Coverage Pointers - Volume XI, No. 15

Dear Coverage Pointers Subscribers:

 Happy Friday.  We're a few days closer to Spring.

 This Week's Top Story

All the chatter this week is about the Second Department's decision in Wilner v. Allstate which is covered in Steve Peiper's column this week.  It's a case that requires careful attention and reflection. 

 The Wilner case involves a homeowner's property claim for storm damage which led to the collapse of a retaining wall as well as tree and other damage.  The plaintiffs claimed that Allstate failed to pay the amounts due under a first party policy and failed to defend them in a criminal proceeding commenced against them by the Village of Roslyn for damages caused to Village property. The third cause of action against Allstate was for violations of the state's deceptive practices statute, General Business Law § 349. Specifically, the plaintiffs alleged that a provision of the insurance policy required them to protect the defendant's subrogation interest by instituting an action against the Village before the statute of limitations expired. According to the plaintiffs, Allstate refused to reach a timely decision on coverage, thereby compelling the plaintiffs to comply with that provision and sue the Village at their own expense. The plaintiffs alleged that the defendant's actions "caused injury to Plaintiffs, and have the potential to harm the public at large" because every Allstate Deluxe Plus Homeowners' Policy contains the provision requiring those insured to protect the defendant's right to subrogate.

 The Appellate Division, Second Department refused to dismiss the claim for actual damages on their General Business Law § 349 cause of action, punitive damages, and attorney's fees.  It also ordered the insurer to produce records relating to hundreds of storm claims so that the insured could attempt to demonstrate a pattern of conduct aimed at the general public.  Sheesh.

 Anyway, do read Steve's in-depth synopsis of the decision and of course, you'll find the full text of the decision in the attached issue.

 Educational Opportunities:

 DRI Insurance Programs (www.dri.org)

• 2010 Insurance Coverage and Claims institute
  Chicago - Intercontinental Hotel
  April 15-16, 2010
  Whether you are a seasoned veteran or are new to the coverage and claims arena, DRI's Insurance Coverage and Claims Institute will increase your understanding of new and emerging issues to give you an edge. The speakers are drawn from top defense attorneys, in-house counsel, claims personnel, insurance regulators and judges to bring you new views and different perspectives on the latest coverage and claims issues.
  
• DRI Insurance Coverage and Practice Symposium -
  New York City
  November 17-19, 2010,
  I was honored and delighted to be appointed as Chair of the DRI insurance Coverage and Practice Symposium which will be held about three week's earlier than usual, in New York City in November.  We'll be putting together a blockbuster program so mark the dates on your calendar.

PLRB - LIRB

• PLRB - LIRB Claims Conference
  San Antonio
  March 21 - 24, 2010
  As a member of the Planning Committee and a speaker at the PLRB - LIRB Claims Conference in San Antonio, I hope and trust that we'll see many of you, as we do each year, at this spectacular venue.  If you haven't registered for the conference, you can get all the information at the website, www.plrb.org

Notes from Audrey Seeley, the Queen of No Fault: 

As a discussion point, I find it interesting that in reviewing the no-fault case law that the majority of cases decided are on insufficient evidence within an affidavit or procedural issues as opposed to addressing the merits of the dispute between the insurer and the assignee or EIP.  The most recent example is a Second Department case wherein it reversed and denied an insurer's motion to vacate a default judgment because the insurer's adjuster affidavit failed to address what the standard office procedures were for not only receipt of a summons and complaint in a different state but also standard office procedure for what occurs if a medical bill is received by the insurer. 

 There is a great upcoming program with DRI from April 14-16th.  It is the Insurance Coverage and Claims Institute in Chicago.  This will be another great program with the Wednesday afternoon session being changed to focus on some of the emerging issues in the industry - such as what is the LEED Certification Program and the potential insurance coverage issues associated with it and what are the claims emanating from China (this does not appear to focus solely on Chinese Drywall either).  On Thursday, the New Hampshire Insurance Department Commissioner, Mr. Roger A. Sevigny, will be speaking as well as the Honorable Paul M. Glenn, the US Bankruptcy Crt, Middle District of Florida.  Also, for those who have a focus on professional liability or bad faith there are tracks dedicated to each issue on Friday.  If you would like a copy of the brochure via PDF send me an email at [email protected].

 Audrey 

 

A Celebratory Day

I know you were wondering what we celebrate on January 22.   According to the website, www.catchannel.com, today is National Answer Your Cat's Question Day.  According to the website:

 

 Most cat owners can identify with the sometimes unusual and questioning looks that cross felines' faces when they want humans to address their every desire, even though giving in to some of those desires would not be in the best interest of the cat.

National Answer Your Cat's Questions Day is Jan. 22, and pet owners can respond to their quizzical cat's questions with the assistance of veterinarians from the California Veterinary Medical Association (CVMA). The veterinarians compiled a list of answers to questions cats may be pondering in order to help cat owners understand feline health and behavioral issues.

One Hundred Years Ago Today

History repeats itself

 Anyone who follows Albany politics knows that this week, a special Senate Committee voted to either expel or censure Senator Hiram Monserrate, the Senate leader who was arrested for assault of his girlfriend. 

 Things don't change very much. 

  A century ago, the news were abuzz with the tale of Senator Jotham P. Allds, After the death of President pro tem John Raines the Republican majority in the Senate chose Senator Allds, who was supported by the Republican Party machine and he took power in early January.  Seven state senators, who objected to Allds, met separately at the Ten Eyck Hotel in Albany.  At this meeting, State Senator Benn Conger (the President of the Corona Typewriter Company), told his fellow senators that he had paid Allds a bribe of $1000 in 1901, when both had been assemblymen and Allds was the Majority Leader of the State Assembly, to kill a bill objected to by bridge construction companies in which Conger was interested.

 On January 5, Allds was chosen President pro tempore and Majority Leader of the State Senate. Shortly afterwards Conger's statement about the bribe was leaked to the press, but Conger then denied having paid the bribe himself. On January 20, 1910 the State Senate appointed a Committee to decide on how to proceed.  After testimony before the full Senate, Allds resigned the Presidency pro tempore and he was found guilty by a vote of 40 to 9, but Allds had resigned just before the begin of the session to avoid expulsion. Conger also resigned,

Editor's Note:  It wasn't until 1926 that the L.C. Smith & Bros. and Corona Typewriter companies merged.  The company was renamed the SCM Corporation in 1962.

In This Week's Issue:

KOHANE'S COVERAGE CORNER
Dan D. Kohane
[email protected]

• Does the Employee Exclusion Require That The Injured Party Be An Employee of The Insured?
• Question of Fact Raised About Timeliness of Insured's Notice
• Uninsured Motorist Carrier Had Good Reason for Delaying Requests for Pre-Arbitration Discovery
• In An Effort to Stay An Uninsured Motorist Arbitration, Integon Wins the Ping-Pong Match
• Insured Did Not Have Acceptable Excuse for Its Failure to Notify Insurer of Accident And Coverage Is Lost

MARGO'S MUSINGS ON SERIOUS INJURY UNDER NEW YORK NO FAULT
Margo M. Lagueras
[email protected]

• Seat Belt Use Raises Question of Causal Relationship Between MRI Findings and Accident
• Without Explanation or Reference to MRI Reports, Expert's Opinion Is Conclusory
• Inconsistent Reasons For Cessation of Treatment Sever Causal Relationship
• Opinion Regarding Causation Is Speculative Where No Contemporaneous Findings Are Submitted And Prior Accident Resulting in Similar Injury Is Not Addressed
• IME Noting Significant Range-of-Motion Limitations Defeats Summary Judgment
• Plaintiff's Failure to Present Contemporaneous Range-of-Motion Findings Dooms His Claim
• Tendon Tears, And Herniated or Bulging Discs Are Not, In of Themselves, Evidence of Serious Injury
• Contradictory Reports Raise Triable Issue of Fact Regarding Causation
• Conclusion That Limitation Is "Voluntary" Must Be Supported With Objective Medical Evidence 

AUDREY'S ANGLES ON NO-FAULT

Audrey Seeley

[email protected]

 

Litigation

• Motion to Vacate Default Judgment Denied - Remember What The Standard Is
• Signed Application Stating In Course of Employment Enough to Stay Action Pending WC Determination<

PEIPER ON PROPERTY (and POTPOURRI)

Steven E. Peiper

[email protected]

Of Property

 

• Waiver of Subrogation Clause Enforceable So Long As Insurance Procurement Clause Is Satisfied
• Another Crack in The Dam? - Second Department Weighs In On GBL § 349 And Extra-Contractual Damages Available Thereunder
  Deadly Delays in Discovery - Parties Must Timely Object to Discovery Demands; Especially in Cases Seeking Extra-Contractual Damages

 And Potpourri 

• Where Injured Party's Employer Does Not Have Workers' Compensation Coverage, The Risk Falls to The Policy Closest to The Injured Party in The Chain of Contracts    

FIJAL'S FEDERAL FOCUS

Katherine A. Fijal

[email protected]

 

• Foreign Policy Trumps State Law 

Earl's Pearls

Earl K. Cantwell

[email protected]

 

The Perils and Pitfalls of Ex Parte Interviews

 

All for now.  See you again after Ground Hog's Day.

 

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
Fijal’s Federal Focus
Earl’s Pearls
Across Borders

KOHANE’S COVERAGE CORNER

Dan D. Kohane
[email protected]

1/14/09           Nautilus Insurance Co. v. Matthew David Events, Ltd.
Appellate Division, First Department
Does The Employee Exclusion Require That The Injured Party Be An Employee of The Insured?
On June 27, 2004, Shea was hurt while working at a corporate party sponsored by Bloomberg, LLC.   Bloomberg had retained Matthew David Events (MDE) to plan, design and manage the shindig.  MDE subcontracted some of the work to United Stage Service (USS).  Shea was an employee of USS, working as a stagehand and was hurt when he fell of a utility vehicle in which he had been riding.
MDE was insured by plaintiff Nautilus Insurance Company under a commercial liability policy.  Shea commenced a personal injury action against Bloomberg and MDE, two days before the three year statute of limitation was to expire. The next day, on June 26, 2007, MDE sent notice about the accident to Nautilus and Nautilus disclaimed on two grounds: MDE’s failure to provide timely notice and that coverage was excluded under a broad “employee injury” exclusion.
Nautilus commenced this declaratory judgment action to confirm its disclaimer. Two causes of action concerned late notice.  The third related to the employment exclusion:  that the policy did not apply to liability as a result of bodily injury to an employee of the insured arising out of and in the course of employment or performing duties related to the conduct of MDE's business. The complaint alleged that while Shea was employed by USS, he was still performing duties related to MDE's work at the time of the accident, and was thus an "employee" of MDE, as the word was defined by the policy.
The "Employee Exclusion," excluded from coverage bodily injury to an "employee" of the insured "arising out of and in the course of: (a) employment by the insured; or (b) performing duties related to the conduct of the insured's business." The exclusion defined "employee" as including but not limited to, any person or persons "hired by, loaned to, leased to, contracted for, or volunteering services to the insured, whether or not paid by the insured."
The Appellate Division panel was split 3-2 on this one.  First of all, the court ruled against the insurer on the late notice issue, without much comment, and then spent the rest of its decision discussion the “Employee Exclusion.”  It concluded that the words “contract for” in the exclusion include employees of subcontractors retained to assist in the work to be performed. The exclusion was not only meant to remove coverage for workers directly under the insured’s contract because if that were the intent, the additional language indicating that the term “employee” includes someone providing "services to the insured, whether or not paid by the insured" would have no meaning.:
The dissenting justices read the exclusion more narrowly.  They argued that Shea was not a person "hired by," "loaned to,", "leased to," and "volunteering services to" the insured. Those terms sound like there a requirement of a direct contractual relationship. In addition, a person who was “leased to” an employer could be paid by a third party. The dissenters would have remanded the matter for a hearing on the issue.
Editor’s Note: We take a third approach to resolution.  While we appreciate the view offered by the majority, the dissenters also offer a reasonable interpretation that the exclusion sounds more like it is designed for individuals hired or contracted directly by the insured.  There being two reasonable interpretations, there is an ambiguity.  There being an ambiguity, it should be construed against the insurer and therefore no remand necessary.
1/12/09           Bauerschmidt & Sons, Inc., v. Nova Casualty Company
Appellate Division, Second Department
Question of Fact Raised About Timeliness of Insured’s Notice
The court reviews the standards for measuring the timeliness of an insured’s notice.  Where a policy of liability insurance requires that notice of an occurrence be given "as soon as practicable," such notice must be accorded to the carrier within a reasonable period of time. There may be circumstances where the insured's failure to give timely notice is excusable, such as where the insured has a good-faith belief in non-liability.  The insured bears the burden of establishing the reasonableness of the excuse.

Here the notice was given four months after the accident which would constitute late notice and since the policy was issued before 1/19/09, would lead to a loss of coverage unless a reasonable excuse is offered.  The court found, however, that the insured raised enough of a belief in non-liability to require a hearing on its reasonableness.

1/5/09             In the Matter of Government Employees Insurance Co. v. Mendoza
Appellate Division, Second Department
Uninsured Motorist Carrier Had Good Reason for Delaying Requests for Pre-Arbitration Discovery
Mendoza was involved in a three-car accident on 1/18/07 and notified his carrier, GEICO 12 days later. On or about 2/2/07, his lawyer sent GEICO a Notice of Intention to file an Uninsured Motorist claim. GEICO responded by indicating that it believed the tortfeasor was in fact insured by a another insurer
GEICO and the attorney traded communications over the next 15 months and GEICO believed that, in fact, another insurer had accepted liability and that a UM claim would therefore not be filed.
Alas, on 5/20/08, the respondent’s attorney sent GEICO a formal request for UM arbitration.  GEICO asked for medical records, authorizations, physical examinations and an EUO.  When the respondent did not comply, GEICO commenced this proceeding to temporarily stay the arbitration until the respondent complied with those demands.
An insurer is permitted to conduct discovery in a UM proceeding and if it fails to act promptly, it can lose its right to secure that discovery unless it provides a justifiable reason for its failure to timely seek the requested discovery. Here, the insurer had a good reason not to conduct discovery earlier, relying on assurances that a UM claim would not be made.
1/5/09             Matter of Integon National Insurance Company v. Montagna
Appellate Division, Second Department
In An Effort to Stay An Uninsured Motorist Arbitration, Integon Wins the Ping-Pong Match
A claim for UM benefits was filed with Integon.  Believing that the offending motorist was in fact covered by a policy issued by Liberty Mutual, Integon moves for a permanent stay of arbitration (as it must, within 20 days of the filing of the arbitration demand).  The court found that Integon satisfied its initial burden of proof, identifying an applicable Liberty policy in play.  In response, Liberty then was successful in coming forward with proof that its policy did not provide coverage for the vehicle.  However, Integon then presented rebuttal proof which convinced the court that the Liberty policy was, in fact, in force and applicable to the vehicle involved in the accident.  Therefore, a permanent stay of arbitration was granted.

1/05/09           Ponok Realty Corp. v. United National Specialty Insurance Company
Appellate Division, Second Department
Insured Did Not Have Acceptable Excuse for Its Failure to Notify Insurer of Accident And Coverage Is Lost
While we are “running out of them,” this is another case involving the “pre-prejudice” notice statute.  Under the legislation, the rule that will now require an insurer to establish that is was prejudiced as a result of untimely notice only applies to policies issued or renewed after January 17th 2009. It would not be applied to the policy in this case, which dates back to 2004.
The insured argued that it gave notice of a potential claim as soon as practicable. Here, it took one from the time the insured received notice of the claim before it notified its liability carrier. The landlord failed to establish that its belief that the tenant would not file a claim was a reasonable.  Likewise, the evidence established, as a matter of law, that the plaintiff's belief in nonliability was unreasonable.

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

Margo M. Lagueras
[email protected]

1/21/10           Sferra v. McGregor
Appellate Division, Third Department
Seat Belt Use Raises Question of Causal Relationship Between MRI Findings and Accident
The plaintiff was driving slowly in a parking lot when her car was hit on the rear passenger side door by the defendant, who was also traveling at a very low rate of speed.  She went to the hospital and then to work where she worked a full day.  A week later she complained of headaches, and pain in her shoulder, upper back and neck.  A month later she complained of lower back pain and subsequently brought this action which the trial court dismissed, agreeing with the defendant that the plaintiff did not suffer a serious injury under § 5102(d).

On appeal, the decision is affirmed.  The defendant submitted two affidavits from an orthopedic surgeon who concluded that the plaintiff’s complaints of cervical pain were due to a pre-existing condition for which she had been continuously treating since 2001.  He noted X-rays taken immediately after the accident which revealed arthritic changes in the cervical spine, and an MRI taken two months later which showed only a mild C4-5 disc bulge.  He also noted that the plaintiff’s limited range-or-motion was consistent with the pre-existing condition and any increase in pain was not permanent. 

The plaintiff alleged that an MRI taken eight months after the accident, and which revealed a small disc protrusion at L5-S1 and a small annular tear at L4-5, was the cause of her lumbar pain and that those injuries were caused by the accident.  The defendant’s orthopedic surgeon stated, however, that because the plaintiff was wearing her seat belt at the time of the accident, there would not have been a significant flexion of the lower spine that would establish a relationship between the MRI findings and the accident.  He further noted that she did not complain of any lower back pain for at least a month after the accident and that the annular tear could have been caused by normal stresses caused by aging.

