs. He also submitted the affidavit of his chiropractor stating that he had significant limitations in range of motion of the cervical spine. Although the plaintiff was still in significant pain, he was discharged by his chiropractor because he had reached his maximum recovery.

 

6/5/07              Wade v Allied Bldg. Prods. Corp.

Appellate Division, Second Department

See below.

 

6/5/07              Zamaniyan v Vrabeck

Appellate Division, Second Department

Defendants’ Doctor’s Findings of Limitations Leads to Denial of Summary Judgment

In two very similarly worded decisions with similar fact patterns, the Appellate Division reversed lower court orders granting summary judgment. In both instances, the Court held that contrary to the lower court’s determinations, the defendants, in their motions for summary judgment, failed to meet their respective prima facie burdens. The defendants’ examining doctors found limitations when examining the plaintiff. Since the defendants failed to establish, prima facie, their entitlement to judgment in the first instance, it is unnecessary to reach the question of whether the plaintiff’s papers were sufficient to raise a triable issue of fact.

 

 

Audrey’s Angle on No-Fault

Audrey Seeley

[email protected]

 

The reporting of No-Fault arbitration awards is not at the same level of reported case law, meaning there is no one source to turn to for comprehensive research of arbitration awards.  We encourage you to submit to us, in a PDF format, at [email protected], any recent no-fault arbitration awards, especially Master Arbitration awards, that address interesting no-fault issues. 

 

Arbitration

 

6/11/07            In the Matter of the Arbitration of the Applicant and the Respondent

                        Arbitrator Thomas J. McCorry, Erie County

Conservative Care 14 Years Post Accident not Medically Necessary – You Think?

The Angle:  While there is no timeframe under the no-fault system placed on medical treatment the treatment must be related to the motor vehicle accident and medically necessary (meaning it is benefiting the EIP).  But conservative treatment 14 years after the accident???  Here, conservative treatment 14 years post accident was not medically necessary based upon the treating surgeon’s medical records and the IME physician’s report. 

 

The Analysis:  The issue in this arbitration was whether medical treatment rendered to the Applicant, eligible injured person (“EIP”), 14 years post accident was medically necessary.  Arbitrator McCorry aptly found it was not.

 

The EIP was involved in an October 30, 1992, motor vehicle accident wherein she allegedly sustained injury in the form of a “little soreness” to her “back region.”

 

On April 24, 2006, the EIP underwent an independent medical examination with Dr. John O’Donnell.  Dr. O’Donnell diagnosed the EIP with chronic and mild to moderate intermittent cervical pain.  He opined that the EIP’s current symptoms had an unclear relationship to the accident 14 years prior.  The current symptoms were flushed out in a series of addendums in the form of distress.  It is not clear if the distress is physical or mental.  Dr. O’Donnell recommended that the EIP begin an active exercise program to decrease exacerbation of her distress and did not recommend orthopedic surgery.  Dr. O’Donnell also opined that the EIP was close to her pre-accident condition and that no further orthopedic treatment was necessary.

 

The EIP’s treating surgeon, Dr. William Capicotto, also agreed that the EIP has reached “maximum improvement” and that the EIP made life style changes that assisted the EIP in avoiding surgery.

 

Arbitrator McCorry, while admittedly sympathetic to the EIP’s situation could not award in her favor based upon the lack of medical documentation supporting continued conservative treatment.

 

6/7/07  In the Matter of the Arbitration of the Applicant and the Respondent

Arbitrator Mary Anne Theiss, Onondaga County

Certified Physical Therapist can Conduct Electromyography and Nerve Conduction Testing.

The Angle:      This is the second decision from Arbitrator Theiss where a physical therapist has been reimbursed for conducting electrodiagnostic testing.  The New York State Education Department permit certified physical therapists to perform the testing.  In addition the Workers’ Compensation Board specifically addresses physical therapists conducting electrodiagnostic testing.  We strongly recommend that insurers request verification in the form of the physical therapist’s certification to ensure that reimbursement is proper.

 

The Analysis:  The Applicant, physical therapist, performed electromyography and nerve conduction testing on the eligible injured person (“EIP”) at the request of the EIP’s treating physician.  The physical therapist and treating physician were not affiliated.

 

The Applicant testified at the arbitration that he was certified to perform electrodiagnostic testing.  Further, the Education Law permits physical therapists to conduct this testing without physician supervision.  The Applicant further testified that the EIP’s treating physician requested the testing to ascertain the EIP’s bilateral hand paresthesia were attributed to a lesion in the cervical region or in the upper extremities.  The electrodiagnostic testing assisted in clarifying the EIP’s source of the symptoms as well as guided the future course of treatment.

 

The insurer denied reimbursement for the testing based upon a peer review conducted by a board certified neurologist, Dr. Topper.  Dr. Topper opined that electrodiagnostic testing should be performed by a physician.  Dr. Topper also concluded that the testing was planned, initiated, and performed by the Applicant without any physician supervision.  Arbitrator Theiss found this conclusion to be incorrect based upon the Applicant’s testimony.  Dr. Topper further opined that treatment was not useful as it did not alter the EIP’s treatment.  Therefore, the electrodiagnostic testing was not medically necessary.

 

Arbitrator Theiss found the Applicant’s live testimony more persuasive and found in favor of the Applicant.

 

Litigation

 

Plaintiff’s Affidavit Fails to Establish Documents are Business Records Resulting in Denial of Summary Judgment.

The number of these cases have substantially decreased but here are two case cites where the court denied the plaintiff’s summary judgment motion due to insufficient affidavits.  The plaintiff’s billing manager or corporate officer failed to establish that there was personal knowledge of the plaintiff’s practices and procedures for billing and mailing bills to insurers.  If you would like the full text of the decision please email me at [email protected] and I would be more than happy to forward them to you.

 

6/8/07  Triboro Chiropractic and Acupuncture, PLLC a/a/o Crystal Williams v. New York Cent. Mut. Fire Ins. Co., 2007 NYSlipOp 51175(U) (2d Dept., App. Term)

Plaintiff can Rely Upon Defendant’s Documents to Establish Prima Facie Case but Make an Effort to Establish an Admissible Business Record.

The insurer moved for summary judgment on the basis that the Plaintiff’s assignee failed to appear for scheduled independent medical examinations (“IME”).  The insurer’s proof consisted of copies of the claim forms, the NF-10, and the letters scheduling the IMEs.  The plaintiff cross-moved for summary judgment on the basis that the medical bills were submitted, remained unpaid, and were not timely denied.  The plaintiff’s proof consisted of an affirmation from plaintiff’s counsel as well as an affidavit from Boris Zigmond, D.C. the “principal doctor” of plaintiff.  The affidavit attested that Mr. Zigmond was informed the NF-10 and claim forms were attached to the insurer’s motion papers.

 

The appellate term held that Mr. Zigmond’s affidavit without the attachment of any documents or foundation for admission of the documents attached to the insurer’s motion papers as business records was insufficient to demonstrate a prima facie case entitlement to summary judgment.

 

Further, the appellate term held that the insurer’s papers were insufficient as they failed to demonstrate that the IME notices were mailed and that the assignor failed to appear for the scheduled examinations.

 

We know it is easy for the plaintiff to establish a prima facie case but it’s not that easy.  In short, if the plaintiff is going to rely upon the defendant’s documents it has to at least establish that they are admissible as business records.

 

6/7/07  Boston Post Road Med. Imaging, P.C. a/a/o Adrian Black v. Progressive Ins. Co.,

2007 NYSlipOp 51173(U) (2d Dept. App. Term)

Insurer’s Evidence Insufficient to Establish Lack of Standing and Eligibility for No-Fault Benefits.

The insurer moved for summary judgment on the basis that the plaintiff was ineligible for no-fault benefit reimbursement as it was not a licensed health care provider under Business Corporation Law §§1503(b) and 1507 and that the plaintiff lacked standing as it sold its rights to collect the bills at issue.

 

The insurer’s evidence as to the standing issue was held to be insufficient.  The insurer offered an unverified complaint with annexed exhibits filed by plaintiff in a Supreme Court action wherein the plaintiff alleged that it entered into a contract to sell accounts receivable.  In addition, the insurer submitted an affidavit from that Supreme Court action attesting that the plaintiff agreed to sell the accounts receivable.  Sounds pretty good huh, (notwithstanding the unverified complaint)?  Well the court held that those documents are not dispositive on this action as they are informal judicial admissions which are “evidence of a fact or facts admitted…the circumstances of which may be explained at trial.”  DRAT!

 

To make matters worse, the court also held that the insurer failed to demonstrate that the plaintiff is ineligible for reimbursement of no-fault benefits.  The insurer’s attachment of an unsigned transcript from the plaintiff’s principal at an examination under oath regarding a claim made by a different medical corporation owned by the principal was not sufficient to demonstrate that the plaintiff is owned or controlled by an entity other than a licensed medical professional.  Likewise, even though the insurer claimed that the plaintiff was channeling most of its profits to a management company as well as companies that it leases it premises and medical equipment there were insufficient facts to establish the extent of plaintiff’s profits being shared.  Therefore, the insurer’s motion was denied.

 

 

PEIPER on PROPERTY

Steven E. Peiper

[email protected]

 

Steve’s on the road to Orange County this morning and reports, accurately, that there wasn’t a single property insurance case reported by an of the appellate courts in New York during the past week.  Drive safely, Steve

 

Across Borders

 

Visit the Hot Cases section of the Federation of Defense & Corporate Counsel website, www.thefederation.org. Dan Kohane serves as the FDCC’s President and Website Editor Emeritus.

 

6/13/07            Mitchell v. Medical Inter-Insurance Exchange
Connecticut Court of Appeals
Insurance Company Must Defend and Indemnify Physicians in Medical Malpractice Claim When the Claim was Filed During an Extended Reporting Period Under the Terms of the Parties’ Insurance Policies.
The physicians held professional liability insurance claims-made policies with the defendant. The policies included additional terms providing that in the event of termination, the insured would have an automatic extended reporting period of thirty days in which claims otherwise covered by the policy could be reported if not covered by another insurance carrier. The underlying medical malpractice suit was reported two weeks into the termination period and the defendant denied coverage. The court held that under a claims-made policy, any reported claim automatically triggers coverage under either the policy period or an extended reporting period, according to Connecticut statutory definitions of a “claims-made policy.”

Submitted by: Kate Bockman & Patrick Scarlett on behalf of Monty Todd

 

6/13/2007        Erie Insurance Exchange v. Heffernan

Maryland Court of Appeals
In a Breach of Contract Action Against an Insurer on an Uninsured/Underinsured Motorist Claim, the Insured Must Show What He/She is “Entitled to Recover” under the Law of the State where the Accident Occurred.
Although principles of lex loci contractus apply to contract disputes, the Maryland uninsured motorist statute and the terms of the insurance policy refer to the insured’s "entitled to recover," which references tort law. The insured must prove his underlying tort claim (that the uninsured motorist was at fault) in order to recover on the breach of contract claim. Therefore, the court relies on the theory of lex loci delicti and requires that the insured resolve the tort aspects of his case under the substantive law of the state where the accident occurred.

Submitted by: Kate Bockman & Patrick Scarlett on behalf of Monty Todd

 

6/13/2007        TH Agriculture & Nutrition, LLC v. Ace European Group, Ltd.

Tenth Circuit Court of Appeals
No Personal Jurisdiction over European Insurance Companies
Plaintiff, the successor in interest to an asbestos distributor, brought suit against its insurance carriers, thirteen European companies that insured plaintiff under general liability policies, in the District Court for the District of Kansas. Plaintiff brought the action seeking damages for breach of contract and a declaratory judgment that the insurers are obligated to indemnify plaintiff for losses resulting from the thousands of asbestos claims filed against plaintiff nationwide and to pay the costs of defending against these claims. The court affirmed the district court’s dismissal of the action for lack of personal jurisdiction. Although the insurers had established minimum contacts with Kansas when it reached out to the forum state by including it within the policies’ worldwide territory-of-coverage clause, the court held that personal jurisdiction over the insurers did not comport with "traditional notions of fair play and substantial justice." Jurisdiction over the insurers did not satisfy the Burger King factors because the insurance contracts stated that they would be governed by Dutch law, and thus exercising jurisdiction in Kansas would be inefficient and would interfere with Dutch sovereignty.
Submitted by: Kate Bockman & Patrick Scarlett on behalf of Monty Todd

 

6/12/2007        Certain Underwriters at Lloyds v. Westchester Fire Ins. Co
Third Circuit Court of Appeals
An Arbitrator, Not a Court, Should Decide Whether to Arbitrate Coverage Disputes under Identical Insurance Contracts Separately or in a Consolidated Arbitration.
Both the insurance company (Westchester) and the reinsurer (the Underwriters) agreed that they had a valid arbitration agreement, but disagreed whether that agreement required them to separate the arbitration of the various contracts or to consolidate them in one arbitration. The Court of Appeals held that such a determination is a procedural issue, concerning only the nature of the arbitration itself, and therefore is an appropriate decision for the arbitrator.

Submitted by: Kate Bockman & Patrick Scarlett on behalf of Monty Todd

 

 

Reported Decisions

 

In the Matter of Temple Construction Corp. v. Sirius America Insurance Company

Simon & Gilman, LLP (Bertram Herman, P.C., Mount Kisco,
N.Y., of counsel), for appellants.
White, Quinlan & Staley, LLP, Garden City, N.Y. (Regis E.
Staley, Jr., of counsel), for
respondent.

 

DECISION & ORDER

In a "proceeding" for a judgment declaring that Sirius America Insurance Company is obligated to defend and indemnify Temple Construction Corp. and Bokharian Jewish Community Center, Inc., in an action entitled Ramos v Havurat Yisrael, pending in the Supreme Court, Kings County, under Index No. 27395/04, the appeal is from an order of the Supreme Court, Kings County (Ruchelsman, J.), dated June 16, 2006, which granted the motion of Sirius America Insurance Company to dismiss the petition.

ORDERED that the proceeding is converted into an action for a declaratory judgment, and the notice of petition and petition are deemed to be a summons and complaint (see CPLR 103[c]); and it is further,

ORDERED that the order is modified, on the law, by deleting the provision thereof granting that branch of the motion of Sirius America Insurance Company which was to dismiss the cause of action asserted by Bokharian Jewish Community Center, Inc., for a declaration that Sirius America Insurance Company is obligated to defend and indemnify Bokharian Jewish Community Center, Inc., in the underlying action, and substituting therefor a provision denying that branch of the motion; as so modified, the order is affirmed, and the cause of action asserted by Bokharian Jewish Community Center, Inc., for a declaration that Sirius America Insurance Company is obligated to defend and indemnify it in the underlying action is reinstated; and it is further,

ORDERED that the matter is remitted to the Supreme Court, Kings County, for the entry of an interlocutory judgment declaring that Sirius America Insurance Company is not obligated to defend and indemnify Temple Construction Corp. in the underlying action.

In July 2004, Jeffrey Ramos allegedly sustained injuries while working for Temple Construction Corp. (hereinafter Temple) on a construction project on the premises of Bokharian Jewish Community Center, Inc. (hereinafter Bokharian). Sirius America Insurance Company (hereinafter Sirius), which issued separate insurance policies covering Temple and Bokharian during the relevant time period, disclaimed coverage to both Temple and Bokharian based on the failure of each to timely notify it of the occurrence referenced in the underlying action. Temple and Bokharian then commenced this "proceeding," seeking a declaration that Sirius must appear and defend them in the underlying personal injury action. The Supreme Court concluded that Temple and Bokharian failed to comply with the notice provisions of their respective policies, and granted Sirius's motion to dismiss the petition. Temple and Bokharian appeal.

Initially, we convert this proceeding into a civil action for a judgment declaring that Sirius is obligated to defend and indemnify Temple and Bokharian in the underlying action and treat the notice of petition and petition as a summons and complaint (see CPLR 103[a]).

Generally, the requirement that an insured provide notice of any occurrence to the insurance company within a reasonable time is considered a condition precedent to the insurer's obligation to defend or indemnify the insured (see White v City of New York, 81 NY2d 955, 957; C.C.R. Realty of Dutchess v New York Cent. Mut. Fire Ins. Co., 1 AD3d 304, 304-305). Absent a showing of legal justification, the failure to comply with the notice condition vitiates coverage (see White v City of New York, supra; Rael Automatic Sprinkler Co., Inc. v Schaefer Agency, 32 AD3d 835).

The evidence presented by Sirius established that it was first given notice of the occurrence by Temple on or about December 22, 2004, when Temple forwarded the original summons and complaint in the underlying action, which named Temple as a defendant, to Sirius. The evidence further demonstrated that Sirius was first given notice of the occurrence by Bokharian on or about May 4, 2005, when Bokharian forwarded the amended summons and complaint in the underlying action, which named Bokharian as a defendant, to Sirius. An affidavit submitted with the petition demonstrated that both Temple and Bokharian were aware of the occurrence by July 26, 2004, the date of the incident, at the latest. Thus, Sirius established that Temple's 5-month delay, and Bokharian's 10-month delay, in notifying it of the occurrence, were unreasonable as a matter of law (see Paul Developers, LLC v Maryland Cas. Ins. Co., 28 AD3d 443, 445; Public Serv. Mut. Ins. Co. v Harlen Hous. Assoc., 7 AD3d 421, 422).

