Dear Coverage Pointers Subscribers:

Thanks for all the dry weather wishes which arrived after our Noah’s Ark issue two weeks ago.  Summer has arrived in Western New York and Southern Ontario and as I craft this bi-monthly missive, I am enjoying a gloriously calm Lake Erie evening. 

It’s obvious that the appellate judges are resting as well, because (as we predicted), we are in the midst of the summer slowdown of appellate decisions.  Don’t worry, come mid-September, just a few short weeks away, we will be bombarded by an array of coverage decisions so eclectic and challenging, that you’ll be overcome by the sheer energy and emotion of these appellate jewels.  In the meantime, we’ll continue to offer you all of the amuse-bouclé available.

Our subscriber base now exceeds 1800 direct recipients and probably twice that number and more

Training, Training
We’re out on the training circuit and on Monday, Mike Perley and I travel to Connecticut to a claims conference being sponsored by one of our favorite clients.  We have three presentations:  Mediation and Negotiation Strategies, A “Primer” on Lead Paint” (focusing both on the defense of lead-based paint claims and the coverage strategies that need to be employed) and one of my favorite topics, “Tackling Tenders.”  The “Tenders” workshop provides practical and strategic hands-on advice on how a claims professional responds to the intake of additional insured and contractual indemnification tenders, distinguishing the two-track approach necessary to properly analyze thee separate claims.

Here Comes the …

On August 15, after 17 years, she’s finally making an honest man out of me.  And what IS the third line to that song, anyway?

Happy 100th Anniversary Lincoln Penny

The Lincoln Penny was released to the public 100 years ago this week, August 2, 1909, the first US Coin to display a bust of a real person, living or dead.  Designed by Victor David Brenner, any urchin who secured and stowed one of those pennies carrying Mr. Brenner’s initials, particularly if that penny was minted in San Francisco, can expect to secure about $1000 today on e-Bay for a near uncirculated 1909-S VDB:

Fitchburg Daily Sentinel
August 7, 1909
Page 2, Column 4
YOUNGSTERS ARE ON.
They Flock to Banks Where They Think
They Can Get Lincoln Penny
The issue of the Lincoln penny from the mint has caused the banks to receive many requests for them. The Safety Fund national bank received a few which they are distributing to their customers. Word went forth, this morning, that the Fitchburg Safe Deposit & Trust Co. and the Worcester North Savings institution had a large number of these highly prized coins and were handing them out to all who called. This rumor reached the ears of the omnipresent small boy and about 9.30 the doors of the bank began to be attractive to the urchins, who were all armed with one or two cents of an earlier coinage.

They entered the bank and had the old coins exchanged for the famous Lincoln penny till the officials in self-defense, had to place a ban on children and decline to accommodate them any more. This didn't discourage them and they congregated around the doors, asking the grownups to exchange their' pennies for them. It was hard to refuse and many a busy man stopped long enough to take the old penny and get a brand new one for the children.

Audrey’s Angles:

The no-fault world never rests!  It may be summertime but the Arbitrators and Judges are not taking a vacation.  The result is some good reading for you.

There are quite a few interesting decisions this time.  One is a worthwhile read on use and operation with a very good survey of the case law on the issue.  Another is a case where the insurer issued its follow-up verification request one day early and lost its lack of medical necessity defense.  The saying it's better to be early than to be late certainly does not apply.

Also, there is an award that addresses a fundamental claims handling issue of apprising either through the denial or at the hearing what is the proper fee schedule.  A lesson to take from that award is either ensure that your denials state the fee schedule or that you ensure your counsel has that information for the hearing.

If you would like a copy of the full arbitration award or case presented in this issue please feel free to email me at [email protected].

