Coverage Pointers - Volume X, No. 24

Dear Coverage Pointers Subscribers:

Put this One on Your Calendar

FDCC “20/20” Insurance Symposium
The Challenges Facing the Insurance Industry as We Approach the Year 2020”
Registration available at www.thefederation.org

The Federation of Defense and Corporate Counsel is pleased to announce a symposium focused on novel issues that the insurance industry will be facing in the upcoming decade.  The conference will take place in New York from September 9-11, 2009.

What will the insurance industry look like in the not-to-distant future? The seminar will touch on some futuristic topics such as: 

• Challenges Insurance Claims Departments Will Encounter in the Year 2020
• The Future Regulation of Insurers/Reinsurers
• Dealing With Insurers Who Are Financially at Risk
• One Country Indivisible - The Blurring of State Lines and State Jurisdiction
• The 2020 Courtroom, Leveraging the Technology of Tomorrow
• The Future of Insurance Class Actions
• Extra Contractual/Punitive Damages Claims of the 21st Century: Making the Case to the Jury
• Exposures of the Future including Nano Technology, Micro Insurance, Privacy, Cyber Risk, and Food Safety
• Tomorrows Legal Partnerships: Lawyers and Insurers Facing the Future Together

Speakers Include:

• Charlie Breitstadt, Director of Government Relations, Nationwide Insurance Companies, 2009 Chair, Guaranty Fund Management Services
• Michael Crowley, President, Specialty Programs Division, Markel Corporation
• Tom Gayner, Chief Investment Officer, Markel Corporation
• Mark Greisiger, CEO, NetDiligence
• Robert Hartwig, Chief Economist, Insurance Information Institute
• Trish Henry, Deputy General Counsel for Government and Industry Affairs, ACE Group Holdings, Inc.
• Gregory Parsons, Ph.D., Chemical & Bimolecular Engineering Department, North Carolina State University
• Kevin Peinkofer, Senior Counsel, Progressive Casualty Insurance Company
• Kelly Ray, Vice President, Legal Strategy, Legal Research Center
• Lisa A. Rickard, President, U.S. Chamber Institute for Legal Reform
• Scott Rickman, Risk Manager, Del Monte Foods
• Paul Stachura, Chief Claims Officer, Fireman’s Fund Insurance Company
• Fran Semaya, Cozen O’Connor, Chair, ABA Task Force on Federal Involvement in Insurance Regulation Modernization
• Pam Woldow, Principal, Altman Weil
• Rick Woollams, President of Property-Casualty Severity Claims and Senior Vice President and Chief Claims Officer, AIG Commercial Insurance Group

Waving Hello

Hope your Memorial Day was a peaceful and enjoyable one.  We are enjoying the late spring and early summer here in Western New York and Southern Ontario.  Audrey is up at the venerable Sagamore speaking before the New York Insurance Association on No Fault claims handling issues (and would love to visit your shop as well).  I am spending time in airports. A good deal of our practice in the greater NYC area, so duty calls and I have a special seat in the LaGuardia USAirways Club with my name on it, I think.

Coverage Mediation

I serve as a coverage mediator to help carriers resolve issues of primacy, notice, inclusions, exclusions and the like.  Think of it.  Problems get resolved for less money, quickly and without the risk of precedent (that might come back to bite on your next case).  Contact me if you want to try a different way of resolving simple or complex coverage issues and I can outline how we can assist.

From Steve Peiper, the Prince of Property:

Greetings.  A pretty slow couple of weeks in the first party realm.  However, procrastinators rejoice, the First Department again shows us that the last day, isn't always the last day, so long as it is a Saturday or Sunday.  As we are all too often reminded, just because you have (insert deadline here) to do something, does not mean you have to wait until the last day to do it.  

Pointer #2 for this week, the decision in Greenwich Ins. Co. v. Volunteers of America reminds us to read the ENTIRE contract before reaching a decision.  Obviously, you'll never know if something was modified unless you actually look at all of the terms.  

Okay, enough lecturing for this week. Best wishes until next time.
Steve
[email protected]

One Hundred Years Ago:
The nomination of the third woman and the first Hispanic to the United States Supreme Court, is a reflection of the strength and character of not only the nominee but women and minorities in general.  Of course, 100 years ago, women’s strength may have been measured and reported slightly differently:

New York Times
May 29, 1909, Page 2, Col 1
WOMEN BEAT SLANDERER.
Drive Him from Town After a Whipping—
His Wife Ill
Special to The New York Times.

Bleeding and begging for mercy, George Englart, an English miner of Manford, two miles north of here, was driven from town last evening by infuriated women. Englart, it is charged, had made remarks reflecting on the character of women in the town. It is believed Englart would have been killed had he not been rescued by citizens, who placed' him aboard a trolley car, with instructions to stay away.

Englart, whose wife is seriously ill, is said to have been warned to stop his alleged slighting remarks. Yesterday the women decided to banish him. As they approached the Englart house, he ran. He was intercepted and beaten. He broke away, and, with his pursuers on his track, started for Meadowlands, two miles away. Two hundred women, it is reported, followed.

Pick handles, clubs, umbrellas, and table legs are said to have been used as weapons. Englart was repeatedly knocked down. Fearing he would be killed the men took a hand. They drove a buggy among the yelling women and succeeded in wresting the victim from his assailants. Englart was put aboard a Cannonsburg trolley car. He is said to have left, the car a short distance out of Meadowlands and disappeared.

Word of the affair did not reach Washington until today, and so far, no arrests have been made.
Englart's friends threaten trouble. The women say they will not allow him to return.

Earl’s Pearls

Earl Cantwell offers another look at the Twombley decision and the subtle changes in pleading rules.

Audrey Seeley Brings Greetings:

Greetings from The Sagamore!  I was asked to speak at the New York Insurance Association ("NYIA") Annual Meeting on the topic of tips for conducting an effective IME/Peer Review in liability and no-fault cases. 

The Courts are pretty quiet but the arbitration tribunal is active.  There are some interesting decisions for your review on whether denials of medical expenses based upon an IME or Peer Review will be upheld as they indicate lack of medical necessity.  Again, we are seeing that the lack of the words lack of medical necessity results in the denial not being upheld.

Audrey
[email protected]

One Hundred Years Ago Today (speaking of airports)
The first sale of an airplane to a non-military buyer took place when the G.H. Curtiss Manufacturing Co. delivered its Curtiss No. 1, nicknamed the Golden Flyer, to the New York Aeronautical Society to complete a $5,000 purchase.  Glenn Curtiss eventually merged his company with that formed by Wilbur and Orille Wright to create what is the present day Curtiss-Wright Corporation.   The Golden Flyer was 33 feet, 6 inches long, had a wingspan of just under 29 meet and could travel at a blazing top spped of 45 mpg powered by a 25 horsepower, four cylinder engine.

This Week’s Issue Includes:

KOHANE’S COVERAGE CORNER

Dan D. Kohane
[email protected]

• 51 Day Delay in Disclaiming is Too Long
• Party Claiming Insured Status has Right to Sue Insurer for Declaratory Relief
• Since Driver was Not Permissive User, No Need for Court to Determine who Insures Him
• Right Idea, Wrong Proof
• Claim Stated Against Broker
  

MARGO’S MUSINGS ON SERIOUS INJURY UNDER NEW YORK NO FAULT

Margo M. Lagueras
[email protected]

• Failure to Address Prior and Subsequent Accidents Render Causation Speculative \Timely Examination Is Necessary For Claims Under the 90/180-Day Category
• Dot Your “I”s and Cross Your “T”s
• Orthopedist’s Conclusory Statement Will Not Establish Causation
• Arthroscopic Report and Report Quantifying ROM Restrictions of Plaintiff’s Right Shoulder Are Sufficient to Raise an Issue of Fact as Regards Permanent Serious Injury Category
• The Defendant’s Motion Papers Better Address the Plaintiff’s Claim as Stated in the Bill of Particulars, or Else
• The Treating Physician’s Affirmation Can Be Sufficient
• Award of $435,000 for Multiple Tears of the Meniscus Does Not Deviate From What Is Reasonable
• Examinations Three Years Before the Motion for Summary Judgment Are Insufficient to Raise a Triable Issue of Fact
• Plaintiff’s 90/180-Day Claim Requires Contemporaneous Competent Medical Evidence
• Assertion That an Injury Is Insignificant Rather Than Serious Requires Quantified Findings
• Treating Chiropractor’s Affidavit Fails to Acknowledge Two Prior Accidents
• Another Sufficient Treating Physician Affirmation

 

AUDREY’S ANGLES ON NO-FAULT
Audrey Seeley
[email protected]
Arbitration

• Peer Review That Provides Solid Discussion on Why Condition Pre-Existed Accident Upheld
• Unpersuasive Chiro IME Coupled With Use of Unusual Denial Form and Cryptic Reasoning Leads to Decision in Applicant’s Favor
• IME Report Does Not State Lack of Medical Necessity for Physical Therapy.

PEIPER ON PROPERTY (and POTPOURRI)

Steven E. Peiper
[email protected]

• No Coverage for Dishonest Acts of Auctioneer
• Acceptance of Premiums AFTER Learning of Fraud, Estops Carrier’s Action for Rescission
• Specific Clause Limiting Indemnity Obligations for Fire Losses Trumps General Indemnity Provision
• Defendant’s Failure to Record Mortgage for Nearly Nine Months is a Breach of the Mortgage Insurance

Keep those nice notes coming in.

Dan

 

Hurwitz & Fine, P.C. is a full-service law firm
providing legal services throughout the State of New York
NEWSLETTER EDITOR
Dan D. Kohane
[email protected]

INSURANCE COVERAGE TEAM
Dan D. Kohane, Team Leader
[email protected]
Michael F. Perley
Katherine A. Fijal
Audrey A. Seeley
Steven E. Peiper
Margo M. Lagueras

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]
Tasha Dandridge-Richburg
Margo M. Lagueras

APPELLATE TEAM
Jody E. Briandi, Team Leader
[email protected]
 Scott M. Duquin

Index to Special Columns

Kohane’s Coverage Corner
Margo’s Musings on “Serious Injury”
 Audrey’s Angles on No Fault
Peiper on Property and Potpourri
Earl’s Pearls
Across Borders

KOHANE’S COVERAGE CORNER

Dan D. Kohane
[email protected]

5/26/09            Guzman v. Nationwide Ins. Co.
Appellate Division, Second Department
51 Day Delay in Disclaiming is Too Long
Enough said.  Particularly aggravating to the carrier is that it claimed it never received notice of the judgment entered against the insured so that it couldn’t deny coverage promptly.  The court was convinced that the notice was sent and therefore, presumed received.
5/19/09            Crummell v. Avis Rent A Car System, Inc.
Appellate Division, Second Department
Party Claiming Insured Status has Right to Sue Insurer for Declaratory Relief
Unlike a personal injury claimant, not permitted to sue a liability insurer until it has a judgment against the insured, a party claiming insured status does have standing to contest a denial.  Here, Crummell claimed that he was entitled to coverage under a policy issued pursuant to a rental agreement.  Accordingly, Crummell had standing to bring an action in an attempt to establish coverage. For complete relief to be accorded to the parties, others involved in the underlying action should be added as parties to this declaratory judgment action.

5/19/09            State Farm Mut. Auto. Ins. Co. v. TIG Ins. Co.
Appellate Division, Second Department
Since Driver was Not Permissive User, No Need for Court to Determine who Insures Him
This started out as a battle between and among insurers relating to priority of coverage for a person who was alleged to be a permissive user of a vehicle.  However, in a parallel proceeding, it was determined that the driver was NOT a permissive user and no appeal was taken from that Order.  Accordingly, the coverage appeals have been rendered academic and the Appellate Division dismissed the lawsuit without reaching the substance.

5/12/09            In the Matter of Progressive Northeastern Ins. Co. v Centeno
5/12/09            In the Matter of Progressive Northeastern Ins. Co. v. Gibson
Appellate Division, Second Department
Right Idea, Wrong Proof
Two cases with identical decisions, but for the case name.  In each, Progressive moved to stay an uninsured motorists (UM) arbitration based on the insured status of the other vehicle.  It is unclear from either decision what proof was offered to establish that status, but the court did not find it sufficient and therefore denied the applications to stay arbitration.

5/12/09            Prince Seating Corp. v. QBE Ins. Company and Century Coverage Corp.
Appellate Division, Second Department
Claim Stated Against Broker
The insured claimed that it had an agreement with Century, an insurance broker, that Prince would advise Century of claims made against the insured and Century would advise is principal, QBE of those claims.  It is alleged that notice was given to Prince of a particular claim but that Century failed to report it to QBE.  The Court, accepting the allegations as true as it must in a motion to dismiss the complaint, finds that a claim in stated and allows the complaint to stand.  Whether there is proof of the allegations remains to be determined following discovery.

MARGO’S MUSINGS ON SERIOUS INJURY UNDER NEW YORK NO FAULT

Margo M. Lagueras
[email protected]

5/26/09            Jules v. Calderon
Appellate Division, Second Department
Failure to Address Prior and Subsequent Accidents Render Causation Speculative
The plaintiff’s experts noted significant limitations in the lumbar and cervical spinal regions based on both contemporaneous and recent examination.  However, neither expert addressed the prior or subsequent accidents in which the plaintiff sustained injuries to his back and neck.   Therefore, the experts’ conclusions that the injuries reported were caused by the subject accident were speculative and did not establish causation.

