Coverage Pointers - Volume VIII, No. 5

Dear Coverage Pointers Subscribers:

 

I extend my apologies for the lateness in the day that this issue is reaching you.  I know that many of you read CP with your morning coffee. However, there is nobody to blame but USAirways, whose flight delays impacted on my plan to finish this issue and note at the Club in Philadelphia.  However, instead of an hour, I had seven minutes to catch my next flight.

 

This issue comes to you from Colonial Williamsburg, where I am attending a meeting of the ABOTA Roundtable for Civil Justice. This is an opportunity for the leaders of civil bar trial groups of all denominations to break bread twice a year in order to join together in our common goal of preserving and strengthening the civil jury system.

 

Today’s issue is the last, we hope, of the slow summer season in the courts. There’s an interesting non-insurance case from the Court of Appeals, our highest court, on the Labor Law provisions for construction sites. 

 

There is also a very interesting decision on Workers Compensation liens which can impact many, many cases where the plaintiff has been classified with a partial, permanent disability. It appears that the Third Department concludes that a Kelly calculation - credit for fees and expenses for future workers compensation benefits - will not be made where there is a partial, as compared to a total disability determination. For those carriers who write workers compensation and employers liability coverage, and for those who are allowing or calculating future offsets, this is a must read.

 

The Business First Annual Survey of Western New York lawyers – Who’s Who in Law – was published today, and Hurwitz & Fine is pleased to announce that eight of our lawyers have been identified by their peers as the among the tops in their field. Being selected by one’s peers is surely a wonderful recognition. Honored were:

 

• Scott Billman: Appellate Law

• Bob Fine:  Corporate Law

• Larry Franco:  Estates and Trusts

• Larry Ross:  Health Care Law

• Dan Kohane: Insurance Law

• Ann Evanko:  Labor and Employment

• Harry Mooney: Litigation

• Mike Perley: Municipal Law

 

Keep those cards and letters coming in and enjoy the weekend.

 

Dan

 

Dan D. Kohane

[email protected]

 

8/31/06            O'Sullivan v. IDI Construction Company

New York State Court of Appeals

Electrical Pipe/Conduit Integral Part of the Construction Site

Plaintiff's Labor Law § 241(6) cause of action, based on 12 NYCRR 23-1.7(e)(1) and (2), failed because the electrical pipe or conduit that plaintiff tripped over was an integral part of the construction. Further, plaintiff cannot recover in negligence or pursuant to Labor Law § 200 because no triable issue of fact exists that defendant IDI Construction Company, Inc.'s on-site safety manager "control[led] the activity bringing about the injury to enable it to avoid or correct an unsafe condition" (Russin v Picciano & Son, 54 NY2d 311, 317 [1981]) or that the defendant maintained an unreasonably dangerous work environment.

 

8/31/06            Burns v. Varriale and St. Paul/Travelers Insurance Company
Appellate Division, Third Department
No Kelly Apportionment for Permanent Partial Disabilities
Burns worked for the Colonie Police Department, and was in his police car when struck by the defendant’s vehicle.  Entitled to both workers’ compensation and no fault benefits, he received the compensation benefits for his wage lost at the rate of $400 a week.  He was designated as having a permanently partially disabled by the Workers' Compensation Board. St. Paul/Travelers Insurance Company was the workers' compensation carrier, was directed to pay plaintiff a weekly sum at a rate of $400. Thereafter, plaintiff and his wife, derivatively, commenced a negligence action against defendant. The parties in that action agreed to a settlement in the amount of $300,000.

Travelers consented to the settlement while reserving its right to take a credit for payment of future compensation against plaintiff's net recovery and to seek satisfaction of its existing lien for benefits it had paid, after deduction of it’s pro rata share of counsel fees. At the time of the settlement, Travelers had a total lien of $46,523.26, reflecting actual payments by Travelers of $96,523.26 less $50,000 paid in lieu of first party no-fault benefits. Thereafter, plaintiffs moved for, among other things, an order directing Travelers to pay them approximately $20,000 in "fresh money" for litigation expenses incurred in the personal injury action. Supreme Court granted plaintiffs' motion and Travelers appealed.  

Existing Law: Workers' Compensation Law § 29(1) provides that an employee who is injured during the course of his or her employment by the negligence of a third-party tortfeasor may seek workers' compensation benefits and simultaneously bring an action against the third party. In order to prevent a double recovery in the event that the claimant prevails against the third party, the statute grants the workers' compensation carrier a lien on the proceeds of the recovery equal to the amount of past compensation paid, with interest, but less a deduction for costs and counsel fees. Similarly, section 29(4) provides a credit or offset, which is a holiday that the workers' compensation carrier receives from payment of future benefits to a claimant until the proceeds recovered by the claimant in a personal injury action are exhausted. If such proceeds are exhausted, "the compensation carrier must award compensation for the deficiency 'between the amount of the recovery . . . actually collected, and the compensation provided or estimated'" under the statute, with the amount "actually collected" defined as "recovery proceeds remaining after deduction for litigation costs" (Matter of Kelly v State Ins. Fund, 60 NY2d 131, 138-139 [1983].

The Kelly case held that the carrier must pay for the benefits it receives as a result of a claimant's efforts in a third-party action by contributing its equitable share of the litigation expenses, including counsel fees, incurred by the claimant.  Generally, a carrier's equitable share of the costs is assessed "as a percentage of the total of the amount of past benefits paid (which the carrier will recoup by enforcing its lien in that amount on the recovery) and the present value of estimated future benefits to [a] claimant (which the carrier will not have to pay because of claimant's recovery)" (id. at 135), when such future benefits are ascertainable.