Audrey A. Seeley

One Hundred Years Ago, Blondes (of both genders) Analyzed

Syracuse Herald
August 7, 1909
Page 1

TOO MUCH SUNSHINE FOR
THE BLONDES OF AMERICA
Dr. C. E. Woodruff Says that they Break Down in this Climate and Fall into Poverty, Disease and Crime
NEW YORK, Aug 7 — A startling note of warning to the blue--eyed, light complexioned New Yorkers is issued by Dr. Charles E. Woodruff, surgeon and major in the United States Army, who has just completed a tour of the prisons and asylums of the city and State.  The jails and institutions, he says, are full of blondes, who unable to stand the struggle for existence in a climate to which they are unfitted, have fallen into poverty, disease and crime.

What is true of New York, he says, is true of the country as a whole, and unless the blond American finds or adopts some better means of survival than he has at present he will be wiped out as a type in favor of the brunette.

The great trouble is the sunshine.  There is too much of it in American for the blonde, says Dr. Woodruff. It breaks down their nervous system, renders them unstable, morally as well as physically, and makes them peculiarly liable to the ravage of consumption and other deadly aliments.

This Week in Coverage Pointers:

KOHANE’S COVERAGE CORNER

Dan D. Kohane
[email protected]

  • How Long Does a Carrier Have to Move to Stay an Uninsured Motorists Arbitration?  Twenty Days, if Based Upon a Policy Exclusion

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

Margo M. Lagueras
[email protected]

  • A Defense Asserting a Pre-existing Condition Must Address the Issue of Exacerbation of That Condition
  • Once Again, Summary Judgment Is Not Supported if Defendant’s Expert Reports the Accident Caused the Exacerbation of Pre-existing Conditions
  • Affirmed Report of a Doctor Who Is No Longer Licensed at the Time the Report Is Written Is Inadmissible

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

  • Well Reasoned Decision on Use and Operation
  • IME and Peer Reviews Need to Clearly State Lack of Medical Necessity
  • Insurer’s Take Note – If You Will Not Provide the Fee Schedule Then the Arbitrator Will Not Ascertain What the Fee Schedule Is

Litigation

  • Compensation Availability Must Be Left to the Workers’ Compensation Board
  • Defamation Claim Against Insurer Dismissed for Failure to Plead with Specificity
  • Fraud Standard Is Preponderance of the Evidence
  • Prematurely Mailing Follow-Up Verification Request Fails to Toll 30 Day Timeframe

PEIPER ON PROPERTY (and POTPOURRI)

Steven E. Peiper
[email protected]

  • Question of Fact Regarding Whether Misplaced Diamonds Qualifies as a “Mysterious Loss”

EARL’S PEARLS
Earl K. Cantwell, II
[email protected]
Know the Real Costs of Arbitration

We wish you all a joyous August and we do love the feedback.  Keep it coming.

Dan

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


NEWSLETTER EDITOR
Dan D. Kohane
[email protected]

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

FIRE, FIRST-PARTY AND SUBROGATION TEAM
Andrea Schillaci, Team Leader
[email protected]
Jody E. Briandi
Steven E. Peiper

NO-FAULT/UM/SUM TEAM
Audrey A. Seeley, Team Leader

[email protected]
Tasha Dandridge-Richburg
Margo M. Lagueras

APPELLATE TEAM
Jody E. Briandi, Team Leader

[email protected]
Scott M. Duquin

Index to Special Columns

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

KOHANE’S COVERAGE CORNER

Dan D. Kohane
[email protected]

7/28/09            In the Matter of Allstate Insurance Company v. Doyle
Appellate Division, Second Department
How Long Does a Carrier Have to Move to Stay an Uninsured Motorists Arbitration?  Twenty Days, if Based Upon a Policy Exclusion

We regularly remind our readers of the shortest statute of limitations in the New York insurance world, 20 days.  If an uninsured motorist or underinsured motorist’s carrier believes that a matter is not subject to arbitration because of a breach of a policy condition or because of a policy exclusion, an application to permanently stay arbitration must be made to the court within 20 days of the demand for arbitration.  A failure to make that motion will result is a loss of the carrier’s right to rely upon that exclusion.  On the other hand, if the reason for seeking an application to stay is that there is not a policy in place or the claimant is not an insured in the first place, missing the 20-day limitation period may not be fatal.