5/26/09            Rahman v. Sarpaz
Appellate Division, Second Department
Timely Examination Is Necessary For Claims Under the 90/180-Day Category
The plaintiff’s 90/180-day claim was clearly set forth in his bill of particulars and stated that he missed 9 ½ months of work following the accident.  The defendants’ motion papers did not adequately address the claim and relied on examinations by the defendants’ experts performed almost 4 years after the accident.  In addition, based on his review of MRI films of the plaintiff’s lumbar and cervical spines taken 4 months after the accident, the defendants’ radiologist simply opined that the plaintiff did not suffer a serious injury under the 90/180-day category, but did not make any reference to the injuries to the left knee also claimed in the bill of particulars.  Consequently, the defendants did not meet their prima facie burden.

5/26/09            Sinfelt v. Helm’s Bros., Inc.
Appellate Division, Second Department
Dot Your “I”s and Cross Your “T”s
And you will raise a triable issue of fact as did the affidavit of the plaintiff’s treating chiropractor in this case.  The affidavit was based on contemporaneous and recent examinations, included a review of MRI reports revealing disc herniations at L5-S1 and C5-6, as well as disc bulges at T5-6 and T6-7, and also related the injuries to the subject accident and stated that the limitations were significant and permanent.  And that, finds the Second Department, is sufficient.

5/26/09            Mickens v. Khalid
Appellate Division, First Department
Orthopedist’s Conclusory Statement Will Not Establish Causation
The orthopedist performed range-of-motions tests on the plaintiff’s left knee 17 months after the accident.  He noted that flexion was limited to 130 degrees but he did not compare that with what is normal or describe the limitations compared with the normal functioning of the knee.  Furthermore, his opinion that the plaintiff suffered a torn meniscus was not supported by the medical evidence and he gave no explanation for his conclusion that the knee injury was causally related to the accident.  As such, his statement was merely conclusory and did not establish causation.

5/26/09            Konfidan v. FF Taxi, Inc.
Appellate Division, First Department
Arthroscopic Report and Report Quantifying ROM Restrictions of Plaintiff’s Right Shoulder Are Sufficient to Raise an Issue of Fact as Regards Permanent Serious Injury Category
The arthroscopic report from the orthopedic surgeon noting the repair of labral and anterior labral tears of the plaintiff’s right shoulder tendons, and the report of his treating physician quantifying range-of motion restrictions of the right shoulder noted during a recent examination, were sufficient objective medical proof of the degree of limitation and to raise an issue of fact under the permanent serious injury category. 

5/19/09            Smith v. Quicci
Appellate Division, Second Department
The Defendant’s Motion Papers Better Address the Plaintiff’s Claim as Stated in the Bill of Particulars, or Else
On appeal, the court reverses the decision of the trial court and finds that the defendants did not meet their prima facie burden because their motion papers did not adequately address the claim under the 90/180-day category and which was set forth in the plaintiff’s bill of particulars.  The accident occurred in October 2005, but the plaintiff did not return to work until August 2006.  Defendants’ neurologist did not examine the plaintiff until two years after the accident and failed to relate his finding to the 90/180-day category claimed.

5/19/09            Morgan v. Littles
Appellate Division, Second Department
The Treating Physician’s Affirmation Can Be Sufficient
And here it was to raise an issue of fact as to whether the plaintiff sustained a serious injury to her lumbar spine under the significant limitation or permanent consequential limitation of use categories.  The affirmation was based both on contemporaneous and recent examinations and included the range-of-motion testing performed.

5/19/09            Smith v. Vohrer
Appellate Division, First Department
Award of $435,000 for Multiple Tears of the Meniscus Does Not Deviate From What Is Reasonable
In a trial fraught with potential mistrials, the court finds that the award of $435,000 for multiple tears of the meniscus does not deviate from reasonable compensation.  Notably, the court determined that mistrials were not warranted even though the plaintiff made a passing reference to letters from insurance companies, and her surgeon made reference to the possibility of future surgery.  The court also did not preclude the testimony of the plaintiff’s surgeon, even though the report of the final examination had not been disclosed, because the court determined that the defendant was not deprived of meaningful cross-examination.  The defendant, in turn, was not prejudiced by the charge on aggravation of existing injury because that issue was in the bill of particulars and argued by the defendant’s own expert.

5/12/09            Chery v. Jones
Appellate Division, Second Department
Examinations Three Years Before the Motion for Summary Judgment Are Insufficient to Raise a Triable Issue of Fact
In opposition to the defendants’ motion, the plaintiff submitted 1) affirmations from his treating physicians, which were based on examinations performed three years before the motion for summary judgment, and 2) an affirmation from his orthopedic surgeon which failed to address the findings of the defendants’ radiologist who determined that the MRI taken shortly after the accident did not show any post-traumatic condition but rather only long-standing degenerative conditions of the cervical and lumbar spines and right shoulder.  These submissions failed to raise a triable issue of fact.

5/12/09            Conder v. City of New York
Appellate Division, Second Department
Plaintiff’s 90/180-Day Claim Requires Contemporaneous Competent Medical Evidence
In opposition to the affirmed IME report of a board-certified orthopedic surgeon submitted by the defendant, the plaintiff did not submit any objective medical evidence showing range-of-motion limitations of her spine or knees that was contemporaneous with the accident.  Consequently, there was no competent medical evidence to show that she sustained a medically-determined injury under the 90/180-day category.

5/12/09            Moore v. Stasi
Appellate Division, Second Department
Assertion That an Injury Is Insignificant Rather Than Serious Requires Quantified Findings
The order granting summary judgment to the defendants is reversed on appeal because the affirmed report of the defendants’ neurologist, which noted a limitation in the range-of-motion of the plaintiff’s spine during leg elevation, failed to quantify the limitation to demonstrate it was insignificant rather than serious.

5/12/09            Nicholson v. Allen
Appellate Division, Second Department
Treating Chiropractor’s Affidavit Fails to Acknowledge Two Prior Accidents
The plaintiff’s treating chiropractor’s affidavit was based on an examination performed four years prior to the motion and failed to address the findings of the defendant’s radiologist who determined that the MRI done three months after the accident only revealed long-standing degenerative conditions.  In addition, the affidavit did not acknowledge that the plaintiff sustained injuries in two prior accidents and therefore failed to raise an issue of fact.

5/12/09            Ortiz v. Zorbas
Appellate Division, Second Department
Another Sufficient Treating Physician Affirmation
This time based, as it must be, on both contemporaneous and recent examinations and concluding that the plaintiff’s cervical injuries and range-of-motion limitations were significant, permanent and caused by the accident.

 

AUDREY’S ANGLES ON NO-FAULT
Audrey Seeley
[email protected]

Arbitration
5/26/09            In the Matter of the Arbitration Between Applicant and Respondent
Arbitrator Thomas J. McCorry (Erie County)
Peer Review That Provides Solid Discussion on Why Condition Pre-Existed Accident Upheld.
The Applicant, eligible injured person (“Applicant”), sought reimbursement for treatment for os odontoideum.  The insurer denied the bills based upon a peer review conducted by Dr. Andrew Bazos.  Dr. Bazos opined that the os odontoideum was a pre-existing condition not causally related to the motor vehicle accident.  The basis for this opinion was upon the Applicant’s complaints of neck paid for at least one year and Lhermitte’s symptoms for over five years before the accident.  Further, a review of the x-ray of the cervical spine revealed no acute fracture but that the os odontoideum was “well corticated” indicating a long standing condition.  The assigned arbitrator found in favor of the insurer not only because the report was persuasive but also because the Applicant lacked standing. 

[Note:  If you would like to know what os odontoideum actually is send me an email at [email protected] and I will send you an educational link.]

5/22/09            In the Matter of the Arbitration Between Applicant and Respondent
Arbitrator Thomas J. McCorry (Erie County)
Unpersuasive Chiro IME Coupled With Use of Unusual Denial Form and Cryptic Reasoning Leads to Decision in Applicant’s Favor.
The Applicant, medical provider (“Applicant”), sought reimbursement for chiropractic services rendered as a result of a December 2, 2002, motor vehicle accident.  The Applicant began treating the eligible injured person three times per week after the accident.  The insurer denied chiropractic services rendered from August 2003 through December 2003 based upon the IME of David Ribakove, D.C. 

Mr. Ribakove’s report indicated that the eligible injured person had resolved cervical whiplash syndrome, lumbar strain/sprain, scoliosis, degenerative arthritis, a lumbar disc bulge, and a cervical disc bulge and herniation with degenerative arthritis.  Mr. Ribakove further opined that while there were mild objective improvements there were benign findings.  Therefore, no further care was needed as related to the December 2002 accident. 

The assigned arbitrator did not find the report persuasive without further explanation.  However, it was determined that the denials were not only untimely but also used an unusual denial of claim form that was handwritten and contained cryptic reasons for the denial.  Therefore, the Applicant could not have been clearly informed of the basis for the denial to uphold the denials.

5/20/09            In the Matter of the Arbitration Between Applicant and Respondent
Arbitrator Thomas J. McCorry (Erie County)
IME Report Does Not State Lack of Medical Necessity for Physical Therapy.
The Applicant, eligible injured person (“Applicant”), sought reimbursement for physical therapy and a TENS unit.  The insurer denied payment for these services based upon an independent medical examination (“IME”) performed by Dr. David Inslicht.  A review of Dr. Inslicht’s report was conducted which reveals the Applicant complained of neck, upper back, right shoulder, and bilateral arm pain.  The cervical spine did have limited range of motion on extension and flexion.  The diagnosis was cervical strain superimposed on a pre-existing condition.  Dr. Inslicht provided the opinion that no further physical therapy was necessary because “improvement with intermittent exacerbations.”  The assigned arbitrator held that this opinion did not mean that the treatment was not medically necessary. 

 

PEIPER ON PROPERTY (and POTPOURRI)

Steven E. Peiper
[email protected]

5/26/09            Atlantic Balloon & Novelty Corp. v. American Motorists Ins. Co.
Appellate Division, Second Department
No Coverage for Dishonest Acts of Auctioneer
In December 1994 Atlantic Balloon (Atlantic) used Wagner to secure a policy of insurance on its behalf.  It did, through American Motorists (American) for "business personal property" coverage for the plaintiffs in the amount of $100,000 for the period December 16, 1994, through December 16, 1995.
Atlantic contracted with an auctioneer to conduct to sell some of Atlantic’s inventory; the auctioneer did but alleged never turned over all the money, stole some merchandise, etc.  American denied coverage for the claim and Atlantic sued American and Wagner.
The statute of limitations regarding Wagner began to run when the policy was sold, not when the loss occurred thus any negligence claim against Wagner expired on December 16, 1997, before Wagner was joined.  So the case is dismissed against Wagner.
The policy issued by American Motorists contains exclusion for "[d]ishonest or criminal acts by you, any of your partners, employees, directors, trustees, authorized representatives or anyone to whom you entrust the property for any purpose." It also contains an exclusion for "False Pretense" which it defines as "Voluntary parting with any property by you or anyone else to whom you have entrusted the property if induced to do so by any fraudulent scheme, trick, device or false pretense."   Accordingly, the claim against American is dismissed.
5/26/09            Security Mutual Life Insurance Company of New York v Rodriguez
Appellate Division, First Department
Acceptance of Premiums AFTER Learning of Fraud, Estops Carrier’s Action for Rescission
Plaintiff, Security, issued several policies through its authorized agent to defendants.  Each such policy commenced on October 1, 2003, and included a standard two-year incontestability clause.  In 2004, Security learned that its agents were the focus of an ongoing investigation into policies that the agents had fraudulently obtained from a second insurance company.  Upon learning of the investigation, Security severed its relationship with the agents.  Thereafter, on October 3, 2003, Security commenced an action alleging fraud against the defendants, and also seeking to rescind those policies that were issued to the defendant’s by the agents under investigation.  

The defendants opposed Security’s action on the basis that (a) it was beyond the incontestability deadline, and thus time-barred and (b) that Security’s acceptance of premiums resulted in the waiver its right to rescind the policy. 

The First Department ruled that because the incontestability clause expired on a Saturday, Security’s action, which was commenced on Monday (10/3), was not time-barred.  However, because Security continued to debit defendants’ accounts for premium payments after it learned of the alleged fraud, and because those premiums had not been refunded, the First Department ruled that Security was now estopped from its attempt to rescind the policy.  Finally, the Court held that Security’s claims of fraud were sufficiently plead, and as such, the fraud claims were permitted to proceed.

5/21/09            Greenwich Insurance Company v Volunteers of America-Greater NY, Inc.
Appellate Division, First Department
Specific Clause Limiting Indemnity Obligations for Fire Losses Trumps General Indemnity Provision
In this subrogation action, Greenwich sought recovery for fire damages which were caused by the defendant’s tenant.  Although the lease provided that defendant would indemnify Greenwich for damage to the property, a second provision limited defendant’s indemnity obligations for fire damage to only those fire damages that were caused directly by defendant.  Where, as here, the fire damages did not directly arise from defendant, the First Department ruled that plaintiff’s insured did not have an indemnity right against defendant.
5/19/09            Surace v.  Commonwealth Land Title Insurance Company
Appellate Division, Second Department
Defendant’s Failure to Record Mortgage for Nearly Nine Months is a Breach of the Mortgage Insurance
On April 5, 2005, plaintiff obtained a mortgage on certain real property in Richmond County.  At that time, plaintiff also obtained title insurance from defendant Commonwealth.  However, for some reason, Commonwealth did not record the mortgage until January 20, 2006.  Unfortunately, in the interim, a second mortgage was obtained on August 1, 2005, and was duly recorded on August 15, 2005.  As a result, a lien had been placed on the premises by the time the plaintiff’s original mortgage was recorded.