8/29/06            Guishard v.  General Security Insurance Company
Appellate Division, Second Department
In Riveting Decision, Court Ducks Question of Whether Auto Exclusion Should Apply to Deny Coverage Under CGL Policy
Plaintiff was converting a van to an ice cream vending truck when he was struck by a rivet from a rivet gun.  General Security provided general liability coverage and denied coverage based on the auto exclusion.  Court finds that carrier’s failure to submit the policy schedule defining the term “auto” in the policy is fatal in defeating its claim that the exclusion applied.  Orders CGL carrier to defend because of a failure of proof on the part of the insurer that the exclusion relied upon was “stated in clear and unmistakable language.” 

Editor’s note:  it is unclear how the definition of “auto” would have made a difference in the final decision by the court, had the schedule been provided. 

 

The Serious (Injury) Side of New York No-Fault

8/31/06            Hernandez v. Almanzar

Appellate Division, First Department

Defendant Doc’s Review of Plaintiff’s Unaffirmed Medical Reports Does not Open Door to Use of them by the Plaintiff

The defense experts' review of plaintiff’s doctors’ unaffirmed reports did not open the door to plaintiffs' reliance on them, since defendants did not submit such reports in support of the motion, nor did their experts rely on them in forming their conclusions.  Those reports, which were created within two months after the February 2002 accident, were not probative of the existence of a permanent injury.  Finally, plaintiff's proof was also insufficient to raise a triable issue as to whether she was prevented from performing substantially all of her usual activities for at least 90 of the first 180 days following the subject accident – plaintiff missed only two to three weeks of class as a result of the accident.

 

8/29/06            Felix v. New York City Transit Authority

Appellate Division, Second Department

No Contemporaneous Proof of Physical Limitations to Accident

While the affirmed medical report of the plaintiff's examining neurologist noted limitations in the plaintiff's range of motion of her cervical and lumbar spine, this report failed to provide any medical proof that was contemporaneous with the subject accident. Moreover, the plaintiff's examining neurologist relied on the unsworn reports of others in reaching his conclusions. The remaining submissions of the plaintiff, with the exception of her affidavit, were without probative value in opposing the motion since they were unsworn or unaffirmed. The plaintiff's self-serving affidavit was insufficient to raise a triable issue of fact as to whether she sustained a serious injury.

 

8/29/06                        Baksh v. Shabi

Appellate Division, Second Department

Plaintiff’s Physician Fails to Address L-5 Degeneration and Relied on Unsworn Medical Reports

The plaintiff's treating physician impermissibly relied on the unsworn reports of other doctors in reaching his conclusions. Moreover, the plaintiff's treating physician failed to address either the findings of the examining radiologist, who determined that the plaintiff suffered from degenerative processes at the L-5 level of her lumbar spine, or the fact that the plaintiff was involved in a subsequent rear-end collision. This rendered speculative his conclusion that the plaintiff's injuries and limitations were causally related to the subject accident.

 

8/29/06                        Brobeck v. Jolloh

Appellate Division, Second Department

Unsworn Medical Reports Sink the Plaintiff Once Again

The plaintiff principally relied upon the affidavit of his treating neurologist, who also submitted an affirmed medical report. Neither submission raised a triable issue of fact since in both the affidavit and the affirmed medical report the plaintiff's examining neurologist relied on the unaffirmed/unsworn reports of others in reaching his opinion and diagnosis. All of the remaining submissions of the plaintiff, with the exception of his own affidavit, were unaffirmed/unsworn and thus without probative value in opposing the defendant's motion. In the absence of such admissible evidence of injury, the plaintiff's self-serving affidavit was insufficient to raise a triable issue of fact.

 

 

Audrey’s Angle on No-Fault

 

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

 

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

 

8/30/06            In the Matter of the Arbitration between the Applicant and Respondent

Arbitrator Thomas J. McCorry, Esq. (Erie County)

Chiropractor Prohibited From Payment Of Technical Portion Of Electrodiagnostic Testing When Never Conducted Testing Or Supervised Testing.

Here is the Angle:  I appeared for this arbitration and was provided with a rare opportunity to cross-exam the chiropractor seeking payment for the electrodiagnostic testing.  Ultimately, based upon the chiropractor’s admissions, he was denied payment of the bill.  Further, there is an interesting related award issued by Arbitrator Brynne L. Haines captioned Nesi Chiropractic a/a/o [eligible injured person] with AAA case no 14200245757.  I encourage you to read both this award as well as Arbitrator Haines’ award to see the full picture of this claim.

 

The Analysis:  The treating chiropractor, John Syracuse, D.C., sought payment of the technical portion of upper and lower NCV/SSEP testing on the eligible injured person.  Arbitrator Haines rendered a previous award against Nesi Chiropractic who sought payment of the professional portion of the same testing on the same eligible injured person.  Nesi Chiropractic is located in Kingston, New York, while Mr. Syracuse is located at the opposite end of the state in Newfane.

 

It is noted that with respect to Arbitrator Haines’ award against Nesi that:

 

…she found the testing in dispute to be ‘far from customary and a violation of accepted good medical practice.  She concluded that the choice of testing was ‘medically unacceptable by common medical standards as well as unjustified in this particular case.’

 

In this case, Mr. Syracuse testified that he was approached by Nesi Chiropractic, who offered to perform electrodiagnostic testing at Mr. Syracuse’s office on referred patients.  Mr. Syracuse used Nesi Chiropractic’s services for approximately 10 patients before discontinuing referrals.

 

Further, Mr. Syracuse admitted that it was a business decision to use this service and was also motivated by the fact that the only neurologist in the area would not accept no-fault or workers’ compensation patients.

 

In addition, Mr. Syracuse admitted that he had no training in electrodiagnostic testing.  Nesi Chiropractic wrote the letters of medical necessity for him and he would review and sign the letters.  Mr. Syracuse was not present when this particular patient was tested.  He reviewed only reports and had no role in the testing or interpretation of the raw data.  Moreover, with this patient the treatment plan was not altered after the electrodiagnostic testing was performed.