Here, the carrier took the position that the claimant was not an insured, because of an exclusion in the policy.  Since the defense to coverage was based upon a policy exclusion, the 20-day period applied.  The insurer, not having made its application for a stay within 20 days, lost its right to complain and raise the issue, and accordingly coverage was available.

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

Margo M. Lagueras
[email protected]

8/6/09              Colavito v. Steyer
Appellate Division, Third Department
A Defense Asserting a Pre-existing Condition Must Address the Issue of Exacerbation of That Condition
The defendant failed to meet his burden for several reasons.  First, relying on an MRI taken just after the accident, his experts concluded that the plaintiff’s symptoms were caused by a pre-existing condition and not causally related to the accident.  However, their opinions did not carry weight because the plaintiff had been asymptomatic prior to the accident and the defendant’s experts failed to address any exacerbation of the pre-existing condition.  In addition, one of defendant’s experts examined the plaintiff 18 months after the accident, and the other did not examine her at all.  Because they did not address her condition within the 180 days following the accident, they did not offer any evidence to rebut her claim under the 90/180-day category.

The plaintiff, on the other hand, submitted her own affidavit in which she denied any pre-existing conditions and detailed her inability to perform her ordinary daily tasks following the accident.  In addition, the affirmation of her physician, who treated her during the 180-day period, stated that she was asymptomatic before the accident, that her symptoms were caused by the accident and required surgery, and that she would never return to her pre-accident status.  Medical evidence qualifying and quantifying her range-or-motion restrictions were annexed to the report.  Therefore, even if the defendant had met his burden, the plaintiff’s submissions were sufficient to raise a triable issue of fact and defeat summary judgment.

7/28/09            Carr v. Macaluso
Appellate Division, Second Department
Once Again, Summary Judgment Is Not Supported if Defendant’s Expert Reports the Accident Caused the Exacerbation of Pre-existing Conditions
In support of their motion for summary judgment, the defendants submitted the affirmed report of their examining expert which, in addition to having examined the plaintiff some three years and seven months after the accident, concluded that the accident exacerbated the plaintiff’s pre-existing condition, which was made even worse due to the plaintiff’s obesity.  Such a report simply will not meet a defendant’s prima facie burden on a motion for summary judgment.

7/28/09            Richards v. Tyson
Appellate Division, Second Department
Affirmed Report of a Doctor Who Is No Longer Licensed at the Time the Report Is Written Is Inadmissible
In opposition to the defendants’ motion for summary judgment dismissing the complaint, the plaintiffs submitted affirmed medical reports of a doctor who, at the time the reports were written, was no longer licensed to practice medicine in the State of New York.  Such reports were not admissible to oppose the motion.  The court additionally found that other affirmed reports submitted failed to raise a triable issue of fact because they were not contemporaneous with the accident.  The court further determined that the plaintiffs failed to support their claims under the 90/180-day category of serious injury based on their deposition testimonies where they admitted they missed little, if any, time from work or school.  As such, the appellate court reverses the trial court as the defendants’ motion should have been granted.

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

Arbitration

8/3/09              Applicant v. Avis Budget Group
Arbitrator Veronica K. O’Connor (Erie County)
Well Reasoned Decision on Use and Operation
The Angle:      This is a very thorough and well reasoned decision on use and operation that everyone should have in their bank of useful cases.  This decision cites a multitude of case law and arbitration decisions regarding various scenarios when the Gholson and Walton rules apply and when they do not.  This is worth a read of the entire decision!

Here Is the Analysis:  On December 16, 2007, the eligible injured person (“EIP”) sustained injuries to his back when he slipped on the metal passenger side step of an Avis 12-passenger vehicle.  After slipping on the side step the EIP fell back against the door and injured his back.

The insurer argued that the back injury did not arise out of the use and operation of a motor vehicle under the Walton rule.  The assigned arbitrator, based upon an exhaustive review of the case law and arbitration awards on the issue, agreed.

The legal analysis begins with the initial three part test applied to use and operation which is found in Gholson:

  1. Accident must arise out of the inherent nature of the vehicle;
  2. Accident must arise within natural territorial limits of the vehicle; and
  3. Vehicle must not merely contribute to the cause of the condition producing the injury but must itself produce the injury.