Temple and Bokharian assert that notice of the occurrence was provided to Sirius the day after the accident by notice to a nonparty insurance broker, Northeastern Group, Ltd. (hereinafter Northeastern). "In general, an insurance broker is considered the agent of the insured, not the insurance company, and notice to the broker is not deemed notice to the insurance company" (MTO Assoc., Ltd. Partnership v Republic-Franklin Ins. Co., 21 AD3d 1008, 1008). However, "a broker will be held to have acted as the insurer's agent where there is some evidence of action on the insurer's part, or facts from which a general authority to represent the insurer may be inferred'" (Rendeiro v State-Wide Ins. Co., 8 AD3d 253, 253, quoting Bennion v Allstate Ins. Co., 284 AD2d 924, 925).

The evidence in the record failed to establish any basis for the claim that Northeastern was Sirius's agent. Northeastern was not listed as an agent — or otherwise — in the insurance policies issued to Temple and Bokharian. Nor was there evidence that any employee of Temple or Bokharian had any contact with Northeastern or its employees prior to the occurrence pertaining to the underlying action. Nor do Temple or Bokharian claim that they purchased their insurance policies from Northeastern. Temple and Bokharian failed to establish that Northeastern possessed any general authority to represent Sirius and accept notice of occurrence on its behalf (see Paul Developers, LLC v Maryland Cas. Ins. Co., supra; cf. Rendeiro v State-Wide Ins. Co., supra).

Temple further contends that Sirius's delay in disclaiming from the time it was first notified of the occurrence until it sent Temple its disclaimer letter, dated December 30, 2004, was unreasonable as a matter of law. This contention is without merit, as Sirius did not receive notice of the occurrence from Temple until December 22, 2004, at the earliest. Thus, Sirius disclaimed as to Temple within a period of approximately eight days, which, as a matter of law, cannot be deemed unreasonable (see e.g. Steinberg v Hermitage Ins. Co., 26 AD3d 426, 427; State Farm Mut. Auto. Ins. Co. v Daniels, 269 AD2d 860, 861).

However, Sirius failed to establish, as a matter of law, that its 47-day delay in disclaiming to Bokharian from the time it was first notified of the occurrence by Bokharian on May 4, 2005, until it sent Bokharian its disclaimer letter, dated June 20, 2005, was reasonable. Although Sirius contended that the delay was warranted by its need to investigate the occurrence, the record is silent as to the date Sirius completed its investigation. Even though Bohkarian did not provide Sirius with timely notice of the occurrence, Sirius's failure to provide timely notice of its disclaimer to Bokharian would result in loss of its disclaimer's effectiveness (see Matter of Allstate Ins. Co. v Cruz, 30 AD3d 511, 512).

In view of the foregoing, and upon consideration of all of the evidence presented, the Supreme Court erred in granting that branch of Sirius's motion which was to dismiss the cause of action asserted by Bokharian for defense and indemnification in the underlying action (see Morris Park Contr. Corp. v National Union Fire Ins. Co. of Pittsburgh, Pa., 33 AD3d 763, 767).

The remaining contentions of Temple and Bokharian are without merit.

We note that since this is a declaratory judgment action, the court should not have dismissed the cause of action asserted by Temple, but should have entered an interlocutory judgment declaring that Sirius is not obligated to defend and indemnify Temple in the underlying action (see Lanza v Wagner, 11 NY2d 317, 334, appeal dismissed 371 US 74, cert denied 371 US 901). Accordingly, we remit the matter to the Supreme Court, Kings County, for the entry of an appropriate judgment.

RIVERA, J.P., FLORIO, DILLON and CARNI, JJ., concur.

ENTER:

Adams v. Boston Properties Limited Partnership

London Fischer LLP, New York (Robert H. Baumgarten of
counsel), for appellants.
Simmons, Jannace & Stagg, LLP, Syosset (Michael D. Kern of
counsel), for Masco Contractor Services East, Inc. and Superior
Contracting Corporation, respondents.
Guararra & Zaitz, New York (Michael J. Guararra of counsel),
for Ritter Contracting, Inc., respondent.

Order, Supreme Court, New York County (Carol R. Edmead, J.), entered May 3, 2006, which, to the extent appealed from, granted the motions of third-party defendants for summary judgment insofar as to dismiss certain third-party claims for contractual indemnification and for breach of contract for failure to procure insurance, unanimously affirmed, with costs.

The third-party claims at issue, for breach of contract and contractual indemnification, were properly dismissed since the promises upon which those claims are based are found in the main agreement, to which third-party defendants were not signatories. While it is true that the construction subcontracts signed by third-party defendants incorporated the main agreement by reference, "[u]nder New York law, incorporation clauses in a construction subcontract, incorporating prime contract clauses by reference into a subcontract, bind a subcontractor only as to prime contract provisions relating to the scope, quality, character and manner of the work to be performed by the subcontractor" (Bussanich v 310 E. 55th St. Tenants, 282 AD2d 243 [2001]; see Goncalves v 515 Park Ave. Condominium, __ AD3d __, 2007 NY Slip Op. 02981 [2007]).

Dwyer v. First Unum Life Insurance Company

 

Begos & Horgan, LLP, Bronxville (Patrick W. Begos of
counsel), for appellants-respondents.
Murray & McCann, Rockville Centre (Joseph D. McCann of
counsel), for respondent-appellant.

Order, Supreme Court, New York County (Bernard J. Fried, J.), entered December 13, 2006, as amended by order, same court and Justice, entered February 16, 2007, which denied plaintiff's and defendants' motions for summary judgment, inter alia, unanimously modified, on the law, defendants' motion granted to the extent of rescinding the policy, the complaint otherwise dismissed, and otherwise affirmed, with costs in favor of defendants. The Clerk is directed to enter judgment accordingly.

For the insurer to be entitled to rescind the policy ab initio, after it had been in existence for two years during the insured's lifetime, it must identify a material misrepresentation in the application that was intended to defraud the insurer (Insurance Law § 3105[b], § 3216[d][1][B][I]; Interested Underwriters at Lloyd's v H.D.I. III Assoc., 213 AD2d 246, 247 [1995]; Process Plants Corp. v Beneficial Natl. Life Ins. Co., 53 AD2d 214, 216-217 [1976], affd 42 NY2d 928 [1977]). "Ordinarily, the question of materiality of misrepresentation is a question of fact for the jury. However, where the evidence concerning the materiality is clear and substantially uncontradicted, the matter is one of law for the court to determine" (id., 53 AD2d at 216). Here, defendants presented the affidavit of their chief underwriter, as well as the company guidelines, both of which establish that if defendants had known of plaintiff's history of chronic back pain, including his prescription medication for such pain and his hospitalization within five years prior to filling out the insurance application, they would not have issued the policy to plaintiff in its present form (Barrett v State Mut. Life Assur. Co., 58 AD2d 320, 323 [1977], affd 44 NY2d 872 [1978], cert denied 440 US 912 [1979]; Process Plants, 53 AD2d at 216-217).

Plaintiff's intent to defraud defendants may also be determined as a matter of law where, as here, it is uncontested that he knew the answers he provided to the questions on the application were false, and he provided some partial answers, omitting only information that would actually have been relevant to a determination of his insurable risk (see Wageman v Metropolitan Life Ins. Co., 24 AD2d 67, 71 [1965], affd 18 NY2d 777 [1966]). Nor was plaintiff entitled to rely on his broker to waive or omit any answer to the specific questions in the application (see id., 24 AD2d at 69; see also Simon v Government Empls. Life Ins. Co. of N.Y., 79 AD2d 705 [1980]).

We reject plaintiff's assertions that preexisting conditions, in place for more than two years, are not subject to the exception for fraudulent misrepresentations under the policy. While plaintiff has spent much of his argument noting other cases in which these defendants or other subsidiaries of UnumProvident were found to have acted in bad faith (see e.g. Radford Trust v First UNUM Life Ins. Co. of Am., 321 F Supp 2d 226 [D Mass 2004]; Hangarter v Paul Revere Life Ins. Co., 236 F Supp 2d 1069 [ND Cal 2002], affd in part & revd in part 373 F3d 998 [9th Cir 2004]), he has failed to come forward with admissible evidence demonstrating such bad faith at work here. Indeed, here, the evidence demonstrates a good faith basis for rescission of the policy.

We have examined plaintiff's remaining arguments and find them insufficient to raise a triable issue of material fact.

Steadfast Insurance Company v. Casden Properties, Inc.

Melito & Adolfsen P.C., New York (Steven I. Lewbel of
counsel), for appellant.
Storch Amini & Munves PC, New York (Russell Bogart of
counsel), for Casden Properties, Inc., LAC Properties Qrs III,
Inc., Hapi Management, Inc., respondents, and Wilkes
respondents.
Wade Clark & Mulcahy, New York (Gregory G. Vetter of
counsel), for The Rubin Group, respondent.

Order, Supreme Court, New York County (Edward H. Lehner, J.), entered May 31, 2006, which, to the extent appealed from as limited by the briefs, denied plaintiff's cross motion for summary judgment seeking a declaration that it owes no duty to provide a defense or coverage in the underlying North Carolina wrongful death action, unanimously affirmed, with costs.

The state of California adheres to the "Notice-Prejudice Rule" under which "a defense based on an insured's failure to give timely notice requires the insurer to prove that it suffered substantial prejudice. Prejudice is not presumed from delayed notice alone. The insurer must show actual prejudice, not the mere possibility of prejudice" (Shell Oil Co. v Winterthur Swiss Ins. Co., 12 Cal App 4th 715, 760, 15 Cal Rptr 2d 815, 845 [1993] [citations omitted]; see also Northwestern Tit. Sec. Co. v Flack, 6 Cal App 3d 134, 141, 85 Cal Rptr 693, 696-697 [1970]; Insurance Co. of Pa. v Associated Intl. Ins. Co., 922 F2d 516, 524 [9th Cir 1991]).

California law is imbued with a strong public policy against technical forfeitures in the insurance context (see Cal Civ Code § 3275; Insurance Co. of Pa., 922 F2d at 524; California Compensation & Fire Co. v Industrial Acc. Commn., 62 Cal 2d 532, 535, 399 P2d 381, 383 [1965]; O'Morrow v Borad, 27 Cal 2d 794, 800, 167 P2d 483, 487 [1946]), and California courts may refuse to enforce a provision in an insurance policy that violates public policy (see Pacific Empls. Ins. Co. v Superior Court, 221 Cal App 3d 1348, 1359, 270 Cal Rptr 779, 784-785 [1990]). Thus, for example, even where an insurance policy makes the notice provision a condition precedent to coverage, an insurer must nonetheless demonstrate prejudice to avoid liability based on the breach of notice requirement (see Insurance Co. of Pa., 922 F2d at 524; Hanover Ins. Co. v Carroll, 241 Cal App 2d 558, 565, 50 Cal Rptr 704, 708-709 [1966]).

Given these principles, the motion court correctly determined that under California law, a policy endorsement waiving the requirement that an insurer must demonstrate prejudice in order to disclaim for untimely notice, thereby waiving the Notice-Prejudice Rule, is void as against public policy (see Service Mgt. Sys. v Steadfast Ins. Co., 2007 US App LEXIS 272, 2007 WL 27114 [9th Cir]).

Blake v. Ford Motor Company

Lieff, Cabraser, Heimann & Bernstein, LLP, New York
(Wendy R. Fleishman of counsel), for appellants.
Schnader Harrison Segal & Lewis LLP, New York (Carl J.
Schaerf of
counsel), for respondent.

Order, Supreme Court, Bronx County (Yvonne Gonzalez, J.), entered May 31, 2006, which, in a action for personal injuries and wrongful death caused by the rolling over of a van in which plaintiffs or their decedents were passengers, denied plaintiffs' motion to amend the complaint so as to add the van's insurer, unanimously affirmed, without costs.

The proposed amendment, which seeks to add claims of fraud and fraudulent concealment against the van's insurer based on its failure to warn the van's owner of the van's rollover risk, was properly denied for lack of merit (see Thompson v Cooper, 24 AD3d 203, 205 [2005]). In the absence of a fiduciary relationship between the van's owner and its insurer, the insurer was under no duty to warn the owner of the van's rollover risk (see McGarr v Guardian Life Ins. Co., 19 AD3d 254, 256 [2005]; Elghanian v Harvey, 249 AD2d 206 [1998]). We have considered plaintiffs' other contentions and find them unavailing.

Fortress Insurance Company v. Kollander

Shayne, Dachs, Stanisci, Corker & Sauer, Mineola, N.Y. (Norman
H. Dachs of counsel), for appellant.
Kolenovsky, Spiegel & Caputo, LLP, New York, N.Y. (Kelly
Caputo of counsel), for respondent.

 

DECISION & ORDER

In an action, in effect, for a judgment declaring that the plaintiff is not obligated to defend and indemnify the defendant in an underlying action entitled Eliades v Kollander, pending in the Supreme Court, Queens County, under Index No. 9620/05, the defendant appeals from (1) an order of the Supreme Court, Nassau County (Mahon, J.), dated September 25, 2006, which, in effect, denied his motion to compel the plaintiff to comply with certain discovery demands, and (2) an order of the same court entered November 2, 2006, which granted the plaintiff's motion for summary judgment declaring that the plaintiff is not obligated to defend and indemnify the defendant in the underlying action, and denied his cross motion for summary judgment declaring that the plaintiff is so obligated.

ORDERED that the orders are affirmed, with one bill of costs, and the matter is remitted to the Supreme Court, Nassau County, for the entry of a judgment declaring that the plaintiff is not obligated to defend or indemnify the defendant in the underlying action.

An insurer can be relieved of its duty to defend by establishing, as a matter of law, that there is no possible factual or legal basis upon which it might eventually be obligated to indemnify the insured (see First State Ins. Co. v J & S United Amusement Corp., 67 NY2d 1044, [*2]1046; Spoor-Lasher Co. v Aetna Cas. & Sur. Co., 39 NY2d 875, 876). The plaintiff, which issued a dental malpractice insurance policy to the defendant in which it essentially agreed to defend and indemnify him in any action brought against him to recover damages for "bodily injury," established that the claims involved in the underlying action did not seek to recover such damages, and therefore, were not within the scope of the policy. Since, in response, the defendant failed to raise a triable issue of fact, the court correctly granted the plaintiff's motion for summary judgment and denied the defendant's cross motion for summary judgment.

The defendant's remaining contention is without merit.

Since this, in effect, is a declaratory judgment action, we remit the matter to the Supreme Court, Nassau County, for the entry of a judgment declaring that the plaintiff is not obligated to defend or indemnify the defendant in the underlying action (see Lanza v Wagner, 11 NY2d 317, 334).

GZA GeoEnvironmental, Inc., New York State Liquidation Bureau

Wilson Elser Moskowitz Edelman & Dicker LLP, New York
(Richard E. Lerner of counsel), for appellant.
Smith & Laquercia, P.C., New York (Robert W. Napoles of
counsel), for respondent.

Order, Supreme Court, New York County (Michael D. Stallman, J.), entered November 2, 2006, which denied claimant's motion to confirm and granted the liquidator's cross motion to disaffirm the report of the special referee, and denied the claim, unanimously affirmed, without costs.

The liquidator was not required to pay the claim resulting from the settlement. Its denial of the claim on the ground the settlement violated the stay was rational and within its broad power to implement the legislative policy embodied in the statutory liquidation scheme (see generally Matter of New York Pub. Interest Research Group v New York State Dept. of Ins., 66 NY2d 444, 448 [1985]). Contrary to claimant's contention, the liquidator, acting in its governmental capacity, was not subject to estoppel for failure to respond to claimant's requests to consent to the proposed settlement (see Serio v Ardra Ins. Co., 304 AD2d 362 [2003], lv denied 100 NY2d 516 [2003]). In any event, there was no basis for estoppel (see Baje Realty v Cutler, 32 AD3d 307 [2006]).

In view of the foregoing, we need not reach the other grounds urged for affirmance. We have considered claimant's other contentions and find them unavailing.

Serio v. United States Fire Insurance Company

Carroll, McNulty & Kull, LLC, New York, N.Y. (Kristin V.
Gallagher and Ann M. Odelson of counsel), for appellants.
Shayne, Dachs, Stanisci, Corker & Sauer, Mineola, N.Y.
(Norman H. Dachs of counsel), for
respondent.

 

DECISION & ORDER

In an action for a judgment declaring that the plaintiff, Gregory V. Serio, Superintendent of Insurance of State of New York, as ancillary receiver of Credit General Insurance Company, is not obligated to defend and indemnify the defendant J.T. Magen & Co., Inc., in an underlying personal injury action entitled Feyjoo v D & G Land Company, LLC, pending in the Supreme Court, Queens County, under Index No. 4517/99, and that the defendants United States Fire Insurance Company and North River Insurance Company are obligated to defend and indemnify the defendant J.T. Magen & Co., Inc., in the underlying action, the defendants United States Fire Insurance Company, North River Insurance Company, and J.T. Magen & Co., Inc., appeal from (1) so much of an order and interlocutory judgment (one paper) of the Supreme Court, Queens County (Polizzi, J.), entered January 6, 2006, as denied their motion for summary judgment and, upon searching the record, awarded summary judgment in favor of the plaintiff and declared that the plaintiff has no duty to indemnify the defendant J.T. Magen & Co., Inc., in the underlying action, and that the general commercial insurance policy issued to J.T. Magen & Co., Inc., by the defendant United States Fire Insurance Company provides primary and not excess insurance, (2) an order of  the same court entered August 2, 2006, which denied their motion for leave to renew, and (3) a judgment of the same court entered August 8, 2006, which is in favor of the plaintiff and against the defendant United States Fire Insurance Company in the principal sum of $342,179.77.