In opposition, the plaintiff submitted the opinion of her treating chiropractor, who did not discuss her long history of neck pain prior to accident, or why she did not experience any lower back pain until weeks after the accident.  He also did not contest the surgeon’s opinion that the seat belt prevented the flexion that would have been necessary to produce the disc herniation.  As such, the plaintiff failed to raise an issue of fact and the complaint was properly dismissed.

1/14/10           Frias v. James
Appellate Division, First Department
Without Explanation or Reference to MRI Reports, Expert’s Opinion Is Conclusory
The defendants’ expert opined that the plaintiff did not sustain a serious injury under either the permanent consequential limitation or the significant limitation of use categories because, although submitting evidence of range-of-motion limitations, he attributed those restrictions to degenerative causes.  His opinion was conclusory, however, because he neither explained his opinion nor made any reference to degeneration in the MRI reports he reviewed. 

The plaintiff’s claim under the 90/180-day category was dismissed, however, because the plaintiff’s bill of particulars, which was submitted by the defendant, did not show that he was prevented from performing substantially all his usual and customary activities during at least 90 of the first 180 days immediately following the accident.

1/14/10           Cekic v. Zapata
Appellate Division, First Department
Inconsistent Reasons For Cessation of Treatment Sever Causal Relationship
Asim Cekic was involved in two prior accidents.  His doctor stated that his neck and back injuries were related to the subject accident but this opinion was contradicted by the doctor’s own report from 2004 in which he found that Asim sustained a permanent partial disability caused by one of the prior accidents.  As the doctor failed to distinguish between the injuries sustained in the various accidents, causation of the restrictions found was speculative.

Co-plaintiff, Almera Cekic, submitted evidence of range-of-motion restrictions but she presented no evidence of any treatment after a year following the accident.  It was one year after that that she was deposed, and two years after stopping treatment that she was re-examined.  Thus, her re-examination took place three years after the accident.  The court determined that the “myriad of reasons” she gave for having ceased seeing any doctors after one year resulted in inconsistencies which severed the causal relationship between her injuries and the accident.

1/12/10           Yunatanov v. Stein
Appellate Division, Second Department
Opinion Regarding Causation Is Speculative Where No Contemporaneous Findings Are Submitted And Prior Accident Resulting in Similar Injury Is Not Addressed
In addition to running afoul by submitting unsworn medical reports, the plaintiff submitted the affidavit of his treating chiropractor that, while reporting significant range-of-motion limitations in the plaintiff’s cervical and lumbar spine, did not present any evidence that was contemporaneous with the accident.  The plaintiff also submitted a properly affirmed report of her treating neurologist.  However, that report similarly failed to offer any contemporaneous evidence, nor did it acknowledge a prior accident, two years earlier, in which the plaintiff had injured her back.  The result is a determination that the expert’s conclusions, that the current injuries were causally related to the subject accident, were speculative.

1/5/10             Kjono v. Fenning
Appellate Division, Second Department
IME Noting Significant Range-of-Motion Limitations Defeats Summary Judgment
The plaintiff appeals and wins.  The defendants failed to meet their burden as they relied, in part, on the affirmed medical report of their examining orthopedic surgeon who noted significant limitations in the plaintiff’s lumbar range-of-motion and also a significant limitation in the cervical spine.  Another case in which the court need not even consider the sufficiency of the plaintiff’s opposing papers.

1/5/10             McIntosh v. O’Brien
Appellate Division, Second Department
Plaintiff’s Failure to Present Contemporaneous Range-of-Motion Findings Dooms His Claim
The plaintiff appealed and lost.  He was rear-ended on the eastbound Long Island Expressway.  At his deposition, he acknowledged that he missed less than 90 days of work.  In addition, the affirmed reports of the examining neurologist and orthopedist concluded that the plaintiff had full range-of-motion in his cervical and lumbar spines, left shoulder and left knee.  In opposition, the plaintiff failed to submit any range-of-motion findings that were contemporaneous with the accident, or any competent medical evidence to support his claim under the 90/180-day category.  The court went on to search the record and award summary judgment even to the non-appealing parties.

1/5/10             Mora v. Riddick
Appellate Division, Second Department
Tendon Tears, And Herniated or Bulging Discs Are Not, In of Themselves, Evidence of Serious Injury
Summary judgment for the defendants is affirmed where the plaintiff opposed the motion with unaffirmed medical reports and evidence that he suffered from herniated and bulging discs and tendon tears, but without the required objective evidence of the extent of the limitations or their duration.  Absent that objective evidence, such injuries are not evidence of serious injury.

1/5/10             Smith v. Rodriguez
Appellate Division, Second Department
Contradictory Reports Raise Triable Issue of Fact Regarding Causation
The court notes that it affirms the decision denying summary judgment to the defendants, but for different reasons from those relied on by the trial court.  It notes that the defendants relied, in part, on the affirmed report of their examining orthopedic surgeon who found significant range-of-motion limitations in the plaintiff’s lumbar spine.  He also noted that a report referring to an MRI demonstrated that the range-of-motion of the plaintiff’s lumbar spine was normal.  However, because he did not address his examination findings, his conclusions did not establish that the limitations were not caused by the accident and lack of causal relationship is not shown.

1/5/10             Mondert v. Iglesia De Dios Pentecostal Cristo Viene, Inc.
Appellate Division, Second Department
Conclusion That Limitation Is “Voluntary” Must Be Supported With Objective Medical Evidence
Once again the defendants fail because they rely, in part, on a medical report, in this case affirmed and by a neurologist, that notes that the plaintiff has a significant limitation in her lumbar spine but then concludes that the limitation is “voluntary” without providing any explanation or substantiating that conclusion with objective medical evidence.

 

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

Litigation

1/5/10             Westchester Med. Ctr. a/a/o Bernard Porter v. Philadelphia Indem. Ins. Co.
Appellate Division, Second Department
Motion to Vacate Default Judgment Denied – Remember What The Standard Is
The Appellate Division reversed the Supreme Court’s Order granting the insurer’s motion to vacate a default judgment.  The grounds for the decision was essentially insufficient evidence to meet the standard set forth in CPLR 5015.  A showing of reasonable excuse in the delay in appearing as well as a meritorious defense is required.  Here, the insurer’s Texas based senior claims examiner’s affidavit averring to no record of receipt of the summons and complaint was insufficient without a showing of what the insurer’s office procedures were for handling receipt of a summons and complaint served at a Pennsylvania office.  Also, the affidavit from the same Texas based adjuster that the alleged bill was never received was insufficient as there was no showing of the insurer’s office procedures used to handling receipt of any bills in a Pennsylvania office.

12/30/09         Ortho Pro Labs, Inc. a/a/o Barry Alousseny v. American Transit Ins. Co.
Appellate Term, Second Department
Signed Application Stating In Course of Employment Enough to Stay Action Pending WC Determination

The insurer sought summary judgment and a stay of the action pending an application to the Workers’ Compensation Board seeking a determination on the parties’ rights under the Workers’ Compensation Law.  The issue on appeal was whether the insurer submitted sufficient evidence to demonstrate an issue of fact whether the assignor was injured while in the scope of his employment.  The insurer submitted the assignor’s signed application for no-fault benefits wherein it stated that he was injured during the course of his employment.  This document was signed under penalty of perjury and sufficient to create the question of whether Workers’ Compensation applied.

 PEIPER ON PROPERTY (and POTPOURRI)

Steven E. Peiper
[email protected]

Of Property

01/19/10         Footlocker, Inc. v. KK & J, LLC
Appellate Division, First Department
Waiver of Subrogation Clause Enforceable So Long As Insurance Procurement Clause Is Satisfied
In this matter, Duane Reade drugstore was damaged as a result of fire that occurred at a premises owned by KK & J. As a result, Duane Reade’s insurer, St. Paul, attempted to prosecute a subrogation claim against KK & J.  St. Paul’s subrogation claim was opposed on the basis of a provision in the lease between Duane Reade and KK & J which provided both parties waived any right to recovery against the other for damages that were covered by its own insurance. 

Initially, the First Department noted that the waiver of subrogation clause was effective, and as such, on its face, St. Paul’s claim was precluded.  However, the Court noted that the enforcement of waiver of subrogation clauses is premised upon a duty to procure insurance covering the risk.  Here, there remained a question of fact as to whether KK & J procured an insurance policy under which the loss would be covered.

01/12/10         Wilner v. Allstate Insurance Company
Appellate Division, Second Department
A.        Another Crack in The Dam? – Second Department Weighs In On GBL § 349 And Extra-Contractual Damages Available Thereunder

B.        Deadly Delays in Discovery – Parties Must Timely Object to Discovery Demands; Especially in Cases Seeking Extra-Contractual Damages
For years, we’ve been warning of a potential shift in the law governing extra-contractual damages in New York.  And, for the most part, the law has mostly remained intact.  Make no mistake, however, the threat, and ever so slow erosion of established precedent, is still underway. 

Our latest example of this trend, perceived or not, involves a first party property damage claim for damages sustained to an outside retaining wall and trees.  The cause of the damage was a storm which allegedly caused the collapse of a hillside adjacent to the covered parcel.  Not surprisingly, plaintiffs/insureds Wilners submitted a claim under their homeowners’ coverage with Allstate.  When a dispute over the coverage could not be resolved, the Wilners commenced the instant action.

The Wilners first cause of action sought recovery for breach of the insuring agreement.  The second cause of action sought recovery for an alleged breach of contract when Allstate denied the Wilners request for a defense in a related criminal proceeding (Note this claim was later dismissed).  Finally, the Wilners commenced a third cause of action alleging a violation of General Business Law § 349.  As a result of the alleged GBL violation, the Wilners also sought punitive damages and attorneys’ fees. 

Allstate promptly moved to dismiss all three causes of action, along with the request for attorneys’ fees and punitive damages.  In response, the Wilners cross-moved to compel a massive document production from Allstate. 

We deal first with the issues surrounding the Wilners’ motion to compel.  As a result of the motion to compel, the Wilners were awarded in camera production of

“all property damage claims under [Allstate Homeowners’ Policies like the one at issue] for damages resulting from a rain and/or wind storm which occurred on or about October 7, 2005 in Nassau County….and….all claims that resulted in litigation [for property damage] from October 7, 2005 through January 7, 2007 in Nassau County.”

This resulted in the production of 375 claims files.  On appeal, the Second Department stated that because objections were not interposed within 20 days, as required by the CPLR, defendant was precluded from opposing the demands.  Furthermore, the Court noted that the demands were not palpably improper because they were sufficiently tailored to claims related to the storm at issue. 

We further note that defendant’s request for plaintiff to reimburse it for the cost of producing this discovery was also denied.  According to the Second Department, the issue of costs incurred in discovery was not raised until the appeal. 

*** Obviously, this decision underscores the absolute necessity of timely interposing objections to demands.  As we have seen, the scope of discovery demands in an extra-contractual case has become increasingly broad.  With this in mind, at a minimum, timely objections MUST be interposed in these cases.  A better practice might be to aggressively challenge the scope of the demands by seeking a protective order, immediately, upon service ***

With respect to the GBL § 349 claim, in addition to serving as a vehicle for major discovery demands, it also provided the plaintiff with a “backdoor” argument to introduce a claim for punitive damages.  Note, at no point, does the plaintiff allege bad faith.  The punitive damages claim was based solely upon the alleged violation of the GBL.  The Second Department points out that the plaintiffs did not seek punitive damages as a result of the alleged breach of contract.   

In any event, the Second Department stated that the statutory protections under Section 349 should be broadly construed where there is an allegation of deceptive or misleading business practices involving economic activity. The Court noted that GBL § 349 claims have previously been found in disputes over (1) coverage and rate materials distributed by an insurance carrier, (2) defense obligations of insurance carriers, as well as (3) claim handling procedures in insurance cases. 

The standard for pleading a GBL § 349 claim requires that the claimant demonstrate “consumer-oriented misconduct” which is “deceptive and misleading to a reasonable consumer” and which “causes actual damages [the damages need not be pecuniary].”    Here, the Wilners argued that the Allstate policy required them to undertake steps to protect Allstate’s possible subrogation claims.  With the statute of limitations about to expire on a potential subrogation claim, the Wilners commenced an action against the Village of Roslyn.  This was apparently undertaken by the Wilners without ever asking Allstate if it intended to proceed with the subrogation arguments.

The Wilners argue that Allstate’s failure to reach a timely coverage decision forced the Wilners into prosecuting a subrogation claim on behalf of Allstate.  The Wilners argue if the subrogation action was not commenced, Allstate would have disclaimed coverage for the Wilners’ failure to preserve and protect Allstate’s possible subrogation rights.

Further, the Wilners argue that the delay of Allstate was intentionally undertaken with the purpose of forcing the Wilners to incur legal fees, and as such is part of a larger consumer oriented scheme employed by Allstate to have subrogation claims prosecuted at the cost to their insureds. 

Because this same condition requiring the protection of subrogation rights is found in every Allstate homeowners’ policy, the Wilners argue that Allstate’s scheme has a “broad impact on consumers at large.”  As such, the Wilners maintain that this falls neatly within the scope of GBL § 349. 

Importantly, Allstate moved to dismiss the GBL §349 for failure to state a cause of action.  In deciding this motion, the Court is required to accept all allegations of the opposing party as true.  As such, the allegations set forth by the Wilners, which for the purposes of deciding Allstate’s motion the Court must accept as true, meet all of the criteria for successfully pleading a GBL claim.

Understanding that the claim was procedurally correct, Allstate argued that the Wilners’ interpretation of their duties to protect subrogation rights was unreasonable.  In response to this position, the Court noted that the reasonableness of the Wilners’ interpretation of their requirements under the policy was a question of fact that must be determined by the jury.

Having established that the Wilners had met their burden of asserting a viable claim under GBL § 349, the Second Department also commented on damages that may be recoverable.  Initially, the Court noted that Section 349 explicitly provides recovery of actual damages, as well as treble damages up to $1,000. 

In addition, because the Wilners alleged that Allstate intentionally withheld its coverage decision to force the Wilners to commence the subrogation action against the Village of Rosyln, these allegations, if proven correct, could form the basis for punitive damages.  

Finally, the Court noted that the Trial Court has broad discretion in awarding attorneys’ fees incurred in prosecuting a violation of GBL § 349.  As such, the Court refused to dismiss any claim for attorneys’ fees at this time.

*** This case, along with others we have seen in the last few years, amounts to a complete end run to avoid prosecuting a bad faith claim.  As you all know, under the Court of Appeals tests in Rocanova v Equitable Life Assur. Soc. of the United States and New York Univ. v Continental Ins. Co., proving Bad Faith in a First Party Insurance context is very difficult.  It requires, at a minimum, a demonstration that (1) the claim is actionable as an independent tort, (2) that the carrier’s action was egregious, (3) that it was directed at the insured and to the general public as a whole 

As a way around this, Plaintiff’s are now using GBL § 349 as a method to open up discovery and seek extra-contractual/punitive damages.  As this case starkly points out, it is much easier to assert a claim under GBL § 349 than it is to assert a claim under the traditional Bad Faith standard. 

Clearly, GBL § 349 was never intended to govern a dispute over policy terms between carrier and insured.  Then, again, one could argue that it was not meant to apply to a carrier’s duty to defend where there were covered and non-covered grounds ---that is until the Third Department’s decision in Elacqua v. Phys. Reciprocal Insurers was handed down. 

This case, as with the decisions in Elacqua, Bi-Economy v. Harleysville, and Panasia Estates v. Hudson Ins. Co., all underscore how plaintiff’s are using creative arguments to circumvent New York’s long standing rules which limit excess/punitive exposure in First Party Coverage disputes.  It is important to note that, to date, these efforts have not resulted in an award.  However, with each case that avoids immediate dismissal, the chance of the standard governing punitive damages being relaxed continues to increase  ***

And Potpourri

01/14/10         Begor v. Holmes d/b/a Four Seasons Logging
Appellate Division, Third Department
Where Injured Party’s Employer Does Not Have Workers’ Compensation Coverage, The Risk Falls to The Policy Closest to The Injured Party in The Chain of Contracts  
Claimant, Begor, was injured, and ultimately died, as a result of an incident that occurred while in the course of his employment as a logger for Four Seasons Logging.  Four Seasons was retained to remove trees from a parcel by Mid Hudson Hardwoods, Inc.  Mid Hudson acquired the right to timber the property by Brenner & McHugh who was serving as the general contractor of a construction project at the site.   When it was determined that Mr. Begor’s employer, Four Seasons, did not have workers’ compensation coverage, the fight over which workers’ compensation policy was apply was triggered.

Mid-Hudson retained Four Seasons, and under normal circumstances, would have been on the risk.  However, because the policy Zurich issued to Mid-Hudson only provided coverage to “leased workers”, it maintained that Begor was not entitled to coverage.  This is because as an employee of a subcontractor, it was clear that Mr. Begor was not a “leased worker” under the policy.

Eventually, the Workers’ Compensation Law Judge (“WCLJ”) presiding over the case found that the Zurich policy issued to Mid-Hudson did not apply because Mr. Begor was not a “leased employee.”  As such, under the ruling of the WCLJ hearing the case, the policy issued to Brenner would apply pursuant to Section 56 of the Workers’ Compensation Law.  Importantly, Section 56 provides that a policy will “step down” to provide coverage to employees of a subcontractor where such subcontractor did not procure workers’ compensation coverage.  The WCLJ’s opinion was later affirmed by a decision of the Workers’ Compensation Board’s Panel.