Upon learning of this, plaintiff naturally commenced an action seeking recovery for Commonwealth’s breach of contract, as well as, general negligence.  The Second Department agreed with the plaintiff’s argument, and searched the record in order to grant of summary judgment on behalf of the plaintiff.  

EARL’S PEARLS
Earl K. Cantwell, II
[email protected]
IT’S “TWOMBLY” TIME AGAIN

A few issues ago, I wrote about the case of Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), which is being oft-cited for the proposition that there is a heightened pleading standard, particularly in more complicated cases, for the United States District Courts.  Twombly concerned the adequacy of pleading an anti-trust case alleging an agreement in violation of Section 1 of the Sherman Anti-Trust Act.  It has since been cited many times in various contexts in the course of analyzing whether there are indeed stricter pleading requirements in Federal Court.

In Twombly, the Supreme Court jettisoned the “old” statement from Conley v. Gibson, that a complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove “no set of facts” in support of the claim which would grant relief.  In contrast to this longstanding “no set of facts” language of Conley, the Court in Twombly essentially replaced it with language that a complaint must allege “enough facts to state a claim for relief that is plausible on its face.”

In Twombly, the Supreme Court contended that it was not setting a “heightened pleading standard”, but in the same sentence stated that the requirement to be met is “enough facts to state a claim to relief that is plausible on its face.”  Conceptually, the courts have since struggled with whether there is a new or heightened pleading standard, and it appears possible to argue that there has been a subtle but important change from the “no set of facts” possibility standard of Conley v. Gibson to the “plausible on its face” probable standard of Twombly.  It also appears that newer cases have since applied the Twombly pleading requirement beyond anti-trust cases. 

The Third Circuit, for example, has refused to read Twombly so narrowly as to limit its holding on plausibility only to anti-trust contexts.  It coined the name “plausibility paradigm,” and held that stating a claim requires a complaint with enough factual matter, taken as true, to suggest the required elements.  This creates a necessity to review a pleading to see whether in context it has sufficient allegations necessary to show that a claim exists and recovery is “plausible” not merely possible. 

The Second Circuit has reviewed Twombly and interpreted it as requiring a flexible “plausibility standard” (I like plausibility paradigm better) which requires the pleader to amplify a claim with enough factual allegations in contexts where amplification is needed to render a claim plausible.  To some extent, then, the plausibility paradigm may depend on the case and context with the suggestion that more complex cases such as anti-trust, ERISA, class actions, securities claims, insurance and commercial claims must allege enough facts to “nudge the claims” past the line from conceivable to plausible/possible. 

In the meantime, the Sixth Circuit has also reviewed the plausibility standard and focused on the rejection of conclusory allegations embodied in the Conley v. Gibson “no set of facts rule”.  It appears clear that the “no set of facts” rule is gone and departed, and a pleading cannot rely on conclusory allegations, labels and conclusions, or empty recitations of the elements of a cause of action which now may be found insufficient.  The complaint or other pleading must assert facts that affirmatively and plausibly suggest that the pleader has a right of recovery or defense, rather than facts that are merely consistent with or raise a theoretical possibility of such a claim or defense.  The allegations must be enough that, if assumed to be true, the plaintiff plausibly – and not just theoretically or speculatively – has a claim for relief.  This is a particularly important nuance where the complaint may allege conduct that may also be legally or factually consistent with lawful conduct.

Therefore, in complicated commercial cases such as insurance coverage cases, declaratory judgment actions, and complex personal injury and property damage recovery claims, the complaint must contain enough factual recitation to indicate that the claim is not merely speculative but plausible or likely under the facts alleged.  The new Twombly “plausibility paradigm” requires the pleader to inject more factual substance and connections into the pleading, and forces the pleading to stand on its face to a greater extent than previously the case where courts could read all sorts of inferences and possibilities into an alleged claim under the “no set of facts” rule. 

Therefore, a pleading should be closely scrutinized under the new “plausibility paradigm” to see if it truly states a cause of action and the necessary factual connections to entitle the pleader to relief and, if not, an appropriate motion should be made citing Twombly and its growing progeny.  The pleading must not rely on formulaic recitations of the elements of a cause of action or conclusory allegations without factual substance or connection, but rather contain enough factual detail to indicate that, based upon the facts alleged; the pleader has a plausible and likely claim for relief.

ACROSS BORDERS

5/21/09                        Evanston Ins. Co. v. OEA, Inc
Ninth Circuit Court of Appeals
No Duty to Defend Action by Defendant's Employees
In an action by Plaintiff-Insurers seeking a declaration that Plaintiffs had no duty to defend Defendant in an action by Defendant's employees, summary judgment for Plaintiffs is affirmed where: 1) the employees' claims were made prior to the policy period; and 2) the amount of damages was certain enough to allow for prejudgment interest.
Submitted by: Kile Turner (Norman, Wood, Kendrick and Turner)

5/21/09            Health Care Industry Liability Ins. Program v. Momence Meadows Nursing Care, Inc.
Seventh Circuit Court of Appeals
No Duty to Defend in False Claims Case
In a dispute involving insurance liability coverage, district court judgment finding that plaintiff had no duty to defend defendant is affirmed where the wrongdoings for which the parties in the underlying suit are attempting to hold defendant liable for are the filing of false claims and unlawful employment actions, not the injuries suffered by residents under defendant's care, and none of the policy provisions cover such claims.
Submitted by: Kile Turner (Norman, Wood, Kendrick and Turner) - Posted: 05/27/2009
           
REPORTED DECISIONS

In the Matter of Progressive Northeastern Ins. Co. v Centeno.

Buratti, Kaplan, McCarthy & McCarthy, Yonkers, N.Y. (Michael
A. Zarkower of counsel), for appellant.
Lester Schwab Katz & Dwyer, LLP, New York, N.Y. (John
Sandercock and Steven B. Prystowsky
of counsel), for additional
respondent-respondent.


DECISION & ORDER
In a proceeding pursuant to CPLR article 75, inter alia, to permanently stay arbitration of an uninsured motorist claim, the petitioner appeals, as limited by its brief, from so much of an order of the Supreme Court, Kings County (Kurtz, J.), dated February 8, 2008, as, after a framed-issue hearing, denied that branch of the petition which was to permanently stay arbitration.
ORDERED that the order is affirmed insofar as appealed from, with costs.
The petitioner's failure to meet its initial burden of showing that the offending vehicle was, in fact, insured on the date of the accident mandated denial of that branch of the petition which was to permanently stay arbitration (see Matter of Progressive Northwestern Ins. Co. v Gjonaj, 43 AD3d 1169; Matter of Allstate Ins. Co. v Holloway, 272 AD2d 539, 539-540; Matter of Eagle Ins. Co. v McPherson, 271 AD2d 689; Matter of Eagle Ins. Co. v Battershield, 225 AD2d 545).

 In the Matter of Progressive Northeastern Ins. Co. v. Gibson

Buratti, Kaplan, McCarthy & McCarthy, Yonkers, N.Y. (Michael
A. Zarkower of counsel), for appellant.
Lester Schwab Katz & Dwyer, LLP, New York, N.Y. (John
Sandercock and Steven B. Prystowsky
of counsel), for additional
respondent-respondent.


DECISION & ORDER
In a proceeding pursuant to CPLR article 75, inter alia, to permanently stay arbitration of an uninsured motorist claim, the petitioner appeals, as limited by its brief, from so much of an order of the Supreme Court, Kings County (Kurtz, J.), dated February 8, 2008, as, after a framed-issue hearing, in effect, denied that branch of the petition which was to permanently stay arbitration.
ORDERED that the order is affirmed insofar as appealed from, with costs.
The petitioner's failure to meet its initial burden of showing that the offending vehicle was, in fact, insured on the date of the accident mandated denial of that branch of the petition which was to permanently stay arbitration (see Matter of Progressive Northwestern Ins. Co. v Gjonaj, 43 AD3d 1169; Matter of Allstate Ins. Co. v Holloway, 272 AD2d 539, 539-540; Matter of Eagle Ins. Co. v McPherson, 271 AD2d 689; Matter of Eagle Ins. Co. v Battershield, 225 AD2d 545).
Prince Seating Corp., v. QBE Insurance Company and Century Coverage Corp.

Sullivan Law Group, LLP, New York, N.Y. (Robert M. Sullivan
and Sara B. Feldman of counsel), for appellant.
Seidemann & Mermelstein, Brooklyn, N.Y. (David J.
Seidemann of counsel), for respondent.


DECISION & ORDER
In an action, inter alia, to recover damages for breach of contract, the defendant Century Coverage Corp. appeals from so much of an order of the Supreme Court, Kings County (Jacobson, J.), dated May 2, 2008, as denied its cross motion pursuant to CPLR 3211 to dismiss the second amended complaint insofar as asserted against it for failure to state a cause of action and as barred by the statute of limitations.
ORDERED that the order is affirmed insofar as appealed from, with costs.
In the second amended complaint, the plaintiff, Prince Seating Corp. (hereinafter Prince), alleged that it had an agreement with the defendant Century Coverage Corp. (hereinafter Century), an insurance broker, whereby Prince would notify Century of any claims brought against it, and Century, in turn, would pass along those claims to its principal and Prince's insurer, the defendant QBE Insurance Company (hereinafter QBE). Prince alleges that Century breached this agreement by failing to pass along to QBE a particular claim brought against Prince in Virginia. As a result, QBE denied a defense and indemnification to Prince on the ground that it failed to provide timely notice of the claim. Without a defense, Prince defaulted in the Virginia action, resulting in a $1.4 million judgment against it.
On a motion to dismiss pursuant to CPLR 3211(a)(7) for failure to state a cause of action, the facts as alleged in the complaint must be accepted as true, the plaintiff is accorded the benefit of every possible favorable inference, and the court's function is to determine only whether the facts as alleged fit within any cognizable legal theory (see Leon v Martinez, 84 NY2d 83, 87-88; Guggenheimer v Ginzburg, 43 NY2d 268, 275). The second amended complaint pleaded the existence of an agreement which was breached, and therefore, stated a cause of action sounding in breach of contract. Further, the cause of action to recover damages for breach of contract was not time-barred (see CPLR 213(2).
Chery v. Jones

Harmon, Linder & Rogowsky, New York, N.Y. (Mitchell Dranow,
Mineola, N.Y., of counsel), for appellant.
Mary Audi Bjork (Ahmuty, Demers & McManus, Albertson,
N.Y. [Brendan T. Fitzpatrick], 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, Rockland County (Garvey, J.), dated April 14, 2008, 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 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 through the affirmed medical reports of their examining orthopedist and radiologist (see Kurin v Zyuz, 54 AD3d 902; Passaretti v Ping Kwok Yung, 39 AD3d 517; Faulkner v Steinman, 28 AD3d 604; Fryar v First Student, Inc., 21 AD3d 525; Meyers v Bobower Yeshiva Bnei Zion, 20 AD3d 456; McCauley v Ross, 298 AD2d 506). The plaintiff's submissions in opposition failed to raise a triable issue of fact. The affirmations of the plaintiff's treating physicians were based upon examinations of the plaintiff made nearly three years prior to the motion for summary judgment (see Diaz v Lopresti, 57 AD3d 832; Sapienza v Ruggiero, 57 AD3d 643; Carrillo v DiPaola, 56 AD3d 712; Cornelius v Cintas Corp., 50 AD3d 1085; Wright v Rodriguez, 49 AD3d 532), and the affirmation of the plaintiff's orthopedic surgeon failed to address the findings of the defendants' examining radiologist that the magnetic resonance imagings of the plaintiff's cervical and lumbar spine and right shoulder, taken shortly after the accident, did not reveal any post-traumatic changes, but only long-standing degenerative conditions (see Ciordia v Luchian, 54 AD3d 708; Roman v Fast Lane Car Serv., Inc., 46 AD3d 535; Khan v Finchler, 33 AD3d 966). Furthermore, the plaintiff failed to proffer competent medical evidence that he was unable to perform substantially all of his usual and customary daily activities for not less than 90 of the first 180 days subsequent to the subject accident (see Leeber v Ward, 55 AD3d 563; Kurin v Zyuz, 54 AD3d 902; Jones v Gooding, 50 AD3d 968; Amato v Fast Repair Inc., 42 AD3d 477).
Conder v. City of New York

Baker, McEvoy, Morrisey & Moskovits, P.C., New York, N.Y.
(Stacy R. Seldin of counsel), for appellant.
Samuel J. Lurie, New York, N.Y. (Dennis A. Breen of counsel),
for respondent.