 

Arbitrator McCorry reviewing Workers’ Compensation Medical Fee Schedule section 5, radiology (b) noted that since Mr. Syracuse did not perform and or supervise the procedure he was not entitled to payment.

 

8/30/06            In the Matter of the Arbitration between the Applicant and Respondent

Arbitrator Thomas J. McCorry, Esq. (Erie County)

Insurer’s Refusal to Reschedule an IME from A Saturday to a Weekday So Counsel Could Appear Was Unreasonable.

Here is the Angle:  An IME must be held at a time and place reasonably convenient for the eligible injured person as well as counsel who wish to attend.  Here, the insurer scheduled a Saturday IME and refused to reschedule it to a weekday when counsel had regular business hours and could attend. 

 

The Analysis:  The eligible injured person was involved in an October 29, 2005, motor vehicle accident that resulted in her being taken out of work by her chiropractor until mid-August 2006.  The insurer denied all no-fault benefits on February 7, 2006, for her failure to appear for a scheduled independent medical examination (“IME”).

 

The insurer scheduled the IME for a Saturday.  The eligible injured person testified that counsel advised her not to appear for the examination as it was scheduled for a weekend.  Further, counsel requested an adjournment of the IME to a weekday.  The reason for the adjournment was that someone from the law firm wanted to attend the IME with the eligible injured person, but the law firm did not routinely keep scheduled business hours on Saturday and Sunday.  The insurer instead of rescheduling the IME to a weekday denied the claim.

 

Arbitrator McCorry found in favor of the eligible injured person citing unspecified insurance department regulations that provide the IME must be held at a time and place reasonably convenient for the eligible injured person.  Accordingly, Arbitrator McCorry found it unreasonable for the insurer to reschedule an examination to a weekday as it was reasonably convenient for the eligible injured person and counsel.

 

8/29/06            In the Matter of the Arbitration between the Applicant and Respondent

Arbitrator Veronica O’Connor, Esq. (Erie County)

Eligible Injured Person Cannot Be Awarded Future Dental Expenses As Cost Must Be Incurred And Service Rendered.

Here is the Angle:  An arbitrator cannot award expenses for future services.  Here, the eligible injured person presented to the arbitrator an estimate for dental treatment to be performed.  The eligible injured person had not undergone the recommended dental treatment or incurred any expense for the recommended dental treatment. 

The Analysis:  The eligible injured person sought payment for dental services not yet performed allegedly arising out of a December 10, 1999, motor vehicle accident.  The eligible injured person claimed that the dental services were required to correct previous dental treatment rendered as a result of the December 10, 1999, accident.  The first dental treatment consisted of implants, prosthetic work, and a lower removable partial.  The insurer paid for this first course of dental treatment.

 

However, the eligible injured person was not happy with the work performed and consulted with another dentist who recommended further limited dental treatment.  More specifically the second dentist indicated that:

 

…she claims she is unable to wear the lower partial and is unhappy with the prosthetic work.  Her major complaint is about the fit and feel of the lower partial.  It is a different design than her original partial and she is unable to wear it…..I would fabricate a new partial that would hopefully satisfy her….I hesitate to alter any of the other work as I do not want to take on the responsibility for it….This would be billed @ $900.00 plus fees for the consultations…

 

On October 31, 2005, the insurer had the eligible injured person examined by Dr. A. Alexander Drapanas.  Dr. Drapanas concluded that the eligible injured person’s dentition was restored to a degree far beyond what may have been warranted.  He could not conceive of anything more that could be or should have been done beyond what the first dentist already performed.  Dr. Drapanas further opined that there was no causal relationship between what the eligible injured person described occurred on December 10, 1999, and what he observed as a result of her oral reconstruction.

 

Arbitrator O’Connor noted that Insurance Law §5102(a)(1) provides that basic economic loss includes “all necessary expenses incurred” for medical services.  Further, 11 NYCRR §65-1.1(d) provides that the insurer will pay first-party benefits to reimburse for basic economic loss sustained by an eligible injured person due to personal injuries caused by an accident arising out of the use and operation of a motor vehicle.

 

Arbitrator O’Connor held that based upon the Insurance Law and implementing regulations that the claimed service must be rendered and the cost incurred before it can be reimbursed.  Since the eligible injured person did not actually incur the cost or have the dental work performed Arbitrator O’Connor held that the claim was beyond the scope of this arbitration.  Further, she was without authority to award future services that were not incurred.

 

 

Across Borders

 

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

8/31/06            Fiesss v. State Farm Lloyds

Texas Supreme Court

Ensuing Clause does Not Render Exclusion Ambiguous
Answering a certified question of the circuit court, the Texas Supreme Court held that a mold exclusion that ended “[w]e do cover ensuing loss caused by water damage, unambiguously excluded coverage for mold damage.

 

Submitted by: C. Theresa Barone and Michael R. Nelson (Nelson, Levine, deLuca & Horst, L.L.C.)

8/30/06            Continental Casualty Company v. Advance Terrazzo
Eighth Circuit Court of Appeals

Release of Irritant from Propane Powered Tool Excluded Under Absolute Pollution Exclusion Advance Terrazzo was sued for injuries caused by carbon monoxide emitted from its propane-powered terrazzo grinders. Advance’s general liability insurers filed a declaratory judgment action in federal court, contending that the absolute pollution exclusion barred coverage. The policy excluded coverage for bodily injury arising out of the dispersal, release, or escape of pollutants. Advance argued that the absolute pollution exclusion is ambiguous when applied to routine business hazards such as the release of carbon monoxide from terrazzo grinders. The court found that carbon monoxide, an "irritant" under prior case law, was caused by Advance’s grinders and "dispersed" throughout the work site. Accordingly, the insurance companies had no duty to defend Advance Terrazzo.

 

Submitted by: C. Theresa Barone and Michael R. Nelson (Nelson, Levine, deLuca & Horst, L.L.C.)