In reversing the decision, the full Workers’ Compensation Board reversed and held that under Section 56, Zurich, as Mid-Hudson’s carrier, was required to provide coverage to, not only to the “leased workers of Mid-Hudson”, but also to employees of subcontractors that did not maintain workers’ compensation coverage.  The insuring grant of the Zurich policy did not have any impact on the statutory additions to coverage as created by Workers’ Compensation Law § 56.

In reviewing this matter, the Third Department affirmed the decision of the full Workers’ Compensation Board.  Because Section 56 applied to provide coverage for employees of uninsured subcontractors, the search for insurance coverage stopped at the first available policy in the chain of contracts in this case.  The statutory grant of coverage under Rule 56 essentially trumped the definition of the term “insured” under the Zurich policy, and because Zurich (as insurer to Mid-Hudson) was next in line in the chain of contracts it was on the risk.

FIJAL’S FEDERAL FOCUS

Katherine A. Fijal
[email protected]

1/15/10           In Re: Assicurazoni Generali, S.P.A.
United States Court of Appeals for the Second Circuit
Foreign Policy Trumps State Law
Plaintiffs are beneficiaries of insurance policies purchased by their ancestors in the years leading up to the Holocaust from defendant Assicurazioni Generali, S.P.A. [“Generali”], an Italian insurance company.  Plaintiffs brought state law claims alleging breach of insurance contracts, based on Generali’s refusal to pay under those policies.  Cases were consolidated for pre-trial proceedings.  The district count granted Generali’s motion to dismiss based on the Supreme Court’s decision in American Insurance Association v. Garamendi, 539 U.S. 396 (2003), which held that the Plaintiffs’ state-law claims were preempted by the foreign policy of the United States, which favors resolution of Holocaust-era insurance claims in the International Commission on Holocaust Era Insurance Claims [“ICHEIC”], an international claims resolution organization founded by private insurance companies and supported by the United States and other foreign government entities.   The Second Circuit affirmed.

In affirming the district court’s decision the Second Circuit analyzed the applicability of Garamendi.  In Garamendi, the Supreme Court explained that state law “must give way” to the foreign policy of the United States, as set by the President, where there is “evidence of clear conflict between the policies adopted by the two.”  Based on the amicus brief of the Untied States and statements made during negotiations between the United States and Germany, Austria, and France regarding Holocaust-era insurance claims, the Court concluded that the “consistent Presidential foreign policy has been to encourage European governments and companies to volunteer settlement funds in preference to litigation or coercive sanctions,” and, in the insurance context specifically, “to encourage European insurers to work with the ICHEIC to develop acceptable claims procedures.”

The cases before the Court essentially seek enforcement of the plaintiffs’ claimed contract rights against Generali under State law.  The Court determined that such law suits are directly in conflict with the Government’s policy that claims should be resolved exclusively through the ICHEIC.

Plaintiffs made several arguments in an effort to distinguish Garamendi.  First, they argue that Generali is an Italian Company and that Italy, unlike Germany, Austria, and France, had not entered into an executive agreement with the President of the Untied States regarding Holocaust-era insurance claims.   After reviewing the evidence and taking into account policy considerations the Second Circuit notes that the Supreme Court in Garamendi did not view the existence of an executive agreement especially since Generali was one of the plaintiffs in Garamendi and was not excluded from the judgment on the ground that it is an Italian company and that Italy is not a party.  In addition the Court sought the advice of the Secretary of State on the foreign policy of the United States [both Condoleezza Rice and Hillary Rodham Clinton] and it was made clear that “it has been and continues to be the foreign policy of the Untied States that the ICHEIC should be regarded as the exclusive forum and remedy for claims within its purview”, and that this policy applies to claims against Generali.
Plaintiffs next argue that strong state interests underlie the laws that form the basis for their suit, and therefore, unlike in Garamendi, the balance between state and federal policy tips in their favor. The Second Circuit disagreed stating that in this case, the conflict between the federal policy that the ICHEIC should be the exclusive forum for resolving Holocaust-era insurance claims and Plaintiffs’ attempt to adjudicate their Holocaust-era insurance claims under state law is even more clear than the conflict in Garamendi, which involved only a disclosure requirement, and not a state law suit to enforce the insurance claim.  The court held that state law must yield to the federal policy, regardless of the importance of the interests behind the state law.

Finally, plaintiffs argued that the ICHEIC’s December 31, 2003 deadline for accepting claims has passed, so that dismissal of their claims will deny them the opportunity to pursue those claims in any forum.  The Court determined that this argument was premised on a misunderstanding of the government’s policy.  It was never the foreign policy of the United States that claims should merely be held in abeyance pending conclusion of the ICHEIC process. The policy is that the ICHEIC “should be regarded as the exclusive forum and remedy for claims with its purview.”  Permitting state-law claims to proceed after the ICHEIC has ceased operations directly conflicts with that policy goad.  It would undermine future efforts to secure voluntary compensation agreements if ICHEIC participants became subject to litigation as soon as ICHEIC had concluded.

In conclusion, the court held that under the authority of Garamendi the Plaintiffs’ claims, which fall within the scope of the ICHEIC process, are preempted by the foreign policy of the United States.

EARL'S PEARLS
Earl K. Cantwell
[email protected]

The Perils and Pitfalls of Ex Parte Interviews

In a recent case, the Iowa Supreme Court held that the work product doctrine applied to exempt from disclosure an attorney’s memorandum of an ex parte interview conducted with a plaintiff’s treating physician.  A patient sued a doctor and a medical clinic for medical malpractice.  Unknown to the plaintiff’s attorney, a defense attorney interviewed one of the doctors who made a statement to the effect that the patient should have been referred sooner to an orthopedic surgeon.  When that doctor was subsequently named as an expert witness, he testified at his deposition that he did not believe the patient should have been referred to specialty practice “sooner” or at an earlier date.  However, plaintiff’s attorney apparently learned of the meeting between the doctor and defense counsel, he sought to discover the attorney’s memorandum recording the doctor’s alleged prior comments.

The defense attorney contended that the memo was privileged, but the trial court ruled that it was not privileged.  On an interlocutory appeal, the Iowa Supreme Court held that the memorandum was protected by the work product doctrine.  However, this was a Pyrrhic victory since as a sanction for violating an Iowa statute requiring notice before meeting with an opposing party’s treating physician, the plaintiff was still allowed to discover the portion of the memo describing the doctor’s prior statements. 

Iowa creates the physician-client privilege by statute.  Under the statute, there is a waiver of the privilege which allows defendants to informally “consult” with a treating physician, but the statute requires notice to allow plaintiff’s counsel to be present.  The statute does not expressly provide a remedy for a violation.  The Iowa Supreme Court held that the trial court has discretion to impose “sanctions” for violation of the statute. 

The defense attorney first argued that the attorney-client privilege applied because he was also the doctor’s personal attorney.  Alternatively, he argued that the attorney-client privilege applied because he also represented the clinic where the doctor was an employee.  The court rejected those arguments, concluding that the memorandum arose from the attorney’s investigation into the hospital’s potential liability for the actions or conduct of another doctor.  The court further held the memorandum was not protected by the attorney’s representation of the clinic.  The court held that the privilege did not apply where the corporate employee is interviewed as a “witness” to alleged actions of others.  Parsing the complicated situation, the court held that the attorney-client privilege only applied to protect the doctor’s statements regarding his own actions and the clinic’s potential liability.  The privilege did not, however, apply to the doctor’s observations with respect to another doctor’s treatment of the plaintiff.  Based on an in-camera review of the memorandum, the court determined that the privilege did not apply.

The court next considered whether the attorney work product doctrine applied under an Iowa statute which closely resembles Federal Rule of Civil Procedure 26(b)(3).  The court determined that the attorney’s notes of the doctor’s comments were created in anticipation of litigation, and to the extent the memorandum included the attorney’s impressions and opinions, it was entitled to special protection.

However, in an ultimate victory for plaintiff’s counsel, the court held that as a sanction for the defense attorney’s violation of the Iowa statute, the memorandum was discoverable to the extent it recorded the doctor’s prior statements.  Defense counsel won the appeal, but lost the battle.

The first lesson to be learned from this case, Keefe v. Bernard, 2009 WL 3486738 (Iowa, October 30, 2009), is that counsel must engage in the proper process and procedures to obtain and participate in such ex parte interviews with a plaintiff’s treating physicians.  In New York, for example, this is now covered by a rather elaborate set of rules which have grown up concerning such “speaking authorizations” which have to be obtained, often with a great deal of acrimony, from plaintiff’s counsel.  However, the New York courts have also ruled that attorney notes of such interviews need not be supplied to plaintiff’s counsel, and that plaintiff’s counsel does not have a right to be present during the interview.  A reviewing court may carefully scrutinize the tactics of defense counsel and may impose sanctions such as disclosure, forfeiture of privilege, precluding testimony, etc., if the right procedures are not followed.

A second warning is not to allow outsiders or third parties such as adjusters, investigators and others to be present during the interview.  Confidentiality, the attorney-client privilege, and the special protection accorded to attorney work product might be lost and waived.  It is also important to carefully label and record counsel’s raw notes and transcribed reports as prepared for litigation and as attorney work product.  At times, the title or name given to such materials can be taken out of context or misinterpreted which could lead to questions concerning confidentiality, privilege, and the origin of the notes as actual attorney work product. 

A final lesson is that interviewing the plaintiff’s treating physician is not likely to give rise to attorney-client privilege even with respect to letters, notes or reports that may be made to a client or insurance company.  Therefore, special care should be taken to make sure that the interview, and the notes and reports of such an interview, are protected and clearly marked as attorney work product prepared in anticipation or in defense of litigation

ACROSS BORDERS
Please visit the Hot Cases Section of the Federation of Defense & Corporate Counsel website: www.thefederation.org

1/11/10           American Home Assurance Company v. Pope
Eighth Circuit Court of Appeals
Insurer Has Duty To Defend And Indemnify A Clinical Psychologist On Claims That He Failed to Warn of Sexual Abuse
Dr. Bruce Strnad (Strnad) was a named insured under a professional liability policy issued by American Home (Home). The complaint alleged that Strnad learned of the sexual abuse of the plaintiff in 1988 and did not report it to Child Services. Home refused to defend or indemnity based upon an exclusion for knowingly wrongful acts. At an arbitration an award of 27 million was made against Strnad. The Court found that this exclusion was ambigious and did not bar the duty to defend and indemnify under the facts of this case.
Submitted by: Kay Gaffney Crowe, Barnes Alford

1/04/10           Trinity Universal Ins. Co. v. Employers Mutual Cas. Co.
Fifth Circuit Court of Appeals
Insurance Company Which Did Not Defend Action Is Found To Have Duty To Defend And To Owe A Share Of Fees To Carrier Which Did Defend
Trinity Universal Insurance Company (Trinity) and Employers Mutual Casualty Company (EMC) each issued CGL policies which covered Lacy Masonry while doing masonry work for McKenna Hospital (McKenna). McKenna sued Lacy Masonry. Trinity agreed to defend. EMC denied that it had a duty to defend and refused to participate in the defense. The Court applying Texas law found that EMC had a duty to defend. The Court found not withstanding the Texas law on contribution the duty to defend was an independant obligation and Trinity was entitled to recover a porportionate share of the cost of defense.
Submitted by: Kay Gaffney Crowe, Barnes Alford

REPORTED DECISIONS

Ponok Realty Corp. v. United National Specialty Insurance Company

Anderson Kill & Olick, P.C., New York, N.Y. (Jeffrey E. Glen
of counsel), for appellant.
Greenfield & Ruhl, Uniondale, N.Y. (Brian J. Greenfield
and Scott L. Mathias of counsel), for
respondent.

DECISION & ORDER
In an action, inter alia, for a judgment declaring that the defendant, United National Specialty Insurance Company, is obligated to defend and indemnify Ponok Realty Corp. in an underlying action entitled RO Gallery Image Makers, Inc. v Ponok Realty Corp., pending in the Supreme Court, Queens County, under Index No. 19538/03, the plaintiff appeals from an order of the Supreme Court, Queens County (Kelly, J.), entered July 7, 2008, which granted the defendant's motion, among other things, in effect, for summary judgment declaring that the defendant is not so obligated.
ORDERED that the order is affirmed, with costs, and the matter is remitted to the Supreme Court, Queens County, for the entry of a judgment, inter alia, declaring that the defendant is not obligated to defend and indemnify Ponok Realty Corp. in the underlying action.
The plaintiff's argument that the "prejudice" rule articulated in Insurance Law § 3420(c)(2)(A), governs this case is unavailing. A 2008 amendment to Insurance Law § 3420(c)(2)(A) (see L 2008, ch 388, § 4) provides that where "an insurer alleges that it was prejudiced as a result  of a failure to provide timely notice, the burden shall be on . . . the insurer to prove that it has been prejudiced" if the notice was provided within two years of the time required under the policy (see Insurance Law § 3420[c][2][A][i]). However, it is clear from section 8 of the act amending Insurance Law § 3420 that the amendments were to "apply to policies issued or delivered in this state on or after [January 17, 2009]" (McKinney's Cons Laws of NY, Book 27, Insurance Law § 3420, 2009 Pocket Part, at 15, Historical and Statutory Notes, L 2008, ch 388, § 8; see generally Matter of Auerbach v Board of Educ. of City School Dist. of City of N.Y., 86 NY2d 198, 204). The insurance policy issued by the defendant to the plaintiff was effective from October 3, 2003, until October 3, 2004. Since the policy was issued before the effective date of the relevant amendment to Insurance Law § 3420, the amended version of that section does not apply to the subject insurance policy.
Moreover, the plaintiff's argument that notice of a potential claim was given to the defendant "as soon as practicable" is similarly unconvincing. Where an insurance policy requires that notice of an occurrence be given "as soon as practicable," notice must be given within a reasonable time in view of all of the circumstances (see Great Canal Realty Corp. v Seneca Ins. Co., Inc., 5 NY3d 742, 743; 120 Whitehall Realty Assoc., LLC v Hermitage Ins. Co., 40 AD3d 719, 721; Genova v Regal Mar. Indus., 309 AD2d 733, 734). "The insured's failure to satisfy the notice requirement constitutes a failure to comply with a condition precedent which, as a matter of law, vitiates the contract'" (Great Canal Realty Corp. v Seneca Ins. Co., Inc., 5 NY3d at 743, quoting Argo Corp. v Greater N.Y. Mut. Ins. Co., 4 NY3d 332, 339; see Sputnik Rest. Corp. v United Natl. Ins. Co., 62 AD3d 689). "[C]ircumstances may exist that will excuse or explain the insured's delay in giving notice, such as a reasonable belief in nonliability" (Genova v Regal Mar. Indus., 309 AD2d at 734; see Great Canal Realty Corp. v Seneca Ins. Co., Inc., 5 NY3d at 743-744; C.C.R. Realty of Dutchess v New York Cent. Mut. Fire Ins. Co., 1 AD3d 304, 305).
In general, the existence of a good faith belief that the injured party would not seek to hold the insured liable, and the reasonableness of such belief, are questions of fact for the fact-finder (see Genova v Regal Mar. Indus., 309 AD2d at 734; C.C.R. Realty of Dutchess v New York Cent. Mut. Fire Ins. Co., 1 AD3d at 305). The burden of demonstrating the reasonableness of the excuse lies with the insured (see Genova v Regal Mar. Indus., 309 AD2d at 734). Nevertheless, summary judgment may be awarded to the insurer if, construing all inferences in favor of the insured, the evidence establishes, as a matter of law, that the insured's belief in nonliability was unreasonable or in bad faith (see 120 Whitehall Realty Assoc., LLC v Hermitage Ins. Co., 40 AD3d at 721; Genova v Regal Mar. Indus., 309 AD2d at 734).
Here, the defendant established its prima facie entitlement to judgment as a matter of law by demonstrating that it was not notified of the subject property damage claim until more than one year had elapsed since the plaintiff received notice of such claim from its tenant (see Great Canal Realty Corp. v Seneca Ins. Co., Inc., 5 NY3d at 743; Sputnik Rest. Corp. v United Natl. Ins. Co., 62 AD3d at 689; 120 Whitehall Realty Assoc., LLC v Hermitage Ins. Co., 40 AD3d at 721; Genova v Regal Mar. Indus., 309 AD2d at 734). In opposition, the plaintiff failed to raise a triable issue of fact as to whether its belief that its tenant would not file a claim was reasonable. In construing all inferences in favor of the insured, the evidence established, as a matter of law, that the plaintiff's belief in nonliability was unreasonable (see 120 Whitehall Realty Assoc., LLC v Hermitage Ins. Co., 40 AD3d at 721; Genova v Regal Mar. Indus., 309 AD2d at 734). Accordingly, the Supreme Court properly granted the defendant's motion for summary judgment.
Since this is a declaratory judgment action, the matter must be remitted to the Supreme Court, Queens County, for the entry of a judgment, inter alia, declaring that the defendant is not obligated to defend and indemnify Ponok Realty Corp. in the underlying action (see Lanza v Wagner, 11 NY2d 317, 334, appeal dismissed 371 US 74, cert denied 371 US 901).
In the Matter of Integon National Insurance Co.  v. Montagna

Jaffe & Asher LLP, New York, N.Y. (Marshall T. Potashner and
Barak P. Cardenas of counsel), for respondent-appellant Liberty
Mutual Insurance Company.
Nicoletti Gonson Spinner & Owen LLP, New York, N.Y.
(Edward S. Benson of counsel), for
respondent-appellant Diamond State
Insurance Company.
Theodore A. Stamas, Carle Place, N.Y. (Ira Cooper of counsel),
for petitioner-respondent.
Siben and Siben LLP, Bay Shore, N.Y. (Alan G. Faber of
counsel), for respondent.