 

Then over 20 years later the Walton rule provided a major change and restriction in the extension of no-fault coverage to those injured during the process of loading or unloading a vehicle.   The Walton rule, while extending coverage to those injured during the process of loading or unloading a vehicle, also limited coverage to those injuries caused by the vehicle. 

Thereafter, an extensive survey of the case law regarding whether coverage is afforded on loading and unloading of a vehicle follows.

Next, the Arbitrator discussed how the Walton case has language that extends to cases not involving loading and unloading of a vehicle.  An example would be injuries arising from the repair of a motor vehicle may not be afforded coverage unless the vehicle was being used at the time of the injury and the vehicle caused the injury.

Likewise, the Walton case also reaffirmed prior decisions not affording coverage for injuries that occurred while the vehicle was being used, but were injuries sustained wholly unrelated to the vehicle’s use.

Overall, the Walton case shifts the focus to whether the vehicle actually caused the injuries as opposed to what the party was doing at the time of the accident.

7/31/09            Applicant v. Nationwide Ins. Co.
Arbitrator Veronica K. O’Connor (Erie County)
IME and Peer Reviews Need to Clearly State Lack of Medical Necessity
The Angle:      In Upstate arbitrations there has been an increase in the awards citing Hobby v. CNA Ins. Co. for the proposition that an IME or peer review report that suggests or hints at maximum medical improvement will be invalidated.  Of course, the Applicant, under Hobby, is required to show the medical necessity for the continued treatment after the insurer’s denial.  Accordingly, a review of the Applicant’s evidence, particularly the medical records Applicant must submit, is required.  The word of caution to insurers is to review your expert reports!  If your expert finds positive objective findings and then states that no further treatment is required for corrective care, or that no further improvement will be seen with a particular type of treatment, you have a potential problem.

Here is the Analysis: The eligible injured person (“EIP”) began a course of chiropractic care with the Applicant as a result of a September 27, 2005, motor vehicle accident.  The insurer had the EIP examined by a chiropractor on two separate occasions.  The expert chiropractor opined that the EIP was no longer in the corrective care phase of her treatment and her improvement was minimal since the last examination.  He further opined that “no further chiropractic treatment will be required for corrective care.”

The aforementioned statement was interpreted by the assigned arbitrator as concluding that the EIP reached maximum medical improvement.  This is not a valid denial basis under Hobby v. CNA Ins. Co.  Despite finding that the denial basis was not valid, the assigned arbitrator further reviewed the Applicant’s evidence submission to determine whether the Applicant had submitted evidence to support medical necessity for the continued chiropractic care after the denials were issued.  The assigned arbitrator held that Applicant’s evidence and the EIPs testimony were sufficient to meet Applicant’s burden.

7/24/09            Applicant v. State Farm Ins. Co.
Arbitrator Mary Anne Theiss (Onondaga County)
Insurer’s Take Note – If You Will Not Provide the Fee Schedule Then the Arbitrator Will Not Ascertain What the Fee Schedule Is
This arbitration involved what appears to be two bills.  The first bill was awarded and the insurer indicated that it was not properly fee schedule rated.  The assigned arbitrator noted that she had provided the insurer with four different opportunities to provide the correct rate yet it failed to do so.  The assigned arbitrator essentially indicated that since the insurer would not find the time within those four hearings to provide the correct rate then she was not going to award the fee schedule rate.  Therefore, the full amount of the bill was awarded. 

Regarding the second bill, the medical provider failed to ever submit it to the insurer for payment.  The assigned arbitrator determined that it was the medical provider’s responsibility, and not the applicant’s eligible injured person’s, to seek payment of the bill.  The assigned arbitrator properly stated that in the event that any entity went against the applicant for payment, applicant should present the decision for consideration.