DECISION & ORDER
In an action to recover damages for personal injuries, the defendant Giraldo Rubelio appeals from an order of the Supreme Court, Queens County (Taylor, J.), dated September 22, 2008, which denied his motion for summary judgment dismissing the complaint insofar as asserted against him 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 appellant's motion for summary judgment dismissing the complaint insofar as asserted against him is granted.
Contrary to the determination of the Supreme Court, the appellant 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 345). The appellant met his burden by submitting, inter alia, the affirmed report of a board-certified orthopedic surgeon who conducted an independent medical examination of the plaintiff, during which he performed various range of motion and other objective tests (see Charley v Goss, 54 AD3d 569, affd 12 NY3d 750; Johnson v County of Suffolk, 55 AD3d 875). In opposition, the plaintiff failed to raise a triable issue of fact. The plaintiff did not proffer any objective medical evidence showing range-of-motion limitations in her spine or knees, or any other area, that were contemporaneous with the subject accident (see Collado v Satellite Solutions & Electronics of WNY, LLC, 56 AD3d 411; Kurin v Zyuz, 54 AD3d 902; Perdomo v Scott, 50 AD3d 1115; Scotto v Suh, 50 AD3d 1012). Moreover, in the absence of any objective medical evidence contemporaneous with the plaintiff's accident, there was no competent medical evidence to establish that she sustained any medically-determined injuries of a nonpermanent nature which prevented her from performing substantially all of her usual and customary daily activities for not less than 90 of the first 180 days following the accident (see Sainte-Aime v Ho, 274 AD2d 569; Arshad v Gomer, 268 AD2d 450; DiNunzio v County of Suffolk, 256 AD2d 498, 499).
Accordingly, the appellant's motion for summary judgment should have been granted.
Moore v. Stasi

Paul Ajlouny & Associates, P.C., Garden City, N.Y. (Neil Flynn
of counsel), for appellant.
Baxter, Smith & Shapiro, P.C., Hicksville, N.Y. (Anne Marie
Garcia and Dennis S. Heffernan 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, Nassau County (Galasso, J.), entered July 18, 2008, which granted the defendants' motion for summary judgment dismissing the complaint on the ground that he did not sustain a serious injury within the meaning of Insurance Law § 5102(d).
ORDERED that the order is reversed, on the law, with costs, and the defendants' motion for summary judgment dismissing the complaint is denied.
The defendants failed to meet their prima facie burden of showing that 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 affirmed medical report of the defendants' examining neurologist noted a clear limitation in the range of motion of the plaintiff's lumbar spine during leg elevation testing, but did not sufficiently quantify the limitation to establish that it was insignificant (see Marshak v Migliore, 60 AD3d 647; Gaccione v Krebs, 53 AD3d 524, 525; Giammanco v Valerio, 47 AD3d 674, 675; Coburn v Samuel, 44 AD3d 698, 699; Iles v Jonat, 35 AD3d 537, 538; McCrary v Street, 34 AD3d 768, 769; Whittaker v Webster Trucking Corp., 33 AD3d 613; Yashayev v Rodriguez, 28 AD3d 651, 652).
Since the defendants failed to satisfy their initial burden on their motion, it is not necessary to consider whether the plaintiff's opposition papers were sufficient to raise a triable issue of fact (see Marshak v Migliore, 60 AD3d at 647; Coscia v 938 Trading Corp., 283 AD2d 538).
Nicholson v. Allen

Cheven, Keely & Hatzis, New York, N.Y. (William B. Stock of
counsel), for appellant.
Kenneth M. Mollins, Melville, N.Y. (Leo Bevolas of counsel),
for respondent.

DECISION & ORDER
In an action to recover damages for personal injuries, the defendant Rudolph Allen appeals from an order of the Supreme Court, Kings County (Martin, J.), dated March 17, 2008, which denied his motion for summary judgment dismissing the complaint insofar as asserted against him 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 Rudolph Allen (hereinafter the defendant) 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 through the affirmed medical reports of his examining neurologist, orthopedist, and radiologist (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 345; Staff v Yshua, 59 AD3d 614; Geliga v Karibian, Inc., 56 AD3d 518; O'Shea v Johnson, 49 AD3d 614; Kivelowitz v Calia, 43 AD3d 1111; Porto v Blum, 39 AD3d 614 ). Contrary to the Supreme Court's determination, the plaintiff failed to raise a triable issue of fact. The affidavit of the plaintiff's treating chiropractor was based upon examinations of the plaintiff he made nearly four years prior to the motion for summary judgment, and not upon any recent examination (see Diaz v Lopresti, 57 AD3d 832; Sapienza v Ruggiero, 57 AD3d 643; Carrillo v DiPaola, 56 AD3d 712; Cornelius v Cintas Corp., 50 AD3d 1085; Wright v Rodriguez, 49 AD3d 532). The affidavit also failed to address the findings of the defendant's examining radiologist that the magnetic resonance images of the plaintiff's lumbar spine, taken three months after the accident, did not reveal any post-traumatic changes, but only long-standing degenerative conditions (see Ciordia v Luchian, 54 AD3d 708; Roman v Fast Lane Car Serv., Inc., 46 AD3d 535; Khan v Finchler, 33 AD3d 966), and failed to acknowledge the fact that the plaintiff had been injured in two prior automobile accidents (see Cornelius v Cintas Corp., 50 AD3d 1085; Laurent v McIntosh, 49 AD3d 820; Wright v Rodriguez, 49 AD3d 532; Luciano v Luchsinger, 46 AD3d 634; Vidor v Davila, 37 AD3d 826). Furthermore, 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 subject accident (see Leeber v Ward, 55 AD3d 563; Kurin v Zyuz, 54 AD3d 902; Jones v Gooding, 50 AD3d 968; Amato v Fast Repair Inc., 42 AD3d 477).
Ortiz v. Zorbas

Mallilo & Grossman, Flushing, N.Y. (John S. Manessis of
counsel), for appellant.
Baker, McEvoy, Morrissey & Moskovits, P.C., New York,
N.Y. (Stacy R. Seldin 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 (Weiss, J.), dated April 14, 2008, which granted the motion of the defendants Konstantios P. Zorbas, Boulevard Taxi Leasing, Inc., and Haitham S. Tawfik for summary judgment dismissing the complaint insofar as asserted against them 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 of the defendants Konstantios P. Zorbas, Boulevard Taxi Leasing, Inc., and Haitham S. Tawfik 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) is denied.
The defendants Konstantios P. Zorbas, Boulevard Taxi Leasing, Inc., and Haitham S. Tawfik met their 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 accident (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955, 956-957). In opposition, the plaintiff raised a triable issue of fact.
Dr. David Zelefsky, the plaintiff's treating physician, opined in an affirmation, based on his contemporaneous and most recent examinations of the plaintiff, that the plaintiff's cervical injuries and observed range-of-motion limitations were significant and permanent, and causally related to the subject accident. Thus, the plaintiff raised a triable issue of fact as to whether she sustained a permanent consequential limitation of use and/or a significant limitation of use of her cervical spine as a result of the subject accident (see Azor v Torado, 59 AD3d 367; Williams v Clark, 54 AD3d 942; Casey v Mas Transp., Inc., 48 AD3d 610; Green v Nara Car & Limo, Inc., 42 AD3d 430; Francovig v Senekis Cab Corp., 41 AD3d 643, 644-645; Acosta v Rubin, 2 AD3d 657). The plaintiff adequately explained the lengthy gap in her treatment (see Jules v Barbecho, 55 AD3d 548; Black v Robinson, 305 AD2d 438; see also Pommells v Perez, 4 NY3d 566, 574).
Smith v. Vohrer

Costello, Shea & Gaffney LLP, New York (Steven E. Garry of
counsel), for appellants.
Kim I. McHale & Associates, New York (John C. Naccarato of
counsel), for respondent.
Order, Supreme Court, Bronx County (Mark Friedlander, J.), entered April 9, 2008, which, after a jury trial, denied the motion pursuant to CPLR 4404 of defendants Clifford C. Vohrer and Lease Plan USA to set aside the verdict and enter judgment notwithstanding the verdict, or, in the alternative, to grant a new trial, and order, same court and Justice, entered April 10, 2008, which, after a jury trial, denied the motion, pursuant to CPLR 4404 of defendants Sotomayor and La Manada Auto Corp. to set aside the verdict, unanimously affirmed, without costs.
Plaintiff provided sufficient evidence from her treating surgeon, which included evidence that she suffered a torn meniscus as a result of the accident, to sustain a claim of
serious injury under Insurance Law 5201(d) (see Noriega v Sauerhaft, 5 AD3d 121, 122 [2004]). Moreover, the surgeon's testimony that further treatment after the surgery was not necessary provided a sufficient explanation of the gap in treatment to send the case to the jury (Pommells v Perez, 4 NY3d 566, 574 [2005]). Given the evidence that other cars in the intersection had to make way for defendant, and that the car he hit was pushed a block in the direction defendant was traveling, the jury reasonably concluded that defendant's speeding through a crowded intersection was the main cause of the accident (Gomez v 192 E. 151st St. Assoc., L.P., 26 AD3d 276 [2006]).
Plaintiff's single passing reference to letters from insurance companies, adduced by defendant's counsel, did not require a mistrial (see Siegfried v Siegfried, 123 AD2d 621, 622 [1986]). While it would have been preferable for plaintiff to disclose the report of the final examination by her surgeon (who testified at trial), in light of the other discovery defendant had, it was not necessary to preclude the testimony, nor was defendant deprived of meaningful cross-examination (see Mendola v Richmond Ob/Gyn Assocs., 191 Misc 2d 699, 701 [2002]). Nor did the surgeon's passing reference to possible future surgery require a new trial, as it was not intentionally elicited, and, in context, was a reference to the future functional limitations of the injury (see Shehata v Sushiden Am., Inc., 190 AD2d 620 [1993]).
Defendant was not prejudiced by the charge on aggravation of existing injury, despite the fact that it was not submitted at the charging conference. The issue of aggravation was in the bill of particulars, and was argued by defendant's own expert. Moreover, defendant failed to ask for supplemental summations (see Afghani v City of New York, 227 AD2d 305 [1996]).
The award of $435,000 for multiple tears of the meniscus did not deviate from reasonable compensation (see Feliciano v Ford Motor Credit Co., 28 AD3d 221 [2006]). Nor did the jury have to find on the evidence submitted that had plaintiff worn a seat belt, her injury would have been mitigated (see Berk v Schenck, 122 AD2d 823, 825 [1986]).
Crummell v. Avis Rent A Car System, Inc.

Feder, Kaszovitz, Isaacson, Weber, Skala, Bass & Rhine, LLP,
New York, N.Y. (Alvin M. Feder of counsel), for appellant.
Cascone & Kluepfel, LLP, Garden City, N.Y. (David F.
Kluepfel of counsel), for respondent.


DECISION & ORDER
In an action for a judgment declaring, in effect, that the defendant is obligated to provide the plaintiff with certain "additional liability insurance" coverage pursuant to the parties' automobile rental agreement, dated June 10, 2006, the plaintiff appeals from an order of the Supreme Court, Queens County (Satterfield, J.), dated June 2, 2008, which granted the defendant's motion to dismiss the complaint for failure to state a cause of action, pursuant to CPLR 3211(a)(7), and for failure to join a necessary party, pursuant to CPLR 3211(a)(10).
ORDERED that the order is reversed, on the law, with costs, that branch of the defendant's motion which was to dismiss the complaint for failure to state a cause of action, pursuant to CPLR 3211(a)(7), is denied, and that branch of the defendant's motion which was to dismiss the complaint for failure to join a necessary party, pursuant to CPLR 3211(a)(10), is denied on condition that the plaintiff shall join as a party defendant hereto Thomas Pinkerton, a defendant in an underlying action entitled Crummell v Pinkerton, pending in the Supreme Court, Queens County, under Index No. 23289/06; and it is further,
ORDERED that the time for the plaintiff to join Thomas Pinkerton as a party defendant to this action as shall be within 30 days of service upon him of a copy of this decision and order.
The Supreme Court erred in granting that branch of the defendant's motion which was to dismiss the complaint for failure to state a cause of action, pursuant to CPLR 3211(a)(7), due to the plaintiff's failure to comply with Insurance Law § 3420(a)(2). That provision governs the right of an injured party who is a stranger to an insurance contract to maintain a direct action against the tortfeasor's insurer (see Lang v Hanover Ins. Co., 3 NY3d 350, 353-354). It does not apply where, as here, a signatory to a contract seeks a declaration of his rights with respect to another contracting party (see CPLR 3001; Lang v Hanover Ins. Co., 3 NY3d 350, 353).
While the Supreme Court correctly concluded that Thomas Pinkerton is a necessary party to this action (see CPLR 1001[a]; cf. Bello v Employees Motor Corp., 240 AD2d 527), under the circumstances presented, the plaintiff should have been given an opportunity to rectify his failure to join him (see Stevens v Eaton, 267 AD2d 450, 450-451).
The Supreme Court should not have considered, and we do not consider, the defendant's remaining contention, because the defendant improperly raised it for the first time in its reply papers in the Supreme Court (see Luft v Luft, 52 AD3d 479, 480; Medugno v City of Glen Cove, 279 AD2d 510, 511-512).
State Farm Mutual Automobile Insurance Company v. TIG Insurance Company

Teresa Girolamo (Bertram Herman, P.C., Mount Kisco, N.Y., of
counsel), for defendant-appellant.
Martin, Fallon & MullÉ, Huntington, N.Y. (Richard C. MullÉ
of counsel), for plaintiff-respondent.
Shay & Maguire LLP, East Meadow, N.Y. (Kenneth R.
Maguire and Jaret SanPietro of counsel), for
defendants third-party
plaintiffs-respondents TIG Insurance
Company and Luxury Cars of Bayside, Inc.
Callan, Koster, Brady & Brennan, LLP, New York, N.Y.
(Michael P. Kandler of counsel), for
third-party defendant-respondent Hanover
Insurance Company.