DECISION & ORDER
In a proceeding pursuant to CPLR article 75 to permanently stay arbitration of an uninsured motorist claim, Liberty Mutual Insurance Company appeals and Diamond State Insurance Company separately appeals from an order of the Supreme Court, Suffolk County (Pitts, J.), dated September 18, 2008, which granted the petition.
ORDERED that the order is affirmed, with one bill of costs to the petitioner-respondent, payable by the respondents-appellants.
After the petitioner, Integon National Insurance Company (hereinafter Integon) established, prima facie, that the respondents Liberty Mutual Insurance Company (hereinafter Liberty) and Diamond State Insurance Company (hereinafter Diamond) insured the vehicle that was involved in the subject accident, the burden shifted to Liberty and Diamond to establish a lack of coverage or a timely and valid disclaimer of coverage (see Matter of Progressive Northeastern Ins. Co. v Gibson, 62 AD3d 804; Matter of State Farm Mut. Auto. Ins. Co. v Mazyck, 48 AD3d 580, 580-581; Matter of Mercury Ins. Group v Ocana, 46 AD3d 561, 562; Matter of Allstate Ins. Co. v Berger, 47 AD3d 708, 710; Matter of Progressive Northwestern Ins. Co. v Galluzzo, 16 AD3d 692, 693; Matter of Eagle Ins. Co. v Rodriguez, 15 AD3d 399, 400; Eveready Ins. Co. v Blackett, 148 AD2d 413, 414). Although Liberty came forward with rebuttal proof showing that its policy did not cover the vehicle, Integon presented additional proof of insurance which overcame the rebuttal proof (see Matter of State Farm Mut. Auto. Ins. Co. v Yeglinski, 79 AD2d 1029, 1030; Matter of Travelers Indem. Co. v Machado, 28 AD3d 569, 570-571; see also Pierre v Providence Washington Ins. Co., 99 NY2d 222, 228-229; 49 CFR 387.15). Accordingly, the petition to permanently stay arbitration of the uninsured motorist claim was properly granted (see Matter of State Farm Mut. Auto. Ins. Co. v Mazyck, 48 AD3d at 580-581; Matter of Allstate Ins. Co. v Berger, 47 AD3d at 711; Matter of Progressive Northwestern Ins. Co. v Galluzzo, 16 AD3d at 693; Matter of Eagle Ins. Co. v Rodriguez, 15 AD3d at 400).
The appellants' remaining contentions are either not properly before this Court or without merit.
In the Matter of Government Employees Insurance Company v. Mendoza

Gail S. Lauzon (Montfort, Healy, McGuire & Salley, Garden
City, N.Y. [Donald S. Neumann, Jr.], of counsel), for appellant.
Linda T. Ziatz, P.C., Ridgewood, N.Y., for respondent.

DECISION & ORDER
In a proceeding pursuant to CPLR article 75, in effect, to temporarily stay arbitration of an uninsured motorist claim pending the respondent's compliance with requested discovery, the petitioner appeals from an order of the Supreme Court, Queens County (Rios, J.), dated September 16, 2008, which denied the petition.
ORDERED that the order is reversed, on the facts and in the exercise of discretion, with costs, the petition is granted, and the arbitration is stayed pending the respondent's compliance with the requested discovery.
On January 18, 2007, the respondent was involved in an automobile accident with two other cars. On January 30, 2007, he reported this to his insurer, the petitioner, Government Employees Insurance Company (hereinafter GEICO). On or about February 12, 2007, the respondent's attorney mailed GEICO a Notice of Intention to file an uninsured motorist claim. By letter dated February 20, 2007, GEICO informed respondent's attorney that it had reason to believe that the tortfeasor was insured by another insurance carrier.
GEICO and the respondent's attorney engaged in various communications over the next 15 months. From these communications, as late as April 22, 2008, GEICO believed that another insurance carrier had accepted liability for the losses due to the accident, that the respondent's attorney had agreed that this was correct, and that the respondent's attorney was going to withdraw any uninsured motorist claim.
However, on or about May 20, 2008, the respondent's attorney sent GEICO a formal request for uninsured motorist arbitration. After receiving that request, by letters dated May 29, 2008, and June 9, 2008, respectively, GEICO requested that the respondent furnish medical records and authorizations, and submit to physical examinations and an examination under oath, pursuant to the insurance policy (hereinafter the requested discovery). When the respondent did not comply, by petition dated June 10, 2008, GEICO commenced this proceeding to, in effect, temporarily stay the arbitration until the respondent complied with those demands. The Supreme Court denied the petition, and we reverse. 
Where an insurer has ample time to seek discovery of its insured as provided for in an insurance policy, but unjustifiably fails to do so in that time, it is not entitled to a stay of arbitration (see Matter of New York Cent. Mut. Fire Ins. Co. v Gershovich, 1 AD3d 364, 365; Matter of Allstate Ins. Co. v Faulk, 250 AD2d 674; Matter of Liberty Mut. Ins. Co. v DeCaro, 244 AD2d 487; Matter of Allstate Ins. Co. v Urena, 208 AD2d 623; Matter of Allstate Ins. Co. v Nebedum, 208 AD2d 624). In contrast, where an insurer presents a justifiable excuse for its failure to seek such discovery, a temporary stay of arbitration will be granted in order to allow the insurer to obtain the information sought (see Matter of State Farm Mut. Auto. Ins. Co. v Goldstein, 34 AD3d 824; Matter of Liberty Mut. Ins. Co. v Almeida, 266 AD2d 547; Matter of Metropolitan Prop. & Cas. Ins. Co. v Keeney, 241 AD2d 455; Matter of Motor Veh. Acc. Indem. Corp. [Lucash], 16 AD2d 975).
Here, the Supreme Court erred in denying the petition, as the insurer provided a justifiable reason for its failure to timely seek the requested discovery. The parties were involved in good faith communications regarding liability for the accident, and the insurer reasonably relied on the assurances by the respondent's attorney that a different insurance carrier was accepting liability for the losses suffered in the accident, and that he was not planning on making an uninsured motorist claim. Accordingly, the arbitration should have been stayed until the respondent complied with the requested discovery (see Matter of Liberty Mut. Ins. Co. v Almeida, 266 AD2d 547; Matter of Metropolitan Property & Cas. Ins. Co. v Keeney, 241 AD2d 455; Matter of Motor Veh. Acc. Indem. Corp. [Lucash], 16 AD2d 975; see also Matter of State Farm Mut. Auto. Ins. Co. v Goldstein, 34 AD3d 824).
Kjono v. Fenning

Cerussi & Gunn, P.C., Garden City, N.Y. (Brian R. Gunn and
Linda P. O'Gorman of counsel), for appellant.
Picciano & Scahill, P.C., Westbury, N.Y. (Francis J. Scahill
and Andrea E Ferrucci of counsel), for
respondents.

DECISION & ORDER
In an action to recover damages for personal injuries, the plaintiff appeals, as limited by his brief, from so much of an order of the Supreme Court, Nassau County (Spinola, J.), dated November 12, 2008, as granted the motion of the defendants Morton Held and Barbara Held for summary judgment dismissing the complaint insofar as asserted against them 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 insofar as appealed from, on the law, with costs, and the motion of the defendants Morton Held and Barbara Held for summary judgment dismissing the complaint insofar as asserted against them is denied.
The defendants Morton Held and Barbara Held (hereinafter the Helds) 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). In support of their motion, the Helds relied on, inter alia, the affirmed medical report of their examining orthopedic surgeon. In that report, which was based on an examination of the plaintiff conducted on January 7, 2008, the orthopedic surgeon noted significant limitations in the plaintiff's lumbar spine range of motion, and a significant limitation in his cervical spine range of motion (see Held v Heideman, 63 AD3d 1105, 1106; Torres v Garcia, 59 AD3d 705; Bagot v Singh, 59 AD3d 368; Hurtte v Budget Roadside Care, 54 AD3d 362; Jenkins v Miled Hacking Corp., 43 AD3d 393; Bentivegna v Stein, 42 AD3d 555, 556; Zamaniyan v Vrabeck, 41 AD3d 472, 473).
Accordingly, the Supreme Court should have denied the Helds' motion for summary judgment dismissing the complaint insofar as asserted against them regardless of the sufficiency of the plaintiff's opposing papers (see Held v Heideman, 63 AD3d at 1106; Coscia v 938 Trading Corp., 283 AD2d 538).
McIntosh v. O'Brien

Napoli Bern Ripka, LLP, New York, N.Y. (Denise A. Rubin of
counsel), for appellant.
Martyn, Toher & Martyn, Mineola, N.Y. (John J. Bello, Jr., of
counsel), for respondents Dennis
O'Brien, Garden State Engine & Equipment,
Broadway Neon Sign Corporation, and
Broadway National Sign Corporation.
Michael A. Cardozo, Corporation Counsel, New York, N.Y.
(Stephen J. McGrath and Victoria
Scalzo of counsel), for respondents
Anthony Genduso, New York City
Department of Education, and City of
New York.
Stewart H. Friedman, Lake Success, N.Y. (David A. Harrison of
counsel), for respondents David
Delgado and Summit Restaurant Reps &
Sales.

DECISION & ORDER
In an action to recover damages for personal injuries, the plaintiff appeals (1), as limited by his brief, from so much of an order of the Supreme Court, Queens County (Kerrigan, J.), dated November 28, 2007, as granted the motion of the defendants Dennis O'Brien, Garden State Engine & Equipment, Broadway Neon Sign Corporation, and Broadway National Sign Corporation for summary judgment dismissing the complaint insofar as asserted against them on the ground that he did not sustain a serious injury within the meaning of Insurance Law § 5102(d), and granted that branch of the separate motion of the defendants David Delgado and Summit Restaurant Reps & Sales which was for summary judgment dismissing the cause of action with respect to the 90/180-day category of serious injury set forth under Insurance Law § 5102(d) insofar as asserted against them, and (2) from an order of the same court dated May 21, 2008, which granted the motion of the defendants Anthony Genduso, New York City Department of Education, and City of New York, and the cross motion of the defendants David Delgado and Summit Restaurant Reps & Sales, to dismiss the complaint and all cross claims insofar as asserted against them for failure to state a cause of action pursuant to CPLR 3211(a)(7).
ORDERED that the order dated November 28, 2007, is affirmed insofar as appealed from, and, upon searching the record, summary judgment is awarded to the defendants Anthony Genduso, New York City Department of Education, City of New York, Dennis Delgado, and Summit Restaurant Reps & Sales, dismissing the complaint and all cross claims insofar as asserted against them; and it is further,
ORDERED that the appeal from the order dated May 21, 2008, is dismissed as academic in light of our determination of the appeals from the order dated November 28, 2007; and it is further,
ORDERED that one bill of costs is awarded to the defendants appearing separately and filing separate briefs.
The plaintiff's car was struck from behind by a motor vehicle operated by the defendant Anthony Genduso on the eastbound roadway of the Long Island Expressway, in Queens. After joinder of issue, the defendants Dennis O'Brien, Garden State Engine & Equipment, Broadway Neon Sign Corporation, and Broadway National Sign Corporation (hereinafter collectively the O'Brien defendants) moved 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). The defendants David Delgado and Summit Restaurant Reps & Sales (hereinafter together the Delgado defendants) moved for summary judgment dismissing the complaint insofar as asserted against them on the same ground, and the defendants Anthony Genduso, New York City Department of Education, and City of New York (hereinafter collectively the municipal defendants) thereafter cross-moved, inter alia, for summary judgment dismissing the complaint and all cross claims insofar as asserted against them on the same ground. In the first order appealed from, the Supreme Court granted the O'Brien defendants' motion in its entirety, granted that branch of the Delgado defendants' motion which was for summary judgment dismissing the cause of action with respect to the 90/180-day category set forth under Insurance Law § 5102(d) insofar as asserted against them, and denied the municipal defendants' cross motion. In the second order appealed from, the Supreme Court granted a subsequent motion of the municipal defendants, and cross motion of the Delgado defendants, to dismiss the complaint and all cross claims insofar as asserted against them for failure to state a cause of action.
Contrary to the plaintiff's contentions, the motions of the O'Brien defendants and the Delgado defendants for summary judgment were timely made. The plaintiff agreed, pursuant to a stipulation entered into June 7, 2007, that motions for summary judgment could be made no later than August 17, 2007. Both motions were made prior to that date.
The evidence submitted established prima facie that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955). At his deposition, the plaintiff acknowledged that he missed less than 90 days of work as a result of the subject motor vehicle accident (see Morris v Edmond, 48 AD3d 432). Moreover, the affirmed medical reports of the neurologist and orthopedist retained by the O'Brien defendants concluded, based upon objective range-of-motion tests, that the plaintiff had full range of motion in his cervical and lumbar spines, left shoulder, and left knee. In opposition to the motions and cross motion for summary judgment, the plaintiff failed to present any range of motion findings which were contemporaneous with the subject accident (id. at 433). The plaintiff also failed to proffer competent medical evidence that he sustained a medically-determined injury of a nonpermanent nature which prevented him, for 90 of the 180 days following the subject accident, from performing his usual and customary activities (id.). Therefore, the evidence submitted by the plaintiff failed to raise a triable issue of fact (see CPLR 3212[b]).
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 the motion before the Supreme Court (see Dunham v Hilco Constr. Co., 89 NY2d 425, 429-430; DiLernia v Khan, 62 AD3d 644). Upon searching the record, we award summary judgment to the Delgado defendants and the municipal defendants dismissing the complaint and all cross claims 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) (see CPLR 3212[b]).
In light of our determination on the appeal from the order dated November 28, 2007, the appeal from the order dated May 21, 2008, has been rendered academic.
Mora v. Riddick

Cannon & Acosta, LLP, Huntington Station, N.Y. (June Redeker
of counsel), for appellant.
James Hiebler, Hempstead, N.Y. (Shayne, Dachs, Corker, Sauer
& Dachs, LLP [Jonathan A. Dachs],
of counsel), for respondent Barbara J.
Riddick.

DECISION & ORDER
In an action to recover damages for personal injuries, the plaintiff appeals from an order of the Supreme Court, Nassau County (Adams, J.), dated September 15, 2008, which granted the motion of the defendant Barbara J. Riddick, and that branch of the cross motion of the defendants County of Nassau and Daniel R. Clarke which were for summary judgment dismissing the complaint insofar as asserted against each of them on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d).
ORDERED that the order is affirmed, with costs payable to the defendant Barbara J. Riddick.
The Supreme Court properly determined that the defendants met their respective prima facie burdens of showing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) as a result of the subject accident (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955, 956-957). In opposition, the plaintiff failed to raise a triable issue of fact. Initially, the medical reports submitted by Dr. Lauren Stimler-Levy, the plaintiff's treating physician, were unaffirmed and, thus, insufficient to raise a triable issue of fact (see Grasso v Angerami, 79 NY2d 813; Shaji v City of New Rochelle, 66 AD3d 760; Maffei v Santiago, 63 AD3d 1011; Niles v Lam Pakie Ho, 61 AD3d 657; Uribe-Zapata v Capallan, 54 AD3d 936; Patterson v NY Alarm Response Corp., 45 AD3d 656; Verette v Zia, 44 AD3d 747; Nociforo v Penna, 42 AD3d 514; Pagano v Kingsbury, 182 AD2d 268). Additionally, while the plaintiff submitted medical evidence that he suffered from, inter alia, herniated and bulging discs, as well as tendon tears, those findings are not evidence of a serious injury in the absence of objective evidence of the extent of the alleged physical limitations resulting from the injuries and their duration (see Ciancio v Nolan, 65 AD3d 1273; Magid v Lincoln Servs. Corp., 60 AD3d 1008, 1009; Washington v Mendoza, 57 AD3d 972; Cornelius v Cintas Corp., 50 AD3d 1085, 1087; Shvartsman v Vildman, 47 AD3d 700).
The plaintiff also failed to set forth any competent medical evidence to raise a triable issue of fact as to whether he sustained a medically-determined injury of a nonpermanent nature which prevented him from performing his usual and customary daily activities for 90 of the 180 days following the subject accident (see Sainte-Aime v Ho, 274 AD2d 569).
Smith v. Rodriguez

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

DECISION & ORDER
In an action to recover damages for personal injuries, the defendants Celeste Rodriguez and Ferando Tapia appeal, as limited by their brief, from so much of an order of the Supreme Court, Kings County (Schneier, J.), dated June 19, 2009, 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, without costs or disbursements.
Although we affirm the order insofar as appealed from, we do so for reasons different from those relied upon by the Supreme Court. The appellants 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). In support of their motion, the appellants relied on, inter alia, the affirmed medical report of Dr. Gregory Montalbano. Dr. Montalbano, the appellants' examining orthopedic surgeon, examined the plaintiff for evaluation on October 24, 2008, and found significant limitations in the plaintiff's lumbar spine range of motion (see Washington v Asdotel Enters., Inc., 66 AD3d 880; Buono v Sarnes, 66 AD3d 809; Landman v Sarcona, 63 AD3d 690; Bagot v Singh, 59 AD3d 368; Hurtte v Budget Roadside Care, 54 AD3d 362). While Dr. Montalbano asserted that a report referable to a magnetic resonance imaging scan of the plaintiff's lumbar spine demonstrated that the range of motion in that portion of the spine was normal, he did not address the limitations he found during his examination of the plaintiff. Thus, Dr. Montalbano's findings and conclusions failed to establish that the limitations he noted with respect to the plaintiff's lumbar spine were not caused by the subject accident (see McKenzie v Redl, 47 AD3d 775).
Since the appellants 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 Washington v Asdotel Enters., Inc., 66 AD3d 880; Coscia v 938 Trading Corp., 283 AD2d 538).
Mondert v. Iglesia De Dios Pentecostal Cristo Viene, Inc.