Litigation

7/28/09            LMK Psych. Service, P.C. a/a/o v. American Transit Ins. Co.
Appellate Division, Second Department
Compensation Availability Must Be Left to the Workers’ Compensation Board
The Court reiterated a long standing rule that whether an eligible injured person is entitled to Workers’ Compensation benefits is left to the Workers’ Compensation Board which has primary jurisdiction.  Further, if a plaintiff fails to litigate the issue before the Board then the Court must remit the matter to the Board and not express an opinion on the availability of Workers’ Compensation.

7/21/09            Horbul v. Mercury Ins. Co.
Appellate Division, Second Department
Defamation Claim Against Insurer Dismissed for Failure to Plead with Specificity
The insurer’s motion to dismiss for failure to state a cause of action for slander per se should have been granted.  The plaintiff alleged slander per se against the insurer because the insurer reported to the police that plaintiff filed a fraudulent claim for no-fault benefits for his son.  The insurer successfully argued that the complaint failed to comply with CPLR §3016(a) requiring the plaintiff to specifically plead the particular words complained of.  (Congratulations to Jason Tenebaum, Esq. of Piccano & Scahill, P.C., a downstate colleague, who represented the insurer).

7/20/09            V.S. Med. Services, P.C. a/a/o Carlos Gaviria v. Allstate Ins. Co.
Appellate Term, Second Department
Fraud Standard Is Preponderance of the Evidence
The insurer need only establish by preponderance of the evidence that the alleged injuries were the result of insurance fraud.  Contrary to the plaintiff’s assertion, the insurer need not prove this defense by clear and convincing evidence.

7/14/09            Radiology Today, P.C. a/a/o Eduard Sosnovskiy v. GEICO Ins. Co.
                        D.S. Chiropractic, P.C. a/a/o Marian Plantt v. Country-Wide Ins. Co.
Appellate Term, Second Department
Prematurely Mailing Follow-Up Verification Request Fails to Toll 30 Day Timeframe
The insurer requested verification of a medical claim and mailed its follow-up verification request on the 30th calendar day after the initial verification request was sent.  The follow-up verification was sent prematurely without any effect on delaying the claim.  Accordingly, the 30 day timeframe to pay or deny ran and the insurer was precluded from raising it proffered lack of medical necessity defense.

PEIPER ON PROPERTY (and POTPOURRI)

Steven E. Peiper
[email protected]

07/28/09          Nussbaum Diamonds, LLC v The Hanover Ins. Co.
Appellate Division, First Department
Question of Fact Regarding Whether Misplaced Diamonds Qualifies as a “Mysterious Loss”
The insured, Nussbaum, took out a commercial property policy with defendant Hanover.  As part of that policy, an Endorsement was appended which provided additional coverage for covered merchandise that was taken out of the insured location.  That Endorsement had an exclusion which reduced the policy limit of one-half for merchandise lost outside of the store due to a “mysterious disappearance.” 

In this case, an employee of Nussbaum took several hundred thousand dollars worth of diamonds out of the store while on a sales trip from Manhattan to Rochester, New York.  Unfortunately, upon his arrival in Rochester, the salesperson discovered that the diamonds were no longer in his possession.  He recalled having the diamonds as he drove away from the insured premises, but could not account for them after any of the four stops he made between the insured premises and Rochester, New York.

A report of the missing diamonds was immediately made to the Rochester and New York City Police Departments, respectively.  In addition, a claim for lost merchandise occurring away from the store was also submitted to Hanover. 

After initially denying coverage, Hanover eventually acknowledged coverage under the Off-Premises Endorsement.  However, as Hanover believed the loss to be mysterious, it only agreed to a payment of the reduced limit.  Nussbaum commenced legal action alleging that it was entitled to full policy limits under the Off-Premises Endorsement.  Specifically, Nussbaum alleged that the loss was not mysterious, and as such the reduced policy limit provision did not apply. 

The First Department noted for the mysterious loss exclusion to apply, Hanover was charged with the burden of establishing that there were no other plausible explanations for the loss.  Here, Hanover argued that Nussbaum had not presented any evidence which explained the loss of the merchandise.     Nussbaum, of course, presented various circumstances where the diamonds may have been lost due to the negligence of its employee.  Indeed, Nussbaum stated that any of the four stops between New York City and Rochester could have resulted in the loss of the merchandise.