DECISION & ORDER
In an action for a judgment declaring the priority of insurance coverage obligations with respect to an automobile accident, the defendant Progressive Casualty Insurance Company appeals (1), as limited by its brief, from so much of an order of the Supreme Court, Kings County (Schmidt, J.), dated September 18, 2007, as granted the motion of the defendants third-party plaintiffs, TIG Insurance Company and Luxury Cars of Bayside, Inc., for summary judgment to the extent of finding that TIG Insurance Company has no coverage obligation if other insurance is available, (2), as [*2]limited by its brief, from so much of an order of the same court also dated September 18, 2007, as granted the cross motion of the defendant third-party defendant Benny Shabtai and the third-party defendant Seville Watch Corp. for summary judgment to the extent of determining that Progressive Casualty Insurance Company coverage shall be primary and that the coverage provided by the third-party defendant Hanover Insurance Company and the plaintiff, State Farm Mutual Automobile Insurance Company, shall be concurrent, (3), by permission, from an order of the same court also dated September 18, 2007, which conditionally granted the cross motion of Hanover Insurance Company for summary judgment pending determination of a framed-issue hearing on the issue of permissive use, and (4), by permission, from an order of the same court also dated September 18, 2007, which denied its cross motion for summary judgment declaring it has no coverage obligation and directed a framed-issue hearing on the issue of permissive use.
ORDERED that the appeals are dismissed as academic, without costs or disbursements.
"It is a fundamental principle of our jurisprudence that the power of a court to declare the law only arises out of, and is limited to, determining the rights of persons which are actually controverted in a particular case pending before the tribunal" (Matter of Hearst Corp. v Clyne, 50 NY2d 707, 713). Courts are prohibited from rendering advisory opinions and "an appeal will be considered moot unless the rights of the parties will be directly affected by the determination of the appeal and the interest of the parties is an immediate consequence of the judgment" (Matter of Hearst Corp. v Clyne, 50 NY2d 707, 714; see Saratoga County Chamber of Commerce v Pataki, 100 NY2d 801, 810-811; Funderburke v New York State Dept. of Civ. Serv., 49 AD3d 809).
In the orders appealed from, the Supreme Court, in effect, determined the priority of coverage in the event that the driver of the subject vehicle was determined to be a permissive driver at the time of the accident. After these appeals were taken, the Supreme Court (Sunshine, J.H.O.), in an order dated August 3, 2008, determined that the driver of the vehicle was not a permissive driver at the time of the accident. No party has appealed from that order and the time to do so has expired. Accordingly, the instant appeals have been rendered academic and must be dismissed (see Saratoga County Chamber of Commerce v Pataki, 100 NY2d at 810-811; Funderburke v New York State Dept. of Civ. Serv., 49 AD3d 809).
MASTRO, J.P., DILLON, LEVENTHAL and CHAMBERS, JJ., concur.

Konfidan v. FF Taxi, Inc.

The Sullivan Law Firm, New York (Timothy M. Sullivan of
counsel), for appellants.
Law Office of Todd A. Restivo, P.C., Garden City (Todd A.
Restivo of counsel), for respondent.
Order, Supreme Court, Bronx County (Howard H. Sherman, J.), entered August 22, 2008, which, to the extent appealed from, denied so much of defendants' motion for summary judgment as sought dismissal of plaintiff's claims of serious permanent injury to his right shoulder and of 90/180-day injury, unanimously modified, on the law, to grant the portion of the motion seeking dismissal of plaintiff's 90/180-day claim, and otherwise affirmed, without costs.
In opposition to defendants' prima facie showing, plaintiff submitted an orthopedic surgeon's arthroscopic report noting repairs made to tears of his labral and anterior labral right shoulder tendons and his treating physician's report, following a recent physical examination, quantifying restrictions in the range of motion of his right shoulder. This evidence constitutes sufficient objective medical proof of the degree of limitation resulting from the injury to raise an issue of fact whether plaintiff sustained a serious permanent injury to his right shoulder (see Insurance Law § 5102[d]; Toure v Avis Rent-A-Car System, 98 NY2d 345 [2002]). Defendants failed to raise the issue of a treatment gap in their motion papers and we decline to reach their unpreserved argument.
Plaintiff submitted no medical evidence to substantiate his claim that his injuries precluded him from engaging in substantially all his customary daily activities for 90 of the first 180 days after the accident (see Dembele v Cambisaca, 59 AD3d 352, 353 [2009]).
Mickens v. Khalid

Belovin & Franzbalu, LLP, Bronx (David A. Karlin of
counsel), for appellants.
Baker, McEvoy, Morrissey & Moskovits, P.C., New York
(Stacy R. Seldin of counsel), for respondents.
Order, Supreme Court, Bronx County (Mary Ann Brigantti-Hughes, J.), entered December 18, 2007, which granted defendants' motion for summary judgment dismissing the complaint on the threshold issue of serious injury, and denied plaintiffs' cross motion for partial summary judgment on the issue of liability as moot, unanimously affirmed, without costs.
Defendants met their prima facie burden through the submission of affirmed reports of their neurologist, orthopedist and radiologist which showed that the injured plaintiff Mickens did not sustain a serious injury within the meaning of Insurance Law § 5102(d) as a result of the accident (see Franchini v Palmieri, 1 NY3d 536 [2003]; Dembele v Cambisaca, 59 AD3d 352 [2009]; Brown v Achy, 9 AD3d 30,31 [2004]). In opposition, Mickens failed to raise a triable issue of fact.
While Mickens's treating orthopedist performed range of motion tests 17 months after the accident and found that her left knee flexed only to 130 degrees, he did not compare that flexion to normal range. Nor did he explain the significance of his findings, or provide a sufficient description of the qualitative nature of the limitations based on the normal function and use of the knee (see Gorden v Tibulcio, 50 AD3d 460, 464 [2008]; Otero v 971 Only U, Inc., 36 AD3d 430, 431 [2007]; Vasquez v Reluzzo, 28 AD3d 365, 366 [2006]).
Furthermore, Dr. Kramer's opinion that Mickens sustained a torn meniscus, is not supported by objective medical evidence. He also did not explain the basis for his conclusion that Mickens's condition was causally related to the accident. His conclusory statement was not sufficient to establish the necessary causation (see Migliaccio v Miruku, 56 AD3d 393 [2008]; Smith v Brito, 23 AD3d 273 [2005]). Nor did Dr. Kramer rebut defendants' radiologists finding that plaintiff had a "[d]evelopmental abnormality of the patellofemoral compartment" (see Reyes v Esquilin, 54 AD3d 615 [2008]).
Plaintiffs' claim that Kisha Mickens was unable to perform her usual and customary activities during the 90/180 day period is not supported by objective medical proof (see Valentin v Pomilla, 59 AD3d 184, 186-187 [2009]; Taylor v Vasquez, 58 AD3d 406, 407 [2009]; Onishi v N & B Taxi, Inc., 51 AD3d 594, 595 [2008]). Furthermore, their claim is at odds with that asserted in the bill of particulars.
Morgan v. Littles

White & McSpedon, P.C., New York, N.Y. (Baker, McEvoy,
Morrissey & Moskovits, P.C. [Stacy R. Seldin] of counsel), for
appellants.
Michael S. Lamonsoff, New York, N.Y. (Tara M. Ulezalka of
counsel), for respondent.

DECISION & ORDER
In an action to recover damages for personal injuries, the defendants Jacques R. Francois and Wilson Taxi Corp. appeal, as limited by their brief, from so much of an order of the Supreme Court, Kings County (Martin, J.), dated April 8, 2008, 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 met their 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 accident (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY 955, 956-957). In opposition, the plaintiff raised a triable issue of fact. The affirmation of the plaintiff's treating physician, who examined the plaintiff contemporaneously with the accident as well as recently, and conducted range of motion testing, was sufficient to raise a triable issue of fact as to whether the plaintiff sustained a serious injury to her lumbar spine under the significant limitation of use or permanent consequential limitation of use categories of Insurance Law § 5102(d) (see Delorbe v Perez, 59 AD3d 491; Williams v Clark, 54 AD3d 942; Casey v Mas Transp., Inc., 48 AD3d 610. 611; Green v Nara Car & Limo, Inc., 42 AD3d 430, 430; Francovig v Senekis Cab Corp., 41 AD3d 643, 644-645; Acosta v Rubin, 2 AD3d 657, 659).
Smith v. Quicci

Wolfson, Greller & Egitto, P.C., Poughkeepsie, N.Y. (Stephen L.
Greller of counsel), for appellant.
James P. Harris, Goshen, N.Y., for respondents.

DECISION & ORDER
In an action to recover damages for personal injuries, the plaintiff appeals from an order of the Supreme Court, Dutchess County (Pagones, J.), dated June 19, 2008, which granted the defendants' 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 defendants' motion for summary judgment dismissing the complaint is denied.
Contrary to the Supreme Court's determination, the defendants failed to meet their 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 accident (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955, 956-957). The defendants' motion papers failed to adequately address the plaintiff's claim, clearly set forth in her bill of particulars, that she sustained a medically-determined injury or impairment of a nonpermanent nature which prevented her from performing substantially all of the material acts which constituted her usual and customary daily activities for not less than 90 days during the 180 days immediately following the subject accident (see Alexandre v Dweck, 44 AD3d 597; Sayers v Hot, 23 AD3d 453, 454). The subject accident occurred October 26, 2005, and the plaintiff did not return to work until August 2006. The defendants' neurologist conducted his independent examination of the plaintiff almost two years after the accident. He failed to relate his findings to this category of serious injury for the period of time immediately following the accident. Furthermore, when he examined the plaintiff he merely opined that the plaintiff had full range of motion in the cervical spine, yet failed to set forth the objective medical testing he performed to arrive at that conclusion (see Giammalva v Winters, 59 AD3d 595; Stern v Oceanside School Dist., 55 AD3d 596; Cedillo v Rivera, 39 AD3d 453; McLaughlin v Rizzo, 38 AD3d 856).
Since the defendants failed to meet their prima facie burden, it is unnecessary to consider whether the papers submitted by the plaintiff in opposition to the defendants' motion were sufficient to raise a triable issue of fact (see Giammalva v Winters, 59 AD3d 595; Alexandre v Dweck, 44 AD3d 597; Coscia v 938 Trading Corp., 283 AD2d 538).
Atlantic Balloon & Novelty Corp. v. American Motorists Insurance Company

Lewis Johs Avallone Aviles LLP, Melville, N.Y. (Elizabeth A.
Fitzpatrick of counsel), for appellant-respondent.
Kral, Clerkin, Redmond, Ryan, Perry & Girvan, LLP, Mineola,
N.Y. (Andrew J. Mihalick of counsel),
for respondent-appellant.