ORDERED that the appeals by the defendants North River Insurance Company and J.T. Magen & Co., Inc., from the judgment entered August 8, 2006, are dismissed, as they are not aggrieved thereby (see CPLR 5511); and it is further,

ORDERED that the order and interlocutory judgment entered January 6, 2006, is reversed insofar as appealed from, on the law, the motion of the defendants United States Fire Insurance Company, North River Insurance Company, and J.T. Magen & Co., Inc., for summary judgment is granted, it is declared that the defendants United States Fire Insurance Company and North River Insurance Company are not obligated to indemnify the defendant J.T. Magen & Co., Inc., in the underlying action and that the general commercial insurance policy issued to J.T. Magen & Co., Inc., by United States Fire Insurance Company is excess to the general commercial insurance policy issued by Credit General Insurance Company, and the judgment entered August 8, 2006, is vacated; and it is further,

ORDERED that the appeals from the order entered August 2, 2006 and the judgment entered August 8, 2006, are dismissed as academic in light of our determination on the appeal from the order and interlocutory judgment entered January 6, 2006; and it is further,

ORDERED that one bill of costs is awarded to the appellants.

The plaintiff in this case is the Superintendent of Insurance of the State of New York (hereinafter the Superintendent), as ancillary receiver of Credit General Insurance Company (hereinafter Credit General). The Supreme Court erred in holding that the Superintendent was not estopped from disclaiming coverage of the defendant J.T. Magen & Co., Inc. (hereinafter Magen), in the underlying action. "While the State Insurance Fund is an agency of the State, its function is akin to that of a private insurance carrier and, especially in matters of litigation, it is considered to be an entity separate from the State itself . . . It follows that in a proper case, laches and estoppel may be imputed to the fund" (Matter of Carney v Newburgh Park Motors, 84 AD2d 599).

Here, the appellants established that Credit General assumed the defense of Magen in the underlying action without reserving the right to deny coverage. The appellants also established that Magen was prejudiced by the Superintendent's disclaimer of such coverage which was issued after liability had been established in the underlying action and shortly before the damages trial. As such, the Superintendent is estopped from denying coverage (see Albert J. Schiff Assoc. v Flack, 51 NY2d 692; Utica Mut. Ins. Co. v 215 W. 91st St. Corp., 283 AD2d 421, 425; Brooklyn Hosp. Ctr. v Centennial Ins. Co., 258 AD2d 491, 492) and has a duty to indemnify Magen with respect to the underlying personal injury action.

The Supreme Court also erred in finding that the policy issued to Magen by the defendant United States Fire Insurance Company provided primary coverage. The appellants established that Magen was an additional insured under the policy issued by Credit General. Moreover, provisions of the subcontract between Magen and Credit General's insured established that Credit General's coverage was primary (see Pecker Iron Works of N.Y. v Travelers' Ins. Co., 99 NY2d 391).

Meegan v. Progressive Insurance Company

Appeal from a judgment of the Supreme Court, Erie County (Joseph R. Glownia, J.), entered November 7, 2005 in a personal injury action. The judgment, upon a jury verdict in favor of plaintiffs and against defendant, awarded plaintiffs the amount of $479,091.85.


SUGARMAN LAW FIRM, LLP, SYRACUSE (TIMOTHY J. PERRY OF COUNSEL), FOR DEFENDANT-APPELLANT.
KNOER, CRAWFORD & BENDER, LLP, BUFFALO (PAUL A. BENDER OF COUNSEL), FOR PLAINTIFFS-RESPONDENTS.


It is hereby ORDERED that the judgment so appealed from be and the same hereby is reversed on the law without costs, the cross motion for a directed verdict is denied in part, the posttrial motion is granted in part, the verdict is set aside, and a new trial is granted on the issues of serious injury and damages.


Opinion by Peradotto, J.: Sheila M. Meegan (plaintiff) was injured in a motor vehicle accident when the vehicle that she was driving was rear-ended by another vehicle. She thereafter settled with the driver of the other vehicle for $25,000, the maximum amount of coverage under his insurance policy. Plaintiffs then commenced this action seeking supplementary uninsured/underinsured motorist (SUM) coverage under the policy issued by defendant to plaintiff Michael T. Meegan, plaintiff's husband. The case proceeded to trial, and Supreme Court granted plaintiffs' cross motion for a directed verdict on, inter alia, the issue whether plaintiff sustained a serious injury. The jury thereafter returned a verdict in plaintiffs' favor, and defendant moved for, inter alia, an order reducing the verdict "to conform to the coverage for this claim" or an order setting aside the verdict and granting a new trial on all issues. The court denied defendant's posttrial motion, and judgment was entered for plaintiffs in the amount of $479,091.85.

For the reasons that follow, we agree with defendant that a new trial should be granted on the issue whether plaintiff sustained a serious injury within the meaning of Insurance Law § 5102 (d) because the court erred in granting that part of plaintiffs' cross motion for a directed verdict on that issue. That issue involved questions of fact for the jury, and the court therefore erred in concluding that plaintiff's shoulder injury met the serious injury threshold as a matter of law. [*2]

We address first the judgment in appeal No. 2. Plaintiffs contend that they were not required to establish that plaintiff sustained a serious injury in the context of this case. That contention is inconsistent with their position at trial and is raised for the first time on appeal. Nevertheless, we address plaintiffs' contention in view of our conclusion that a new trial on the issue of serious injury should be granted. Plaintiffs' contention involves an issue of first impression in this Department and, although the Second Department addressed the issue in Raffellini v State Farm Mut. Auto. Ins. Co. (36 AD3d 92), we disagree with its resolution of the issue.

The SUM endorsement to defendant's policy provides in relevant part that defendant agrees to "pay all sums that the insured . . . shall be legally entitled to recover as damages from the owner or operator of an uninsured motor vehicle because of bodily injury sustained by the insured, caused by an accident . . . subject to the Exclusions, Conditions, Limits and other provisions of [the] SUM endorsement." Pursuant to an exclusion in the SUM endorsement, SUM coverage does not apply "for non-economic loss[] resulting from bodily injury . . . unless the insured has sustained serious injury as defined in section 5102(d) of the New York Insurance Law." Thus, under the terms of the policy, plaintiffs were required to establish that plaintiff sustained a serious injury.

In Raffellini, the Second Department held that the provision in the insurance contract imposing a serious injury threshold requirement in the underinsurance context should not be given effect (see id. at 105). Pursuant to the reasoning of the Second Department, "the Legislature made a point of imposing the serious injury threshold requirement in [Insurance Law § ] 3420 (f) (1), which governs mandatory, uninsured motorists coverage, . . . [but] omitted that threshold from the ensuing section, section 3420 (f) (2), which governs the optional coverage an insured may, for an additional premium, purchase from his or her insurer" (id. at 103). Thus, reasoned the Second Department, the omission of the serious injury threshold requirement in section 3420 (f) (2) renders "legally irrelevant" a defense of lack of serious injury (id. at 103), and the regulations imposing such a requirement "would appear unauthorized" (id. at 104). The Court in Raffellini went on to note that Insurance Law § 3420 (a) provides for certain mandatory policy provisions that are to be "equally or more favorable to the insured" and that a provision in a contract imposing a serious injury threshold requirement is less favorable to an insured than section 3420 (f) (2) and thus should not be enforced (see id. at 105).

We disagree with the decision of the Second Department in Raffellini and conclude that plaintiffs were required to establish that plaintiff sustained a serious injury in order to recover under the policy. The language of the SUM endorsement in this case comes directly from the insurance regulations containing the requirements for SUM endorsements, which include the exclusion that SUM coverage does not apply to non-economic damages unless the insured has sustained a "serious injury" as defined in Insurance Law § 5102 (d) (see 11 NYCRR 60-2.3 [f]).

It is well established that "[r]esponsibility for administering the Insurance Law rests with the Superintendent of Insurance . . ., who has broad power to interpret, clarify, and implement the legislative policy' " (Matter of Medical Socy. of State of N.Y. v Serio, 100 NY2d 854, 863-864; see Insurance Law § 301). Pursuant to Insurance Law § 301, the Superintendent of Insurance has the power to promulgate regulations, and those regulations are valid as long as they are not inconsistent with a specific statutory provision (see Medical Socy. of State of N.Y., 100 NY2d at 864; see also State Farm Mut. Auto. Ins. Cos. v Brooks, 78 AD2d 456, 458, appeal dismissed 54 NY2d 753).

In our view, the regulations requiring a person to establish that he or she sustained a serious injury in order to be entitled to SUM coverage are not inconsistent with section 3420 (f) [*3](2) or any other provision of the Insurance Law. In the construction of a statute, the primary consideration for the court is to ascertain and give effect to the intent of the Legislature (see McKinney's Cons Laws of NY, Book 1, Statutes § 92 [a]; Matter of Allstate Ins. Co. v Libow, 106 AD2d 110, 114, affd for the reasons stated 65 NY2d 807). Statutes are to "be given a reasonable construction, it being presumed that a reasonable result was intended by the Legislature" (§ 143).

Insurance Law § 3420 (f) (2) does not explicitly dispense with the serious injury threshold requirement and, because "the statute is silent [on the issue], the regulations [implementing the statute and imposing that requirement] in no way conflict with the statute" (Medical Socy. of State of N.Y., 100 NY2d at 871). We further conclude that the regulations do not impose a requirement that is less favorable to the insured than section 3420 (f) (2). The regulations simply impose the same legal requirement that an injured plaintiff would have against an adequately insured driver and an uninsured driver (see § 3420 [f] [1]; § 5104). The regulations were not promulgated "on a blank slate without any legislative guidance, nor did [they] effectuate a profound change in . . . policy" (Medical Socy. of State of N.Y., 100 NY2d at 865). The obvious purpose of section 3420 (f) (2) and its corresponding regulations is to permit drivers to protect themselves under the same terms as they protect others injured as a result of their negligence. It was not the intent of the Legislature to provide a person injured by an underinsured driver with greater rights or a lesser burden of proof than an injured person otherwise would have against an adequately insured driver, when both actions arise from the same incident. To so conclude would be unreasonable and contrary to the purpose and intent of the no-fault law. We further note that SUM coverage is optional, and that an insured elects to obtain such coverage upon the specified terms and conditions of the coverage.

In sum, we conclude that, because the conditional and exclusionary language of the policy is not explicitly prohibited by the statute, and because the regulations implementing such policy provisions are authorized and not inconsistent with the language or purpose of Insurance Law § 3420 (f) (2) or any other provision of the Insurance Law, the policy provision containing the serious injury threshold requirement exclusion is valid and enforceable.

We further conclude that defendant is entitled to a new trial on damages. Contrary to the contentions of plaintiffs, absent evidence that defendant acted in bad faith, their underinsurance claim is limited to the amount of coverage provided in the policy, which is $250,000, less an offset of $25,000 for the payment made on behalf of the other driver (see Mendoza v Allstate Ins. Co., 13 AD3d 594, 595). We also add that plaintiff's recovery of past and future medical expenses and lost wages may be limited by exclusions, conditions, limits, or other provisions of the policy. Defendant's remaining contentions with respect to the judgment in appeal No. 2 are moot in light of our determination.

We conclude with respect to the order in appeal No. 1 that the court abused its discretion in granting plaintiffs' motion in limine in part by precluding an expert for defendant from testifying with respect to an entry in the medical records of one of plaintiff's physicians. In support of their motion, plaintiffs submitted an affidavit of that physician's office manager in which she stated that plaintiff did not become a patient of the physician until approximately one month after the date of the entry. In her affidavit, however, the office manager did not establish that she had personal knowledge of the entry, nor did she establish that she was responsible for making such entries. Even if she had made such a showing, the certified medical records were admissible in evidence pursuant to CPLR 4518 (c) and constituted prima facie evidence of the facts contained therein (see generally LaDuke v State Farm Ins. Co., 158 AD2d 137). Plaintiffs' contention with respect to the accuracy of the entry in those medical records goes to the weight to be given to the medical records, not their admissibility (see generally National Fuel Gas Supply [*4]Corp. v Goodremote, 13 AD3d 1134, 1135).

Accordingly, we conclude that the judgment in appeal No. 2 should be reversed, plaintiffs' cross motion for a directed verdict denied in part, defendant's posttrial motion granted in part, the verdict set aside and a new trial granted on the issues of serious injury and damages. We further conclude that the order in appeal No. 1 should be reversed insofar as appealed from and plaintiffs' motion in limine denied in its entirety.
Lunn and Pine, JJ., concur with Peradotto, J.; Centra, J., dissents in part and votes to modify in accordance with the following Opinion in which Gorski, J.P., concurs.

I

For the reasons that follow, we respectfully dissent in appeal No. 1 and dissent in part in appeal No. 2 because, in our view, defendant is not entitled to a new trial on the issues of serious injury and damages. With respect to appeal No. 2, we agree with the majority that plaintiffs' underinsurance claim is limited to $225,000, and we therefore would modify the judgment in appeal No. 2 accordingly.

II

Sheila M. Meegan (plaintiff) sustained injuries in a motor vehicle accident when the vehicle she was driving was rear-ended by a vehicle driven by Kevin T. Berry. Plaintiff settled with Berry's insurance company for $25,000, the maximum amount of coverage under Berry's policy. Plaintiffs thereafter commenced this action seeking supplementary uninsured/underinsured motorists (SUM) coverage from defendant, who issued a policy to plaintiff Michael T. Meegan, plaintiff's husband. Supreme Court granted plaintiffs' motion in limine in part and precluded certain testimony of defendant's expert (appeal No. 1). The action proceeded to trial, and a jury awarded plaintiff $26,250 for past lost wages, approximately $21,500 for past medical expenses, $100,000 for past pain and suffering, $50,000 for future lost wages, $65,000 for future medical expenses, and $200,000 for future pain and suffering. The jury also awarded Michael Meegan $15,000 on his derivative claim. The court granted judgment on the verdict (appeal No. 2) and denied defendant's posttrial motion for an order reducing the verdict, vacating the award for past lost wages and medical expenses, or setting aside the verdict and granting a new trial on all issues. Defendant now appeals.

III

As did the majority, we will first address the issue of serious injury. The majority concludes that the court erred in granting that part of plaintiffs' cross motion for a directed verdict on the issue of serious injury and that defendant therefore is entitled to a new trial on that issue. The majority further rejects the contention of plaintiffs that they are not required to establish that plaintiff sustained a serious injury. We agree with the decision of the Second Department in Raffellini v State Farm Mut. Auto. Ins. Co. (36 AD3d 92) and conclude that plaintiffs are not required to establish that plaintiff sustained a serious injury.

To begin, we note that there is no statutory requirement that a plaintiff who asserts a breach of contract claim for SUM benefits must establish that he or she sustained a serious injury. Insurance Law § 5104 (a) provides that, "in any action by or on behalf of a covered person against another covered person for personal injuries arising out of negligence in the use or operation of a motor vehicle in this state, there shall be no right of recovery for non-economic [*5]loss, except in the case of serious injury, or for basic economic loss." That statute is not applicable to the facts of this case because, although plaintiff is a "covered person," defendant is not. Plaintiffs' claim for SUM benefits is governed by Insurance Law § 3420 (f) (2) (A), which provides that a policy of insurance shall, at the option of the insured, provide SUM insurance for bodily injury. That section does not require a plaintiff asserting a breach of contract claim for SUM benefits to establish that he or she sustained a serious injury. Unlike section 3420 (f) (2) (A), however, Insurance Law § 3420 (f) (1) requires a plaintiff seeking uninsured motorist (UM) benefits to establish that he or she sustained a serious injury.

There is therefore no statutory provision to support defendant's contention that plaintiffs must establish that plaintiff sustained a serious injury. Instead, defendant relies on the insurance policy, which provides that there is no SUM coverage "for non-economic loss[] resulting from bodily injury . . . unless the insured has sustained serious injury as defined in section 5102(d) of the New York Insurance Law." That provision is set forth in the insurance regulations containing the requirements for SUM endorsements (see 11 NYCRR 60-2.3 [f])^[FN1]. The majority concludes that those regulations are not inconsistent with section 3420 (f) (2) and should therefore be upheld. We disagree with that conclusion.

As the majority notes, the Superintendent of Insurance (Superintendent) "has broad power to interpret, clarify, and implement the legislative policy' " (Matter of Medical Socy. of State of N.Y. v Serio, 100 NY2d 854, 863-864). Where, however, " the question is one of pure statutory reading and analysis, dependent only on accurate apprehension of legislative intent, there is little basis to rely on any special competence or expertise of the administrative agency' " (Matter of Gruber [New York City Dept. of Personnel-Sweeney], 89 NY2d 225, 231; see Matter of Belmonte v Snashall, 2 NY3d 560, 566). In that situation, "the judiciary need not accord any deference to the agency's determination, and is free to ascertain the proper interpretation from the statutory language and legislative intent" (Gruber, 89 NY2d at 231-232).