8/28/06            Naifeh v. Valley Forge Life Insurance  Company
Tennessee Supreme Court

Ambiguity in Notation Regarding Backdating of Policy to Be Construed in Favor of Insured
The decedent, John Naifeh, was required to maintain a one million dollar life insurance as part of a divorce settlement. The policy was cancelled for nonpayment of the premiums shortly before his death. The beneficiary argued that the cancellation was improper given the premiums paid by the insured. The total premiums paid would have been adequate if the policy was backdated, as shown in the application, to give the insured an age of 51 rather than 52 at the time the policy was written. The insurer argued that the notation on the application regarding the date was not followed and that the policy was properly terminated. The court disagreed, finding that the policy date was ambiguous and therefore must be construed in favor of the policyholder.

 

Submitted by: C. Theresa Barone and Michael R. Nelson (Nelson, Levine, deLuca & Horst, L.L.C

 

 

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

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[email protected]

 

Insurance Coverage Team

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Dan D. Kohane
Scott M. Duquin

 

 

Guishard v. General Security Insurance Company

In an action for a judgment declaring, inter alia, that the defendant is obligated to defend and indemnify the plaintiffs in an action entitled Phillips v Guishard, pending in the Supreme Court, Bronx County, under Index No. 23809/02, the defendant appeals from a judgment of the Supreme Court, Kings County (Vaughan, J.), entered August 16, 2005, which, upon an order of the same court dated May 18, 2005, denying its motion for summary judgment and granting the plaintiffs' cross motion for summary judgment, declared that the defendant was obligated to defend and indemnify the plaintiffs in the underlying action.

ORDERED that the judgment is affirmed, with costs.

In this action, the plaintiffs seek, inter alia, a judgment declaring that the defendant, General Security Insurance Company (hereinafter General Security), is obligated to defend and indemnify them in an underlying personal injury action pursuant to a general liability insurance policy. General Security moved for summary judgment declaring that there was no coverage based on the auto exclusion in its policy because the injured plaintiff in the underlying action was struck by a rivet from a rivet gun while converting a van owned by the plaintiffs into an ice cream vending truck. The Supreme Court denied the motion and granted the plaintiffs' cross motion for summary judgment declaring that General Security is obligated to defend and indemnify the plaintiffs in the underlying action. We agree. [*2]

In an insurance coverage case, the insurer bears the burden of establishing that the claimed policy exclusion defeats the insured's claim to coverage by demonstrating that the exclusion relied upon is "stated in clear and unmistakable language, is subject to no other reasonable interpretation, and applies in the particular case" (Continental Cas. Co. v Rapid - Am. Corp., 80 NY2d 640, 652; see Seaboard Sur. Co. v Gillette Co., 64 NY2d 304, 311; Community Hosp. at Glen Cove v American Home Assur. Co., 171 AD2d 639; AFA Protective Sys. v Atlantic Mut. Co., 157 AD2d 683, 685). Here, General Security did not submit the policy schedule defining the term "auto" as used in the policy. Accordingly, General Security's submissions failed to demonstrate its prima facie entitlement to judgment as a matter of law or raise a triable issue of fact in opposition to the plaintiffs' prima facie showing of entitlement to judgment as a matter of law (see Alvarez v Prospect Hosp., 68 NY2d 320, 324).
SCHMIDT, J.P., CRANE, SPOLZINO and COVELLO, JJ., concur.

ENTER:

Felix v. New York City Transit Authority

Wallace D. Gossett (Steve Efron, New York, N.Y. [Renee Cyr] of
counsel), for appellants.
Mitchell Dranow, Mineola, N.Y., for respondent.

In an action to recover damages for personal injuries, the defendants appeal from an order of the Supreme Court, Kings County (Solomon, J.), dated April 6, 2005, 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, the motion is granted, and the complaint is dismissed.

The defendants established their prima facie entitlement to judgment as a matter of law by demonstrating 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; Kearse v New York City Tr. Auth., 16 AD3d 45). In opposition, the plaintiff failed to raise a triable issue of fact. While the affirmed medical report of the plaintiff's examining neurologist noted limitations in the plaintiff's range of motion of her cervical and lumbar spine, this report failed to provide any medical proof that was contemporaneous with the subject accident (see Ranzie v Abdul-Massih, 28 AD3d 447; Suk Ching Yeung v Rojas, 18 AD3d 863; Nemchyonok v Peng Liu Ying, 2 AD3d 421; Ifrach v Neiman, 306 AD2d 380). Moreover, the plaintiff's examining neurologist relied on the unsworn reports of others in reaching [*2]his conclusions (see Mahoney v Zerillo, 6 AD3d 403; Friedman v U-Haul Truck Rental, 216 AD2d 266). The remaining submissions of the plaintiff, with the exception of her affidavit, were without probative value in opposing the motion since they were unsworn or unaffirmed (see Grasso v Angerami, 79 NY2d 813; Hernandez v Taub, 19 AD3d 368; Pagano v Kingsbury, 182 AD2d 268). In the absence of any admissible objective evidence of injury, the plaintiff's self-serving affidavit was insufficient to raise a triable issue of fact as to whether she sustained a serious injury (see Fisher v Williams, 289 AD2d 288). Finally, the plaintiff failed to submit 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 subject accident (see Sainte-Aime v Ho, 274 AD2d 569).
MILLER, J.P., RITTER, LUCIANO, SPOLZINO and DILLON, JJ., concur.

Baksh v. Shabi

In an action to recover damages for personal injuries, the defendant Ester Bueno appeals from an order of the Supreme Court, Queens County (Hart, J.), dated September 13, 2005, which denied her motion for summary judgment dismissing the complaint insofar as asserted against her 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, the motion is granted, the complaint is dismissed insofar as asserted against the defendant Ester Bueno, and the action against the remaining defendant is severed.