Nicolini, Paradise, Ferretti & Sabella, PLLC, Mineola, N.Y.
(Barbara L. Hall of counsel), for appellant.
Paul G. Vesnaver (Victor A. Carr, Mineola, N.Y., of counsel),
for respondent.

DECISION & ORDER
In an action to recover damages for personal injuries, the defendant Iglesia De Dios Penetecostal Cristo Viene, Inc., appeals from an order of the Supreme Court, Kings County (Schneier, J.), dated January 24, 2008, which denied its motion for summary judgment dismissing the complaint insofar as asserted against it 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 appellant failed to meet its 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 support of its motion, the appellant relied on, inter alia, the affirmed medical report of its examining neurologist. In that report, he noted that the plaintiff had a significant limitation in her lumbar spine range of motion, and concluded that the decreased range of motion was "voluntary." However, he failed to explain or substantiate, with objective medical evidence, the basis for his conclusion that the limitation was voluntary (see Hi Ock Park-Lee v Voleriaperia, 67 AD3d 734, 734; Cuevas v Compote Cab Corp., 61 AD3d 812; Colon v Chuen Sum Chu, 61 AD3d 805; Torres v Garcia, 59 AD3d 705; Busljeta v Plandome Leasing, Inc., 57 AD3d 469).
Since the defendants failed to establish their prima facie entitlement to judgment as a matter of law, it is unnecessary to determine whether the plaintiff's opposition papers were sufficient to raise a triable issue of fact (see Hi Ock Park-Lee v Voleriaperia, 67 AD3d 734; Cuevas v Compote Cab Corp., 61 AD3d 812).

Cekic v. Zapata

Ginsberg & Broome, P.C., New York (Robert M. Ginsberg of
counsel), for appellants.
Votto & Cassata, LLP, Staten Island (Christopher J. Albee of
counsel), for respondent.
Order, Supreme Court, New York County (Paul Wooten, J.), entered April 23, 2009, which, insofar as appealed from, as limited by the briefs, granted defendant's motion for summary judgment dismissing the complaint, unanimously affirmed, without costs.
Defendant met his initial burden by submitting the affirmed report of experts who examined plaintiffs and concluded, based upon objective tests conducted, that neither had suffered a permanent consequential limitation or a significant limitation of his/her lumbar or cervical spine as a result of the subject September 25, 2005 motor vehicle accident.
Although plaintiff Asim Cekic came forward with objective medical evidence of a limitation, such evidence is unavailing due to a failure to distinguish between injuries from the subject accident and those from two prior accidents (see Pommells v Perez, 4 NY3d 566, 572 [2005]). Moreover, Asim Cekic's doctor's conclusory statement in January 2009 that his neck and back injuries were related to the subject accident is contradicted by the findings in the doctor's March 12, 2004 report which found a permanent partial disability resulting from a prior accident on August 12, 2003 (see Depena v Sylla, 63 AD3d 504 [2009]; lv denied 13 NY3d 706 [2009]; Thompson v Abbasi, 15 AD3d 95, 99 [2005]).
Plaintiff Almera Cekic's doctor presented evidence of a limited range of motion, but no evidence of any treatment after one year. Plaintiff Almera Cekic testified that she had stopped seeing the doctor — giving a myriad of reasons — approximately one year prior to being deposed in this action, i.e., two years prior to her August 2008 re-examination. Such a cessation in treatment, without a consistent explanation, severs the causal connection between her injuries and the accident three years earlier (Pommells at 580; Gonzalez v A.V. Managing, Inc., 37 AD3d 175 [2007]).
Frias v. James

Kaplan & McCarthy, Yonkers (Jeffrey A. Domoto of counsel),
for appellants.
Daniel J. Hansen, New York, for respondent.
Order, Supreme Court, Bronx County (Dominic R. Massaro, J.), entered July 7, 2009, which, in an action for personal injuries arising out of a motor vehicle accident, denied defendants' motion for summary judgment dismissing the complaint, unanimously modified, on the law, to dismiss plaintiff's 90/180-day claim of serious injury, and otherwise affirmed, without costs.
Defendants failed to establish their prima facie entitlement to judgment as a matter of law with respect to plaintiff's claims under the "permanent consequential limitation of use of a body organ or member" and "significant limitation of use of a body function or system" categories of serious injury under Insurance Law § 5102(d). In support of their motion, defendants submitted evidence that plaintiff was suffering from restrictions of motion in his lumbar spine, and the opinion of defendants' examining neurologist that such restrictions were attributed to degenerative causes. That opinion, however, was conclusory as it was advanced without any elaboration and without any reference to degeneration in the MRI reports reviewed (see Pommells v Perez, 4 NY3d 566, 577-578 [2005]; June v Akhtar, 62 AD3d 427, 428 [2009]). In view of the foregoing, it is not necessary to consider whether plaintiff's opposition with respect to those claims was sufficient to raise a triable issue of fact (see Glynn v Hopkins, 55 AD3d 498 [2008]).
However, plaintiff's claim of serious injury under the 90/180-day category should have been dismissed. Plaintiff's bill of particulars that was submitted with defendant's motion failed to demonstrate that substantially all his usual activities were curtailed during the requisite time period (see Licari v Elliott, 57 NY2d 230, 238-239 [1982]; Uddin v Cooper, 32 AD3d 270, 271-272 [2006], lv denied 8 NY3d 808 [2007]), and plaintiff has failed to address this issue on appeal.
Yunatanov v. Stein

Gershbaum & Weisz, P.C., New York, N.Y. (Charles Gershbaum of
counsel), for appellant.
Martyn, Toher & Martyn, Mineola, N.Y. (Wayne Paul Esposito
of counsel), for respondent.

DECISION & ORDER
In an action, inter alia, to recover damages for personal injuries, the plaintiff appeals, as limited by her brief, (1) from so much of an order of the Supreme Court, Queens County (Kitzes, J.), dated September 19, 2008, as granted that branch of the defendant's motion which was for summary judgment dismissing the first cause of action on the ground that she did not sustain a serious injury within the meaning of Insurance Law § 5102(d), and (2) from so much of an order of the same court entered December 29, 2008, as denied those branches of her motion which were for leave to reargue and renew.
ORDERED that the appeal from so much of the order entered December 29, 2008, as denied that branch of the plaintiff's motion which was for leave to reargue is dismissed, as no appeal lies from an order denying leave to reargue; and it is further,
ORDERED that the order dated September 19, 2008, is affirmed insofar as appealed from; and it is further,
ORDERED that the order entered December 29, 2008, is affirmed insofar as reviewed; and it is further,
ORDERED that one bill of costs is awarded to the defendant.
The Supreme Court properly determined that the defendant, in support of that branch of his motion which was for summary judgment dismissing the first cause of action, met his prima facie burden of showing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) as a result of the subject accident (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955, 956-957). In opposition, the plaintiff failed to raise a triable issue of fact.
Initially, the medical reports of Dr. Neil J. Koppel and Dr. Steven M. Erlanger, as well as those from Physiologic Physical Therapy, P.C., and Orthopaedic Associates of Great Neck, LLP, were insufficient to raise a triable issue of fact since they were unsworn (see Grasso v Angerami, 79 NY2d 813; Choi Ping Wong v Innocent, 54 AD3d 384; Uribe-Zapata v Capallan, 54 AD3d 936; Patterson v NY Alarm Response Corp., 45 AD3d 656; Verette v Zia, 44 AD3d 747; Nociforo v Penna, 42 AD3d 514; Pagano v Kingsbury, 182 AD2d 268).
The Supreme Court erroneously concluded that the report of Dr. Martin B. Gillman, the plaintiff's examining chiropractor, was unaffirmed, as it was submitted in affidavit form. Nevertheless, this report failed to raise a triable issue of fact. While Dr. Gillman examined the plaintiff on June 11, 2008, and found significant limitations of motion in the cervical and lumbar regions of the plaintiff's spine, neither he nor the plaintiff proffered competent medical evidence that revealed the existence of significant limitations in the plaintiff's cervical and lumbar spine ranges-of-motion that were contemporaneous with the subject accident (see Taylor v Flaherty, 65 AD3d 1328; Fung v Uddin, 60 AD3d 992; Gould v Ombrellino, 57 AD3d 608; Kuchero v Tabachnikov, 54 AD3d 729; Ferraro v Ridge Car Serv., 49 AD3d 498).
While the medical reports of Dr. Farshad D. Hannanian, the plaintiff's treating neurologist, also were in proper form and noted that the plaintiff had positive straight leg raising results, these results were neither contemporaneous with the subject accident nor conclusive of any significant limitations in the plaintiff's lumbar spine that were caused by the subject accident. Dr. Hannanian failed to acknowledge that the plaintiff was involved in a car accident two years prior to the subject accident, in which she injured her back. Given this failure, his conclusions that the plaintiff's symptoms and disability were related to the subject accident, especially those conclusions concerning her back, were rendered speculative (see Su Gil Yun v Barber, 63 AD3d 1140; Silla v Mohammad, 52 AD3d 681; Cornelius v Cintas Corp., 50 AD3d 1085, 1086; Wright v Rodriguez, 49 AD3d 532; Moore v Sarwar, 29 AD3d 752).
The plaintiff failed to submit competent medical evidence that the injuries she allegedly sustained as a result of the subject accident rendered her unable to perform substantially all of her daily activities for not less than 90 days of the first 180 days thereafter (see Ponciano v Schaefer, 59 AD3d 605; Sainte-Aime v Ho, 274 AD2d 569). The plaintiff alleged, in her bill of particulars, that she missed, at most, one month of work as a result of the subject accident.
The Supreme Court providently exercised its discretion in denying that branch of the plaintiffs' motion which was for leave to renew. A motion for leave to renew "shall be based upon new facts not offered on the prior motion that would change the prior determination" (CPLR 2221[e][2]) and "shall contain reasonable justification for the failure to present such facts on the prior motion" (CPLR 2221[e][3]; see Barnett v Smith, 64 AD3d 669; Chernysheva v Pinchuck, 57 AD3d 936; Dinten-Quiros v Brown, 49 AD3d 588; Madison v Tahir, 45 AD3d 744). Here, the affidavit of Dr. Gillman, which reiterated the findings of his report which had been submitted by the plaintiffs in opposition to the original motion, did not constitute "new facts."
Bauerschmidt & Sons, Inc., v. Nova Casualty Company

Melito & Adolfsen, P.C., New York, N.Y. (Ignatius John Melito
and Rippi Gill of counsel), for appellant.
Meyer, Suozzi, English & Klein, P.C., Garden City, N.Y.
(Robert N. Zausmer of counsel), for
respondent.


DECISION & ORDER
In an action, inter alia, for a judgment declaring that the defendant is obligated to defend and indemnify the plaintiff in an underlying action entitled Fiore v Bauerschmidt & Sons, Inc., commenced in Supreme Court, Kings County, under Index No. 4645/08, the defendant appeals from an order of the Supreme Court, Queens County (James Golia, J.), dated June 30, 2009, which denied its motion for summary judgment.
ORDERED that the order is affirmed, with costs.
Where, as here, a policy of liability insurance requires that notice of an occurrence be given "as soon as practicable," such notice must be accorded to the carrier within a reasonable period of time (see Great Canal Realty Corp. v Seneca Ins. Co., Inc., 5 NY3d 742, 743; Security Mut. Ins. Co. of N.Y. v Acker-Fitzsimons Corp., 31 NY2d 436, 441). However, there may be circumstances where the insured's failure to give timely notice is excusable, such as where the insured has a good-faith belief in nonliability (see Security Mut. Ins. Co. of N.Y. v Acker-Fitzsimons Corp., 31 NY2d at 441). The insured bears the burden of establishing the reasonableness of the proffered excuse (see Great Canal Realty Corp. v Seneca Ins. Co., Inc., 5 NY3d at 744). "Ordinarily, the question of whether the insured had a good faith belief in nonliability, and whether that belief was reasonable, presents an issue of fact and not one of law" (St. James Mech., Inc. v Royal & Sunalliance, 44 AD3d 1030, 1031; see Hermitage Ins. Co., v Arm-ing, Inc., 46 AD3d 620, 621; Hudson City School Dist. v Utica Mut. Ins. Co., 241 AD2d 641, 642; Kim v Maher, 226 AD2d 350; G.L.G. Contr. Corp. v Aetna Cas. & Sur. Co., 215 AD2d 821, 822-823).
Here, the defendant made a prima facie showing of entitlement to judgment as a matter of law based on the plaintiff's approximately four-month delay in notifying the defendant of the underlying incident (see Avery & Avery, P.C., v American Ins. Co., 51 AD3d 695, 697-698). In opposition, the plaintiff raised a triable issue of fact as to whether the delay was reasonably based on a good-faith belief of nonliability (see St. James Mech., Inc. v Royal & Sunalliance, 44 AD3d at 1031). Accordingly, the Supreme Court properly denied the defendant's motion for summary judgment.
Nautilus Insurance Co. v. Matthew David Events, Ltd.

Wade Clark Mulcahy, New York (Robert J. Cosgrove and
Menachem Mendel Simon of counsel), for appellant.
Ferro, Kuba, Mangano, Sklyar, P.C., Hauppauge (George J.
Parisi of counsel), for respondent.
Order, Supreme Court, New York County (Michael D. Stallman, J.), entered January 12, 2009, which, to the extent appealed from as limited by the briefs, denied plaintiff's motion for summary judgment, and upon a search of the record, granted defendants summary dismissal of the third cause of action of the complaint, reversed, on the law, without costs, the motion for summary judgment granted, and it is declared that Nautilus Insurance Company has no obligation to defend or indemnify Matthew David Events, Ltd. and Timothy Shea in the underlying action. The Clerk is directed to enter judgment accordingly.
In the underlying action, Timothy Shea, defendant herein, seeks monetary damages for alleged personal injuries sustained while working at a corporate party held on Randall's Island and sponsored by Bloomberg, LLC and Bloomberg, Inc. (Bloomberg). Bloomberg had entered into an agreement with defendant Matthew Davis Events (MDE) for MDE to plan, design and manage the event for Bloomberg.
MDE also entered into an agreement with United Stage Service, Inc. (Stage) to perform work, labor and services for the Bloomberg event at Randall's Island. Shea, then an employee of Stage, worked as a stagehand at the event. He alleges that he was injured as a result of an on-the-job accident when he fell off a utility vehicle in which he had been riding.
On the date of the accident, June 27, 2004, MDE was insured by plaintiff Nautilus Insurance Company under a commercial liability policy. Almost three years after the accident, on June 25, 2007, Shea commenced a personal injury action against Bloomberg and MDE, among others. The next day, on June 26, 2007, MDE sent notice about the accident to Nautilus. Immediately, Nautilus disclaimed coverage on the grounds that MDE failed to provide timely notice of the claim and that Shea's injury was excluded under the terms of the policy.
Upon denying coverage, Nautilus commenced this action against MDE, among others, seeking a declaration that no coverage was owed to MDE for the claims asserted in the Shea action. The first and second causes of action of the complaint allege that pursuant to the terms of the policy, Nautilus was not required to defend or indemnify MDE because of its failure to provide timely notice of the occurrence or suit. The third cause of action alleges that the policy did not apply to liability as a result of bodily injury to an employee of the insured arising out of and in the course of employment or performing duties related to the conduct of MDE's business. Specifically, the complaint alleges that at the time of the accident, Shea was working for Stage, a company performing duties relating to MDE's work. Because Shea was performing duties related to MDE's work at the time of the accident, and was thus an "employee" of MDE, as the word was defined by the policy, the policy did not provide defense or indemnity coverage to MDE in the underlying action and Nautilus was entitled to a declaration that no coverage was owed to MDE for any claims asserted by Shea.
On May 16, 2008, Nautilus moved for summary judgment and for a declaration that it was under no obligation to defend or indemnify MDE and/or Shea in the underlying action, and to dismiss all counterclaims against it. In opposition,
MDE averred, inter alia, that the language of the employee exclusion was ambiguous since it was not clear whether or not employees of a contractor were included. MDE also argued that the motion was premature since discovery had not yet commenced and it was necessary to determine the relationship between MDE and Stage. Nautilus replied that the language of the employee exclusion was clear, and since Shea was an "employee" of MDE at the time of the accident, recovery under the policy was precluded.
The motion court denied Nautilus's motion for summary judgment holding that the employee exclusion was inapplicable. The court then, upon a search of the record, dismissed the third cause of action of the complaint. The court stated that exclusions from coverage in an insurance policy must be specific and clear in order to be enforced, and ambiguities were construed against the insurer. In this case, the court found that it was not clear whether Shea, as Stage's employee, would be a person "contracted for" by MDE and excluded from coverage. Inasmuch as the policy did not define the phrase "contracted for," the court concluded that it was susceptible to more than one meaning. The court noted that, for instance, the phrase could be narrowly defined to include only a temporary worker whom MDE contracted from a temporary employment agency. We reverse.
" [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 [1986], quoting State of New York v Home Indem. Co., 66 NY2d 669, 671 [1985]), whose unambiguous provisions must be given "their plain and ordinary meaning" (United States Fid. & Guar. Co. v Annunziata, 67 NY2d 229, 232 [1986] [internal quotations marks and citations omitted]; see Maroney v New York Cent. Mut. Fire Ins. Co., 5 NY3d 467, 471-473 [2007]; Catucci v Greenwich Ins. Co., 37 AD3d 513, 514 [2007]). "An exclusion from coverage must be specific and clear in order to be enforced' (Seaboard Sur. Co. v Gillette Co., 64 NY2d 304, 311 [1984]), 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 [2007]; see Ace Wire & Cable Co. v Aetna Cas. & Sur. Co., 60 NY2d 390, 398 [1983]; Ruge v Utica First Ins. Co., 32 AD3d 424, 426 [2006], lv denied 7 NY3d 716 [2006]). 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 [2003], lv dismissed 3 NY3d 696 [2004]; Garson Mgt. Co. v Travelers Indem. Co. of Ill., 300 AD2d 538, 539 [2002], lv denied 100 NY2d 503 [2003]).
In this case, Nautilus met its burden of demonstrating that the exclusion provision relied upon by the court to dismiss the third cause of action clearly applies to the underlying action. The policy contained an "Employee Exclusion," which excluded from coverage bodily injury to an "employee" of the insured "arising out of and in the course of: (a)[e]mployment by the insured; or (b)[p]erforming duties related to the conduct of the insured's business." The employee exclusion is very broad. The exclusion defined "employee" as including but not limited to, any person or persons "hired by, loaned to, leased to, contracted for, or volunteering services to the insured, whether or not paid by the insured." Moreover, the exclusion was applicable whether the insured was liable as an employer or in any other capacity and applied to any obligation to share damages with or repay someone else who must pay damages because of the injury.
We agree with Nautilus that giving the words "contract for" their plain and ordinary meaning, MDE's retention of a subcontractor to perform work for the Bloomberg event at Randalls' Island constituted services for the insured and thus falls within the scope of the employee injury exclusion. Indeed, the "contract for" language of the Employee Exclusion clearly contemplates that a contractor could be retained by a party other than the insured on the insured's behalf, and that an injury to that contractor or its employee would fall within the scope of the exclusion (see U.S. Underwriters Ins. Co. v Beckford, 1998 WL 23754, 1998 US Dist LEXIS 574 [ED NY 1998]). The argument that this language may be interpreted to apply only to persons who contract directly to work for MDE renders the explanatory language that the term "employees" includes those providing "services to the insured, whether or not paid by the insured" a nullity. It is a well settled principle of contract law that a court should not adopt a construction of a contract "which will operate to leave a provision of a contract . . . without force and effect. An interpretation that gives effect to all the terms of an agreement is preferable to one that ignores terms or accords them an unreasonable interpretation" (Ruttenberg v Davidge Data Sys. Corp., 215 AD2d 191, 196 [1995] [internal quotation marks and citations omitted]; see also Consolidated Edison Co. of NY, Inc. v United Coastal Ins. Co., 216 AD2d 137 [1995], lv denied 87 NY2d 808 [1996]).
All concur except Mazzarelli, J.P. and Richter, J. who dissent in part in a memorandum by Mazzarelli, J.P. as follows:

MAZZARELLI, J.P. (dissenting in part)
Plaintiff issued a commercial general liability insurance policy to defendant Matthew David Events (the insured), a planner for events held on Randall's Island. Defendant Shea, an employee of a subcontractor hired by the insured, was allegedly injured while working as a stagehand at an event hosted by Bloomberg, LLC and Bloomberg, Inc. Shea then commenced a personal injury action against the insured and others. The insured demanded that plaintiff provide it with a defense and, if necessary, indemnification.
Plaintiff commenced this action seeking a declaration that the incident was not covered by the policy. Plaintiff's position was premised on an endorsement to the policy entitled "Employee Exclusion." The endorsement expressly excluded from coverage claims for bodily injury to "[a]n employee' of the insured arising out of and in the course of: (a) Employment by the insured; or (b) Performing duties related to the conduct of the insured's business." The term "employee" was expressly defined to "include . . . any person or persons hired by, loaned to, leased to, contracted for, or volunteering services to the insured, whether or not paid by the insured." The phrase "contracted for" was not further defined.
It is well settled that " [t]o negate coverage by virtue of an exclusion, an insurer must establish that the exclusion is stated in clear and unmistakable language, is subject to no other reasonable interpretation, and applies in the particular case" (Westview Assoc. v Guaranty Natl. Ins. Co., 95 NY2d 334, 340 [2000], quoting Continental Cas. Co. v Rapid-American Corp. (80 NY2d 640, 652 [1993]). Moreover, "[i]f the language of the policy is doubtful or uncertain in its meaning, any ambiguity must be resolved in favor of the insured and against the insurer" (Westview Assoc., 95 NY2d at 340).
The exclusion invoked by plaintiff is ambiguous because it is eminently reasonable to interpret the definition in the endorsement of the term "employee" as extending only to those who are engaged directly by the insured. Such an interpretation is based on the policy definition which describes "employee[s]" as persons having been "hired by," "loaned to,", "leased to," and "volunteering services to" the insured. The emphasized prepositions strongly suggest the necessity for privity between the insured and the person being employed by it if a claim is to be excluded.
Plaintiff does not argue that Shea was "hired by," "loaned to," "leased to," or "volunteering services to" the insured. Rather, it argues that Shea fits the one other class of "employee" delineated in the definition, one "contracted for" the insured. Plaintiff contends that this element of the definition expands the universe of "employee[s]" covered by the endorsement to any person who does work that benefits the insured. However, in deciding whether an agreement is ambiguous, " [p]articular words should be considered, not as if isolated from the context, but in the light of the obligation as a whole and the intention of the parties as manifested thereby'" (Kass v Kass, 91 NY2d 554, 566 [1998], quoting Atwater & Co. v Panama R.R. Co., 246 NY 519, 524 [1927]). Again, the overall context of the definition of "employee" suggests that the parties intended that only those engaged directly by the insured would be covered by the exclusion. Indeed, this is consistent with the notion that at least one of the purposes of hiring a subcontractor is to insulate oneself from liability. The interpretation urged by plaintiff would defeat this purpose by depriving the insured of coverage for injuries to employees of subcontractors.
In addition, the phrase "a person . . . contracted for . . . the insured" is ambiguous on its face. Indeed, a reasonable person, if he or she could make any sense of the phrase at all, would be confused as to who had contracted with whom. Even if some sensible meaning could be ascribed to the phrase, reasonable people could differ about what it means. One person could, like plaintiff, interpret it as referring to a person who, like Shea, works for a company with which the insured enters into a contract. However, another person could, as Supreme Court did, interpret the phrase as referring to a person furnished directly to the insured pursuant to a contract entered into between the insured and third-party, such as a temporary employment agency. Because the term is reasonably susceptible of more than one interpretation, it is ambiguous (see Chimart Assoc. v Paul, 66 NY2d 570, 573 [1986]).
The majority states that to accept the insured's interpretation of the endorsement would render a nullity the provision that a person can be considered an "employee" "whether or not paid by the insured." However, that is not necessarily so. It is not unreasonable to believe that such a modifier was added simply to confirm that a person directly engaged by the insured can be an "employee" whether or not he or she is compensated. It does not necessarily apply, as the majority interprets it, to situations where an "employee" is paid by a third party.
Because the definition of "employee" contained in the endorsement is inherently ambiguous, Supreme Court properly denied summary judgment to plaintiff. However, plaintiff's interpretation is not so unreasonable that a declaration is warranted that the insured is entitled to coverage (see Sekulow v Nationwide Mut. Ins. Co., 193 AD2d 395 [1993]). Because an issue of fact exists, Supreme Court overreached in searching the record and dismissing the third cause of action. Instead, I would reinstate plaintiff's third cause of action so that a trier of fact can determine whether the endorsement at issue here bars the insured's claim.
Footlocker, Inc., v KK & J, LLC
Sheps Law Group, P.C., Melville (Robert C. Sheps of counsel),
for appellants.
Lewis Brisbois Bisgaard & Smith LLP, New York (Frank D.
Thompson, II of counsel), for respondents.
Order, Supreme Court, New York County (Edward H. Lehner, J.), entered November 17, 2008, which granted defendants' motion for summary judgment dismissing the claims asserted by plaintiff St. Paul Fire and Marine Insurance Company, unanimously reversed, on the law, without costs, the motion denied, and St. Paul's claims reinstated.
This subrogation action was commenced after a fire occurred on September 24, 2002 in a food court located below street level at 2916 Third Avenue in the Bronx. The fire allegedly broke out when a torch used by one of the individuals removing duct work from a former Burger King came into contact with cooking grease that had accumulated in the duct work. The fire resulted in extensive property damage to surrounding businesses, including that of plaintiff St. Paul's insured, Duane Reade, at 2914 Third Avenue. At the time of the fire, defendant KK & J was the owner of 2912, 2914, and 2916 Third Avenue, and defendant Springfield Food Court was the managing agent for these properties. Springfield also independently operated the Burger King.
Duane Reade's lease agreement provides that each party waived "any and all" rights of recovery against the other for loss, injury or damage covered by its insurance, notwithstanding that the loss, injury, or damage may have resulted from the other's negligence or fault. We reject St. Paul's argument that this waiver of subrogation is unenforceable with respect to any allegations of negligence against defendants. However, issues of fact preclude summary judgment in defendants' favor.
While, as St. Paul's points out, "a waiver of subrogation clause cannot be enforced beyond the scope of the specific context in which it appears" (Kaf-Kaf, Inc. v Rodless Decorations, 90 NY2d 654, 660 [1997]), by the terms of the subject clause, Duane Reade waived recovery for "any" loss caused by defendants for which it was covered by insurance, not solely losses that originated within its leased premises. In addition, although the term "Building" is not defined in the lease, the rider to the lease refers to the basement restaurant as located within the "Building." Thus, the renovation work being performed in the Burger King, which resulted in a fire that spread to Duane Reade's leased premises, was not "wholly outside the scope of the landlord and tenant relationship" (Interested Underwriters at Lloyds v Ducor's Inc., 103 AD2d 76, 77 [1984], affd 65 NY2d 647 [1985]; see Atlantic Mut. Ins. Co. v Elliana Props., 261 AD2d 296 [1999]).
However, the record raises an issue of fact whether KK & J satisfied its insurance procurement responsibilities in accordance with the intended risk allocation scheme under the lease agreement. As St. Paul points out, waiver of subrogation clauses are "necessarily premised on the procurement of insurance by the parties" (Liberty Mut. Ins. Co. v Perfect Knowledge, 299 AD2d 524, 526 [2002]). Although the plain language of the subject lease agreement does not require any party other than Duane Reade to procure fire insurance, defendants submitted an umbrella third-party liability insurance policy to demonstrate that KK & J was covered for the risk of fire, and since the lease agreement does not require that the insurance procured be first-party property insurance, it may be that this policy satisfies KK & J's obligation to procure the type of insurance necessary to the enforcement of the waiver clause. A triable issue is raised by the fact that the policy identifies "Hospitality and Leisure Services, Inc.," and not KK & J, as the named insured.
As to defendant Springfield, the complaint and bill of particulars allege that, as the franchisee operator of the Burger King, it was negligent in permitting grease to accumulate in the duct work and in failing to clean out the grease, knowing that the duct work would be removed when the Burger King ceased to operate. The record evidence that the cause of the fire was the contact between a torch and grease in the duct work precludes summary judgment dismissing St. Paul's claims against Springfield in its capacity as the operator of the Burger King.
Finally, contrary to St. Paul's contention, a waiver of subrogation may bar a claim for gross negligence (Great Am. Ins. Co. of N.Y. v Simplexgrinnell LP, 60 AD3d 456 [2009]).
THIS CONSTITUTES THE DECISION AND ORDER
OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.
Begor v. Holmes

Calendar Date: November 23, 2009
Before: Cardona, P.J., Rose, Malone Jr., Stein and Garry, JJ.

Gibson & Behman, P.C., New York City (Ron L.
Langman of counsel), for appellant.
Gregory J. Allen, State Insurance Fund, White Plains
(Kelly A. O'Neill of counsel), for Brenner & McHugh, Inc.,
and another, respondents.

Garry, J.
Appeal from a decision of the Workers' Compensation Board, filed July 16, 2008, which ruled that American Zurich Insurance Company is the liable workers' compensation carrier.
In 2001, claimant was injured in a logging accident while employed by Mark Holmes, a subcontractor doing business as Four Seasons Logging. Four Seasons had no workers' compensation insurance. Claimant died from complications of his injuries in 2005. The general contractor on the project, Brenner & McHugh, Inc., had been hired by the landowner to develop the property. At the time of the accident, Brenner had workers' compensation insurance through the State Insurance Fund (hereinafter SIF). Brenner entered into a subcontract with Mid Hudson Hardwoods, Inc. by which Mid Hudson agreed to purchase and harvest timber on the land. Mid Hudson subcontracted with Four Seasons to cut the timber.
Mid Hudson's human resources functions, including payroll, employee benefits, and workers' compensation benefits, were managed by Hudson Valley Staff Limited (hereinafter HVSL), a professional employer organization (hereinafter PEO). Under the PEO arrangement, Mid Hudson selected its employees. HVSL then hired them, acted as their employer or coemployer of record, and leased them back to Mid Hudson. At the time of the accident, Mid Hudson's leased employees were covered by a workers' compensation and employers' liability insurance policy obtained by HVSL and issued by American Zurich Insurance Company (hereinafter Zurich), on which the named insured was HVSL as labor contractor for Mid Hudson. The policy provided, in pertinent part: "This policy provides coverage for the workers leased to the client [Mid Hudson] . . . This policy does not satisfy the client's duty for the complete payment of any obligations it may have under the Workers' Compensation Law for non-leased employees . . ." The policy language was derived from provisions pertaining to leased employees in the New York Workers' Compensation Manual for Workers' Compensation and Employers' Liability Insurance. The certificate of liability insurance for the policy similarly provided that "[c]overage is provided for only those employees leased to but not subcontractors of Mid Hudson."
After an initial hearing on claimant's application for workers' compensation benefits, a Workers' Compensation Law Judge (hereinafter WCLJ) found that Mid Hudson had coverage under the Zurich policy and continued the case. After further hearings, a WCLJ issued a decision that found that Mid Hudson did not have coverage on the date of the accident extending to Four Seasons and that, since Four Seasons and Mid Hudson had failed to provide coverage for claimant, SIF was obligated under Workers' Compensation Law § 56, as Brenner's carrier, to pay any outstanding awards and causally related medical bills.
SIF requested review of this decision by the Workers' Compensation Board. A panel of the Board concurred with the WCLJ's determination that the claim was SIF's liability, finding that Mid Hudson was an uninsured subcontractor because, although it had coverage for its leased employees, it had exposed itself to workers' compensation liability for which it had no coverage by subcontracting work to Four Seasons. SIF requested full Board review of this determination. The full Board accepted review, rescinded the Board panel's decision, and returned the matter forfurther consideration. The Board panel then issued a decision finding that the limitation of coverage in the Zurich policy to leased workers was ineffective to exempt claimant from coverage because, under Workers' Compensation Law § 54 (4), the policy was deemed to include the statutory coverage provided under Workers' Compensation Law § 56 to employees of uninsured subcontractors such as claimant. The Board panel therefore found that Zurich, as Mid Hudson's carrier, was liable for the claim. Zurich now appeals.
Because the resolution of this matter depends on pure statutory construction, we accord no deference to the Board's determination (see Matter of Belance v Manhattan Beer Distribs., 52 AD3d 1059, 1061 [2008], lv denied 11 NY3d 715 [2009]; Matter of Carter v Von Roll Isola, USA, Inc., 25 AD3d 987, 989 [2006]). However, we agree with the Board's statutory analysis. Pursuant to Workers' Compensation Law § 54 (4), every workers' compensation insurance policy "shall be deemed to include all employees of the employer employed at or in connection with the business of the employer carried on, maintained, or operated at the location or locations set forth in such contract or agreement and employees for whose injuries a contractor may become liable under the provisions of [Workers' Compensation Law § 56]" (emphasis added). Workers' Compensation Law § 56, in turn, provides that "[a] contractor, the subject of whose contract is, involves or includes a hazardous employment, who subcontracts all or any part of such contract shall, in any case of injury or death to any employee, arising out of and in the course of such hazardous employment, be liable for and pay compensation to such employee or persons entitled to compensation on the death of such employee . . . unless the subcontractor primarily liable for such compensation . . . has secured compensation therefor as provided in this chapter." The purpose of Workers' Compensation Law § 56 is "to protect an injured employee and place liability on the insured contractor or subcontractor nearest to the uninsured employer in the chain of subcontractors" (Matter of Minnaugh v Topper & Griggs, 69 AD2d 965, 966 [1979]; see Matter of Passarelli v Columbia Eng'g & Contr. Co., 270 NY 68, 73-74 [1936]).
It is undisputed that claimant was the employee of an uninsured subcontractor in hazardous employment, thus bringing him within the ambit of the statutory protection. We agree with the Board that Mid Hudson, as the contractor nearest in the chain to claimant's uninsured employer, became liable for his injuries under Workers' Compensation Law § 56, and that the limitation in its policy to leased employees was ineffective to exclude him from the statutory coverage deemed to be included in Mid Hudson's policy under Workers' Compensation Law § 54 (4). Zurich argues that Mid Hudson should have been found to be uninsured with regard to claimant because he was not a leased employee, thus shifting liability for his coverage to SIF as the carrier for the next insured contractor in the chain. Mid Hudson was not, however, uninsured, and neither the fact that its workers' compensation coverage was procured on its behalf by a PEO or that the PEO was named as an insured in the policy in its capacity as Mid Hudson's labor contractor alters this conclusion. Further, Mid Hudson's use of a PEO arrangement with HVLS to manage its relationships with its own employees does not affect its status as a contractor in relation to Four Seasons for purposes of Workers' Compensation Law § 56.
Workers' Compensation Law § 56 places liability on the contractor nearest in the chain to the uninsured employer in order to encourage contractors to employ "only those subcontractors who have workers' compensation coverage, or face the financial risk themselves" (Minkowitz, Practice Commentaries, McKinney's Cons Laws of NY, Book 64, Workers' Compensation Law § 56, at 102). This purpose would be subverted by permitting a contractor who hires an uninsured subcontractor to deflect liability to another contractor by using a PEO to procure its employees and its workers' compensation coverage. "The Workers' Compensation Law is remedial in nature and should be liberally construed so as to effectuate the economic and humanitarian objects of the act" (Matter of Simpson v Glen Aubrey Fire Co., 86 AD2d 909, 910 [1982] [citation omitted]). The Board's determination that Mid Hudson, as the nearest insured subcontractor to Four Seasons in the chain of contractors, was liable to claimant under Workers' Compensation Law § 54 (4) and § 56 is in accord with the plain language of both statutes and with the public policy considerations underlying the workers' compensation statutory scheme (see Crosby v State of N.Y., Workers' Compensation Bd., 57 NY2d 305, 313 [1982]).
Cardona, P.J., Rose, Malone Jr. and Stein, JJ., concur.
ORDERED that the decision is affirmed, without costs.
Wilner v Allstate Insurance Company

APPEAL by the defendant, in an action, inter alia, to recover under a homeowner's insurance policy, as limited by its brief, from so much of an order of the Supreme Court (F. Dana Winslow, J.), entered January 21, 2009, in Nassau County, as denied those branches of its motion pursuant to CPLR 3211(a)(7) which were to dismiss the third cause of action alleging a violation of General Business Law § 349, and to dismiss the demand for punitive damages and attorney's fees, and granted the plaintiffs' cross motion to compel discovery.