In our view, no deference should be accorded to the Superintendent's interpretation of the statute, and the regulations are not rational (cf. Belmonte, 2 NY3d at 565-567; Medical Socy. of State of N.Y., 100 NY2d at 867, 871-872). Interpretation of a statute begins with an examination of its plain meaning (see Bluebird Partners v First Fid. Bank, 97 NY2d 456, 460-461). In addition, " [a] statute or legislative act is to be construed as a whole, and . . . all parts of an act are to be read and construed together to determine the legislative intent . . . Not only are different parts of the same act interpreted together, but different acts which are in pari materia are to be construed each in the light of the other' " (Matter of Cook v Carmen S. Pariso, Inc., 287 AD2d 208, 215; see McKinney's Cons Laws of NY, Book 1, Statutes § 97).

As noted above, Insurance Law § 3420 (f) (2) (A), governing SUM benefits, does not require any showing of a serious injury, yet section 3420 (f) (1), governing UM benefits, and section 5104 (a), governing negligence actions, do require such a showing. If the Legislature had wished to include a serious injury threshold requirement for SUM benefits, it could easily have done so (see generally Bluebird Partners, 97 NY2d at 461). There was no reason for the Legislature to include such a requirement, however, because a plaintiff seeking to recover SUM benefits from his or her insurer must already have made a showing of serious injury in an action against the tortfeasor. Section 3420 (f) (2) (A) provides that, "[a]s a condition precedent to the [*6]obligation of the insurer to pay under the [SUM] insurance coverage, the limits of liability of all bodily injury liability bonds or insurance policies applicable at the time of the accident shall be exhausted by payment of judgments or settlements" (see Matter of Metropolitan Prop. & Cas. Ins. Co. v Mancuso, 93 NY2d 487, 493). Thus, plaintiffs are not entitled to recover SUM benefits against their insurer unless and until they have collected the limits of the policy from the tortfeasor, and plaintiffs must meet the serious injury threshold requirement in that action against the tortfeasor. It would make no sense to require a plaintiff to make a showing of a serious injury in a tort action against a tortfeasor, and then to require the plaintiff to make that same showing again in a breach of contract action for SUM benefits against his or her insurer. Nor is it of any import whether the action against the tortfeasor ended in a settlement or proceeded to trial, where either the court or the jury would make an explicit finding of serious injury. The serious injury requirement is applicable in any of those scenarios. If a plaintiff does not have a serious injury, there is no reason for the tortfeasor to pay the limits of his or her policy.

We agree with the statement of the Second Department in Raffellini that the regulations and the provision in the insurance policy impose a requirement that "is less favorable to the insured than [Insurance Law § ] 3420 (f) (2) and should not be given effect" (id. at 105). In concluding otherwise, the majority states that "[i]t was not the intent of the Legislature to provide a person injured by an underinsured driver with greater rights or a lesser burden of proof than an injured person otherwise would have against an adequately insured driver, when both actions arise from the same incident." In our view, the majority's statement is flawed because a person injured by an underinsured driver already is required to meet the serious injury threshold in an action against the tortfeasor. Therefore, by omitting that threshold requirement for a SUM claim, the Legislature is not affording the person injured by an underinsured driver any greater rights or any lesser burden of proof. Regardless of whether a person is injured by an underinsured driver or an adequately insured driver, the person must meet the serious injury threshold in an action against the driver, and an action against the underinsured driver is a condition precedent to any claim for SUM benefits. In upholding the regulations, the majority actually is imposing a greater burden of proof on the person injured by an underinsured driver than a person injured by an adequately insured driver. A person injured by an underinsured driver would first have to establish that he or she sustained a serious injury in order to obtain a judgment or settlement from the tortfeasor and would have to make that showing again in the breach of contract action against his or her insurer for SUM benefits.

In sum, we conclude that the court did not err in directing a verdict on the issue of serious injury because plaintiffs were not required to make that showing in the first instance.

IV

The remaining issues raised by defendant do not require a new trial. Defendant contends that the award of damages for Michael Meegan's derivative claim must be vacated because the SUM endorsement does not provide coverage for derivative losses. There is no need to reach defendant's contention, however, because derivative damages awarded for loss of consortium must be added to the direct damages awarded in determining the limit of liability for bodily injury sustained by one person (see Champagne v State Farm Mut. Auto. Ins. Co., 185 AD2d 835, 837, lv denied 81 NY2d 704). In other words, the SUM coverage under this policy was $250,000 per person and $500,000 per accident, and the award of damages for plaintiff and the derivative damages for Michael Meegan cannot exceed $250,000 because plaintiff and Michael are considered one person in this context. Because the award to plaintiff exceeded $250,000, there cannot be an additional amount awarded to Michael Meegan.

There is also no need for a new trial based on the court's having granted plaintiffs' [*7]motion in limine in part by precluding an expert from testifying with respect to an entry in the medical records of one of plaintiff's physicians. Assuming, arguendo, that the court erred in granting that part of plaintiffs' motion, we conclude that the error is harmless. The entry in the medical records stated that plaintiff "has TMJ problems," and there was other evidence before the jury concerning plaintiff's preexisting condition of TMJ dysfunction.

We agree with defendant and the majority that plaintiffs' underinsurance claim is limited to $225,000, i.e., $250,000 less an offset of $25,000 for the payment made on behalf of the other driver. Plaintiffs' reliance on Acquista v New York Life Ins. Co. (285 AD2d 73) is misplaced. In that case, the plaintiff asserted causes of action for, inter alia, breach of contract and bad faith by defendant insurer (id. at 75). The First Department determined that the cause of action alleging bad faith could not stand as a "distinct tort cause of action [but that the] allegations may be employed to interpose a claim for consequential damages beyond the limits of the policy for the claimed breach of contract" (id. at 82). In this case, however, plaintiffs did not allege bad faith by defendant and thus cannot recover consequential damages beyond the limits of the policy.

V

Accordingly, we would affirm the order in appeal No. 1 and modify the judgment in appeal No. 2 by granting defendant's posttrial motion in part and reducing the verdict to $225,000.
Entered: June 8, 2007
JoAnn M. Wahl
Clerk of the Court

Footnotes

Footnote 1:We recognize that the regulations apply to claims for SUM benefits involving both uninsured and underinsured vehicles. Our analysis is limited, however, to situations involving only underinsured vehicles.

 

David Christa Construction, Inc. v. American Home Assurance Company

Appeal from an order of the Supreme Court, Wayne County (Stephen R. Sirkin, A.J.), entered March 29, 2006 in a declaratory judgment action. The order denied the motion of defendant American Home Assurance Company for summary judgment.


COHEN & LOMBARDO, P.C., BUFFALO (STUART B. SHAPIRO OF COUNSEL), FOR DEFENDANT-APPELLANT.
SMITH, MURPHY & SCHOEPPERLE, LLP, BUFFALO (FRANK G. GODSON OF COUNSEL), FOR PLAINTIFF-RESPONDENT.



It is hereby ORDERED that the order so appealed from be and the same hereby is unanimously affirmed without costs.

Memorandum: Plaintiff commenced this action seeking, inter alia, judgment declaring that it is covered under the policies issued by defendant insurers to defendant Spring Lake Excavating, Inc., plaintiff's subcontractor, and that defendant insurers are obligated to defend and indemnify plaintiff in the underlying consolidated action. American Home Assurance Company (defendant) appeals from an order denying its motion for summary judgment seeking a declaration that its insurance policy is excess to two policies carried by plaintiff and that defendant "does not owe plaintiff a defense or indemnification (other than possible excess indemnification) for the claims" in the underlying action.

Supreme Court properly denied defendant's motion insofar as it sought a declaration concerning the priority of coverage among the applicable insurance policies. Even assuming, arguendo, that defendant is correct that the memorandum of law submitted by plaintiff in opposition to the motion was insufficient to raise an issue of fact (see generally CPLR 2214 [b]), we nevertheless conclude that defendant is not entitled to declaratory relief, based on its failure to join a necessary party. According to defendant, its obligation to provide insurance coverage to plaintiff is excess to the primary obligation of United Pacific Insurance Company (United Pacific) and, because United Pacific is not a party to this action, it would not be bound by any declaration (see City of New York v Long Is. Airports Limousine Serv. Corp., 48 NY2d 469, 475; [*2]Wrobel v La Ware, 229 AD2d 861, 862). Thus, until United Pacific "is joined as a party and afforded an opportunity to be heard, the declaratory judgment sought herein cannot serve any legitimate purpose" (Wrobel, 229 AD2d at 862; see Cadman Mem. Cong. Socy. of Brooklyn v Kenyon, 279 App Div 1015, 1016, affd 306 NY 151, rearg denied 306 NY 851; Matter of J-T Assoc. v Hudson Riv.——Black Riv. Regulating Dist., 175 AD2d 438, 440-441, lv denied 79 NY2d 753; see also CPLR 1001 [a]).

Progressive Northeastern Ins. Co. v. Heath

Appeal from an order of the Supreme Court, Cayuga County (Peter E. Corning, A.J.), entered March 8, 2006 in a proceeding pursuant to CPLR article 75. The order granted the petition and permanently stayed arbitration.


THE BARNES FIRM, P.C., ROCHESTER (RICHARD P. AMICO OF COUNSEL), FOR RESPONDENT-APPELLANT.
SUGARMAN LAW FIRM, LLP, SYRACUSE (TIMOTHY J. PERRY OF COUNSEL), FOR PETITIONER-RESPONDENT.


It is hereby ORDERED that the order so appealed from be and the same hereby is unanimously affirmed without costs.

Memorandum: On July 29, 2003, respondent was seriously injured when the vehicle in which he was a passenger struck another vehicle. Respondent filed claims with the insurance companies for both vehicles. The insurance company for the vehicle in which respondent was a passenger denied his claim on the ground that the policy had expired at the time of the accident and thus the vehicle was not insured. The insurance company for the second vehicle denied respondent's claim on the ground that there was no liability for the accident on the part of its insured. The Motor Vehicle Accident Indemnification Corporation denied respondent's subsequent application for benefits on the ground that respondent was covered by an insurance policy issued by petitioner, Progressive Northeastern Insurance Company (Progressive), to respondent's parents.

On March 16, 2004, respondent filed both a claim for no-fault benefits and an uninsured motorist (UM) claim with Progressive. Progressive paid benefits on the no-fault claim but disclaimed coverage on the UM claim based on respondent's failure to give Progressive notice and proof of the claim as soon as practicable. When respondent informed Progressive of his intent to arbitrate his UM claim, Progressive commenced this CPLR article 75 proceeding seeking to stay arbitration. We conclude that Supreme Court properly granted the petition.

Contrary to the contention of respondent, the fact that Progressive paid no-fault benefits does not establish that Progressive waived the right to disclaim coverage on the UM claim. "Waiver is the intentional relinquishment of a known right" (Enright v Nationwide Ins. [appeal No. 2], 295 AD2d 980, 981; see Gilbert Frank Corp. v Federal Ins. Co., 70 NY2d 966, 968). [*2]Here, there is no evidence in the record establishing Progressive's intentional relinquishment of the notice requirements (see generally Albert J. Schiff Assoc. v Flack, 51 NY2d 692, 698).

Contrary to respondent's further contention, Progressive was not required to show prejudice before disclaiming coverage on the UM claim. Traditionally, the rule in New York has been that "an insured's failure to provide timely notice of an accident [or claim] relieves the carrier of its obligation to perform regardless of whether it can demonstrate prejudice" (Rekemeyer v State Farm Mut. Auto. Ins. Co., 4 NY3d 468, 474-475). Although the Court of Appeals has declined to apply the traditional rule in cases where the insurer has received late notice of a legal action but otherwise received timely notice of the accident or claim (see e.g. Rekemeyer, 4 NY3d at 475-476; Matter of Brandon [Nationwide Mut. Ins. Co.], 97 NY2d 491, 497-498), here there was no timely notice of the accident or claim (see Argo Corp. v Greater N.Y. Mut. Ins. Co., 4 NY3d 332, 339-340; Matter of Assurance Co. of Am. v Delgrosso, 38 AD3d 649, 650; Gershow Recycling Corp. v Transcontinental Ins. Co., 22 AD3d 460, 461; Brownstone Partners/AF & F, LLC v A. Aleem Constr., Inc., 18 AD3d 204). Thus, Progressive was entitled to disclaim coverage on the UM claim based on respondent's seven-month delay in notifying Progressive of the accident or claim (see e.g. Gershow Recycling Corp., 22 AD3d at 461).

Britt v. Goodspeed Transit, Inc.

Feinman & Grossbard, P.C., White Plains (Steven N. Feinman of counsel), for appellants.
Keith A. Hawthorne, Bronx, for respondent.

Order, Supreme Court, Bronx County (Howard R. Silver, J.), entered January 18, 2007, which denied defendants' motion for summary judgment dismissing the complaint, unanimously affirmed, without costs.

Plaintiff's physician's affirmation as to a continuing 30% reduction in range of motion in lumbar extension, as well as significant left shoulder residual limitations, raise issues of fact on whether he suffered a "serious injury" (Insurance Law § 5102[d]). These findings, made during a physical examination three years after the accident, were compared with this doctor's findings during his examination of plaintiff the day after the accident. The doctor also cited an MRI taken one month after the accident, revealing lumbar disc herniation and bulge, and opined that significant quantified and permanent range-of-motion limitations of the left shoulder were caused by this accident (see Cespedes v McNamee, 308 AD2d 409 [2003]; Verderosa v Simonelli, 260 AD2d 293 [1999]).

Gordover  v. Balandina

Irwen C. Abrams (Wilson, Elser, Moskowitz, Edelman & Dicker,
LLP, White Plains, N.Y. [Joseph A.H. McGovern and John D.
Morio] of counsel), for appellants.
Alpert & Kaufman, LLP, New York, N.Y. (Louis Badolato and
Gary Solbin of counsel), for respondent.

 

DECISION & ORDER

In an action to recover damages for personal injuries, the defendants Yelena Olekhnovich and Sergey Olekhnovich appeal from an order of the Supreme Court, Kings County (Kramer, J.), dated August 17, 2006, which denied their motion for summary judgment dismissing the complaint insofar as asserted against them on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

ORDERED that the order is affirmed, with costs.

The defendants Yelena Olekhnovich and Sergey Olekhnovich, through the submission of the plaintiff's verified bill of particulars and the affirmed medical reports of their examining neurologist, examining orthopedic surgeon, and radiologist, made a prima facie showing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) as a result of the subject motor vehicle accident (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955; Kearse v New York City Tr. Auth., 16 AD3d 45; Collins v Stone, 8 AD3d 321). In opposition, the plaintiff raised a triable issue of fact.
SCHMIDT, J.P., KRAUSMAN, GOLDSTEIN, COVELLO and ANGIOLILLO, JJ., concur.

Jamison v. Garcia

DeSena & Sweeney, LLP, Hauppauge, N.Y. (Anne Marie
Caradonna of counsel), for appellants.
Razis & Ross, P.C., Astoria, N.Y. (George Razis and Elena Razis of counsel), for respondent.

 

DECISION & ORDER

In an action to recover damages for personal injuries, the defendants Akhnaton Gomez and Jorge Gomez appeal from so much of an order of the Supreme Court, Queens County (Polizzi, J.), dated August 22, 2006, as denied their motion for summary judgment dismissing the complaint insofar as asserted against them on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

ORDERED that the order is affirmed insofar as appealed from, with costs.

The appellants established, prima facie, their entitlement to summary judgment dismissing the complaint insofar as asserted against them on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) as a result of the subject motor vehicle accident (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955, 956-957). The plaintiff, however, raised a triable issue of fact as to whether she lost her fetus due to this accident rather than as a result of a voluntary termination of pregnancy (see Yu v C & A Seneca Constr., ___ AD3d ___ [2d Dept, May 1, 2007]; Berkshire Nursing Ctr. Inc. v Novello, 13 AD3d 327, 328-329).

The appellants' remaining contention regarding the disposition of the codefendants' cross motion is not before us on this appeal.
CRANE, J.P., SANTUCCI, FLORIO, DILLON and BALKIN, JJ., concur.

Perrotta v. Bambury

Greenstein & Milbauer, P.C. (Arnold E. DiJoseph, P.C., New York,
N.Y. [Norman I. Lida] of counsel), for respondents.
Hawkins Feretic & Daly, LLC, New York, N.Y. (James M. Merlino of counsel), for appellants.

 

DECISION & ORDER

In an action to recover damages for personal injuries, etc., the defendants appeal from an order of the Supreme Court, Richmond County (Maltese, J.), dated March 6, 2006, which denied their motion for summary judgment dismissing the complaint on the ground that the plaintiff Ronald Perrotta did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

ORDERED that the order is affirmed, with costs.

The papers submitted in support of the defendants' motion for summary judgment failed to make a prima facie showing that the plaintiff Ronald Perrotta did not sustain a serious injury within the meaning of Insurance Law § 5102(d) as a result of the subject motor vehicle accident (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955, 956-957). Since the defendants failed to establish their prima facie entitlement to judgment as a matter of law in the first instance, it is unnecessary to reach the question of whether the plaintiffs' papers were sufficient to raise a triable issue of fact (see Coscia v 938 Trading Corp., 283 AD2d 538). SCHMIDT, J.P., KRAUSMAN, GOLDSTEIN, COVELLO and ANGIOLILLO, JJ., concur.

Tobias v. Chupenko

Baker, McEvoy, Morrissey & Moskovits, P.C. (Stacy R. Seldin of counsel), for appellants.
Harold Solomon, Rockville Centre, N.Y. (Bernard G. Chambers of counsel), for respondent.