DECISION & ORDER
In an action to recover damages for breach of contract and negligence, the defendant American Motorists Insurance Company appeals from so much of an order of the Supreme Court, Suffolk County (Pines, J.), entered October 15, 2007, as denied its motion for summary judgment dismissing the complaint insofar as asserted against it, and the defendant George Wagner Associates cross-appeals, as limited by its brief, from so much of the same order as denied its motion pursuant to CPLR 3211(a)(5) to dismiss the complaint and all cross claims insofar as asserted against it as time-barred, or alternatively, for summary judgment dismissing the complaint and all cross claims insofar as asserted against it.
ORDERED that the order is reversed insofar as appealed and cross-appealed from, on the law, with one bill of costs payable by the plaintiffs to the defendants American Motorists Insurance Company and George Wagner Associates, the motion of the defendant American Motorists Insurance Company for summary judgment dismissing the complaint insofar as asserted against it and that branch of the motion of the defendant George Wagner Associates which was pursuant to CPLR 3211(a)(5) to dismiss the complaint and all cross claims insofar as asserted it as time-barred are granted, and the motion of the defendant George Wagner Associates is otherwise denied as academic.
In December 1994 the plaintiffs, Atlantic Balloon & Novelty Corp. (hereinafter Atlantic Balloon), and World International Buying Corp., utilized the defendant George Wagner Associates (hereinafter Wagner) to procure an insurance policy on their behalf. The policy, issued by the defendant American Motorists Insurance Company (hereinafter American Motorists) provided "business personal property" coverage for the plaintiffs in the amount of $100,000 for the period December 16, 1994, through December 16, 1995.
During the coverage period, Atlantic Balloon contracted with an auctioneer to conduct an auction of Atlantic Balloon's inventory. Atlantic Balloon claims that the auctioneer never turned over the proceeds from the auction, which occurred on or about May 25, 1995, and May 26, 1995, and stole some of Atlantic Balloon's merchandise. Atlantic Balloon also claims that the auctioneer sold the merchandise for less than the agreed-upon amount and failed to ensure that bidders paid for items prior to leaving the premises.
The plaintiffs thereafter made a claim to American Motorists pursuant to the insurance policy for losses allegedly sustained during the auction. American Motorists denied the claim. The plaintiffs brought this action against American Motorists seeking damages for breach of the insurance contract. The plaintiffs later added Wagner as a defendant, asserting that it was negligent in its procurement of the policy.
American Motorists moved for summary judgment dismissing the complaint insofar as asserted against it based on, among other things, the policy's exclusionary language. Wagner moved pursuant to CPLR 3211(a)(5) to dismiss the complaint and all cross claims insofar as asserted against it as time-barred, or alternatively, for summary judgment dismissing the complaint and all cross claims insofar as asserted against it. The Supreme Court denied both motions.
We disagree with the Supreme Court's determination that the plaintiffs' negligence cause of action against Wagner accrued in May 1995, when the plaintiffs experienced the alleged theft of cash and merchandise during the auction. Rather, the plaintiffs sustained an injury in the form of losing a property right to the proper insurance protection when Wagner purportedly procured an inadequate policy on December 16, 1994 (see Kronos, Inc. v AVX Corp., 81 NY2d 90; Neary v Tower Ins., 32 AD3d 920, 920; Mauro v Niemann Agency, 303 AD2d 468; Cappelli v Berkshire Life Ins. Co., 276 AD2d 458, 459). Thus, the statute of limitations on the negligence cause of action expired on December 16, 1997 (see CPLR 214[4]). Since the plaintiffs joined Wagner as a defendant on April 3, 1998, their negligence claim against Wagner is time-barred. Although the statute of limitations for a contractual breach would not have expired until December 16, 2000, six years after Wagner purportedly failed to obtain the appropriate coverage, the cause of action against Wagner was grounded in negligence only.
The Supreme Court also erred in denying the motion of American Motorists for summary judgment dismissing the complaint insofar as asserted against it. " [C]ourts bear the responsibility of determining the rights or obligations of parties under insurance contracts based on the specific language of the policies'" (Sanabria v American Home Assur. Co., 68 NY2d 866, 868, quoting State of New York v Home Indem. Co., 66 NY2d 669, 671), whose unambiguous provisions must be given "their plain and ordinary meaning" (United States Fid. & Guar. Co. v Annunziata, 67 NY2d 229, 232; see Maroney v New York Cent. Fire Ins. Co., 5 NY3d 467, 471-472; Catucci v Greenwich Ins. Co., 37 AD3d 513, 514). "[A]n exclusion from coverage must be specific and clear in order to be enforced (Seaboard Sur. Co. v Gillette Co., 64 NY2d 304, 311), and an ambiguity in an exclusionary clause must be construed most strongly against the insurer" (Guachichulca v Laszlo N. Tauber & Assoc., LLC, 37 AD3d 760, 761; see Ace Wire & Cable Co. v Aetna Cas. & Sur. Co., 60 NY2d 390, 398; Ruge v Utica First Ins. Co., 32 AD3d 424, 426). However, the plain meaning of the policy's language may not be disregarded to find an ambiguity where none exists (see Bassuk Bros. v Utica First Ins. Co., 1 AD3d 470, 471; Garson Mgt. Co. v Travelers Indem. Co. of Ill., 300 AD2d 538, 539; Sampson v Johnston, 272 AD2d 956).
The policy issued by American Motorists contains an exclusion for "[d]ishonest or criminal acts by you, any of your partners, employees, directors, trustees, authorized representatives or anyone to whom you entrust the property for any purpose." It also contains an exclusion for "False Pretense" which it defines as "Voluntary parting with any property by you or anyone else to whom you have entrusted the property if induced to do so by any fraudulent scheme, trick, device or false pretense."
American Motorists met its initial burden of establishing its entitlement to judgment as a matter of law by demonstrating that these exclusions clearly applied to the loss in this case (see Catucci v Greenwich Ins. Co., 37 AD3d 513; see generally Alvarez v Prospect Hosp., 68 NY2d 320, 324). The contract between the auctioneer and Atlantic Balloon established that Atlantic Balloon "entrusted" its merchandise to the auctioneer because, pursuant to the contract, Atlantic Balloon agreed that the auctioneer was to take the merchandise on "consignment" and auction it on Atlantic Balloon's behalf. Thus, the merchandise and auction proceeds purportedly stolen during the auction are not a covered loss under the policy. In opposition, the plaintiffs failed to raise a triable issue of fact (see Zuckerman v City of New York, 49 NY2d 557).
The remaining contentions of American Motorists and Wagner have been rendered academic by our determination.
Guzman v. Nationwide Mutual Fire Insurance Company, respondent.

Alex Muller, New York, N.Y. (Ephrem J. Wertenteil of counsel), for
appellant.
Bartlett, McDonough, Bastone & Monaghan, LLP, White Plains,
N.Y. (Edward J. Guardaro, Jr., and Gina
Bernardi Di Folco of counsel), for
respondent.


DECISION & ORDER
In an action pursuant to Insurance Law § 3420(a)(2) to recover an unsatisfied judgment against the defendant's insured, the plaintiff appeals, as limited by his brief, from so much of an order of the Supreme Court, Kings County (Vaughan, J.), dated September 26, 2007, as denied his motion for summary judgment on the complaint.
ORDERED that the order is reversed insofar as appealed from, on the law, with costs, and the plaintiff's motion for summary judgment on the complaint is granted.
Insurance Law § 3420(d) states that written notice of a disclaimer shall be given "as soon as is reasonably possible" after the insurer learns of the grounds for disclaimer of liability or denial of coverage (see First Fin. Ins. Co. v Jetco Contr. Corp., 1 NY3d 64; Matter of Firemen's Fund Ins. Co. of Newark v Hopkins, 88 NY2d 836, 837; Varella v American Tr. Ins. Co., 306 AD2d 464). "An insurer's failure to [timely disclaim liability or deny coverage] precludes effective disclaimer or denial,' even where the insured and the injured party have failed to provide the insurer with timely notice of the claim in the first instance" (Matter of Allstate Ins. Co. v Cruz, 30 AD3d 511, 512, quoting Hartford Ins. Co. v County of Nassau, 46 NY2d 1028, 1029 [citation omitted]).
The plaintiff submitted an affidavit of service by mail dated February 12, 2003, stating that service by mail was made that day of a judgment with notice of entry. The judgment had been entered in his favor and against the defendant's insured on February 10, 2003. This raised a presumption that a proper mailing occurred. In opposition, the defendant's papers failed to raise a triable issue of fact regarding service of the judgment (see Kihl v Pfeffer, 94 NY2d 118, 122; Engel v Lichterman, 62 NY2d 943, 944-945; Kendall v Kelly, 283 AD2d 401).
In addition, under the facts and circumstances of this case, the defendant's 51-day delay before disclaiming coverage on April 4, 2003, on the ground of late notice of the underlying lawsuit, was unreasonable as a matter of law (see First Fin. Ins. Co. v Jetco Contr. Corp., 1 NY3d 64; Sirius Am. Ins. Co. v Vigo Constr. Co., 48 AD3d 450; Reyes v Diamond State Ins. Co., 35 AD3d 830; Matter of Allstate Ins. Co. v Swinton, 27 AD3d 462; Moore v Ewing, 9 AD3d 484). Accordingly, the plaintiff's motion for summary judgment on the complaint should have been granted (see Varella v American Tr. Ins. Co., 306 AD2d 464). In view of this determination, it is unnecessary to reach the plaintiff's remaining contentions.
Jules v. Calderon

Harmon, Linder & Rogowsky, New York, N.Y. (Mitchell Dranow
of counsel), for appellants.
Richard T. Lau, Jericho, N.Y. (Joseph G. Gallo of counsel), for
respondent.

DECISION & ORDER
In an action to recover damages for personal injuries, the plaintiffs appeal from an order of the Supreme Court, Nassau County (Palmieri, J.), entered February 15, 2008, which granted the defendant's motion for summary judgment dismissing the complaint insofar as asserted by the plaintiff Garry R. Jules on the ground that Garry R. Jules did not sustain a serious injury within the meaning of Insurance Law § 5102(d).
ORDERED that the appeal by the plaintiff Frantzi Jules is dismissed, without costs or disbursements, as that plaintiff is not aggrieved by the order appealed from (see CPLR 5511); and it is further,
ORDERED that the order is affirmed on the appeal by the plaintiff Garry R. Jules, with costs.
The defendant met her prima facie burden of showing that the plaintiff Garry R. Jules (hereinafter 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; see also Kearse v New York City Tr. Auth., 16 AD3d 45, 49-50). In opposition, the plaintiff failed to raise a triable issue of fact.
As to the plaintiff's left knee, while he submitted medical evidence that a recent examination revealed limitations therein, he failed to proffer any objective medical evidence of the existence of a significant limitation in his left knee that was contemporaneous with the subject accident (see Garcia v Lopez, 59 AD3d 593, 720; Leeber v Ward, 55 AD3d 563; Ferraro v Ridge Car Serv., 49 AD3d 498; D'Onofrio v Floton, Inc., 45 AD3d 525).
As to the plaintiff's lumbar and cervical spines, the submissions of Dr. Jerry A. Lubliner and Dr. Theodore Leslie Dantes revealed significant limitations in the lumbar and cervical regions of his spine both contemporaneously with the subject accident and more recently. However, neither expert addressed the fact that the plaintiff was involved in a prior accident in 2003, as well as a subsequent accident in 2005, in which he injured his neck and back. The failure to address these prior and subsequent accidents and injuries rendered speculative the conclusions of those experts that the injuries and limitations they noted in the plaintiff's cervical and lumbar regions were caused by the subject accident (see Joseph v A and H Livery, 58 AD3d 688; Sapienza v Ruggiero, 57 AD3d 643; Zinger v Zylberberg, 35 AD3d 851; Baksh v Shabi, 32 AD3d 525; see also Penaloza v Chavez, 48 AD3d 654; Vidor v Davila, 37 AD3d 826).
The affirmed magnetic resonance imaging report of the plaintiff's cervical spine, dated June 14, 2004, merely revealed the existence of a herniated disc at C5-6. The mere existence of a herniated 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 Sealy v Riteway-1, Inc., 54 AD3d 1018; Kilakos v Mascera, 53 AD3d 527; Cerisier v Thibiu, 29 AD3d 507; Bravo v Rehman, 28 AD3d 694; Kearse v New York City Tr. Auth., 16 AD3d 45). The plaintiff's affidavit was insufficient to meet this requirement (see Ferber v Madorran, 60 AD3d 725; Ponicano v Schaefer, 59 AD3d 605; Luna v Mann, 58 AD3d 699).
The plaintiff failed to submit competent medical evidence that the injuries he allegedly sustained in the subject accident rendered him unable to perform substantially all of his usual and customary daily activities for not less than 90 days of the first 180 days subsequent to the subject accident (see Roman v Fast Lane Car Serv., Inc., 46 AD3d 535; Sainte-Aime v Ho, 274 AD2d 569).
Rahman v. Sarpaz

Baker, McEvoy, Morrissey & Moskovitz, P.C., New York, N.Y.
(Stacy R. Seldin 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, Kings County (Jacobson, J.), dated March 12, 2008, which granted the defendants' motion for summary judgment dismissing the complaint on the ground that he did not sustain a serious injury within the meaning of Insurance Law § 5102(d).
ORDERED that the order is reversed, on the law, with costs, and the defendants' motion for summary judgment is denied.
The defendants did not meet their 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 accident (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955, 956-957). The defendants' motion papers did not adequately address the plaintiff's claim, clearly set forth in his bill of particulars, that he sustained a medically-determined injury or impairment of a nonpermanent nature which prevented him from performing substantially all of the material acts which constituted his usual and customary daily activities for not less than 90 days during the 180 days immediately following the subject accident (see Carr v KMO Transp., Inc., 58 AD3d 783; Jensen v Nicmanda Trucking, Inc., 47 AD3d 769; Alexandre v Dweck, 44 AD3d 597; Sayers v Hot, 23 AD3d 453, 454). The subject accident occurred on November 8, 2003, and the plaintiff was not examined by the defendants' experts, Dr. Guoping Zhou and Dr. Michael P. Rafiy, until September 28, 2007, approximately 3 years and 10 months after the subject accident. The plaintiff testified at his deposition that he missed 9½ months of work as a result of the subject accident, which was noted in the reports of Dr. Zhou and Dr. Rafiy. Dr. Zhou and Dr. Rafiy did not address this category of serious injury in their respective reports (see Carr v KMO Transp., Inc., 58 AD3d 783; Sayers v Hot, 23 AD3d 453).
While the defendants relied on the affirmed medical report of Dr. David L. Milbauer, their radiologist, Dr. Milbauer failed to establish that the plaintiff did not sustain a serious injury under the 90/180-day category. Dr. Milbauer merely provided his opinion based on his review of the plaintiff's lumbar and cervical spine magnetic resonance imaging films dated March 8, 2004. The plaintiff in this case claimed more than spinal injuries in his bill of particulars; he also claimed left knee injuries as a result of the subject accident. Dr. Milbauer's reports do not address the plaintiff's left knee or the 90/180-day category of serious injury (see Carr v KMO Transp., Inc., 58 AD3d 783; Jenson v Nicmanda Trucking Inc., 47 AD3d 783).
Since the defendants failed to meet their prima facie burden, it is unnecessary to consider whether the plaintiff's opposition papers were sufficient to raise a triable issue of fact (see Carr v KMO Transp., Inc., 58 AD3d 783; Sayers v Hot, 23 AD3d 453).
Sinfelt v. Helm's Bros., Inc.