Contrary to the determination of the Supreme Court, the defendant Ester Bueno, via her submissions in support of her motion, established, 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). In opposition, the plaintiff failed to raise a triable issue of fact. The plaintiff's treating physician impermissibly relied on the unsworn reports of other doctors in reaching his conclusions (see Springer v Arthurs, 22 AD3d 829; Vallejo v Builders for Family Youth, Diocese of Brooklyn, 18 AD3d 741; Mahoney v Zerillo, 6 AD3d 403; Friedman v U-Haul Truck Rental, 216 AD2d 266). Moreover, the plaintiff's treating physician failed to address either the findings of Bueno's examining radiologist, who determined that the plaintiff suffered from degenerative processes at the L-5 level of her lumbar [*2]spine, or the fact that the plaintiff was involved in a subsequent rear-end collision. This rendered speculative his conclusion that the plaintiff's injuries and limitations were causally related to the subject accident (see Tudisco v James, 28 AD3D 536; Giraldo v Mandanici, 24 AD3d 419; Allyn v Hanley, 2 AD3d 470; Lorthe v Adeyeye, 306 AD2d 252). Furthermore, the plaintiff failed to proffer competent medical evidence that connected his alleged inability to perform substantially all of his daily activities for not less than 90 of the first 180 days subsequent to the subject accident with the alleged accident-related injuries (see Sainte-Aime v Ho, 274 AD2d 569; DiNunzio v County of Suffolk, 256 AD2d 498).
ADAMS, J.P., GOLDSTEIN, FISHER and LIFSON, JJ., concur.

Brobeck v. Jolloh

 In an action to recover damages for personal injuries, the defendant appeals, as limited by his brief, from so much of an order of the Supreme Court, Kings County (Vaughan, J.), dated July 21, 2005, as 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 insofar as appealed from, on the law, with costs, the motion is granted, and the complaint is dismissed.

The defendant made a prima facie showing, via his submissions, 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; Kearse v New York City Tr. Auth., 16 AD3d 45; Collins v Stone, 8 AD3d 321). In opposition, the plaintiff failed to establish the existence of a triable issue of fact. The plaintiff principally relied upon the affidavit of his treating neurologist, who also submitted an affirmed medical report. Neither submission raised a triable issue of fact since in both the affidavit and the affirmed medical report [*2]the plaintiff's examining neurologist relied on the unaffirmed/unsworn reports of others in reaching his opinion and diagnosis (see Vallejo v Builders for Family Youth, Diocese of Brooklyn, 18 AD3d 741, 742; Mahoney v Zerillo, 6 AD3d 403; Friedman v U-Haul Truck Rental, 216 AD2d 266, 267). All of the remaining submissions of the plaintiff, with the exception of his own affidavit, were unaffirmed/unsworn and thus without probative value in opposing the defendant's motion (see Grasso v Angerami, 79 NY2d 813, 814; Hernandez v Taub, 19 AD3d 368, 368; Pagano v Kingsbury, 182 AD2d 268, 270). In the absence of such admissible evidence of injury, the plaintiff's self-serving affidavit was insufficient to raise a triable issue of fact (see Fisher v Williams, 289 AD2d 288, 289). Accordingly, the Supreme Court erred in denying the defendant's motion for summary judgment dismissing the complaint.
SCHMIDT, J.P., CRANE, KRAUSMAN, SKELOS and LUNN, JJ., concur.

O'Sullivan v. IDI Construction Company

 

MEMORANDUM: [*2]

The order of the Appellate Division should be affirmed, with costs. The courts below properly concluded that plaintiff's Labor Law § 241(6) cause of action, based on 12 NYCRR
23-1.7(e)(1) and (2), failed because the electrical pipe or conduit that plaintiff tripped over was an integral part of the construction. Further, plaintiff cannot recover in negligence or pursuant to Labor Law § 200 because no triable issue of fact exists that defendant IDI Construction Company, Inc.'s on-site safety manager "control[led] the activity bringing about the injury to enable it to avoid or correct an unsafe condition" (Russin v Picciano & Son, 54 NY2d 311, 317 [1981]) or that IDI maintained an unreasonably dangerous work environment.
* * * * * * * * * * * * * * * * *
On review of submissions pursuant to section 500.11 of the Rules, order affirmed, with costs, in a memorandum. Chief Judge Kaye and Judges G.B. Smith, Ciparick, Rosenblatt, Graffeo, Read and
R.S. Smith concur.
Decided August 31, 2006

Guishard v. General Security Insurance Company

 

In an action for a judgment declaring, inter alia, that the defendant is obligated to defend and indemnify the plaintiffs in an action entitled Phillips v Guishard, pending in the Supreme Court, Bronx County, under Index No. 23809/02, the defendant appeals from a judgment of the Supreme Court, Kings County (Vaughan, J.), entered August 16, 2005, which, upon an order of the same court dated May 18, 2005, denying its motion for summary judgment and granting the plaintiffs' cross motion for summary judgment, declared that the defendant was obligated to defend and indemnify the plaintiffs in the underlying action.

ORDERED that the judgment is affirmed, with costs.

In this action, the plaintiffs seek, inter alia, a judgment declaring that the defendant, General Security Insurance Company (hereinafter General Security), is obligated to defend and indemnify them in an underlying personal injury action pursuant to a general liability insurance policy. General Security moved for summary judgment declaring that there was no coverage based on the auto exclusion in its policy because the injured plaintiff in the underlying action was struck by a rivet from a rivet gun while converting a van owned by the plaintiffs into an ice cream vending truck. The Supreme Court denied the motion and granted the plaintiffs' cross motion for summary judgment declaring that General Security is obligated to defend and indemnify the plaintiffs in the underlying action. We agree. [*2]

In an insurance coverage case, the insurer bears the burden of establishing that the claimed policy exclusion defeats the insured's claim to coverage by demonstrating that the exclusion relied upon is "stated in clear and unmistakable language, is subject to no other reasonable interpretation, and applies in the particular case" (Continental Cas. Co. v Rapid - Am. Corp., 80 NY2d 640, 652; see Seaboard Sur. Co. v Gillette Co., 64 NY2d 304, 311; Community Hosp. at Glen Cove v American Home Assur. Co., 171 AD2d 639; AFA Protective Sys. v Atlantic Mut. Co., 157 AD2d 683, 685). Here, General Security did not submit the policy schedule defining the term "auto" as used in the policy. Accordingly, General Security's submissions failed to demonstrate its prima facie entitlement to judgment as a matter of law or raise a triable issue of fact in opposition to the plaintiffs' prima facie showing of entitlement to judgment as a matter of law (see Alvarez v Prospect Hosp., 68 NY2d 320, 324).
SCHMIDT, J.P., CRANE, SPOLZINO and COVELLO, JJ., concur.