 

DECISION & ORDER

In an action to recover damages for personal injuries, the defendants appeal from an order of the Supreme Court, Kings County (Schmidt, J.), dated September 5, 2006, which denied their motion for summary judgment dismissing the complaint on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

ORDERED that the order is reversed, on the law, with costs, and the motion for summary judgment dismissing the complaint is granted.

The defendants met their prima facie burden on their motion of establishing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) as a result of the subject accident (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955). In opposition, the plaintiff failed to raise a triable issue of fact.

The plaintiff's examining physician, Dr. Levinson, failed to quantify, on the basis of objective testing, the limitations which he found in the plaintiff's lumbar spine (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Davis v New York City Tr. Auth., 294 AD2d 531, 532; Sainte-Aime v Ho, 274 AD2d 569, 570). Moreover, while the affirmation of the plaintiff's examining physician, Dr. Brown, set forth range of motion findings with respect to the plaintiff's left shoulder, right wrist, and left knee, it failed to compare those findings to the normal range of motion (see Osgood v Martes, 39 AD3d 516; Caracci v Miller, 34 AD3d 515; Nagbe v Minigreen Hacking Group, 22 AD3d 326, 327; Bent v Jackson, 15 AD3d 46, 49).

Furthermore, the affirmation of the plaintiff's treating physician, Dr. Gasalberti, and the affidavit of the plaintiff's chiropractor, Dr. Vendittelli, were insufficient to raise a triable issue of fact, as they were not based upon a recent examination of the plaintiff (see Gomez v Epstein, 29 AD3d 950, 951; Legendre v Bao, 29 AD3d 645, 646; Cerisier v Thibiu, 29 AD3d 507).

The magnetic resonance images of the plaintiff's shoulders which showed a tear of the supraspinatus tendon on the right shoulder and tendonopathy of the left shoulder did not establish a serious injury (cf. Yakubov v CG Trans Corp., 30 AD3d 509, 510; Cerisier v Thibiu, supra at 508; Kearse v New York City Tr. Auth., 16 AD3d 45, 49). Those findings are not evidence of a serious injury in the absence of objective evidence of the extent and duration of the alleged physical limitations resulting from the injury (see Yakubov v CG Trans Corp., supra; Kearse v New York City Tr. Auth., supra).

The plaintiff's self-serving affidavit was insufficient to show that he sustained a serious injury since there was no objective medical evidence in support of it (see Yakubov v CG Trans Corp., supra; Davis v New York City Tr. Auth., supra; Sainte-Aime v Ho, supra). The plaintiff also failed to proffer any competent medical evidence that he was unable to perform substantially all of his daily activities for not less than 90 of the first 180 days subsequent to the accident (see Sainte-Aime v Ho, supra).
CRANE, J.P., SANTUCCI, FLORIO, DILLON and BALKIN, JJ., concur.

La Forte v. Tiedemann

 

Appeal from an order and judgment (one paper) of the Supreme Court, Monroe County (Thomas A. Stander, J.), entered May 22, 2006. The order and judgment, entered upon a jury verdict, awarded judgment in the amount of $208,945 in favor of plaintiffs and against defendant.


EGGER & LEEGANT, ROCHESTER (JAN P. EGGER OF COUNSEL),

FOR DEFENDANT-APPELLANT.
BROWN & TARANTINO, LLC, ROCHESTER (DENNIS GRUTTADARO OF COUNSEL), FOR PLAINTIFFS-RESPONDENTS.


It is hereby ORDERED that the order and judgment so appealed from be and the same hereby is unanimously affirmed without costs.

Memorandum: Plaintiffs commenced this action to recover damages for injuries sustained by John S. LaForte (plaintiff) when the vehicle he was driving was rear-ended by a vehicle driven by defendant. Supreme Court properly granted plaintiffs' pretrial motion seeking partial summary judgment determining that plaintiff sustained a serious injury within the meaning of Insurance Law § 5102 (d). Plaintiffs submitted objective evidence that plaintiff suffered a disc herniation at L2-L3 and an annular tear at L5-S1, and they submitted the qualitative assessment of plaintiff's treating orthopedic surgeon, "who concluded that plaintiff's injury was significant, permanent, and causally related to the accident" (Vitez v Shelton, 6 AD3d 1180, 1182; see Toure v Avis Rent A Car Sys., 98 NY2d 345, 353). Defendant failed to raise an issue of fact to defeat plaintiffs' motion inasmuch as his medical expert conceded that plaintiff's injuries may have resulted from the accident and may have aggravated a preexisting condition (see generally Wojcik v Kent, 21 AD3d 1410, 1412).

Defendant stipulated that he was negligent and that his negligence was a proximate cause of the accident, and thus the trial was limited to the issue of damages. Contrary to defendant's contention, the court properly refused to preclude plaintiffs from testifying concerning plaintiff's use of antidepressant medications. Although defendant sought to preclude the testimony on the ground that it varied from plaintiffs' bill of particulars, we conclude that the testimony was properly admitted because it neither misled nor prejudiced defendant (see Sharkey v Locust Val. Mar., 96 AD2d 1093, 1094, appeal dismissed 61 NY2d 669). The court also properly allowed plaintiff's treating orthopedic surgeon to testify that he had relied on the reports of nontestifying physicians, inasmuch as "those out-of-court materials are of the kind generally accepted as reliable by experts in the medical profession" (Fleiss v South Buffalo Ry. Co., 291 AD2d 848, 849). Contrary to defendant's further contention, the court properly refused to give a missing witness charge with respect to plaintiff's primary care physician on the ground that the testimony of that physician would have been cumulative of the testimony of plaintiff's other treating physicians (see Stevens v Brown, 249 AD2d 909, 910; cf. Dukes v Rotem, 191 AD2d 35, 39, appeal dismissed 82 NY2d 886).

Also contrary to defendant's contention, the court properly granted that part of plaintiffs' posttrial motion seeking to set aside the verdict insofar as it awarded no damages for future pain and suffering and granted a new trial on the issue of damages for future pain and suffering unless defendant stipulated to an award for such damages in the amount of $125,000. "By awarding damages for future medical expenses and loss of earnings, the jury must have also accepted the testimony of plaintiff's medical witnesses that plaintiff is . . . disabled and in need of future medical treatment as the result of injuries that continue to cause pain and limit his physical activity. Thus, the determination that plaintiff has no compensable future pain and suffering is inconsistent and otherwise against the weight of the evidence' " (Corsaro v Mt. Calvary Cemetery, 258 AD2d 969, 969). The court also properly denied that part of defendant's cross motion seeking to vacate the damages awarded for past and future medical expenses on the ground that there was no adequate foundation for those damages (cf. Strangio v New York Power Auth. [appeal No. 2], 275 AD2d 945, 946). We have reviewed defendant's remaining contentions and conclude that none requires reversal or modification of the order and judgment.

 

Carrier v. Shaw

 

Appeal from an order of the Supreme Court, Erie County (Donna M. Siwek, J.), entered April 11, 2006 in a personal injury action. The order, among other things, granted defendant's motion for summary judgment dismissing the complaint.


CANTOR, LUKASIK, DOLCE & PANEPINTO, P.C., BUFFALO

(CATHERINE R. NUGENT OF COUNSEL), FOR PLAINTIFF-APPELLANT.
LAW OFFICES OF JOHN QUACKENBUSH, BUFFALO

(ALAN J. BEDENKO OF COUNSEL), FOR DEFENDANT-RESPONDENT.


It is hereby ORDERED that the order so appealed from be and the same hereby is unanimously modified on the law by denying the motion in part and reinstating the complaint, as amplified by the bill of particulars, with respect to the permanent consequential limitation of use of a body organ or member and significant limitation of use of a body function or system categories of serious injury within the meaning of Insurance Law § 5102 (d) and as modified the order is affirmed without costs.

Memorandum: Plaintiff was injured when the vehicle she was driving was rear-ended by a vehicle driven by defendant, and defendant thereafter moved for summary judgment dismissing the complaint. We conclude that Supreme Court erred in granting defendant's motion insofar as the complaint, as amplified by the bill of particulars, alleges that plaintiff sustained a serious injury within the meaning of two categories of serious injury set forth in Insurance Law § 5102 (d), i.e., the permanent consequential limitation of use and significant limitation of use categories. We therefore modify the order accordingly. Plaintiff does not address on appeal the propriety of the order with respect to the third category alleged, i.e., the 90/180 category, and thus is deemed to have abandoned any issue with respect to that category (see Ciesinski v Town of Aurora, 202 AD2d 984).

We conclude with respect to the two remaining categories of serious injury that, although defendant met her initial burden, plaintiff raised issues of fact by submitting competent and objective medical evidence with respect to the nature and extent of her injuries (see e.g. Bitici v New York City Tr. Auth., 245 AD2d 157; Cassagnol v Williamsburg Plaza Taxi, 234 AD2d 208). The affidavits of plaintiff's treating physicians include findings based on their examinations of plaintiff as well as her x-rays and abnormal ENG findings (see generally Parker v Defontaine-Stratton, 231 AD2d 412; Cesar v Felix, 181 AD2d 852, 853-854). Thus, the submissions of plaintiff in opposition to defendant's motion did not consist solely of her subjective complaints or her physicians' conclusory and speculative statements, which would have been insufficient to defeat defendant's motion (see Velez v Cohan, 203 AD2d 156, 157-158; see generally Braham v U-Haul Co., 195 AD2d 277, 277-278).

In view of our modification of the order, we note that plaintiff's cross motion for partial summary judgment on the issue of negligence is no longer moot (see Pecora v Lawrence, 28 AD3d 1136, 1137).

Cotto v. JND Concrete & Brick, Inc.

Robert P. Tusa (Sweetbaum & Sweetbaum, Lake Success, N.Y.
[Marshall D. Sweetbaum] of counsel), for appellants.
Rubenstein & Rynecki, Brooklyn, N.Y. (Kliopatra Vrontos of counsel), for respondents.

 

DECISION & ORDER

In an action to recover damages for personal injuries and property damage, etc., the defendants appeal from an order of the Supreme Court, Richmond County (Gigante, J.), dated July 19, 2006, which denied their motion for summary judgment dismissing the complaint on the ground that the plaintiff Norma G. Cotto did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

ORDERED that the order is modified, on the law, by deleting the provision thereof denying that branch of the motion which was for summary judgment dismissing the first and second causes of action, and substituting therefor a provision granting that branch of the motion; as so modified, the order is affirmed, with costs to the defendants.

The defendants satisfied their prima facie burden of showing that the plaintiff Norma G. Cotto (hereinafter the injured plaintiff) did not sustain a serious injury within the meaning of Insurance Law § 5102(d) (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955, 956-957). In opposition, the plaintiffs failed to raise a triable issue of fact. The plaintiffs' evidence was comprised, inter alia, of unsworn medical reports (see Grasso v Angerami, 79 NY2d 813, 814; Pagano v Kingsbury, 182 AD2d 268, 270), and the affirmation of the injured plaintiff's physician, which incorporated by reference, among other things, certain reports dated October 10, 2005, and March 10, 2006. It appears that the range of motion findings that were set forth in the October 10, 2005, report were not based on a recent examination of the injured plaintiff (see Whitfield-Forbes v Pazmino, 36 AD3d 901; Olson v Russell, 35 AD3d 684). The March 10, 2006, report failed to compare the findings to the normal range of motion (see Caracci v Miller, 34 AD3d 515). The injured plaintiff's physician improperly relied upon the unsworn medical reports and studies prepared by other doctors (see Merisca v Alford, 243 AD2d 613, 614; Friedman v U-Haul Truck Rental, 216 AD2d 266, 267).

Moreover, the plaintiffs' claim that the injured plaintiff was unable to perform substantially all of her daily activities for not less than 90 out of the first 180 days as a result of the subject accident was unsupported by competent medical evidence (see D'Alba v Yong-Ae Choi, 33 AD3d 650, 651; Murray v Hartford, 23 AD3d 629, 629-630). Accordingly, that branch of the defendants' motion which was for summary judgment dismissing the causes of action to recover damages for personal injuries and for loss of services should have been granted.

The Supreme Court, however, properly denied that branch of the defendants' motion which was for summary judgment dismissing the third cause of action to recover for property damage (see Pajda v Pedone, 303 AD2d 729, 730; McCauley v Ross, 298 AD2d 506, 507; Yaraghi v Zeller, 286 AD2d 765). RIVERA, J.P., SPOLZINO, FISHER, LIFSON and DICKERSON, JJ., concur.

Figueroa v. Dalmar Car Service Corp.

Baker, McEvoy, Morrissey & Moskovits, P.C., New York, N.Y.
(Stacy R. Seldin of counsel), for appellants.
Jacob Rabinowitz, New York, N.Y., for respondents.

 

DECISION & ORDER

In an action to recover damages for personal injuries, etc., the defendants Dalmar Car Service Corp. and Edvardo Hernandez appeal, as limited by their brief, from so much of an order of the Supreme Court, Kings County (Lewis, J.), dated September 22, 2006, as denied their motion for summary judgment dismissing the complaint insofar as asserted against them on the ground that the injured plaintiff Ida B. Chaluissant Figueroa did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

ORDERED that the order is affirmed insofar as appealed from, with costs.

The Supreme Court correctly denied the motion of the defendants Dalmar Car Service Corp. and Edvardo Hernandez (hereinafter the defendants) for summary judgment dismissing the complaint insofar as asserted against them. The defendants failed to make a prima facie showing that the plaintiff Ida B. Chaluissant Figueroa (hereinafter the injured plaintiff) did not sustain a serious injury within the meaning of Insurance Law § 5102(d) (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955). The defendants' moving papers did not address the allegations made by the injured plaintiff, as contained in her bill of particulars which was submitted in support of the motion, that as a result of the accident she sustained an injury which prevented her from performing substantially all of the material acts which constituted her usual and customary daily activity for a period of not less than 90 days during the 180 days immediately following the accident (see Insurance Law § 5102[d]; Nakanishi v Sadaqat, 35 AD3d 416; Sayers v Hot, 23 AD3d 453, 454; Nembhard v Delatorre, 16 AD3d 390, 391; Kawasaki v Hertz Corp., 199 AD2d 46). Since the defendants failed to establish their prima facie entitlement to judgment as a matter of law, it is unnecessary to reach the question of whether the injured plaintiff's opposition papers were sufficient to raise a triable issue of fact (see Coscia v 938 Trading Corp., 283 AD2d 538).
SCHMIDT, J.P., KRAUSMAN, GOLDSTEIN, COVELLO and ANGIOLILLO, JJ., concur.

Garcia v. Solbes

James P. Nunemaker, Jr. & Associates, Uniondale, N.Y. (Linda Meisler of counsel),for appellant.
Sam Z. Shore, Forest Hills, N.Y. (Peter M. Zirbies of counsel), for respondent.

 

DECISION & ORDER

In an action to recover damages for personal injuries, the defendant appeals from an order of the Supreme Court, Kings County (Knipel, J.), dated August 2, 2006, which denied his motion for summary judgment dismissing the complaint on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

ORDERED that the order is reversed, on the law, with costs, and the motion for summary judgment dismissing the complaint is granted.

The defendant met his prima facie burden of establishing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) as a result of the subject accident (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955). In opposition, the plaintiff failed to raise a triable issue of fact.

While the affidavit and medical report of the plaintiff's examining orthopedist noted limitations in the plaintiff's range of motion of her cervical spine, the plaintiff failed to provide any admissible medical proof that was contemporaneous with the subject accident which showed range of motion limitations in her spine (see Felix v New York City Tr. Auth., 32 AD3d 527; Ramirez v Parache, 31 AD3d 415; Bell v Rameau, 29 AD3d 839; Ranzie v Abdul-Massih, 28 AD3d 447; Li v Woo Sung Yun, 27 AD3d 624). The magnetic resonance images of the plaintiff's cervical and lumbar spine, which showed multiple bulging and herniated discs, and of her right shoulder, which showed impingement, did not, alone, establish a serious injury (see Yakubov v CG Trans Corp., 30 AD3d 509, 510; Cerisier v Thibiu, 29 AD3d 507, 508; Kearse v New York City Tr. Auth., 16 AD3d 45, 49). The mere existence of those conditions is not evidence of a serious injury in the absence of objective evidence of the extent of the alleged physical limitations resulting from the injuries and their duration (see Yakubov v CG Trans Corp., supra; Kearse v New York City Tr. Auth., supra). The self-serving affidavit of the plaintiff and her deposition testimony were insufficient to show that she suffered a serious injury caused by the accident since there was no objective medical evidence to show that she suffered a serious injury (see Yakubov v CG Trans Corp., 30 AD3d 509; Davis v New York City Transit Authority, 294 AD2d 531; Sainte-Aime v Ho, 274 AD2d 569).

The plaintiff failed to proffer competent medical evidence that she was unable to perform substantially all of her daily activities for not less than 90 of the first 180 days subsequent to the accident (see Sainte-Aime v Ho, supra).
MASTRO, J.P., RITTER, SKELOS, CARNI, and McCARTHY, JJ., concur.

Gordon-Silvera v.Long Island R.R.

Norman R. Colon, Bay Terrace, N.Y. (Ben Lyhovsky of counsel), for appellant.
Martyn, Toher & Martyn, Mineola, N.Y. (Timothy J. Murphy of counsel), for respondents.