Mallilo & Grossman, Flushing, N.Y. (Francesco Pomara, Jr., of
counsel), for appellant.
Richard T. Lau, Jericho, N.Y. (Gene W. Wiggins 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 (Kelly, J.), dated April 17, 2008, which granted the motion of the defendants Kwang Kyu Kim and Dongsun Kim for summary judgment dismissing the complaint insofar as asserted against them 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 of the defendants Kwang Kyu Kim and Dongsun Kim for summary judgment dismissing the complaint insofar as asserted against them is denied.
The defendants Kwang Kyu Kim and Dongsun Kim (hereinafter the respondents) met their 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 accident (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955, 956-957). In opposition, the plaintiff raised a triable issue of fact.
The plaintiff relied, inter alia, upon the affidavit of her treating chiropractor, Dr. Mark Snyder. Dr. Snyder opined, based on his contemporaneous and most recent examinations, as well as upon his review of the plaintiff's magnetic resonance imaging reports, which revealed, inter alia, disc herniations at L5-S1 and C5-6, and disc bulges at T5-6 and T6-7, that the plaintiff's lumbar and cervical injuries and observed range of motion limitations therein were permanent and causally related to the subject accident. He further opined that the plaintiff's limitations were significant. The affidavit was sufficient to raise a triable issue of fact as to whether the plaintiff sustained a serious injury to her lumbar or cervical spine under the significant limitation of use and/or the permanent consequential limitation of use categories of Insurance Law § 5102(d) as a result of the subject accident (see Williams v Clark, 54 AD3d 942; Casey v Mas Transp., Inc., 48 AD3d 610; Green v Nara Car & Limo, Inc., 42 AD3d 430; Francovig v Senekis Cab Corp., 41 AD3d 643, 644-645; Acosta v Rubin, 2 AD3d 657).
Contrary to the respondents' assertions on appeal, the plaintiff adequately explained the gap in her treatment between 2003 and 2007 (see Pommells v Perez, 4 NY3d 566; Black v Robinson, 305 AD2d 438).
Security Mutual Life Insurance Company of New York v Rodriguez

Defendants appeal from an order of the Supreme Court, New York County (Charles E. Ramos, J.), entered December 7, 2007, which denied their motion to dismiss the complaint.

Kramer Levin Naftalis & Frankel LLP, New York
(Stephen M. Sinaiko, David
S. Frankel and Erin E. Oshiro
of counsel), for appellants.
Clifford Chance US LLP, New York (Anthony M.
Candido and Valeria
Calafiore of counsel), for
respondent.

McGUIRE, J.
In October 2003 defendants Lucy Rodriguez and Esmail Mobarak, Rodriguez's son, purchased three life insurance policies with an aggregate benefit of $20 million from agents of plaintiff Security Mutual Life Insurance Company. The policies were issued on Rodriguez's life and Mobarak is the beneficiary under each policy. Each policy contains an incontestability clause that precludes plaintiff from challenging the policy "after it has been in force, during the Insured's lifetime, for two years from the earlier of its Policy Date or Issue Date." The parties agree that, the earlier of these dates, the Policy Date, is October 1, 2003.
In July 2004 the New York County District Attorney's Office commenced a civil forfeiture proceeding against the agents of Security from whom defendants purchased the policies. The District Attorney alleged that the agents had engaged in fraudulent conduct relating to the issuance of life insurance policies by another carrier, Prudential Financial Company. In September 2004 Security notified defendants that the agents were no longer authorized to conduct business on behalf of plaintiff or take any action concerning policies issued by plaintiff. The agents pleaded guilty in May 2005 to insurance fraud crimes with respect to the issuance of life insurance policies by Prudential.
On Monday October 3, 2005, plaintiff commenced this action against defendants seeking rescission of the policies and damages for fraud. Plaintiff alleged that defendants, in conjunction with the agents, fraudulently procured the policies by providing false and misleading financial and medical information about Rodriguez to plaintiff. Defendants moved to dismiss the complaint on the ground that the incontestability clause barred the action because the policies became incontestable after Saturday October 1, 2005 and the action was not commenced until two days later. Alternatively, defendants sought dismissal of the rescission claim on the ground that plaintiff waived its right to rescind the policies because it accepted premium payments after commencing the action, and dismissal of the fraud claims on the ground that plaintiff failed to plead the alleged fraud with sufficient detail. Plaintiff opposed the motion, arguing that because the date on which the policies became incontestable fell on a Saturday, the action was commenced in a timely fashion on the next business day; it did not waive its rescission claim by accepting premium payments; and its fraud claims were pled with sufficient detail. Supreme Court denied defendants' motion, and this appeal ensued.
Defendants argue that the policies became incontestable after October 1, 2005; the statutory provision dealing with certain contractual deadlines falling on weekends and public holidays, General Construction Law § 25, does not apply so as to extend plaintiff's time to contest the policies; and plaintiff's action, commenced on October 3, thus is barred by the incontestability clause. Plaintiff counters that because Insurance Law § 3203(a)(3) requires the inclusion of the incontestability provision in the policies,[FN1] General Construction Law § 25-a, which governs statutory deadlines falling on weekends and public holidays, extended its time to contest the policies to Monday October 3. Alternatively, plaintiff argues that even if General Construction Law § 25-a does not apply, § 25 applies in any event. General Construction Law § 25, entitled "Public holiday, Saturday or Sunday in contractual obligations; extension of time where performance of act authorized or required by contract is due on Saturday, Sunday or public holiday," states, in relevant part, that:
"Where a contract by its terms authorizes or requires ... the performance of a condition on a Saturday, Sunday or a public holiday, or authorizes or requires ... the performance of a condition within or before or after a period of time computed from a certain day, and such period of time ends on a Saturday, Sunday or a public holiday, unless the contract expressly or impliedly indicates a different intent, such ... condition [may be] performed on the next succeeding business day ... with the same force and effect as if made or performed in accordance with the terms of the contract."[FN2]
General Construction Law § 25-a, entitled "Public holidays, Saturday or Sunday in statutes; extension of time where performance of act is due on Saturday, Sunday or public holiday," states that:
"When any period of time, computed from a certain day, within which or after which or before which an act is authorized or required to be done, ends on a Saturday, Sunday or a public holiday, such act may be done on the next succeeding business day ..., except that where a period of time specified by contract ends on a Saturday, Sunday or a public holiday, the extension of such period is governed by section twenty-five of this chapter."
At first blush, the statutes appear to be unproblematic and to govern two distinct situations. General Construction Law § 25-a extends to the next succeeding business day a party's time to perform any act authorized or required to be performed before a particular period of time where that period ends on a Saturday, Sunday or public holiday, unless the period of time is specified in a contract. Thus, § 25-a provides that "where a period of time specified by contract ends on a Saturday, Sunday or a public holiday, the extension of such period is governed by section twenty-five of this chapter." General Construction Law § 25,[FN3] in turn, extends to the next succeeding business day a party's time to perform a contractual "condition" when the period in which performance is due ends on a weekend or public holiday. Thus, § 25-a broadly allows for an extension of "any period of time ... within which or after which or before which an act is authorized or required to be done" when that period ends on a weekend or a public holiday. By contrast, albeit implicitly, § 25 permits an extension of time only where the party seeking the extension was authorized or required to perform a "condition" of a contract and the last day of the period of time to perform that condition ends on a weekend or public holiday [FN4] .
Here, the relevant period of time is recited in the policies, so General Construction Law § 25 would seem to apply and an extension would be available only if the commencement of an action contesting the policies was a "condition" under the policies. But the incontestability clause in the policies is mandated by a statute, Insurance Law § 3203(a)(3); if plaintiff had omitted the clause from the policies it would be deemed part of the policies as though written into them (see Trizzano v Allstate Ins. Co., 7 AD3d 783, 785 [2004], lv denied in part and dismissed in part, 3 NY3d 696 [2004]; 2 Couch on Insurance 3d § 19:1 ["Existing and valid statutory provisions enter into and form a part of all contracts of insurance to which they are applicable, and, together with settled judicial constructions thereof, become a part of the contract as much as if they were actually incorporated therein"] [internal footnotes omitted]). Thus, if General Construction Law § 25 governs, an anomalous result would follow: an insurer that complies with the law and includes in its life insurance policies the clause it is required by law to include will have a shorter period of time in which to contest the policies than it would have if it omitted the clause from the policies.
That anomaly is not required by the literal terms of § 25 or § 25-a. That is, neither statute purports to state the governing rule when a period of time within which an act is authorized or required is specified both in a statute and in a contract. Nor is this anomaly required by the case law. As we have held, "[w]hen a provision of an insurance policy mirrors statutory language ... the policy clause is subject to the same interpretation as the statute" (Matter of Country Wide Ins. Co. [Russo], 201 AD2d 368, 370 [1994]). Country Wide is consistent with Metropolitan Life Ins. Co. v Schmidt (299 NY 428 [1949]), in which the Court determined that the incontestability clause of a policy must be interpreted in the same manner as the language of the statute requiring the clause (id. at 432 ["the language of the policy provision which was copied from the statute, is statutory language, and as such, is subject to the General Construction Law, since there is nothing in the general object or context of the Insurance Law provision to indicate that a different meaning or application was intended from that required to be given by section 20 of the General Construction Law"]). Thus, General Construction Law § 25-a applies to the period of time plaintiff had to contest the policies and extended the end of that period to October 3, and plaintiff's action is not barred by the incontestability clause [FN5] .
With respect to defendants' contention that plaintiff waived the right to rescind the policies, "[w]here an insurer accepts premiums after learning of an event allowing for cancellation of the policy, the insurer has waived the right to cancel or rescind" (Continental Ins. Co. v Helmsley Enters., 211 AD2d 589 [1995]; see Bible v John Hancock Mut. Life Ins. Co., 256 NY 458 [Cardozo, Ch. J. 1931]; see also Johnson v Mutual Benefit Health & Acc. Assn of Omaha, Neb., 5 AD2d 103, 107 [1957], mod on other grounds 5 NY2d 1031 [1959])[FN6] . The basis of this rule is that an insurer's claimed attempt to both accept premiums and reserve its right to rescind is unenforceable for lack of mutuality and timeliness (Continental Ins. Co., 211 AD2d at 589, citing McNaught v Equitable Life Assur. Socy., 136 App Div 774 [1910]). Here, plaintiff commenced this action in October 2005. Yet, between that month and June 2006, plaintiff collected nine $5,000 premium payments from Mobarak; the payments were debited monthly from Mobarak's checking account. Thus, after commencing this action, plaintiff collected approximately $40,000 in premiums from Mobarak, none of which have been refunded.
Plaintiff argues that it did not waive the right to rescind the policies because it accepted the premium payments after it commenced the action. According to plaintiff, the commencement of an action to rescind a policy is an unambiguous sign that the insurer is seeking to cancel, not enforce, a policy. Therefore, the argument goes, plaintiff did not manifest an intention to abandon its right to rescind the policies and its acceptance of premiums could not be construed as an intent to ratify the policies. Plaintiff's argument is contrary to the case law.
In Continental Ins. Co. (supra), the plaintiff issued to the defendant property owner several liability insurance policies [FN7] . Approximately six months after the policies were issued, the plaintiff discovered misrepresentations that the defendant made to the plaintiff, which permitted the defendant to obtain the coverage at reduced premiums. The plaintiff discovered the misrepresentations in February 1989 and within days of the discovery demanded that the defendant pay additional premiums; the plaintiff indicated to the defendant that the policies "would not and could not be permitted to stand as written." The parties then negotiated for several months in an effort to resolve the dispute until May 1989 when the plaintiff commenced an action against the defendant to rescind the policies. The defendant continued to make its monthly premium payments to the plaintiff through June 1989.
Supreme Court granted the defendant's motion for summary judgment dismissing the rescission claim, finding that the plaintiff had waived its rescission claim by accepting the premium payments. The plaintiff appealed, arguing, among other things, that it did not waive the rescission claim by accepting the premiums following its discovery of the alleged fraud and after it commenced the action. We disagreed and affirmed the dismissal of the rescission claim, concluding that "[t]he IAS Court properly determined that plaintiff waived its right to seek rescission of the contract of insurance when it knowingly accepted premium payments for several months following discovery of the alleged misrepresentations upon which it claimed to have relied when it issued the policies" (211 AD2d at 589).
In Scalia v Equitable Life Assur. Socy. of the U.S. (251 AD2d 315 [1998]), the plaintiff purchased a disability income insurance policy from the defendant. The plaintiff sustained an injury that he claimed rendered him totally disabled and sought benefits under the policy (Scalia, defendant-appellant's brief, 1998 WL 35178856, *4-5). After paying the plaintiff benefits for several months, the defendant denied him further benefits on the ground that he was not totally disabled (id. at *5). The plaintiff commenced an action in April 1994 seeking further benefits under the policy (id.). After its motion to dismiss the action was denied and it served its answer, the defendant moved in July 1995 to amend its answer to include a defense that the plaintiff's claim was barred because he made material misrepresentations in his application for the policy (id. at *5-6). The defendant also sought to amend its answer to include a counterclaim for rescission of the policy (id. at *6). Although Supreme Court granted the motion to amend, it subsequently dismissed the defense founded on the plaintiff's alleged misrepresentations and the related counterclaim (id. at *7). The court did so because the defendant had accepted premium payments from the plaintiff until September 1995, several months after asserting its defense and counterclaim based on the plaintiff's alleged misrepresentations (id. at *7-8). Thus, according to Supreme Court, the defendant had waived its right to rescind the policy (id.).
The Second Department affirmed. Citing, among other authorities, our decision in Continental Ins. Co., the Court noted that "[i]t is well settled that the continued acceptance of premiums by the carrier after learning of facts which allow for rescission of the policy, constitutes a waiver of, or more properly an estoppel against, the right to rescind" (251 AD2d at 315). The Court determined that "[t]he record supports the Supreme Court's determination that the defendant ... waived its right to rescind the disability income insurance policy, by continuing to accept premium payments after it gained sufficient knowledge of the alleged misrepresentations upon which it claims to have relied when issuing the policy" (id.; see also Oglesby v Massachusetts Acc. Co., 230 App Div 361 [1930]).
Plaintiff's acceptance of premiums from Mobarak after learning of the alleged fraud allowing for cancellation of the policies constituted a waiver of (or more properly an estoppel against) its right to cancel or rescind the policies (see Scalia, supra; Continental Ins. Co., supra). We note, too, that plaintiff did not retain temporarily a payment (or a couple of payments) from Mobarak before refunding the payment (cf. Travelers Ins. Co. v Pomerantz, 246 NY 63, 70-71 [1927]; Boyd v Allstate Life Ins. Co. of N.Y., 267 AD2d 1038, 1040 [1999]). Rather, as discussed above, plaintiff collected from Mobarak nine $5,000 premium payments over a nine-month period and plaintiff has not refunded any of those payments. The collection and retention of those payments compel the conclusion that plaintiff cannot now seek to rescind the policies (see Scalia, supra [insurer waived right to rescind policy where it accepted premium payments for several months after it asserted counterclaim to rescind that policy]; Continental Ins. Co., supra [insurer waived right to rescind policy where it accepted premium payments for "several months" following discovery of alleged misrepresentations]; Garbin v Mutual Life Ins. Co. of N.Y., 77 Misc 2d 689 [App Term, 1st Dept 1974] [insurer waived right to rescind policy where it accepted and retained four separate quarterly premium payments]). Accordingly, Supreme Court erred in denying that aspect of defendants' motion seeking dismissal of the cause of action for rescission.
To the extent that Prudential Ins. Co. of Am. v BMC Indus. (630 F Supp 1298 [SD NY 1986]), relied upon by plaintiff, is inconsistent with Continental Ins. Co. (supra) and Scalia (supra), we do not follow it. In Prudential, the plaintiffs entered into an agreement with defendants pursuant to which the plaintiffs purchased notes held by the defendants. The defendants were required to make periodic interest payments to the plaintiffs on the unpaid balance of the notes. The plaintiffs commenced an action against the defendants to rescind the agreement, alleging that the defendants failed to disclose material information and misrepresented material facts during the parties' negotiations. The defendants asserted that the plaintiffs ratified the agreement by accepting several interest payments after they commenced the action. The court granted the plaintiffs' motion to strike the defendants' ratification defense, holding that "the acceptance of money during the pendency of th[e] action is not inconsistent with the Plaintiffs['] claim for rescission [because] it does not undermine the clear demand for rescission embodied by the act of filing the ... action" (id. at 1303). The court, however, was not addressing the situation where an insurer accepted premium payments from the insured after the insurer asserted a claim to rescind the policies. That situation, as discussed above, is controlled by New York case law, including our own precedent (Continental Ins. Co., supra; see e.g. Scalia, supra). Additionally, it should be noted that Prudential was decided before Continental Ins. Co. and Scalia.
Finally, Supreme Court properly determined that the complaint sufficiently alleged fraud with the requisite particularity (see CPLR 3016[b]; Bernstein v Kelso & Co., 231 AD2d 314, 320 [1997]). Notably, the complaint specified not only the misstatement of Rodriguez's net worth, but also the falsity of the medical statements and the proffering of fictitious accountant and medical records.
Accordingly, the order of Supreme Court, New York County (Charles E. Ramos, J.), entered December 7, 2007, which denied defendants' motion to dismiss the complaint, should be modified, on the law, to grant that aspect of defendants' motion seeking dismissal of the rescission claim, and otherwise affirmed, without costs.
All concur.
Order, Supreme Court, New York County (Charles E. Ramos, J.), entered December 7, 2007, modified, on the law, to grant that aspect of defendants' motion seeking dismissal of the rescission claim, and otherwise affirmed, without costs.
Opinion by McGuire, J. All concur.
Gonzalez, P.J., McGuire, Moskowitz, DeGrasse, Freedman, JJ.
THIS CONSTITUTES THE DECISION AND ORDER
OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.
Footnotes