In light of both arguments, the Court found a question of fact as to whether the possibility that the diamonds were lost at any one of the four stops was a plausible explanation for the claim.  As such, plaintiff’s motion for summary judgment was denied.

 

EARL’S PEARLS
Earl K. Cantwell, II
[email protected]

KNOW THE REAL COSTS OF ARBITRATION

Historical information and literature suggested that arbitration should be a speedier, more cost effective and economical means of deciding cases, particularly complicated commercial cases, complex tort and injury cases, and other cases involving a specialized industry or a technically complicated claim.  However, the actual costs of arbitrating are an overlooked but important part of the decision whether to enforce an arbitration clause or consent to arbitration.  Arbitration of a significant case in the present environment can entail thousands of dollars in arbitration fees alone, so the expense has to be carefully evaluated, particularly in the current economic and insurance climate. 

First, arbitration administration fees in a complicated commercial or tort claim can consume thousands of dollars just in filing and administration fees paid to the arbitration forum, a fact that is often ignored.  Parties who agree to arbitrate before a panel of arbitrators of the AAA, JAMS Resolution Center, American Health Lawyers Association (AHLA) or International Chamber of Commerce (and others) need to immediately contemplate and budget that the short and long term out-of-pocket fees to arbitration agencies can, within a short period of time, easily reach five figures and may be subject to reallocation to impose costs on a losing party.  The arbitration forum can be problematic since many corporate lawyers drafting arbitration provisions simply insert them with little or no knowledge of the actual costs and benefits of the underlying forums and they may be unaware of the nuances of the rules of each arbitration agency. 

Second, the necessity of paying a party’s own arbitration counsel, just as in litigation, is most likely a given.  However, with more and more arbitrations looking more and more like litigation, a party’s counsel fees can rise just as readily in arbitration as in court.

Third, arbitrators often command high daily and hourly billing rates that can seriously mount, particularly in a dispute that may involve several days of hearings with a three person arbitration panel.  Arbitrator fees can easily exceed $50,000 and surpass $100,000.  Furthermore, there is usually a requirement for substantial early deposits and payments to the arbitrators in advance of actual hearing dates.  Given the politics of arbitration, and the relationship of the arbitrators to the arbitration agency, it is very difficult to approach either the forum or the arbitrators to propose some reduction or modification in fees. 

There are also concerns on how to address a situation wherein one of the parties to the arbitration fails or refuses to pay the requisite fees on time.  Should the non-paying party pay the fees and request to be reimbursed as part of the final award?  Should you file an action in court to obtain an order requiring a non-paying party to advance or pay the fees?  Should a party consider discontinuing the arbitration and filing suit in court claiming that the non-paying party has waived or forfeited any right to arbitrate?

In weighing the decision to arbitrate or compel arbitration it must also be noted that in complex commercial matters, technologically complex tort claims, and other major disputes, litigating in arbitration may actually be more difficult, inter alia, because of the difficulty in compelling attendance of witnesses across state lines, limitations on pre-hearing discovery which may be imposed, and a lack of any kind of judicial review or court compulsion.  In many complex cases, arbitration may in fact be more expensive and problematic than proceeding in court.

Another disadvantage of arbitration is the uncertainty of whether and to what extent arbitration fees may be fee-shifted to a losing party, which may make the cost of an arbitration much higher than counsel or the client anticipate. 

These are some of the factors to be considered before seeking to compel or obtain an arbitration agreement where time and costs can spiral and be controlled largely by the flow of events and by rulings of the arbitrators themselves which are just as difficult to predict as rulings of a trial court in litigation.