 

DECISION & ORDER

In an action to recover damages for personal injuries and injury to property, the plaintiff appeals, as limited by her brief, from so much of an order of the Supreme Court, Queens County (Weiss, J.), dated March 1, 2006, as granted that branch of the defendants' motion which was for summary judgment dismissing the complaint on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

ORDERED that the order is modified, on the law, by deleting the provision thereof, granting that branch of the motion which was for summary judgment dismissing the second cause of action and substituting therefor a provision denying that branch of the motion; as so modified, the order is affirmed insofar as appealed from, without costs or disbursements.

The defendants made a prima facie showing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955). In opposition, the plaintiff failed to raise a triable issue of fact. The affirmation and affidavit of the plaintiff's experts failed to address the findings of degeneration in her spine as noted in the affirmed medical report of the defendant's examining radiologist, rendering speculative the conclusion that the injuries to her spine were caused by the subject accident (see Giraldo v Mandanici, 24 AD3d 419; Ifrach v Neiman, 306 AD2d 380; Lorthe v Adeyeye, 306 AD2d 252; Ginty v MacNamara, 300 AD2d 624). Moreover, in the absence of objective evidence of the extent of the alleged physical limitations resulting from the injuries and their duration, the magnetic resonance images of the plaintiff's cervical and lumbar spine which showed bulging discs and a herniation are not, in themselves, evidence of a serious injury (see Yakubov v CG Trans Corp., 30 AD3d 509, 510; Cerisier v Thibiu, 29 AD3d 507, 508; Kearse v New York City Tr. Auth., 16 AD3d 45, 49). Further, the affidavit of the plaintiff and her deposition testimony were insufficient to raise a triable issue of fact that she sustained a serious injury caused by the accident since there was no objective medical evidence to show that she sustained a serious injury (see Yakubov v CG Trans Corp., supra; Davis v New York City Tr. Auth., 294 AD2d 531; Sainte-Aime v Ho, 274 AD2d 569). Finally, "[t]he plaintiff's assertion that she was unable to return to work and perform her usual and customary activities after the accident, without objective evidence substantiating the existence of a medically-determined injury which caused the alleged limitation of her activities, was insufficient to raise a triable issue of fact as to her inability to perform substantially all of her daily activities for not less than 90 of the first 180 days subsequent to the accident" (Sainte-Aime v Ho, supra at 570). Accordingly, the plaintiff's causes of action seeking to recover damages for personal injuries were properly dismissed.

However, the second cause of action to recover damages for injury to property should not have been summarily dismissed (see Pajda v Pedone, 303 AD2d 729; McCauley v Ross, 298 AD2d 506; Yaraghi v Zeller, 286 AD2d 765).
RIVERA, J.P., SPOLZINO, FISHER, LIFSON and DICKERSON, JJ., concur.

Laguerre v. Chavarria

Robert P. Tusa (Sweetbaum & Sweetbaum, Lake Success, N.Y.
[Marshall D. Sweetbaum] of counsel), for appellants.
Mitchell Dranow, Mineola, N.Y., for respondent.

 

DECISION & ORDER

In an action to recover damages for personal injuries, the defendants appeal from an order of the Supreme Court, Kings County (Johnson, J.), dated November 16, 2006, which denied their motion for summary judgment dismissing the complaint on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

ORDERED that the order is reversed, on the law, with costs, and the defendant's motion for summary judgment dismissing the complaint is granted.

The defendants made a prima facie showing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955). In opposition, the plaintiff failed to raise a triable issue of fact. The report of the plaintiff's treating chiropractor was not in affidavit form, and therefore was without probative value (see Kunz v Gleeson, 9 AD3d 480; Santoro v Daniel, 276 AD2d 478; Doumanis v Conzo, 265 AD2d 296; Rum v Pam Transp., 250 AD2d 751). The remaining medical submissions of the plaintiff were without probative value in opposing the motion since they were neither sworn nor affirmed nor certified (see Grasso v Angerami, 79 NY2d 813, 814-815; Felix v New York City Tr. Auth., 32 AD3d 527, 528; Yakubov v CG Trans Corp., 30 AD3d 509; Pagano v Kingsbury, 182 AD2d 268, 270; see also CPLR 4518[c]). The self-serving affidavit of the plaintiff was insufficient to show that he sustained a serious injury caused by the accident since there was no objective medical evidence to support it (see Davis v New York City Tr. Auth., 294 AD2d 531; Sainte-Aime v Ho, 274 AD2d 569).

Finally, the plaintiff failed to proffer competent medical evidence that the injuries he allegedly sustained in the accident rendered him unable to perform substantially all of his daily activities for not less than 90 of the first 180 days subsequent to the accident (see Sainte-Aime v Ho, 274 AD2d 569).
MASTRO, J.P., RITTER, SKELOS, CARNI and McCARTHY, JJ., concur.

Lee v. Troia

Sim & Park, LLP, New York, N.Y. (Sang J. Sim of counsel), for appellant.
James P. Nunemaker, Jr., Jericho, N.Y. (Linda Meisler of counsel), for respondent.

 

DECISION & ORDER

In an action to recover damages for personal injuries, the plaintiff appeals from an order of the Supreme Court, Queens County (Price, J.), dated July 7, 2006, which granted the defendant's motion for summary judgment dismissing the complaint on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

ORDERED that the order is affirmed, with costs.

The defendant made a prima facie showing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955). In opposition, the plaintiff failed to raise a triable issue of fact. The affirmation of his treating physician and the affirmed report of his examining orthopedic surgeon failed to address the findings of degeneration in his spine as noted in the affirmed medical report of the defendant's radiologist, rendering speculative the findings that the injuries to his spine were caused by the subject accident (see Giraldo v Mandanici, 24 AD3d 419, 420; Lorthe v Adeyeye, 306 AD2d 252, 253; Ginty v MacNamara, 300 AD2d 624, 625).

The magnetic resonance images of the plaintiff's cervical and lumbar spine, which showed multiple bulging and herniated discs, did not, alone, establish a serious injury (see Yakubov v CG Trans Corp., 30 AD3d 509, 510; Cerisier v Thibiu, 29 AD3d 507, 508; Kearse v New York City Tr. Auth., 16 AD3d 45, 49). The mere existence of a bulging disc is not evidence of a serious injury in the absence of objective evidence of the extent of the alleged physical limitations resulting from the disc injury and its duration (see Yakubov v CG Trans Corp., supra; Kearse v New York City Tr. Auth., supra). The plaintiff's self-serving affidavit was insufficient to meet that requirement (see Yakubov v CG Trans Corp., supra). The remaining submissions of the plaintiffs were without probative value in opposing the motion since they were unsworn/unaffirmed or uncertified (see Grasso v Angerami, 79 NY2d 813, 814-815; Felix v New York City Tr. Auth., 32 AD3d 527, 528; Yakubov v CG Trans Corp., supra; Pagano v Kingsbury, 182 AD2d 268, 270; see also CPLR 4518[c]).
CRANE, J.P., SANTUCCI, FLORIO, DILLON and BALKIN, JJ., concur.

Nannarone v. Ott

Christopher Tompkins, New York, N.Y., for appellant.
James P. Nunemaker, Jr., Jericho, N.Y. (Kathleen E. Fioretti of counsel), for respondent.

 

DECISION & ORDER

In an action to recover damages for personal injuries, the plaintiff appeals from an order of the Supreme Court, Queens County (Grays, J.), dated May 18, 2006, which granted the defendant's motion for summary judgment dismissing the complaint on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

ORDERED that the order is affirmed, with costs.

The defendant made a prima facie showing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955). In opposition, the plaintiff failed to raise a triable issue of fact. The plaintiff failed to proffer competent medical evidence that was contemporaneous with the subject accident which showed any range of motion limitations in her right knee (see Bell v Rameau, 29 AD3d 839; Ranzie v Abdul-Massih, 28 AD3d 447, 448). The magnetic resonance imaging reports of the plaintiff's right knee which showed, inter alia, a meniscal tear did not, alone, establish a serious injury (see Yakubov v CG Trans Corp., 30 AD3d 509, 510; Cerisier v Thibiu, 29 AD3d 507, 508; Kearse v New York City Tr. Auth., 16 AD3d 45, 49). The mere existence of such an injury is not evidence of a serious injury in the absence of objective evidence of the extent of the alleged physical limitations resulting from the injury and its duration (see Yakubov v CG Trans Corp., supra; Kearse v New York City Tr. Auth., supra). The plaintiff's self-serving affidavit was insufficient to meet that requirement (see Yakubov v CG Trans Corp., supra). The remaining submission of the plaintiff, an X-ray report, was without probative value in opposing the motion since it was unsworn or unaffirmed (see Grasso v Angerami, 79 NY2d 813, 814-815; Felix v New York City Tr. Auth., 32 AD3d 527, 528; Yakubov v CG Trans Corp., supra; Pagano v Kingsbury, 182 AD2d 268, 270).

Further, the plaintiff failed to submit competent medical evidence that the injuries she allegedly sustained in the accident rendered her unable to perform substantially all of her daily activities for not less than 90 days of the first 180 days subsequent to the subject accident (see Bell v Rameau, supra; Sainte-Aime v Ho, 274 AD2d 569).

Accordingly, the Supreme Court properly granted the defendant's motion for summary judgment dismissing the complaint.
RIVERA, J.P., SPOLZINO, FISHER, LIFSON and DICKERSON, JJ., concur.

O'Neal v. Bronopolsky

Baker, McEvoy, Morrissey & Moskovits, P.C., New York, N.Y.
(Michael I. Josephs of counsel), for appellant.
Eric H. Green, New York, N.Y., for respondent.

 

DECISION & ORDER

In an action to recover damages for personal injuries, the defendant appeals from an order of the Supreme Court, Kings County (Harkavy, J.), dated July 5, 2006, which denied his motion for summary judgment dismissing the complaint on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

ORDERED that the order is affirmed, with costs.

The defendant failed to establish, prima facie, that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) as a result of the subject accident (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955, 956-957). The defendant failed to even address, much less satisfy, his burden with respect to the plaintiff's allegation that he suffered a knee injury as a result of the accident (see Hughes v Cai, 31 AD3d 385; Loadholt v New York City Transit Authority, 12 AD3d 352). Since the defendant failed to establish his prima facie entitlement to judgment as a matter of law in the first instance, it is unnecessary to reach the question of whether the plaintiff's papers were sufficient to raise a triable issue of fact (see Coscia v 938 Trading Corp., 283 AD2d 538).
SCHMIDT, J.P., KRAUSMAN, GOLDSTEIN, COVELLO and ANGIOLILLO, JJ., concur.

Park v. Herreros

Andrew Park, New York, N.Y. (Sang J. Sim of counsel), for appellant.
Baker, McEvoy, Morrissey & Moskovits, P.C., New York, N.Y.
(Holly E. Peck of counsel), for respondents.

 

DECISION & ORDER

In an action to recover damages for personal injuries, the plaintiff appeals from an order of the Supreme Court, Queens County (Price, J.), dated June 30, 2006, which granted the defendants' motion for summary judgment dismissing the complaint on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

ORDERED that the order is affirmed, with costs.

The defendants made a prima facie showing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955). In opposition, the plaintiff failed to raise a triable issue of fact.
CRANE, J.P., SANTUCCI, FLORIO, DILLON and BALKIN, JJ., concur.

Paz v. Wydrzynski

Cannon & Acosta, LLP, Huntington Station, N.Y. (June Redeker of counsel), for appellant.
Corigliano, Geiger, Verrill & Brandwein, Jericho, N.Y.
(Kathleen M. Geiger of counsel), for respondent Jaroslaw Wydrzynski.
Robert P. Tusa (Sweetbaum & Sweetbaum, Lake Success, N.Y.
[Marshall D. Sweetbaum] of counsel), for respondents Carlos R. Paz and Bairon Reyes.

 

DECISION & ORDER

In an action to recover damages for personal injuries, the plaintiff appeals from an order of the Supreme Court, Suffolk County (Werner, J.), entered April 6, 2006, which granted the separate motions of the defendants Carlos R. Paz and Bairon Reyes, and the defendant Jaroslaw Wydrzynski, for summary judgment dismissing the complaint on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

ORDERED that the order is reversed, on the law, with one bill of costs payable by the respondents appearing separately and filing separate briefs, and the motions for summary judgment dismissing the complaint are denied.

The defendant Jaroslaw Wydrzynski, and the defendants Carlos R. Paz and Bairon Reyes established their respective prima facie burdens that the plaintiff did not sustain a serious injury by submitting, inter alia, affirmations of their examining orthopedists and a radiologist (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955). However, contrary to the conclusion of the Supreme Court, the plaintiff raised triable issues of fact by submitting the affirmed magnetic resonance imaging report of a radiologist stating that the plaintiff had sustained herniated cervical discs and by submitting the affidavit of his chiropractor stating that he had significant limitations in range of motion of the cervical spine as quantified in the chiropractor's affidavit (see Pommells v Perez, 4 NY3d 566, 567; Shpakovskaya v Etienne, 23 AD3d 368; Paul v Allstar Rentals, Inc., 22 AD3d 476; Kerzhner v N.Y. Ubu Taxi Corp., 17 AD3d 410). Although the plaintiff was still in significant pain, he was discharged by his chiropractor because he had reached his maximum recovery and any further treatment would be merely palliative. Thus, the plaintiff's chiropractor adequately explained the gap in treatment (see Shpakovskaya v Etienne, supra at 369).
MASTRO, J.P., RITTER, SKELOS, CARNI and McCARTHY, JJ., concur.

Wade v. Allied Bldg. Prods. Corp.

Corozzo & Greenberg, P.C., Howard Beach, N.Y. (Alan H.
Greenberg of counsel), for appellant.
Steven F. Goldstein, LLP, Carle Place, N.Y. (Christopher R.
Invidiata of counsel), for respondents
Allied Building Products Corp. and Kenneth Webb.
McCabe, Collins, McGeough & Fowler, Carle Place, N.Y.
(Patrick M. Murphy of counsel), for respondent Francesco Pugliese.

 

DECISION & ORDER

In an action to recover damages for personal injuries, the plaintiff appeals, as limited by her brief, from so much of an order of the Supreme Court, Nassau County (McCarty, J.), entered November 3, 2006, as granted the motion of the defendants Allied Building Products Corp. and Kenneth Webb, and the separate motion of the defendant Francesco Pugliese, for summary judgment dismissing the complaint on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

ORDERED that the order is reversed, on the law, with one bill of costs payable to the plaintiff by the defendants appearing separately and filing separate briefs, and the motions for summary judgment dismissing the complaint are denied.

Contrary to the Supreme Court's determination, the defendants, in their separate motions for summary judgment, failed to meet their respective prima facie burdens of showing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) as a result of the subject motor vehicle accident (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955, 956-957). The defendants' examining neurologist found limitations when he examined the plaintiff (see Iles v Jonat, 35 AD3d 537). Since the defendants failed to establish, prima facie, their entitlement to judgment as a matter of law in the first instance, it is unnecessary to reach the question of whether the plaintiff's papers were sufficient to raise a triable issue of fact (see Coscia v 938 Trading Corp., 283 AD2d 538).
CRANE, J.P., SANTUCCI, FLORIO, DILLON and BALKIN, JJ., concur.

Zamaniyan v. Vrabeck

Mitchell Dranow, Mineola, N.Y., for appellant.
Baxter, Smith, Tassan & Shapiro, P.C., Jericho, N.Y. (Sim R. Shapiro of counsel), for respondent.

 

DECISION & ORDER

In an action to recover damages for personal injuries, the plaintiff appeals from an order of the Supreme Court, Suffolk County (Doyle, J.), dated February 15, 2006, which granted the defendant's motion for summary judgment dismissing the complaint on the ground that she did not sustain a serious injury within the meaning of Insurance Law § 5102(d).

ORDERED that the order is reversed, on the law, with costs, and the motion for summary judgment dismissing the complaint is denied.

The defendant failed to meet his prima facie burden of showing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) as a result of the subject motor vehicle accident (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955, 956-957). The defendant's examining neurologist found limitations when he examined the plaintiff (see Smith v Delcore, 29 AD3d 890; Sano v Gorelik, 24 AD3d 747; Kaminsky v Waldner, 19 AD3d 370; Omar v Bello, 13 AD3d 430; Spuhler v Khan, 14 AD3d 693; Scotti v Boutureira, 8 AD3d 652). Since the defendant failed to establish his prima facie entitlement to judgment as a matter of law in the first instance, it is unnecessary to reach the question of whether the plaintiff's papers were sufficient to raise a triable issue of fact (see Coscia v 938 Trading Corp., 283 AD2d 538).
MASTRO, J.P., RITTER, SKELOS, CARNI and McCARTHY, JJ., concur.

 

Allstate Insurance Company v. American Home Assurance Company

 

Plaintiff appeals from an order of the Supreme Court, New York County (Karla Moskowitz, J.), entered February 22, 2006, which denied its motion for partial summary judgment and granted defendant's cross motion for partial summary judgment declaring that its post-settlement allocation did not violate the terms of the parties' facultative reinsurance certificates and was reasonable and made in good faith.


SULLIVAN, J.

In this declaratory judgment action, we are asked whether we must give deference under the "follow-the-fortunes" doctrine to an insurer's reinsurance loss allocation on a one-occurrence-per- site basis that allowed the insurer to exceed the facultative reinsurance agreement's ^[FN1] $1 million-per-occurrence deductible with respect to four sites. In the underlying litigation between the insurer and its insured as to one of the sites, a United States District Court ruled that there were seven occurrences requiring the application of seven deductibles, and as to the remaining three sites, the insurer in both the litigation and settlement negotiations and eventual settlement took the position that there were multiple occurrences at each site. As is undisputed, had the insurer applied the same multiple occurrence allocation in the loss allocation bill presented to its reinsurer, it would have no reinsurance claim.