Feldman, Rudy, Kirby & Farquharson, P.C., Westbury, N.Y.
(Bruce W. Farquharson of counsel), for appellant.
The Sullivan Law Group, LLP, New York, N.Y. (Robert M.
Sullivan, Suzanne M. Saia, and Sara B.
Feldman of counsel), for
respondents.
OPINION & ORDER

DICKERSON, J. Proceedings
The plaintiffs commenced this action by summons and complaint dated September 11, 2007. In their complaint, the plaintiffs alleged that they bought a home owner's insurance policy from the defendant, entitled the Allstate Deluxe Plus Homeowners' Policy, to insure the real property they owned in the Village of Roslyn. The policy was to be effective from April 19, 2005, through April 19, 2006. On or about October 8, 2005, a storm allegedly caused a hillside on the plaintiffs' property to collapse, destroyed their retaining wall, felled several trees, and caused other damage.
In the first cause of action, the plaintiffs alleged that the defendant breached the contract by refusing to pay the amounts due to them under the policy of insurance. In the second cause of action, the plaintiffs alleged that the defendant breached the contract in refusing to provide a defense to the plaintiffs after the Village instituted criminal proceedings against them for damage to Village property which resulted from the collapse. In the third cause of action, the plaintiffs alleged that the defendant violated General Business Law § 349. Specifically, the plaintiffs alleged that a provision of the insurance policy required them to protect the defendant's subrogation interest by instituting an action against the Village before the statute of limitations expired. According to the plaintiffs, the defendant refused to reach a timely decision on coverage, thereby compelling the plaintiffs to comply with that provision and sue the Village at their own expense. The plaintiffs alleged that the defendant's actions "caused injury to Plaintiffs, and have the potential to harm the public at large" because every Allstate Deluxe Plus Homeowners' Policy contains the provision requiring those insured to protect the defendant's right to subrogate. The plaintiffs sought, inter alia, actual damages on their General Business Law § 349 cause of action, punitive damages, and attorney's fees.
The defendant moved pursuant to CPLR 3211(a)(7) to dismiss the second and third causes of action and the plaintiffs' demand for punitive damages and attorney's fees. With regard to the third cause of action, the defendant argued that the plaintiffs failed to allege consumer-oriented conduct, that any act by the defendant was deceptive or misleading in a material way, and that they had been injured as a result of an allegedly deceptive act. In addition, the defendant asserted that the insurance policy did not require an insured to file a lawsuit against anyone, and no reasonable policy holder would conclude that it did. The defendant also claimed that attorney's fees and punitive damages were not recoverable under the circumstances.
The defendant submitted, among other items, a copy of its Deluxe Plus Homeowners' Policy. The language allegedly requiring the insured to protect the defendant's subrogation rights provided, in pertinent part,
"When we pay for any loss, an insured person's right to recover from anyone else becomes ours up to the amount we have paid. An insured person must protect these rights and help us enforce them. You may waive your rights to recover against another person for loss involving the property covered by this policy. This waiver must be in writing prior to the date of loss."
The plaintiffs opposed the defendant's motion and cross-moved to compel the defendant to provide full unredacted versions of relevant computer notes, and documents and information pertaining to other claims filed under the Deluxe Plus Homeowners' Policy resulting from the October 2005 storm.
In an order entered October 7, 2008, the Supreme Court ordered the defendant to
"produce in camera all property damage claims under the Allstate Deluxe Plus Homeowners Policy for damages resulting from a rain and/or wind storm which occurred on or about October 7, 2005 in Nassau County as well as all claims that resulted in litigation, such documents being limited to property damage claims between October 7, 2005 to January 7, 2007 in Nassau County only."
By order to show cause returnable December 8, 2008, the defendant, inter alia, sought leave to reargue, asserting, among other things, that the order went beyond the scope of the relief sought by the plaintiffs in their cross motion. The defendant claimed that the plaintiffs sought information regarding claims under the Deluxe Plus Homeowners Policy, while the court's order compelled production of all property damage claims arising from the storm at issue. The defendant claimed that the requirements of the order were onerous.
In an order entered January 21, 2009, the Supreme Court, Nassau County (Winslow, J.), granted that branch of the defendant's motion which was to dismiss the second cause of action. The court denied those branches of the defendant's motion which were pursuant to CPLR 3211(a)(7) to dismiss the third cause of action alleging a violation of General Business Law § 349, and to dismiss the demand for punitive damages and attorney's fees, stating that, "at this stage of the proceedings, it [could not] determine that Plaintiffs cause of action under [General Business Law] § 349 is insufficient as a matter of law." The court granted the plaintiffs' cross motion to compel discovery.
DISCUSSION
In determining a motion to dismiss pursuant to CPLR 3211(a)(7), "the sole criterion is whether the pleading states a cause of action, and if from its four corners factual allegations are discerned which taken together manifest any cause of action cognizable at law a motion for dismissal will fail" (Guggenheimer v Ginzburg, 43 NY2d 268, 275; see Pacific Carlton Dev. Corp. v 752 Pac., LLC, 62 AD3d 677, 679). "[T]he complaint must be liberally construed in the light most favorable to the plaintiff and all allegations must be accepted as true" (Pacific Carlton Dev. Corp. v 752 Pac., LLC, 62 AD3d at 679; see Leon v Martinez, 84 NY2d 83, 87). Affidavits may be received, and the court may freely consider them for the limited purpose of remedying any defects in the complaint (see Leon v Martinez, 84 NY2d at 88; Fitzgerald v Federal Signal Corp., 63 AD3d 994, 995).

General Business Law § 349 General Business Law § 349 prohibits deceptive and misleading business practices and its scope is broad indeed (see Karlin v IVF Am., 93 NY2d 282, 290, quoting NY Dept of Law, Mem to Governor, 1963 NY Legis Ann, at 105 [General Business Law § 349 "on [its] face appl[ies] to virtually all economic activity, and [its] application has been correspondingly broad. The reach of [this] statute[] provide[s] needed authority to cope with the numerous, ever-changing types of false and deceptive business practices which plague consumers in our State'"] [citations and footnote omitted]; see also Matter of Food Parade, Inc. v Office of Consumer Affairs of County of Nassau, 7 NY3d 568, 574 [Graffeo, J., dissenting] ["This Court has broadly construed general consumer protection laws to effectuate their remedial purposes, applying the state deceptive practices law to a full spectrum of consumer-oriented conduct, from the sale of vanishing premium' life insurance policies to the provision of infertility services . . . In determining what types of conduct may be deceptive practices under state law, this Court has applied an objective standard which asks whether the representation or omission [was] likely to mislead a reasonable consumer acting reasonably under the circumstances,' taking into account not only the impact on the average consumer' but also on the vast multitude which the statutes were enacted to safeguard—including the ignorant, the unthinking and the credulous who, in making purchases, do not stop to analyze but are governed by appearances and general impressions'"] [citations omitted]; Gaidon v Guardian Life Ins. Co. of Am., 96 NY2d 201, 210 [General Business Law § 349 "encompasses a significantly wider range of deceptive business practices that were never previously condemned by decisional law"]; State of New York v Feldman, 210 F Supp 2d 294, 301 [General Business Law § 349 "was intended to be broadly applicable, extending far beyond the reach of common law fraud"]).
The types of goods and services to which General Business Law § 349 applies is expansive. With regard to matters pertaining to insurance, it has been determined to apply to:
Coverage & Rates (see Gaidon v Guardian Life Ins. Co. of Am., 94 NY2d 330 ["out-of-pocket premium payments [for life insurance policies] would vanish within a stated period of time"]; Monter v Massachusetts Mut. Life Ins. Co., 12 AD3d 651 [allegations of misrepresentations concerning terms of Flexible Premium Variable Life Insurance Policies, and deception concerning marketing thereof]; Beller v William Penn Life Ins. Co. of N.Y., 8 AD3d 310 [plaintiff stated General Business Law § 349 cause of action by alleging that the defendant engaged in deceptive practices by increasing the cost of insurance rates without regard to certain flexible factors which would have required the raise to decrease]; Skibinsky v State Farm Fire & Cas. Co., 6 AD3d 975 [allegations of intentional misrepresentation concerning coverage of a insurance policy provided to plaintiff]; Brenkus v Metropolitan Life Ins. Co., 309 AD2d 1260 [amount of life insurance coverage]; Batas v Prudential Ins. Co. of Am., 281 AD2d 260; Makastchian v Oxford Health Plans, 270 AD2d 25 [allegations of deceptive practices that would cause subscribers to believe that they still had health insurance when coverage had already been cancelled]);
Provision Of Defense Counsel (see Elacqua v Physicians' Reciprocal Insurers, 52 AD3d 886 ["This threat of divided loyalty and conflict of interest between the insurer and the insured is the precise evil sought to be remedied . . . hence the requirement that independent counsel be provided at the expense of the insurer and that the insurer advise the insured of this right. Defendant's failure to inform plaintiffs of this right, together with plaintiffs' showing that undivided and uncompromised conflict-free representation was not provided to them, constitutes harm within the meaning of General Business Law § 349"]);
Claims Procedures (see Shebar v Metropolitan Life Ins. Co., 25 AD3d 858 [allegations that "despite promises to the contrary in its standard-form policy sold to the public, defendant made practice of not investigating claims for long-term disability benefits in good faith, in a timely fashion, and in accordance with acceptable medical standards . . . when the person submitting the claim . . . is relatively young and suffers from a mental illness'"]; Makuch v New York Cent. Mut. Fire Ins. Co., 12 AD3d 1110; Acquista v New York Life Ins. Co., 285 AD2d 73 ["allegation that the insurer makes a practice of inordinately delaying and then denying a claim without reference to its viability, may be said to fall within the parameters of" an unfair or deceptive practice]; Rubinoff v U.S. Capitol Ins. Co., NYLJ, May 10, 1996, at 31, col 3 [automobile insurance company fails to provide timely defense to insured as promised]).
Stating a Cognizable Claim
Stating a cause of action to recover damages for a violation of General Business Law § 349is fairly straightforward and should identify consumer-oriented misconduct which is deceptive and materially misleading to a reasonable consumer, and which causes actual damages (see Oswego Laborers' Local 214 Pension Fund v Marine Midland Bank, 85 NY2d 20, 25; see also Stutman v Chemical Bank, 95 NY2d 24, 29; Andre Strishak & Assoc. v Hewlett Packard Co., 300 AD2d 608). Thus, "[t]o state a claim under [General Business Law § 349], a plaintiff must allege that the defendant has engaged in an act or practice that is deceptive or misleading in a material way and that plaintiff has been injured by reason thereof'" (Small v Lorillard Tobacco Co., 94 NY2d 43, 55, quoting Oswego Laborers' Local 214 Pension Fund v Marine Midland Bank, 85 NY2d at 25). "Intent to defraud and justifiable reliance by the plaintiff are not elements of the statutory claim" (Small v Lorillard Tobacco Co., 94 NY2d at 55). "However, proof that a material deceptive act or practice caused actual, although not necessarily pecuniary harm' is required to impose compensatory damages" (id. at 55-56; see Baron v Pfizer, Inc., 42 AD3d 627, 629 [citation and internal quotations omitted] ["Without further allegations that, for example, the price of the product was inflated as a result of defendant's deception or that use of the product adversely affected plaintiff's health, plaintiff's claim sets forth deception as both act and injury and, thus, contains no manifestation of either pecuniary or actual harm . . . [P]laintiff failed even to allege . . . that Neurontin was ineffective to treat her neck pain, and her claim that any off-label prescription . . . was potentially dangerous both asserts a harm that is merely speculative and is belied . . . by the fact that off-label use is a widespread and accepted medical practice"]; see also Ballas v Virgin Media, Inc., 18 Misc 3d 1106[A], affd 60 AD3d 712 [Supreme Court dismissed General Business Law § 349 claim because the so-called "topping-up" requirements of the defendant's pay-by-the-minute cell phone plan were adequately disclosed in a "Terms of Service" booklet]; Vigiletti v Sears, Roebuck & Co., Sup Ct Westchester County, Sept. 23, 2005, Rudolph, J., Index No. 2573/05, affd 42 AD3d 497 [plaintiffs failed to prove actual injury as a result of purchasing tools advertised as "Made in USA" but bearing indications that components thereof were manufactured elsewhere ("no allegations . . . that plaintiffs paid an inflated price for the tools . . . that tools purchased . . . were not made in the U.S.A. or were deceptively labeled or advertised as made in the U.S.A. or that the quality of the tools purchased were of lesser quality than tools made in the U.S.A."), as well as causation ("plaintiffs have failed to allege that they saw any of these allegedly misleading statements before they purchased Craftsman tools"), territoriality ("no allegations that any transactions occurred in New York State"), and conduct which has a broad impact on consumers at large]). In connection with the character of General Business Law § 349 as a broad consumer protection statute and the requirements that the complained of conduct have a "broad impact on consumers at large," the statute does not apply to private contract disputes unique to the parties (see Anesthesia Assoc. of Mount Kisco, LLP v Northern Westchester Hosp. Ctr., 59 AD3d 473, 480; Flax v Lincoln Natl. Life Ins. Co., 54 AD3d 992, 994-995). General Business Law § 349 claims are governed by a three-year period of limitations (see CPLR 214[2]; State of New York v Daicel Chem. Indus., Ltd., 42 AD3d 301, 303; Beller v William Penn Life Ins. Co. of N.Y., 8 AD3d 310, 314), "do[] not need to be based on an independent private right of action" (Farino v Jiffy Lube Intl., 298 AD2d 553, 554), and "the transaction in which the consumer is deceived must occur in New York" (Goshen v Mutual Life Ins. Co. of N.Y., 98 NY2d 314, 324). In determining that the transaction must occur in New York to state a cause of action under General Business Law § 349, the Court of Appeals rejected an alternate interpretation of the statute, declining to adopt an interpretation which would result in "tread[ing] on the ability of other states to regulate their own markets and enforce their own consumer protection laws" and could possibly result in "nationwide, if not global application" (id. at 325).