ACROSS BORDERS

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

8/3/09              Delgado v. Interinsurance Exchange of the Automobile Club of Southern CA
California Supreme Court
An Assault and Battery is Not an “Accident” Under the Terms of an Insurance Policy and therefore the Insurance Company has No Duty to Defend
After an assault and battery by the insured, the injured party sued the insured, alleging that the insured had acted under the unreasonable belief of having to defend himself, an act that according to the injured party fell within the policy’s coverage of an “accident”. The Court held that the insurance company does not have a duty to defend such an action. The found that to prevail in an action seeking declaratory relief on the question of the duty to defend, the insured must prove the existence of a potential for coverage, while the insurer must establish the absence of any such potential. Essentially, the insured need only show that the underlying claim may fall within the policy coverage; the insurer must prove it cannot. A duty to defend exists if the insurer becomes aware of, or if the third party lawsuit pleads, facts giving rise to the potential for coverage under the insuring agreement. Generally, in the context of liability insurance, an accident is an unexpected, unforeseen, or undesigned happening or consequence from either a known or an unknown cause. The Court found that this common law construction of the term “accident” becomes part of the policy and precludes any assertion that the term is ambiguous. The Court did not find that just because the defendant’s policy does not use the words “neither expected nor intended from the standpoint of the insured,” the word “accident” as used in the policy means that whether an event is an accident must be determined from the injured party’s viewpoint. It found that the phrase “neither expected nor intended from the standpoint of the insured” in earlier comprehensive liability policies has been construed as modifying the policy term “injury and damages,” not “accident.”

The Court found that liability insurance is a contract between the insured and the insurance company to provide the insured, in return for the payment of premiums, protection against liability for risks that are within the scope of the policy’s coverage. Insurance policies are read in the light of the parties’ reasonable expectations and, when ambiguous, are interpreted to protect the reasonable expectations of the insured. An injury-producing event is not an “accident” within the policy’s coverage language when all of the acts, the manner in which they were done, and the objective accomplished occurred as intended by the actor. Additionally, the Court found that in a number of contexts other than those involving claims pertaining to assault and battery, courts have in insurance cases rejected the notion that an insured’s mistake of fact or law transforms a knowingly and purposefully inflicted harm into an accidental injury. The Court concluded that an insured’s unreasonable belief in the need for self-defense does not turn the resulting purposeful and intentional act of assault and battery into an “accident” within the policy’s coverage clause.

Therefore, the insurance company had no duty to defend its insured in the lawsuit brought against him by the injured party.
Submitted by: Amy Kempfert and Jeffrey Hensley (Best & Sharp, P.C.)

7/28/09            Spagnola v. The Chubb Corporation
Second Circuit Court of Appeals
Putative Class Action Alleging Unlawful Increase In Homeowner's Insurance Premiums Stated Claim For Breach Of Insurance Contract

Plaintiff brought a putative class action claiming that the Chubb Corporation unlawfully increased his homeowner's insurance premiums in violation of the insurance policy and New York law. The Complaint alleged breach of contract, unjust enrichment, and deceptive business practices. The Southern District of New York granted Chubb's Motion to dismiss all claims for failure to state a claim upon which relief can be granted. The Second Circuit held that Spagnola's allegations that Chubb increased his premiums according to a formula that was not based on "current costs and values" as required by the policy stated a claim for breach of contract sufficient to withstand Chubb's motion to dismiss. The Court affirmed the dismissal of Spagnola's remaining claims, and remanded the case to the district court for further proceedings on the breach of contract claim.
Submitted by: Megan Faust and Jerome G. Wyss, Roetzel & Andress, LPA

REPORTED DECISIONS

In the Matter of Allstate Insurance Company v. Doyle


James R. McCarl, Montgomery, N.Y., for appellant.
Fellows, Hymowitz & Epstein, P.C., New City, N.Y. (Darren
J. Epstein of counsel), for respondent.