Hernandez v. Almanzar

 

Order, Supreme Court, Bronx County (Yvonne Gonzalez, J.), entered June 30, 2005, which denied defendants' motion for summary judgment dismissing the complaint, unanimously reversed, on the law, without costs, and the motion granted. The Clerk is directed to enter judgment in favor of defendants dismissing the complaint.

The first-named plaintiff seeks to recover for "serious injury" within the meaning of the No-Fault Law (Insurance Law
§ 5102[d]) that she allegedly suffered in an automobile accident on February 9, 2002. In support of their motion for summary judgment, defendants submitted reports of an orthopedist and a neurologist, each of whom opined, based on his examination of plaintiff, that she had not suffered a serious injury within the meaning of the statute. Defendants also submitted the transcript of plaintiff's deposition, at which she acknowledged that, besides the February 2002 accident, she had been injured in two other automobile accidents, in October 1999 and January 2003. Plaintiff opposed defendants' motion with the affirmed report of neurologist Dr. Aric Hausknecht, dated April 19, 2005. Based on his examination of plaintiff, Dr. Hausknecht reported certain alleged range-of-motion deficits due to neck and back injuries he attributed to the February 2002 accident. Although Dr. Hausknecht acknowledged that plaintiff had been injured in the October 1999 and January 2003 accidents, he did not explain the basis for his claim that the deficits he allegedly found in April 2005 — more than three years after the subject accident in February 2002 — were proximately caused by that accident, rather than by the October 1999 accident, and were only exacerbated (not caused in the first instance) by the January 2003 accident. Accordingly, plaintiff failed to come forward with evidence sufficient to prove "a serious injury causally related to the [subject] accident" (Pommells v Perez, 4 NY3d 566, 579 [2005] [emphasis added]).

To the extent Dr. Hausknecht's conclusions were based on the unaffirmed reports of plaintiff's treating physicians, such reports do not constitute admissible evidence, and therefore do not suffice to defeat a well-supported summary judgment motion. The defense experts' review of such unaffirmed reports (as noted in their reports) did not open the door to plaintiffs' reliance on them, since defendants did not submit such reports in support of the motion, nor did their experts rely on them in forming their conclusions. In any event, such reports, which were [*2]created within two months after the February 2002 accident, are not probative of the existence of a permanent injury.

Finally, plaintiff's proof was also insufficient to raise a triable issue as to whether she was prevented from performing substantially all of her ususal activities for at least 90 of the first 180 days following the subject accident. In this regard, we note that plaintiff testified that she missed only two to three weeks of class as a result of the accident.

 

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Burns v. Variale

 

Mercure, J.P.

Appeal from an order of the Supreme Court (Teresi, J.), entered April 4, 2005 in Albany County, which, inter alia, directed St. Paul/Travelers Insurance Company to pay $18,960.92 in "fresh money" to plaintiffs.

The primary issue on this appeal is whether the value of future workers' compensation benefits to be awarded to a claimant with a nonschedule permanent, partial disability is speculative. We hold that it is and therefore reverse Supreme Court's apportionment of counsel fees under Workers' Compensation Law § 29 (1) based on such future benefits.

In January 2003, plaintiff Owen F. Burns III (hereinafter plaintiff), a Traffic Safety Investigator for the Town of Colonie Police Department, was injured during the course of his [*2]employment when his police vehicle was struck by a vehicle driven by defendant. As a result of the accident, plaintiff was designated permanently partially disabled by the Workers' Compensation Board. St. Paul/Travelers Insurance Company (hereinafter Travelers), the workers' compensation carrier, was directed to pay plaintiff a weekly sum at a rate of $400. Thereafter, plaintiff and his wife, derivatively, commenced a negligence action against defendant. The parties in that action agreed to a settlement in the amount of $300,000.

Travelers ultimately consented to the settlement while reserving its right to take a credit for payment of future compensation against plaintiff's net recovery and to seek satisfaction of its existing lien for benefits it had paid, after deduction of its pro rata share of counsel fees (see Workers' Compensation Law § 29 [1], [4]). At the time of the settlement, Travelers had a total lien of $46,523.26, reflecting actual payments by Travelers of $96,523.26 less $50,000 paid in lieu of first party no-fault benefits. Thereafter, plaintiffs moved for, among other things, an order directing Travelers to pay them approximately $20,000 in "fresh money" for litigation expenses incurred in the personal injury action. Supreme Court granted plaintiffs' motion and Travelers now appeals ^[FN1]. Because we conclude that Supreme Court's apportionment of counsel fees based on plaintiff's future compensation benefits was speculative, we now reverse in part.