Consumer-Oriented Conduct
The defendant asserts that the alleged misconduct attributed to it is not consumer-oriented, but rather involves a private dispute (see generally New York Univ. v Continental Ins. Co., 87 NY2d 308, 320; Flax v Lincoln Natl. Life Ins. Co., 54 AD3d at 994-995; Zawahir v Berkshire Life Ins. Co., 22 AD3d 841, 842; Berardino v Ochlan, 2 AD3d 556, 557; Korn v First UNUM Life Ins. Co., 277 AD2d 355, 356). However, where the conduct being complained of is not "a private contract dispute as to policy coverage" but instead "involve[s] an extensive marketing scheme that ha[s] a broader impact on consumers at large'" (Gaidon v Guardian Life Ins. Co. of Am., 94 NY2d at 344, quoting Oswego Laborers' Local 214 Pension Fund v Marine Midland Bank, 85 NY2d at 25), the courts will permit a cause of action pursuant to General Business Law § 349. Thus, in Gaidon, the Court of Appeals held that the plaintiffs' allegations stated a cause of action to recover for violation of General Business Law § 349, where the plaintiffs alleged that the defendants had marketed policies by giving misleading assurances that, after a certain amount of time, they would no longer have to pay insurance premiums. These promises of so-called "vanishing" premiums implicated "practices of a national scope that have generated industry-wide litigation" (id. at 342; see also Beller v William Penn Life Ins. Co. of N.Y., 8 AD3d at 314 [complaint stated a General Business Law § 349 cause of action where the plaintiff alleged that the defendant had improperly raised insurance rates on its flexible premium life insurance policies because it had failed to consider factors such as improvements in mortality]; Elacqua v Physicians' Reciprocal Insurers, 52 AD3d at 888 [allegation that the defendant's practice of not informing its insureds that they had the right to choose an independent counsel stated a cause of action under General Business Law § 349 because it "was not an isolated incident, but a routine practice that affected many similarly situated insureds"]).
Here, the plaintiffs allege, in their third cause of action, that the insurance policy, which requires that they protect the defendant's subrogation interest while their claim is being investigated, compelled them to institute a suit against the Village before the statute of limitations expired. This provision, according to the plaintiffs, "in effect forces Plaintiffs to litigate a claim on Allstate's behalf if Allstate's investigation of the claim exceeds the statute of limitations."
The policy provision in question provides, in pertinent part, that, when the defendant "pay[s] for any loss, an insured person's right to recover from anyone else becomes [the defendant's] up to the amount . . . paid," and "[a]n insured person must protect these rights and help [the defendant] enforce them." The plaintiffs allege that this provision is not unique to the plaintiffs, but is contained in every Allstate Deluxe Plus Homeowners' Policy. Consequently, any consumer holding this policy, whose loss is potentially attributable to a third party, is required to protect the defendant's rights. Therefore, the conduct complained of has a "broad impact on consumers at large" and is thus consumer-oriented (see New YorkUniv. v Continental Ins. Co., 87 NY2d at 320).
Misleading Acts
A plaintiff seeking to state a cause of action under General Business Law § 349 must plead that the challenged act or practice was " misleading in a material way'" (Lonner v Simon Prop. Group, Inc., 57 AD3d 100, 110, quoting Singh v Queens Ledger Newspaper Group, 2 AD3d 703, 704). Whether a representation or an omission, the test is whether the allegedly deceptive practice is "likely to mislead a reasonable consumer acting reasonably under the circumstances" (Oswego Laborers' Local 214 Pension Fund v Marine Midland Bank, 85 NY2d at 26; see Andre Strishak & Assoc., P.C. v Hewlett Packard Co., 300 AD2d at 609). "Such a test . . . may be determined as a matter of law or fact (as individual cases require)" (Oswego Laborers' Local 214 Pension Fund v Marine Midland Bank, 85 NY2d at 26).
Here, the plaintiffs allege that the defendant "has engaged in deceptive acts and practices in violation of General Business Law § 349 of New York by refusing to reach a timely decision on coverage, thereby compelling Plaintiffs to comply with the provision . . . which requires Plaintiffs to protect" the defendant's interests. According to the plaintiffs, the defendant's failure to reach a timely decision is "part of a pattern and practice by [the defendant] to force claimants to litigate its claims and incur the costs and expense of hiring an attorney to prevent forfeiture of coverage for a covered loss under the Allstate Deluxe Plus Homeowners Policy of insurance."
In essence, the plaintiffs are alleging that the defendant purposely failed to reach a decision on the merits of their insurance claim in order to force the plaintiffs to bring a suit against the Village before the statute of limitations expired, because, if they did not do so, the defendant could refuse reimbursement of the claim on the ground that the plaintiffs had failed to protect the defendant's subrogation rights (see e.g. Zourelias v Erie Ins. Group, 456 Pa Super 775). Presumably, the purpose of this alleged conduct would be to save the defendant money; if the plaintiffs initiate the suit, the plaintiffs have to pay for it, whereas if the defendant initiates its own suit, the cost will fall upon the defendant. Accepting the plaintiffs' allegations as true (see Leon v Martinez, 84 NY2d at 87; Pacific Carlton Dev. Corp. v 752 Pac., LLC, 62 AD3d at 679), the plaintiffs have successfully pleaded conduct on the part of the defendant which was misleading in a material way.
Reasonableness as a Question of Fact
The defendant argues that no reasonable consumer acting reasonably would interpret the subrogation language to mean that the consumer is required to file a lawsuit against an alleged tortfeasor. The language of the subrogation provision is ambiguous, in that it does not explain how the insured is to "protect [the defendant's] rights and help [the defendant] enforce them." The Court of Appeals has stated that whether a deceptive practice is likely to mislead a reasonable consumer acting reasonably may be determined as either a question of law or fact, depending upon the circumstances (see Oswego Laborers' Local 214 Pension Fund v Marine Midland Bank, 85 NY2d at 26). Under the circumstances of this case, the reasonableness of the plaintiffs' belief as to their responsibilities under the contract of insurance is a question of fact, and should be determined by the factfinder (see Herold v East Coast Scaffolding, 208 AD2d 592 ["An insured's good faith belief in nonliability, when reasonable under the circumstances, may excuse a delay in notifying his insurer of an occurrence' . . . Whether such a belief was, in fact, reasonable, is ordinarily a question of fact"]; G.L.G. Contr. Corp. v Aetna Cas. & Sur. Co., 215 AD2d 821, 822-823 [citations omitted] ["this case is governed by the general rule that the reasonableness of an insured's belief of nonliability is ordinarily an issue of fact and not one of law. While defendant argues, in essence, that plaintiff's purported belief of nonliability is not credible, we note that credibility issues are reserved for the trier of fact to resolve"]; Argentina v Otsego Mut. Fire Ins. Co., 207 AD2d 816, 816, affd 86 NY2d 748; Winstead v UniondaleUnionFreeSchool Dist., 170 AD2d 500, 503).
Injury
The plaintiffs must, of course, allege an injury as a result of the deceptive act or practice (see Stutman v Chemical Bank, 95 NY2d at 29). Here, the plaintiffs allege that, as a result of the defendant's conduct, they were forced to "incur the costs and expense of hiring an attorney to prevent forfeiture of coverage for a covered loss." The defendant argues that the plaintiffs have not suffered any injury, since, if it had issued a denial prior to the expiration of the statute of limitations, the plaintiffs would have been in the exact same position as they now occupy—having to commence and pay for their own action against the Village. Whether the plaintiffs would have commenced the action against the Village if they had received an earlier denial is a question of fact, and must be determined by the factfinder. The plaintiffs alleged that they were forced to pay for an attorney, and thus adequately pleaded damages under General Business Law § 349.
General Business Law § 349 Cause of Action Sufficiently Stated
Accordingly, based on the foregoing, we find that, contrary to the defendant's contention, the plaintiffs' allegations are sufficient to state a cause of action pursuant to General Business Law § 349. Thus, the Supreme Court properly denied that branch of the defendant's motion which was to dismiss the third cause of action.
Recoverable Damages
Under General Business Law § 349 consumers may recover actual damages in any amount, and may recover treble damages under General Business Law § 349(h) up to $1,000 (see Teller v Bill Hayes, Ltd., 213 AD2d 141, 147; Hart v Moore, 155 Misc 2d 203, 207). Moreover, the plaintiffs may seek both treble damages and punitive damages (see Volt Sys. Dev. Corp. v Raytheon Co., 155 AD2d 309, 309; Bianchi v Hood, 128 AD2d 1007).
Punitive Damages
"An award of punitive damages is warranted where the conduct of the party being held liable evidences a high degree of moral culpability, or where the conduct is so flagrant as to transcend mere carelessness, or where the conduct constitutes willful or wanton negligence or recklessness'" (Pellegrini v Richmond County Ambulance Serv., Inc., 48 AD3d 436, 437, quoting Buckholz v Maple Garden Apts., LLC, 38 AD3d 584, 585). Initially, it should be noted that the plaintiffs do not seek punitive damages on their breach of contract claim, but only on their claim under General Business Law § 349. Under that claim, they allege that the defendant intentionally did not reach a final decision on their claim, so as to force them to commence a suit against the Village. If that is true, and for purposes of a CPLR 3211(a)(7) motion to dismiss, "all allegations must be accepted as true" (Pacific Carlton Dev. Corp. v 752 Pac., LLC, 62 AD3d at 679; see Leon v Martinez, 84 NY2d at 87), such conduct may be considered to be " so flagrant as to transcend mere carelessness'" (Pellegrini v Richmond County Ambulance Serv., Inc., 48 AD3d at 437, quoting Buckholz v Maple Garden Apts., LLC, 38 AD3d at 585). Consequently, the plaintiffs' claim for punitive damages should not be dismissed.
Attorney's Fees
The defendant argues that attorney's fees are not available for disputes between insurers and the insured, but it concedes that, under General Business Law § 349, the court has the discretion to award attorney's fees. The plaintiffs only seek attorney's fees on their General Business Law § 349 claim. Since General Business Law § 349(h) provides that the court has the discretion to award reasonable attorney's fees, the plaintiffs' request for attorney's fees should not be dismissed.
Discovery
With regard to their cross motion, the plaintiffs are correct that, since the defendant's objections to their discovery demands were not served within 20 days of service, as required by CPLR 3122(a), this Court's review " is limited to determining whether the requested material is privileged under CPLR 3101 or the demand is palpably improper'" (Coville v Ryder Truck Rental, Inc., 30 AD3d 744, 745, quoting McMahon v Aviette Agency, 301 AD2d 820, 821). The defendant states that the information sought is likely to contain privileged information. However, this conclusory statement is insufficient to establish that the information sought is, in fact, privileged. Moreover, there is nothing "palpably improper" about the plaintiffs' demand. Here, the court has already narrowed the plaintiffs' request and ordered the defendant to produce documents relating to 375 claims made in connection with the October 2005 storm.
The defendant argues that it was improper for the court to allow discovery to bolster what is otherwise an insufficient cause of action. However, as discussed above, the cause of action was sufficiently pleaded. The information sought, regarding claims the defendant has handled for other insureds, relates to the plaintiffs' attempt to establish that the defendant has engaged in a pattern of deception, and, thus, the request is proper (see Gillen v Utica First Ins. Co., 41 AD3d 647, 647 [information sought "was relevant to the plaintiff's cause of action alleging a violation of General Business Law § 349"]).
The defendant also argues that the plaintiffs should be compelled to pay for the discovery. However, this contention was improperly raised for the first time on appeal and thus is not properly before this Court (see Reyes v Albertson, 62 AD3d 855).
CONCLUSION
Accordingly, the order is affirmed insofar as appealed from.
RIVERA, J.P., FLORIO and AUSTIN, JJ., concur.
ORDERED that the order is affirmed insofar as appealed from, with costs.
Sferra v. McGregor

Calendar Date: November 24, 2009
Before: Mercure, J.P., Peters, Lahtinen, Kavanagh and Garry, JJ.

Grasso, Rodriguez & Grasso, Schenectady (Joseph J.
Villano of counsel), for appellant.
Goldberg Segalla, L.L.P., Albany (Matthew S. Lerner
of counsel), for respondent.
MEMORANDUM AND ORDER
Kavanagh, J.
Appeal from an order of the Supreme Court (Caruso, J.), entered May 20, 2009 in Schenectady County, which granted defendant's motion for summary judgment dismissing the complaint.
In June 2006, plaintiff was operating a motor vehicle at a low rate of speed in a shopping center parking lot when she was hit on the rear passenger side door by defendant's vehicle, which, at the time, was traveling at an estimated speed of five miles per hour. Plaintiff was taken to the emergency room of a local hospital complaining of neck pain, was treated and released and then reported to work where she worked her regular shift. The following week, she was treated for headaches, as well as pain to her shoulder, upper back and neck, and was advised to see a chiropractor and begin physical therapy. One month later, plaintiff, for the first time, complained of pain to her lower back. She continued to treat with her primary care physician and to receive chiropractic care, and eventually saw a neurologist in regard to her condition. Plaintiff subsequently commenced this action and, following discovery, defendant moved for summary judgment dismissing the complaint alleging that plaintiff did not suffer a serious injury as defined by Insurance Law § 5102 (d). Supreme Court granted defendant's motion, prompting this appeal.
Plaintiff claims that, as a result of this accident, she sustained injury to both the cervical and lumbar regions of her spine. Specifically, she claims to have suffered from "cervical and lumbar strains, annular disruption of the L4/5 intervertebral disc, with degenerative disc disease and non-compressive right paracentral-lateral and central disc herniations at both L4/5 and L5/S1, and C4/5 intervertebral disc bulge." These injuries, she claims, have resulted in a permanent, significant, and consequential loss of use and function of both her cervical and lumbar spine. In support of his motion for summary judgment, defendant submitted two affidavits from Bryan Bilfield, an orthopedic surgeon, who, after reviewing plaintiff's medical records and examining her, concluded that no objective evidence existed establishing that plaintiff suffered an injury caused by this motor vehicle accident. Bilfield concluded that plaintiff's complaints of pain in regard to her cervical spine were due to a preexisting condition that she had since 2001 and continued to plague her on the date of the accident. In this regard, he referred to the results of a radiograph exam taken immediately after the accident that showed "arthritic changes with no acute abnormality" in plaintiff's cervical spine, as well as an MRI taken two months later that revealed the existence of a "mild C4-5 disc bulge with no evidence of disc herniation, spinal canal stenosis or foraminal narrowing." Bilfield also noted that plaintiff's limited range of motion was consistent with her preexisting condition and that, while the accident may have temporarily increased the pain she had been experiencing as a result of this exacerbation, that increased pain was not permanent.
As for plaintiff's complaints of pain in her lower back, she points to an MRI performed in February 2007, or eight months after the accident, as proof that the accident caused her serious injury. Specifically, plaintiff notes that this exam "showed a small posterior disc protrusion at L5-S1 with minimal impingement on the ventral surface of the thecal sac" as well as "a posterior annular tear at L4-5." In response, Bilfield stated that since plaintiff was wearing a seat belt at the time of the accident, there would not have been a significant flexion of the lower spine that would establish a relation between the findings of the MRI and the automobile accident. He also noted that plaintiff did not complain of pain in her lower back until weeks after the accident and that the annular tear noted in the MRI at L4/5 could have been "caused by normal stresses over time on the lumbar spine with the aging process." In short, Bilfield stated that the objective findings noted in the MRI examination of plaintiff's lumbar spine were not, in his opinion, related to the accident.
Bilfield's findings satisfied defendant's burden of establishing that plaintiff did not suffer a serious injury as a result of this accident (see Toure v Avis Rent A Car Sys., 98 NY2d 345, 352 [2002]; Wolff v Schweitzer, 56 AD3d 859, 860-861 [2008]; Palmeri v Zurn, 55 AD3d 1017, 1018 [2008]), and required plaintiff to provide competent medical evidence that "address[ed] defendant['s] claimed lack of causation'" (Falkner v Hand, 61 AD3d 1153, 1154 [2009], quoting Pommells v Perez, 4 NY3d 566, 580 [2005]). In that regard, plaintiff offered the opinion of her treating chiropractor to the effect that plaintiff suffered a serious injury and, in making that finding, relied on the results of the February 2007 MRI to conclude that plaintiff's loss of range of motion in the cervical spine area and the herniation noted at L4/S1 were caused by the accident [FN1] . However, in offering this opinion, plaintiff's chiropractor did not account for plaintiff's extensive history of neck pain and medical treatment during the five-year period immediately preceding the accident or the fact that this condition had not resolved as of the date of the accident (see Coston v McGray, 49 AD3d 934, 935 [2008]). Moreover, while a disc herniation resulting in a quantifiable loss of one's range of motion can amount to a serious injury (see Dean v Brown, 67 AD3d 1097, ___, 2009 NY Slip Op 07904, *2 [2009]; Lee v Laird, 66 AD3d 1302, 1304 [2009]), plaintiff's expert failed to explain why, if this condition was caused by the impact, plaintiff did not experience any lower back pain in the weeks immediately after the accident. In addition, plaintiff's chiropractor did not take issue with Bilfield's observation that, since plaintiff was wearing a seat belt at the time of the accident, there would have been no significant flexion in her lumbar spine that would have caused a disc herniation and that the annular tear noted in the MRI could have been caused by factors not related to the accident. Simply stated, plaintiff's chiropractor did not, in offering his opinion, provide a meaningful response to the arguments made by defendant's expert regarding the cause of plaintiff's pain and, as such, his affidavit did not serve to create questions of fact regarding causation.
Plaintiff also argues that Bilfield's affidavit should be rejected because he did not have all of plaintiff's medical records when he rendered his opinion regarding the source of her injuries. Even if Bilfield did not have all of plaintiff's medical records when he gave his initial affidavit, he did provide a second affidavit to the effect that he had since reviewed the remaining medical records and reaffirmed his opinion that plaintiff did not suffer a serious injury as a result of this accident. Given plaintiff's failure to present competent evidence that creates a factual issue as to the seriousness of the injuries that she is alleged to have sustained in this accident, Supreme Court properly granted defendant's motion for summary judgment dismissing the complaint.
Footnotes

Footnote 1: We note that while plaintiff's bill of particulars alleged that she was prevented from performing all of her customary daily activities for 90 of the first 180 days following the accident (see Insurance Law § 5102 [d]), she made no claim for loss of earnings and did not pursue this claim in her brief. As a result, we deem the issue to be abandoned (see Brandt-Miller v McArdle, 21 AD3d 1152, 1153 n 2 [2005]; Durham v New York E. Travel, 2 AD3d 1113, 1114 n [2003]).