Defendant, a member of American International Group (AIG), issued commercial property insurance policies to United Technologies Corporation (UTC) for lessor damage to property for the period 1975-1978 and 1978-1981. Both policies had liability limits, for any "one loss, disaster, or casualty," of $6 million under the 1975 policy and $10 million under the 1978 policy. Under both policies, UTC had a self-insured retention or deductible ^[FN2] of $200,000 for "any one occurrence."

Defendant sought and obtained reinsurance for the UTC policies as follows: reinsurance of the $6 million limit of the 1975 UTC policy was structured in two layers — a $1 million primary layer and a $5 million excess of the $1 million layer. Reinsurance of the $10 million limit of the 1978 UTC policy was structured in three layers — a $1 million primary layer, a $5 million excess of the $1 million layer, and $4 million excess over the other two layers.

On or about November 17, 1975, plaintiff and defendant entered into a reinsurance agreement, effective for the same period as the 1975 policy, whereby plaintiff reinsured 22% of the $5 million excess of $1 million layer. Under the 1975 certificate, plaintiff's 22% participation is not triggered until defendant's payment under the 1975 policy exceeds a deductible of $1 million, the primary layer, of any single occurrence loss.

When the 1975 certificate expired, plaintiff issued another to cover the term of the 1978 policy, reinsuring 25% of the $5 million excess of $1 million layer. As with the 1975 certificate, plaintiff's liability under the 1978 certificate is not triggered until defendant's payment under the 1978 policy exceeds a retention or deductible of $1 million for any single occurrence loss.

Plaintiff's certificates provide that subject to the terms and conditions of the certificates and the UFT policies, its liability follows that of defendant under the UTC policies. The 1975 certificate provides:

This Certificate is issued as reinsurance and is subject to the same risks, valuations, privileges, clauses and conditions, endorsements (except changes in location), assignments[,] adjustments and mode of settlement, as are, or were, or may be assumed or adopted by the Reinsured.

Similarly, the 1978 certificate provides:

The liability of Allstate shall follow that of the Company [American Home] and, except as otherwise specifically provided in this certificate, shall be subject to the terms and conditions of the policy(ies) reinsured.

In April 1992, UTC commenced an action against defendant in the United States District Court for the District of Connecticut for indemnification under the UTC policies for physical loss and damage allegedly sustained due to environmental pollution at various sites, including plants in West Palm Beach, Florida, Stratford and Windsor Locks, Connecticut, and Santa Clara County, California (a/k/a Coyote).

During the UTC litigation, both defendant and UTC consistently argued that there were multiple occurrences (losses) at each of these sites; neither ever took the position that each site constituted one occurrence. Their only disagreement concerned the number of occurrences at each site, a key issue that affected defendant's $200,000-per-occurrence deductible under the UTC policies. The number of occurrences dictated the number of deductibles that would be applied. More deductibles meant less covered loss under the policies. Due to the number of sites involved, the District Court determined to handle the discovery and trial in phases.

On March 2, 1998, after trial, a jury found that UTC had shown loss or damage at seven different areas at the Windsor Locks site during the period covered by the 1975 and 1978 policies, allocating an amount to each of the seven areas at which damage or loss occurred. After the verdict, the parties sought summary judgment on the number of occurrences involved so they could determine the number of $200,000 deductibles to be applied, UTC claiming 7 and defendant claiming at least 18. The District Court found "for purposes of calculating deductible amounts . . . seven occurrences of damage or loss took place at the Windsor Locks site consistent with the jury's . . . verdict." The court applied one deductible per occurrence and an additional deductible for each policy period during which the jury found UTC suffered a covered loss.

Defendant moved for a new trial and petitioned for an interlocutory appeal, arguing that the court had applied the wrong standard for determining the number of occurrences at the Windsor Locks site. The petition for an interlocutory appeal was denied, and defendant and UTC settled the litigation before the motion for a new trial was decided. In settling the matter, neither party conceded its position as to the number of occurrences at the Windsor Locks site.

Meanwhile, the UTC litigation continued on the coverage question with respect to the 16 sites, including the West Palm Beach, Stratford and Coyote sites, that were the focus of the second trial. As with their positions on Windsor Locks, both UTC and defendant, in settlement discussions, discovery and trial preparation, took the position that multiple occurrences had taken place at these sites. Each of the exposure analyses prepared by defendant demonstrates a consistent approach, i.e., assessing its exposure at the 16 sites on a multiple-occurrence- per-site basis and estimating the cost of each occurrence at those sites. During discovery and trial preparation, defendant identified and estimated the cost of 11 occurrences at West Palm Beach, 4 at Stratford and 6 at Coyote. UTC also identified multiple occurrences at each of these sites. Thomas Carey, AIG's vice-president of domestic property operations, confirmed that its multiple-occurrence-per-site analysis represented good faith estimates of the cost of each occurrence at these sites.

In January 2002, two months before the trial regarding the 16 sites, defendant settled with UTC, agreeing to pay a lump sum of $112 million for all of the sites at issue. In the settlement negotiations, defendant advanced the position that there had been multiple occurrences at each site, 95 in all at the 16 sites. UTC, on the other hand, maintained that there had been only 44 occurrences. During these negotiations, UTC, referring to the District Court's post-verdict ruling at the first trial, took the position that it had a "verdict in hand" for Windsor Locks and that there should be no discount in settlement for that site. While defendant insisted that it was looking for a global settlement, no concession was made to limit the District Court's ruling that there were seven loss occurrences at the Windsor Locks site.

After the settlement, at defendant's request, William Hassler, its lead counsel in the UTC litigation, who had never before prepared an allocation of an environmental coverage dispute settlement for reinsurance purposes, prepared a fourfold analysis for allocating the settlement to the UTC policies and to defendant's reinsurers. In his analysis, Hassler, in stark contrast to defendant's position before the Connecticut Federal District Court and the court's ruling and the position of defendant and UTC throughout the UTC litigation, treated each site as one occurrence. Hassler evaluated 74 sites, separated into categories based on whether the claimed loss was already tried or was pending, dropped or had no value. Hassler's allocation analysis was fourfold.

In the first step, Hassler used the amount UTC claimed for each site, as provided by UTC's counsel, except that the "[f]igures for the Windsor Locks site were taken from the 1998 jury verdict for that site, as modified by the Court's Ruling on Deductibles/Number of Occurrences." In the second step, Hassler modified the UTC amounts per site by applying one $200,000 deductible per site for each of the 1975 and 1978 policies. If a site was owned or used during the 1975 and 1978 policy periods, the amount deducted was $400,000. For Windsor Locks, however, Hassler relied on the District Court's determination of the number of occurrences at that site. Thus, instead of applying a deductible of $400,000 for the 1975 and 1978 UTC policy periods for Windsor Locks, defendant deducted $2,194,707, which was computed on the basis of the amount of deductibles for the number of occurrences the District Court found at the site, with additional application of $400,000 for the 1975 and 1978 policy periods.

In the third step, Hassler calculated for each site the cost per year of insurance coverage. He did so by dividing the cost by the number of years that UTC owned or used a site. For most of the sites, Hassler assigned 11 years of coverage ^[FN3] for the period covered by all three policies defendant issued to UTC. For Windsor Locks, Hassler accepted the jury's finding that damage at the site had occurred only over the six years that the 1975 and 1978 policies were in effect. In the fourth step of this analysis, Hassler allocated a settlement cost to each policy year, broken down on a site-by-site basis, thereby treating each site as one occurrence. For Windsor Locks, the settlement cost was allocated evenly over six years based on the District Court's determination in that proceeding that damage at that site had occurred during the period of the 1975 and 1978 policies. When Hassler determined the actual per-site-per-year settlement cost for Windsor Locks, however, he did not reduce the cost by the deductibles for seven occurrences, as had been judicially determined. Thus, he did not apply the $1 million self retention for each of the Windsor Locks occurrences under the 1975 and 1978 certificates in the same way he applied the $200,000 deductible under the 1975 and 1978 policies in the second step of his analysis. Similarly, for West Palm Beach, Stratford and Coyote, Hassler did not break down the per-site-per-year settlement cost by the number of occurrences that defendant, and even UTC, had claimed in the UTC litigation at those sites.

Defendant utilized the step four analysis to bill its reinsurers on a one-occurrence-per-site-per-year basis. By treating each site as one occurrence, Windsor Locks, West Palm Beach, Stratford and Coyote were each allocated settlement costs per year in excess of $1 million, thus triggering plaintiff's reinsurance obligations under the 1975 and 1978 certificates. In considering the $1 million-per-occurrence deductible and its effect on the second layer reinsurers like plaintiff ($5 million excess of $1 million), Hassler testified that he did not break down his one-occurrence-per-site allocation to actual occurrences because it would be too subjective, as he could not do so fairly where the per-site-per-year amount was in excess of $1 million. He claimed that this approach was consistent with defendant's past practices. Hassler applied this rationale as well to Windsor Locks.

When defendant demanded payment of $2,578,638.21 from plaintiff for its reinsurance share of defendant's liability under the 1975 and 1978 UTC policies for the Windsor Locks, West Palm Beach, Stratford and Coyote sites, Patrick Parrington, plaintiff's reinsurance claims analyst, noticed the inconsistency in "the manner in which the claim was evaluated by AIG prior to settlement and the subsequent methodology used in ceding the loss to the reinsurer[]," and asked for an explanation for, inter alia, AIG's "disregard of its own multiple occurrence positions taken" at the West Palm Beach, Coyote and Stratford sites. As a result, Parrington audited defendant's handling of the UTC claims and litigation.

Using the documents obtained during the audit, Parrington performed his own per-occurrence-per-site evaluation of the Windsor Locks, West Palm Beach, Stratford and Coyote sites. In his analysis, Parrington relied on the number of occurrences and cost allocated to each occurrence by the jury and District Court in the Windsor Locks trial. For West Palm Beach, Stratford and Coyote, Parrington relied on defendant's own multiple-occurrences-per-site analysis utilized during the UTC litigation in which it identified and allocated a cost for 21 occurrences —11 at West Palm Beach, 4 at Stratford and 6 at Coyote.

Parrington's allocation analysis confirmed that no single occurrence at these sites would have exceeded the $1 million retention. Thus, plaintiff's reinsurance obligations would not have been triggered under the 1975 or 1978 certificates. Plaintiff notified defendant that it would not honor the payment request "because the retentions required under the various Allstate facultative certificates have not been [reached]. Even under the most lenient accounting of occurrences as put forth in this matter by [UTC], no single occurrence impacts the excess of [$1,000,000] reinsurance layer in any given year." Plaintiff thereupon commenced this declaratory judgment action.

After joinder of issue and discovery, plaintiff moved for partial summary judgment seeking a declaration that it was not bound to the follow-the-fortunes doctrine because defendant's reinsurance loss allocation of the Windsor Locks, West Palm Beach, Stratford and Coyote sites was unreasonable, and therefore, it was not liable to defendant under the facultative reinsurance certificates. Defendant cross-moved for partial summary judgment on the same issue, arguing that its allocation was reasonable. The motion court denied the motion and granted the cross motion, relying on North River Insurance Co. v ACE American Reinsurance Co. (361 F3d 134 [2d Cir 2004]) and Travelers Casualty & Surety Co. v Gerling Reinsurance Corp. (419 F3d 181 [2d Cir 2005]) for the proposition that the follow-the-fortunes doctrine is applicable regardless of any inconsistency between the reinsured's pre-settlement and post-settlement allocation positions. Otherwise, the court held, citing North River (361 F3d at 141), it would be engaging in an "intrusive factual inquiry" into defendant's settlement process. The court rejected the effect of the Federal District Court's earlier determination as to the number of occurrences at Windsor Locks because the decision was non-final (see 28 USC § 1291) and because the parties to that proceeding (UFT and defendant) had eventually settled the dispute. Finally, the court found that defendant's one-occurrence-per-site allocation was reasonable because it was consistent with Hassler's manner of applying "bright line tests" rather than "his own subjective judgment."

We reject such reasoning, which reflects, on this record, nothing more than Hassler's subjective judgment, and in effect lends the court's imprimatur to defendant's playing by two sets of rules: one, applied at the insured's claim level where the occurrence deductible is used as often as possible to minimize the amount of the insured's exposure and loss, and later, in the same loss setting, another, where the occurrence deductible is used as sparingly as possible to maximize the reinsured's recovery against the reinsurer. The follow-the-fortunes doctrine was intended to foster consistency in the treatment of losses at both levels, insured and reinsured, not to allow an insurer to use a different set of rules at each level. We soundly reject the notion that the follow-the-fortunes doctrine requires that courts turn a blind eye to such manifest manipulation of the allocation process in total disregard of the reinsured's obligation to act in good faith.

The follow-the-fortunes doctrine requires a reinsurer to indemnify for payments reasonably within the terms of the original policy, even if technically not covered by it (Travelers Cas. & Sur. Co. v Certain Underwriters at Lloyds of London, 96 NY2d 583, 596 [2001]). Pursuant to the doctrine, a reinsurer is bound "to accept the cedent's good faith decisions on all things concerning the underlying insurance terms and claims against the underlying insured: coverage, tactics, lawsuits, compromise, resistance or capitulation" (British Intl. Ins. Co. v Seguros La Republica, 342 F3d 78, 85 [2d Cir 2003]). While, obviously, the doctrine is not so expansive as to "give reinsureds carte blanche to impose whatever settlement decisions they make on their reinsurers" (Affiliated F.M. Ins. Co. v Employers Reins. Corp., 369 F Supp 2d 217, 227 [DRI 2005]), it is intended to avoid relitigating coverage issues under the insured's policies and to promote good faith settlement of the insured's claims (see id.). It "insulates a reinsured's liability determinations from challenge by a reinsurer unless they are fraudulent, in bad faith, or the payments are clearly beyond the scope of the original policy' or in excess of [the reinsurer's] agreed-to exposure'" (North Riv., 361 F3d at 140, quoting Christiania Gen. Ins. Corp. v Great Am. Ins. Co., 979 F2d 268, 280 [2d Cir 1992]).

Contrary to the motion court's holding, Travelers and North River do not require a reinsurer, under the follow-the-fortunes doctrine, to accept the reinsured's post-settlement loss allocation even if that allocation is contrary to the reinsured's pre-allocation position and treatment of the loss allocation issue with its own insured, i.e., its treatment of deductibles. While the cases unequivocally hold that the doctrine extends to a post-settlement allocation despite "an inconsistency between that allocation and the [reinsured's] pre-settlement assessments of risk," it applies only "as long as the allocation meets the typical follow-the-settlements requirements, i.e., is in good faith, reasonable, and within the applicable policies" (North River, 361 F3d at 141 [emphasis added]).

Here, unlike North River, the inconsistency is not between defendant's post-settlement allocation and its pre-settlement assessments of the risk, but between its pre-settlement allocation of loss with its insured (UTC) and its post-settlement allocation with its reinsurer (plaintiff). Defendant was obliged to act in good faith in its post-settlement allocation of loss with plaintiff. As is readily apparent from its post-settlement loss allocation analysis, it did not. A reinsurer is not bound by the follow-the-fortunes doctrine where the reinsured's settlement allocation, at odds with its allocation of the loss with its insured, designed to minimize its loss, reflects an effort to maximize unreasonably the amount of collectible reinsurance (see Hartford Acc. & Indem. Co. v Columbia Cas. Co., 98 F Supp 2d 251, 259 [D Conn 2000]).

Defendant's post-settlement allocation was unreasonable because the one-occurrence-per-site allocation of the Windsor Locks site directly contradicts the District Court ruling as to the number of occurrences at that site. Moreover, the reinsurance allocation is internally inconsistent, as reflected by defendant's highly selective use of the District Court ruling. The one-occurrence-per-site allocation of the other sites, including West Palm Beach, Stratford and Coyote, completely contradicts the multiple-occurrence position that both defendant and its insured pursued in the UTC litigation and settlement negotiations, which culminated in a $112 million lump sum settlement for all of the sites at issue. For defendant to assert aggressively the maximum number of occurrences at each site to minimize its liability to its insured in the UTC litigation, and then completely change its position in allocating its loss to plaintiff under the reinsurance certificates, is neither reasonable nor reflective of good faith. It is disingenuous.

Here, unlike any other reported case involving the follow-the-fortunes doctrine, defendant ignored a court ruling determining the number of occurrences at a covered site in its allocation of loss to plaintiff, and instead imposed a single occurrence at the Windsor Locks site for reinsurance purposes. Based on the jury's verdict, the District Court ruled that there were seven occurrences at that site and, consistent therewith, allocated seven $200,000 deductibles to the covered loss sustained there. Although the claims for the seven occurrences were ultimately settled, neither defendant, which had argued that there had been at least 18 occurrences, nor UTC, which had argued that there had been 7, conceded its position as to the number of occurrences. Defendant, rather than apply the District Court allocation which suited its purposes in reducing its liability to UTC under the 1975 and 1978 policies, used a one-occurrence-per-site calculation in its post-settlement allocation to exaggerate its reinsurance claim against Allstate as to the Windsor Locks site. As Hassler admitted, had defendant broken down the per-site-per-year settlement cost for Windsor Locks by the seven occurrences as determined by the District Court's ruling, no single occurrence would have exceeded the $1 million retention to trigger plaintiff's liability under the 1975 and 1978 certificates. Defendant's inconsistent application of the District Court's occurrence determination is neither reasonable nor based on good faith. And contrary to the motion court's reasoning, this determination requires no "intrusive factual inquiry" into defendant's allocation. Nor, contrary to defendant's argument, is plaintiff "second guessing" its settlement decisions.