Workers' Compensation Law § 29 (1) provides that an employee who is injured during the course of his or her employment by the negligence of a third-party tortfeasor may seek workers' compensation benefits and simultaneously bring an action against the third party. In order to prevent a double recovery in the event that the claimant prevails against the third party, the statute grants the workers' compensation carrier a lien on the proceeds of the recovery equal to the amount of past compensation paid, with interest, but less a deduction for costs and counsel fees (see Workers' Compensation Law § 29 [1]; Becker v Huss Co., 43 NY2d 527, 538 [1978]). Similarly, section 29 (4) provides a credit or offset, which is a holiday that the workers' compensation carrier receives from payment of future benefits to a claimant until the proceeds recovered by the claimant in a personal injury action are exhausted (see Minkowitz, Practice Commentaries, McKinney's Cons Laws of NY, Book 64, Workers' Compensation Law § 29, at 199-200). If such proceeds are exhausted, "the compensation carrier must award compensation for the deficiency 'between the amount of the recovery . . . actually collected, and the compensation provided or estimated'" under the statute, with the amount "actually collected" defined as "recovery proceeds remaining after deduction for litigation costs" (Matter of Kelly v State Ins. Fund, 60 NY2d 131, 138-139 [1983], quoting Workers' Compensation Law § 29 [4]; see Matter of Curtin v City of New York, 287 NY 338, 343-344 [1942]).

The statute requires that the carrier pay for the benefits it receives as a result of a claimant's efforts in a third-party action by contributing its equitable share of the litigation [*3]expenses, including counsel fees, incurred by the claimant (see Workers' Compensation Law § 29 [1]; Matter of Kelly v State Ins. Fund, supra at 138; Becker v Huss Co., supra at 538-589). It is well settled that "the compensation carrier's equitable share of litigation costs incurred by the claimant [is] apportioned on the basis of the total benefit that the carrier derives" (Matter of Kelly v State Ins. Fund, supra at 135 [emphasis added]). Thus, generally, a carrier's equitable share of the costs is assessed "as a percentage of the total of the amount of past benefits paid (which the carrier will recoup by enforcing its lien in that amount on the recovery) and the present value of estimated future benefits to [a] claimant (which the carrier will not have to pay because of claimant's recovery)" (id. at 135), when such future benefits are ascertainable. Requiring the carrier to pay counsel fees up-front on expected and predictable future benefits is consistent with the policy underlying the statute of encouraging claimants to seek recovery against third-party tortfeasors, with the potential for an earlier realization of benefits operating as an inducement to claimants to seek such a recovery (see Matter of Di Meglio v Hartford Ins. Co., 116 Misc 2d 191, 196 [1982]).

In contrast, where "the value of the future benefit derived by [the carrier] as a result of [a claimant's] recovery in the action against the third party cannot be ascertained and is entirely speculative," an apportionment of counsel fees based on such future benefits is not feasible (Matter of Briggs v Kansas City Fire & Mar. Ins. Co., 121 AD2d 810, 812 [1986]). That is, where the carrier's "obligation to pay future benefits . . . cannot be quantified 'by actuarial or other reliable means' . . . [,] the present value of the estimated future compensation payments that [the carrier] would have become obligated to make cannot be ascertained" by the courts (Matter of McKee v Sithe Independence Power Partners, 281 AD2d 891, 891 [2001], quoting Matter of Briggs v Kansas City Fire & Mar. Ins. Co., supra at 812). Travelers and the Special Funds Conservation Committee assert that such a situation is presented when, as here, a claimant receives a permanent partial disability award, as opposed to an award for death benefits, permanent total disability or schedule loss of use. We agree.

An award for death benefits, permanent total disability or schedule loss of use does not fluctuate and the duration of the benefits is predictable. For example, the present value of death benefits to be paid to a dependent spouse may be calculated with the use of actuarial tables that take into account the spouse's life expectancy and probability that he or she will remarry (see Matter of Kelly v State Ins. Fund, supra at 139). Similarly, when a claimant is permanently and totally disabled, there is an expectation that the claimant will receive payment at a certain amount every week for his or her life, the duration of which can be predicted (see Wood v Firestone Tire & Rubber Co., 123 Misc 2d 812, 815 [1984]). An award for a schedule loss of use is for a static rate for a specific number of weeks (see Workers' Compensation Law § 15 [3]) and, therefore, involves no speculation.

When a claimant has a permanent partial disability, however, neither the duration nor the amount of an award is readily predictable because the award may or may not continue for the rest of the claimant's life and the weekly benefit of an award can change based upon the claimant's actual earnings (see generally Matter of Leeber v LILCO, 29 AD3d 1198 [2006]; Matter of Tipping v National Surface Cleaning Mgt., 29 AD3d 1200, 1201 [2006] [Carpinello, J., concurring]). While a finding of permanent partial disability gives rise to an inference that a reduction in wages is related to the disability, the initial burden remains on the claimant to demonstrate that "reduced earning capacity is [not] due to age, general economic conditions or other factors unrelated to the disability" i.e., that the reduction was involuntary (Matter of Meisner v United Parcel Serv., 243 AD2d 128, 130 [1998], lv dismissed 93 NY2d 848 [1999], lv [*4]denied 94 NY2d 757 [1999]; see Matter of Rothe v United Med. Assoc., 18 AD3d 1093, 1094 [2005]; Matter of Thompson v Saucke Bros. Constr. Co., 2 AD3d 993, 993 [2003], lv denied 2 NY3d 703 [2004]; Matter of Scarpelli v Bevco Trucking Corp., 305 AD2d 892, 893 [2003]). Despite a classification as having a permanent partial disability and receipt of benefits in the past, a claimant who voluntarily withdraws from the labor market entirely loses entitlement to future benefits (see Matter of Rothe v United Med. Assoc., supra at 1094; Matter of Scarpelli v Bevco Trucking Corp., supra at 893; Matter of Capezzuti v Glens Falls Hosp., 282 AD2d 808, 810 [2001]; see also Matter of Coneys v New York City Dept. of Mental Health, 299 AD2d 602, 602-603 [2002]). Further, even where a claimant has retired and that retirement is found by the Workers' Compensation Board to be involuntary, the carrier remains free to return before the Board to demonstrate by "'direct and positive proof that something other than the disability [is] the sole cause of claimant's reduced earning capacity after retirement'" (Matter of Leeber v LILCO, supra at 1199, quoting Matter of Pittman v ABM Indus., 24 AD3d 1056, 1058 [2005]; see Matter of Pepe v City & Suburban, 29 AD3d 1184 [2006]). Thus, unlike an award for permanent total disability, the duration of which is to last for the rest of a claimant's life, the duration of an award for permanent partial disability is not readily predictable because it depends on factors unconnected with the disability such as general economic conditions or a claimant's desire to cease working that are not readily ascertainable (see Matter of Rothe v United Med. Assoc., supra at 1094; Matter of Yamonaco v Union Carbide Corp., 42 AD2d 1014, 1014-1015 [1973]).