Footnote 1: Insurance Law § 3203 ("Individual life insurance policies; standard provisions as to contractual rights and responsibilities of policyholders and insurers") provides, in relevant part, that: "(a) All life insurance policies, except as otherwise stated herein, delivered or issued for delivery in this state, shall contain in substance the following provisions, or provisions which the superintendent deems to be more favorable to policyholders: (3) that the policy shall be incontestable after being in force during the life of the insured for a period of two years from its date of issue, and that, if a policy provides that the death benefit provided by the policy may be increased, or other policy provisions changed, upon the application of the policyholder and the production of evidence of insurability, the policy with respect to each such increase or change shall be incontestable after two years from the effective date of such increase or change, except in each case for nonpayment of premiums or violation of policy conditions relating to service in the armed forces."

Footnote 2: The statute also applies to extend to the next succeeding business day a party's time to make a payment of money authorized or required by a contract. That provision is not relevant to this appeal.

Footnote 3: The statute does not apply where the contract expressly or impliedly indicates an intent that the condition must be performed by the end of the period of time regardless of whether that period ends on a Saturday, Sunday or public holiday (see Jessar Realty Corp. v Friedman Realty Co., 253 NY 298 [1930]). Neither plaintiff nor defendants assert that this exception to the statute applies.

Footnote 4: Reading the two statutes together, § 25 precludes an extension of time when a period of time specified in a contract ends on a Saturday, Sunday or public holiday but the contract does not authorize or require the performance of a "condition." After all, a contrary reading of § 25 would render it superfluous as it would perform no function not already performed by § 25-a.

Footnote 5: The parties vigorously dispute whether the commencement of an action contesting the policies is a "condition" within the meaning of General Construction Law § 25. Defendants maintain that the word "condition" should be given its technical meaning under contract law - " an event, not certain to occur, which must occur, unless its non-occurrence is excused, before performance under a contract becomes due'" (Merritt Hill Vineyards v Windy Hgts. Vineyard, 61 NY2d 106, 112 [1984], quoting Restatement, Contracts 2d § 224; see Oppenheimer & Co. v Oppenheim, Appel, Dixon & Co., 86 NY2d 685, 690 [1995]). According to defendants, the commencement of an action contesting the policies is not a "condition" under the policies because it is not an event that must occur before performance by defendants under the policies becomes due, and the extension afforded by § 25 is not available to plaintiff. Plaintiff asserts that the word "condition" should not be given that technical meaning (see Harrison v Allstate Ins. Co., 1999 WL 638243 [SD NY 1999]). Thus, plaintiff contends that the word should be given a broad construction and that, under § 25, "contractual conditions' encompass contractual requirements - such as the one at issue here - that determine whether a party must make future performance (i.e., here, whether [plaintiff] must perform on a fraudulently induced policy)." Because General Construction Law § 25-a applies, however, we need not address this dispute.

Footnote 6: The use of the term "waiver" in this regard is somewhat imprecise. As Judge Cardozo noted in Bible, "the delivery of the policies by the insurer, and the keeping of the premiums with knowledge of a then existing breach of the conditions as to the health of the insured and her treatment in a hospital gave rise to a waiver or, more properly, an estoppel" (256 NY at 462).

Footnote 7: The facts underlying our decision in Continental are taken from the briefs of the parties in that action.

Surace v.  Commonwealth Land Title Insurance Company

Borchert, Genovesi, LaSpina & Landicino, P.C., Whitestone, N.Y.
(Helmut Borchert and Robert W. Frommer of counsel), for
appellant.
Howard M. File, Staten Island, N.Y., for respondents.


DECISION & ORDER
In an action, inter alia, to recover damages for breach of a title insurance policy and the negligent failure to timely record a mortgage, the defendant appeals, as limited by its brief, from stated portions of an order of the Supreme Court, Richmond County (Maltese, J.), dated June 25, 2008, which, inter alia, denied its motion to dismiss the complaint pursuant to CPLR 3211(a)(1) and (7) and for summary judgment dismissing the complaint pursuant to CPLR 3212.
ORDERED that the order is affirmed insofar as appealed from, with costs, and, upon searching the record, summary judgment is awarded to the plaintiffs on the issue of liability.
On April 5, 2005, the plaintiffs obtained a mortgage interest in real property in the principal sum of $360,000. The plaintiffs obtained title insurance from the defendant. The defendant did not submit the mortgage document for recording until January 30, 2006. In the interim, on July 14, 2005, a second mortgage was taken out on the property. This second mortgage was recorded on August 1, 2005. Thus, the second mortgage was recorded before the first mortgage held by the plaintiffs, and became the first lien on the property. The plaintiffs commenced this action, alleging, inter alia, a breach of the title insurance policy and the negligent failure to timely record the mortgage.
To prevail on that branch of its motion which was to dismiss the complaint pursuant to CPLR 3211(a)(1), the defendant was required to demonstrate that "the documentary evidence utterly refutes plaintiff's factual allegations, conclusively establishing a defense as a matter of law" (Goshen v Mutual Life Ins. Co. of N.Y., 98 NY2d 314, 326). Insofar as the defendant's motion is predicated upon CPLR 3211(a)(7), the court is required to "accept the facts as alleged in the complaint as true, accord plaintiffs the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory" (Leon v Martinez, 84 NY2d 83, 87-88).
The complaint states a valid cause of action alleging a breach of the title insurance policy. The complaint also states a valid cause of action alleging negligence, which is independent of the parties' contract of insurance (see Gem Servs. of N.Y. v United Gen. Tit. Ins. Co., 28 AD3d 516; Cruz v Commonwealth Land Tit. Ins. Co., 157 AD2d 333). Moreover, contrary to the arguments of the defendant, the documentary evidence failed to refute the plaintiffs' allegations.
The Supreme Court also properly denied that branch of the defendant's motion which was for summary judgment dismissing the complaint pursuant to CPLR 3212 because the defendant failed to make a prima facie showing of its entitlement to judgment as a matter of law (see Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853).
This Court has the authority to search the record and award summary judgment to a nonappealing party with respect to an issue that was the subject of a motion before the Supreme Court (see Garcia v Lopez, 59 AD3d 593; cf. Dunham v Hilco Constr. Co., 89 NY2d 425, 429-430). Here, the plaintiffs cross-moved for summary judgment on the issue of liability, and the defendant submitted opposition thereto. Upon searching the record, we find that the plaintiffs made a prima facie showing of entitlement to summary judgment on the issue of liability by producing evidence, on their cross motion, that the defendant breached the title insurance policy and was negligent in failing to record the plaintiffs' mortgage in a timely manner. In opposition, the defendant failed to raise a triable issue of fact. Accordingly, the plaintiffs are entitled to summary judgment on the issue of liability (see CPLR 3212[b]).
The defendant's contention that the Supreme Court erred in directing it to pay to the plaintiffs' attorney the sum of $94,622.35 to be held in escrow pending the completion of this matter has been rendered academic. In an order dated August 29, 2008, the Supreme Court, inter alia, amended the order appealed from to delete such provision, upon the stipulation of the parties.
The defendant's remaining contentions are without merit.
RIVERA, J.P., SPOLZINO, ANGIOLILLO and BALKIN, JJ., concur.
Greenwich Insurance Company v Volunteers of America-Greater NY, Inc.

Gennet, Kallmann, Antin & Robinson, PC, New York (Brian J.
Bolan of counsel), for appellant.
Law Offices of Harvey & Vandamme, New York (Hendrick
Vandamme of counsel), for respondent.
Order, Supreme Court, New York County (Michael D. Stallman, J.), entered November 8, 2007, which, in a subrogation action to recover damages caused by a fire in premises leased to defendant by plaintiff insurer's subrogor, granted defendant's motion for summary judgment dismissing the complaint, and denied plaintiffs' cross motion for summary judgment, unanimously affirmed, without costs.
Paragraph 12 of the lease, which obligates defendant to pay for damages specifically caused by fire only if the fire was "caused by [defendant's] actions," controls over paragraph 13, which generally obligates defendant to pay for any damages "caused by [defendant] or any occupant or visitor" (see Bank of Tokyo-Mitsubishi, Ltd., N.Y. Branch v Kvaerner a.s., 243 AD2d 1, 8 [1998]). Since the fire was allegedly caused by defendant's subtenant smoking in bed, and not by defendant's own actions, defendant cannot be held responsible for the cost of repairing the damage under the terms of the lease. We have considered plaintiff's other arguments and find them unavailing.