The motion court's attempt to trivialize the District Court's interlocutory ruling on the ground of non-finality under 28 USC § 1291 is frivolous. Section 1291 relates to finality for appealability purposes. An interlocutory decision that is nonappealable may nevertheless be final in the preclusive sense (see Lummus Co. v Commonwealth Oil Ref. Co., 297 F2d 80, 89 [2d Cir 1961], cert denied sub nom. Dawson v Lummus Co., 368 US 986 [1962]) as was the Windsor Locks decision, which was binding on defendant. A trial was held, the jury returned a verdict, and the court ruled on the precise question of the number of occurrences at the site. The issue was fully litigated and clearly was "not avowedly tentative" (id.). Defendant was effectively bound by the District Court decision when it negotiated a settlement with UTC. Defendant selectively utilized the effect of the Windsor Locks decision, but only when it suited its purpose in reducing its liability to UTC.

Nor is there any support for the motion court's conclusion that defendant and UTC settled the Windsor Locks litigation in a manner that rendered the decision inoperative. A settlement does not entail vacatur of a prior decision. Neither party did anything to eliminate or limit the preclusive effect of the decision. The parties neither agreed nor negotiated to seek to have the court vacate the decision as part of their settlement (see e.g. Mercantile & Gen. Reins. Co. v Colonial Assur. Co., 147 Misc 2d 804, 806-807 [1989]).

Defendant and, for that matter, UTC, never took the position in that litigation and the settlement negotiations that there was only one occurrence at each of the other sites involved (West Palm Beach, Stratford and Coyote). Their only disagreement was over the number of occurrences. During discovery, trial preparation and settlement, defendant vigorously pursued the maximum number of occurrences per site. In its exposure analysis, defendant contended there were 21 occurrences among the West Palm Beach, Stratford and Coyote sites. Defendant allocated a cost, which it conceded was a reasonable, good faith estimate, to each occurrence identified in those sites. Defendant's claim of multiple occurrences was, as AIG's vice president of property operations confirmed in his testimony, a key issue in settlement negotiations that he used as leverage to obtain better terms from UTC. It is undisputed that if defendant had allocated the UTC settlement to plaintiff consistent with the position it took in the UTC litigation and settlement negotiation that there were 11 occurrences at West Palm Beach, 4 at Statford and 6 at Coyote, there would be no reinsurance liability under plaintiff's 1975 and 1978 certificates for those sites.

Finally, we note that defendant's argument as to an industry practice of ceding pollution claims to reinsurers on a single- occurrence-per-site basis is not only unsubstantiated, but offset by the same testimony upon which it relies. In any event, its own standard practice is irrelevant. Moreover, a reinsurer cannot treat its insured's claim on a per-occurrence-loss basis at each site and then allocate the loss to its reinsurer on a single-occurrence-per-site basis. That kind of inconsistent handling of loss is the very antithesis of the follow-the-fortunes doctrine.

Accordingly, the order of the Supreme Court, New York County (Karla Moskowitz, J.), entered February 22, 2006, which denied plaintiff Allstate's motion for partial summary judgment and granted defendant American Home's cross motion for partial summary judgment declaring that its post-settlement allocation did not violate the terms of the parties' facultative reinsurance certificates and was reasonable and made in good faith, should be reversed, on the law, with costs and disbursements, the motion granted, the cross motion denied, and it is declared that plaintiff is not liable to defendant pursuant to the 1975 and 1978 facultative reinsurance certificates.

All concur.

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

ENTERED: JUNE 12, 2007

CLERK

Footnotes

Footnote 1:Facultative reinsurance, as opposed to treaty reinsurance, is policy-specific.

Footnote 2:In the insurance context, the terms retention and deductible, the self-insured portion of a property or liability loss retained by the policyholder, are used interchangeably.

Footnote 3:The 11 years of coverage include the period 1981-1986 covered by a third policy that is not at issue here.

 

Clifford Chance LLP v. Indian Harbor Insurance Company

 

Order, Supreme Court, New York County (Bernard J. Fried, J.), entered December 29, 2006, which denied plaintiffs' motion for summary judgment, unanimously affirmed, with costs.

In light of the clear allocation provision in the policy, which had the effect of a partial exclusion (cf. Owens Corning v National Union Fire Ins. Co. of Pittsburgh, PA, 257 F3d 484, 492-493 [6th Cir 2001]), and despite the joint and several liability of the insured and uninsured defendants in the underlying litigation, the insurer is only required to pay a portion of its insured's claim for reimbursement of the settlement amount based on a determination of the insured's and the uninsured's relative exposures in the litigation and the benefits received from the settlement (see PepsiCo, Inc. v Continental Cas. Co., 640 F Supp 656, 661-662 [SD NY 1986]). Level 3 Communications v Federal Ins. Co. (1999 WL 675295 [ND III 1999]), which involved a more limited allocation provision, does not require otherwise. We have considered plaintiffs' other contentions and find them unavailing.

In the Matter of New York Central Mutual Fire Ins. Co. v. Rafailov

Goidel & Siegel, LLP, New York, N.Y. (Andrew B. Siegel of
counsel), for appellants.
Cullen and Dykman, LLP, Brooklyn, N.Y. (Joseph Miller and
Andrew G. Vassalle of counsel), for
respondent.

 

DECISION & ORDER

In a proceeding pursuant to CPLR article 75, inter alia, to permanently stay arbitration of a demand for uninsured motorist benefits, Veniamin Rafailov, Sara Rafailova, and Alena Rafailova appeal from (1) an order of the Supreme Court, Queens County (Rios, J.), entered March 1, 2006, which granted that branch of the motion of New York Central Mutual Fire Insurance Company which was, in effect, to permanently stay the arbitration of Sara Rafailova and Alena Rafailova, and (2) an order of the same court entered May 2, 2006, which denied their motion, in effect, for leave to reargue.

ORDERED that the appeal by Veniamin Rafailov is dismissed as abandoned (see 22 NYCRR 670.8[e]); and it is further,

ORDERED that the appeal from the order entered May 2, 2006, is dismissed, as no appeal lies from an order denying reargument; and it is further,

ORDERED that the order entered March 1, 2006, is affirmed; and it is further,

ORDERED that one bill of costs is awarded to the respondent.

An insurer may obtain a permanent stay of arbitration where it demonstrates that the claimant violated a condition precedent to coverage (see Matter of County of Rockland [Primiano Constr. Co.], 51 NY2d 1; Matter of 3202 Owners Corp. [Billy Contrs., Inc.], 25 AD3d 715; Matter of Travelers Ins. Co. [Magyar], 217 AD2d 954). The insurer's motion, inter alia, "for an Order dismissing the demands for arbitration" was, in effect, an application to permanently stay arbitration on the ground that the claimants failed to comply with the cooperation clause of the automobile insurance policy, which required them, among other things, to submit to reasonable depositions and medical examinations, and to authorize the insurer to obtain medical records.

An unexcused and willful refusal to comply with disclosure requirements in an insurance policy is a material breach of the cooperation clause and precludes recovery on a claim (see Lentini Bros. Moving & Stor. Co. v New York Prop. Ins. Underwriting Assn., 53 NY2d 835, 837; Baega v Transtate Ins. Co., 213 AD2d 217; 2423 Mermaid Realty Corp. v New York Prop. Ins. Underwriting Assn., 142 AD2d 124, 130-132; Ausch v St. Paul Fire & Mar. Ins. Co., 125 AD2d 43, 50). Compliance with such a clause is a condition precedent to coverage, properly addressed by the court (see Matter of County of Rockland [Primiano Constr. Co.], supra; compare Great Canal Realty Corp. v Seneca Ins. Co., Inc., 5 NY3d 742).

In order to establish breach of a cooperation clause, the insurer must show that the insured "engaged in an unreasonable and willful pattern of refusing to answer material and relevant questions or to supply material and relevant documents" (James & Charles Dimino Wholesale Seafood v Royal Ins. Co., 238 AD2d 379, quoting Avarello v State Farm Fire & Cas. Co., 208 AD2d 483). An insured's duty to cooperate is satisfied by substantial compliance, and where a delay in compliance is neither lengthy nor willful, and is accompanied by a satisfactory explanation, preclusion of a claim is inappropriate (see V.M.V Mgt. Co. v Peerless Ins., 15 AD3d 647; Avarello v State Farm Fire & Cas. Co., 208 AD2d 483).

Here, the appellants repeatedly failed to comply with disclosure demands, even after a prior court order, and subsequent notification of their noncompliance. Moreover, they failed to offer a satisfactory explanation for their untimely and inadequate submissions. As the appellants engaged in an unreasonable and willful pattern of refusing to supply material and relevant documents (see James & Charles Dimino Wholesale Seafood v Royal Ins. Co., supra), the order permanently staying arbitration was appropriate.

The appellants' motion, denominated as one for "renewal and/or reargument," was not based on new facts which were unavailable at the time of the original motion. Moreover, the appellants failed to offer a valid excuse for their failure to present this evidence earlier. Therefore, the motion was, in effect, one for leave to reargue, the denial of which is not appealable (see Eight In One Pet Prods. v Janco Press, Inc., 37 AD3d 402; Rivera v Toruno, 19 AD3d 473; Koehler v Town of Smithtown, 305 AD2d 550).
CRANE, J.P., KRAUSMAN, FISHER and LIFSON, JJ., concur.

 

R.C. Dolner, Inc., v. My-Way Contracting Corp.

Carroll, McNulty & Kull L.L.C., New York (John P.
DeFilippis of counsel), for appellants.
Sedgwick, Detert, Moran & Arnold LLP, New York (Jeffrey
M. Winn of counsel), for Landmark Insurance Company,
respondent.

Order, Supreme Court, New York County (Barbara R. Kapnick, J.), entered December 29, 2005, which denied plaintiff's motion for summary judgment against defendant Landmark Insurance Co. (Landmark), denied the cross motion of defendants United States Fire Insurance Co. and Crum & Forster Insurance Co. (collectively, US Fire) for summary judgment to dismiss the complaint and all cross claims as against them, granted Landmark's cross motion for summary judgment dismissing the complaint and all cross claims as against it, and declared that Landmark is not obligated to indemnify plaintiff and that plaintiff is entitled to primary coverage under its US Fire policy, unanimously affirmed, without costs.

Plaintiff, as general contractor, entered into a subcontract with defendant My-Way Contracting Corp. (My-Way) for demolition work, pursuant to which My-Way procured a certificate of insurance and an insurance policy, issued by Landmark, naming My-Way and plaintiff as additional insureds. Plaintiff obtained a separate policy, issued by US Fire, which would provide excess insurance over any primary insurance covering a loss, but otherwise would afford primary coverage.

On February 2, 1999, during the course of My-Way's demolition work, a large piece of concrete fell, damaging some of the owner's equipment. The owner paid $178,205.16 for repairs and deducted the amount from the total due plaintiff. Plaintiff notified its insurer, US Fire, of the incident on February 9, and forwarded two memoranda, dated March 2 and 3, on the cause, nature, and extent of the damages. On March 17, US Fire, on behalf of plaintiff, sent My-Way a notice of claim and requested that My-Way notify Landmark. Neither plaintiff nor US Fire directly notified Landmark. Rather, on December 13, US Fire sent My-Way a second notice of claim and again told My-Way to notify its insurer. On December 28, My-Way asked Landmark [*2]to process the claim, and attached the certificate of insurance identifying plaintiff as an additional insured, the March memoranda prepared by plaintiff, and the March and December letters from US Fire.

On January 4, 2000, Landmark assigned the matter to its adjusters, who conducted an investigation. The adjusters issued their report on January 24, and that same day Landmark disclaimed coverage for My-Way's failure to provide timely notice, as required by the policy. Specifically, Landmark had not been given notice until December 28, 1999, more than 10 months after the occurrence (February 2, 1999) and more than 9 months after the date of claim letter from US Fire (March 17, 1999). Plaintiff and US Fire were copied on the disclaimer.

On January 25, 2001, one year after the disclaimer was issued, plaintiff wrote to Landmark contesting the denial of coverage. US Fire sent a similar protest on February 8, 2001. By letter dated February 26, 2001, Landmark adhered to its original disclaimer decision.

My-Way's unexcused delay of more than 10 months in submitting the claim to Landmark violated the policy's condition that notice be given "as soon as practicable" (see Holmes v Morgan Guar. & Trust Co., 223 AD2d 441, 442 [1996]), and Landmark's disclaimer, issued less than one month later, was reasonable in light of the prompt and diligent investigation of the claim (see 2540 Assoc. v Assicurazioni Generali, 271 AD2d 282 [2000]). US Fire asserts that its notice to My-Way, sent on March 17, 1999, was prompt, and that Landmark's time within which to disclaim should be measured from that date. However, both plaintiff and US Fire knew of Landmark's identity, and My-Way was not its carrier's agent; therefore, the pertinent period for purposes of timely notification must be measured from the date Landmark actually received notice (see Paul Developers, LLC v Maryland Cas. Ins. Co., 28 AD3d 443 [2006] [fact that insured and additional insureds may have provided timely notice to their own insurance broker is not deemed notice to the insurer]). Plaintiff's and US Fire's letters of January and February 2001, requesting reconsideration, did not constitute a new claim that would nullify the prior disclaimer if not itself promptly disclaimed.

Lista v. Newton

Appeal from an order of the Supreme Court, Orleans County (James P. Punch, A.J.), entered August 9, 2006 in a Labor Law and common-law negligence action. The order denied defendants' motion for summary judgment dismissing the complaint.


BARTH SULLIVAN BEHR, BUFFALO (LAURENCE D. BEHR OF COUNSEL), FOR DEFENDANTS-APPELLANTS.
DE MARIE & SCHOENBORN, P.C., BUFFALO (JOSEPH DE MARIE OF COUNSEL), FOR PLAINTIFF-RESPONDENT.


It is hereby ORDERED that the order so appealed from be and the same hereby is unanimously reversed on the law without costs, the motion is granted and the complaint is dismissed.

Memorandum: Plaintiff commenced this Labor Law and common-law negligence action seeking damages for injuries he allegedly sustained when he fell from a ladder while installing horse stalls in a barn-like building (hereafter, barn). The barn was owned by defendant Mary Newton, who used it to store her property and to shelter horses owned by her daughter, defendant Gerri Schultz. According to plaintiff, he climbed the ladder just prior to the accident and heard the sound of a horse trotting and then heard a clanging sound. He did not remember falling, nor did he know what caused him to fall. He next recalled that he was lying on the ground and that a horse was licking his face. Although plaintiff observed that sections of the moveable fence in the barn had fallen, there is no indication in the record concerning how and why they fell, and there is no other evidence concerning the cause of the accident. We agree with defendants that Supreme Court erred in denying their motion for summary judgment dismissing the complaint.

With respect to the cause of action pursuant to Labor Law § 240 (1), which is asserted only against Newton, we conclude that the exemption from liability for "owners of one and two-family dwellings who contract for but do not direct or control the work" applies to Newton, and thus that she is entitled to summary judgment dismissing that cause of action. "[W]hen an owner of a one- or two-family dwelling contracts for work that directly relates to the residential use of the home, even if the work also serves a commercial purpose, that owner is shielded by the homeowner exemption from the absolute liability" of Labor Law § 240 (1) (Bartoo v Buell, 87 NY2d 362, 368). Furthermore, "the fact that the work was performed on the barn and not on [a] residential home . . . does not alter the analysis; the barn, located on [Newton]'s property and used in part for personal storage purposes, is akin to a garage and should be considered an [*2]extension of the dwelling within the scope of the homeowner exemption" (id. at 369; see George v Hunt [appeal No. 1], 289 AD2d 935).

With respect to the common-law negligence cause of action, which is asserted against both defendants, we note that the only theory of negligence with respect to the cause of plaintiff's fall is that the horse knocked down sections of the fence in the barn, causing the ladder to fall. "[T]he Court of Appeals recently clarified[, however,] that cases involving injuries inflicted by domestic animals may only proceed under strict liability based on the owner's knowledge of the animal's vicious propensities, not on theories of common-law negligence" (Morse v Colombo, 31 AD3d 916, 917; see generally Bard v Jahnke, 6 NY3d 592, 596-599; Collier v Zambito, 1 NY3d 444, 446-447). Consequently, the negligence cause of action must be dismissed insofar as it is based upon the actions of the horse. Insofar as plaintiff alleges that defendants were negligent in installing or maintaining the fence, the evidence submitted by defendants in support of the motion established that the fence was properly installed, and plaintiff failed to raise a triable issue of fact (see generally Zuckerman v City of New York, 49 NY2d 557, 562).

To the extent that the first cause of action may be construed as sounding in strict liability, defendants also are entitled to summary judgment dismissing it. Defendants established their entitlement to judgment as a matter of law (see generally id.), and plaintiff failed to raise an issue of fact with respect to the existence of a vicious propensity on the part of the horse or defendants' knowledge of such a propensity (see Rose v Heaton, 39 AD3d 937; Longstreet v Peltz, 33 AD3d 673; Althoff v Lefebvre, 240 AD2d 604).