Moreover, if the claimant meets his or her burden of demonstrating that a diminution in earnings is related to disability and "'actual earnings during the period of the disability are established, wage earning capacity must be determined exclusively by the actual earnings of the injured employee without evidence of capacity to earn more or less'" (Matter of Meisner v United Parcel Serv., supra at 131, quoting Matter of Matise v Munro Waterproofing Co., 293 NY 496, 500 [1944] [emphasis added]; see generally Matter of Pittman v ABM Indus., supra at 1057 [explaining that once a claimant establishes that retirement is involuntary because a disability caused or contributed to his or her decision to retire, a failure to seek employment despite capacity to do so will not result in a denial of benefits]; Matter of Jiminez v Waldbaums, 9 AD3d 99, 100-101 [2004] [same]). The amount of the benefit awarded to a permanently partially disabled claimant is two thirds of the "difference between his [or her] average weekly wages and his [or her] wage earning capacity thereafter in the same employment or otherwise" (Workers' Compensation Law § 15 [3] [w]). Here, plaintiff's average weekly wage was $1,330, or $69,160 annually, prior to his injury; in 2004, he earned approximately $7,500, entitling him to a tentative weekly award of $400, the maximum weekly benefit. His future income, however, is uncertain because plaintiff has not suffered a total loss of wages and his benefits are subject to change depending on whether his actual wages in the future increase (see Matter of Meisner v United Parcel Serv., supra at 131).

Contrary to Supreme Court's conclusion, there is no inference of a permanent and total loss of wages upon a finding of a permanent, partial disability, as opposed to a permanent, total disability. While it may be reasonably concluded that a claimant who is permanently and totally disabled will suffer a total loss of income in the future, such a conclusion is not warranted in the case of a claimant with a permanent, partial disability who has not retired and is obligated to demonstrate a continued attachment to the labor market (see Matter of Tipping v National Surface Cleaning Mgt., supra at 1202 [Carpinello, J., concurring]; Matter of Rothe v United Med. Assoc., supra at 1094). Inasmuch as plaintiff's actual future earnings and continued attachment to the labor market constitute unknown variables that cannot be reliably predicted, the rate and [*5]the duration of his benefits are subject to change and, thus, any calculation of the present value of his future benefit amount would be speculative. In the absence of a reliable method by which the present value of plaintiff's future benefits can be estimated, counsel fees cannot be apportioned on those benefits at this time. Accordingly, Travelers may recover the amount of its lien, $46,523.26, reduced by its equitable share of the costs incurred in recovering the lien amount, i.e., the percentage of the total recovery that it cost plaintiffs in counsel fees and disbursements to bring the action, or 34.82% (see Matter of Kelly v State Ins. Fund, 60 NY2d 131, 136 [1983], supra)^[FN2]. This amounts to a $30,323.86 recovery for Travelers.

We note that if, upon plaintiff's application, the Workers' Compensation Board determines in the same manner that it would after the carrier's offset is exhausted that he is entitled to continued compensation benefits, the Board shall direct further reimbursement of counsel fees by Travelers based on the amount of those benefits and the 34.82% rate that we have determined to be the carrier's equitable share of the cost incurred in obtaining the benefits to the carrier (see Matter of Russo v New York City Dept. of Correction, 9 AD3d 528, 530 [2004]; see also Workers' Compensation Law § 20 [1]). In other words, if plaintiff would have received further compensation benefits but for the settlement between the time of settlement and exhaustion of the carrier's holiday, the carrier will be required at that point to pay its equitable share of the cost of obtaining those benefits, which can no longer be deemed hypothetical or speculative, as those benefits accrue ^[FN3]. Thus, here, the carrier will be liable, subject to reimbursement from Special Funds, to plaintiff for 34.82% of the full amount of the compensation benefit that plaintiff would have been entitled to receive but for his recovery in the third-party action until the carrier's offset is exhausted (see generally Minkowitz, Practice Commentaries, McKinney's Cons Laws of NY, Book 64, Workers' Compensation Law § 29, at 199-200).

In light of our determination, the parties' remaining arguments are academic.

Spain, Carpinello, Rose and Kane, JJ., concur.

ORDERED that the order is modified, on the law, without costs, by reversing so much thereof as directed St. Paul/Travelers Insurance Company to pay $18,960.92 in "fresh money" to plaintiffs; plaintiffs are directed to pay $30,323.86 to St. Paul/Travelers Insurance Company; and, [*6]as so modified, affirmed.

Footnotes

 

 

Footnote 1: Supreme Court also determined that Travelers could not shift liability for plaintiffs' litigation expenses to the Special Funds Conservation Committee. Special Funds and Travelers have since agreed that the provisions of Workers' Compensation Law § 15 (8) (d) do apply and, thus, that portion of Supreme Court's order that denied Travelers such reimbursement is not before us on this appeal.

Footnote 2: The parties are in agreement that the pro-rata percentage, obtained by dividing the amount of legal expenses by the gross recovery of $300,000, is 34.82%.

Footnote 3: For example, if upon plaintiff's application, the Workers' Compensation Board determines that the tentative rate of $400 per week remains applicable, plaintiff would be entitled to 34.82% of that amount, or $139.28 per week from Travelers, until the carrier credit is exhausted.