DECISION & ORDER
In a proceeding pursuant to CPLR article 75 to permanently stay the arbitration of a claim for underinsured motorist benefits, the petitioner appeals (1) from an order of the Supreme Court, Rockland County (Nelson, J.), dated September 15, 2008, which granted the respondent's motion to reargue and, upon reargument, vacated a prior order dated July 1, 2008, granting the petition to stay arbitration, and dismissed the petition as time-barred under CPLR 7503(c), and (2), as limited by its brief, from so much of an order of the same court dated October 16, 2008, as, upon reargument, adhered to the determination in the order dated September 15, 2008.
ORDERED that the appeal from so much of the order dated September 15, 2008, as, upon reargument, vacated the prior order dated July 1, 2008, and dismissed the petition, is dismissed, as that part of the order was superseded by the order dated October 16, 2008, made upon reargument; and it is further,
ORDERED that the order dated September 15, 2008, is affirmed insofar as reviewed; and it is further,
ORDERED that the order dated October 16, 2008, is affirmed insofar as appealed from; and it is further,
ORDERED that one bill of costs is awarded to the respondent.
Contrary to the petitioner's contentions, the Supreme Court properly dismissed its petition to permanently stay arbitration of the respondent's underinsured motorist claim as time-barred by the 20-day period set forth in CPLR 7503(c). Review of the supplementary uninsured/underinsured motorists endorsement at issue demonstrates that the respondent clearly came within the definition of an "insured" contained therein, and that the petition to stay arbitration was based upon an exclusion in that endorsement rather than a lack of coverage (see Matter of Worcester Ins. Co. v Bettenhauser, 95 NY2d 185; Matter of Allstate Ins. Co. v Arpaia, 276 AD2d 628).
Carr v. Macaluso


Julien & Schlesinger, P.C., New York, N.Y. (Mary Elizabeth
Burns of counsel), for appellant.
Nicoletti Gonson Spinner & Owen, LLP, New York, N.Y.
(Lorenzo Lugara of counsel), for
respondents.

DECISION & ORDER
In an action to recover damages for personal injuries, the plaintiff appeals from an order of the Supreme Court, Kings County (Schack, J.), dated April 28, 2008, which granted the defendants' motion for summary judgment dismissing the complaint on the ground that she did not sustain a serious injury within the meaning of Insurance Law § 5102(d).
ORDERED that the order is reversed, on the law, with costs, and the defendants' motion for summary judgment dismissing the complaint is denied.
The defendants failed to meet their prima facie burden of showing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) as a result of the subject accident (see Toure v Avis Rent A Car Sys., 98 NY2d 345; Gaddy v Eyler, 79 NY2d 955, 956-957). The accident occurred on December 27, 2003, and the plaintiff was not examined by the defendants' expert, Dr. Steven Zaretsky, until July 24, 2007, approximately three years and seven
months later. Nevertheless, Dr. Zaretsky stated in his affirmed report that his testing revealed limitations in cervical range of motion "in all planes." Dr. Zaretsky concluded that the subject accident exacerbated a significant preexisting condition, which was made worse due to the plaintiff's obesity. Thus, the defendants failed to meet their prima facie burden of showing that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) as a result of the subject accident and, accordingly, the Supreme Court should have denied their motion for summary judgment dismissing the complaint (see Scarano v Wehrens, 46 AD3d 797, 798; Cebularz v Diorio, 32 AD3d 975, 976; Gentile v Snook, 20 AD3d 389, 389; Derby v Menchenfriend, 18 AD3d 694, 694-695; Trunk v Spross, 306 AD2d 463, 463), regardless of the sufficiency of the plaintiff's opposition papers (see Winegrad v New York Univ. Med. Ctr., 64 NY2d 851).
Richards v. Tyson


Hawkins, Feretic & Daly, LLC, New York, N.Y. (Matthew
Zizzamia of counsel), for appellant.

DECISION & ORDER
In an action to recover damages for personal injuries, the defendant appeals from an order of the Supreme Court, Kings County (Vaughan, J.), dated March 5, 2008, which denied his motion for summary judgment dismissing the complaint on the ground that none of the plaintiffs sustained a serious injury within the meaning of Insurance Law § 5102(d).
ORDERED that the order is reversed, on the law, with costs, and the defendant's motion for summary judgment dismissing the complaint on the ground that none of the plaintiffs sustained a serious injury within the meaning of Insurance Law § 5102(d) is granted.
The plaintiffs commenced this action to recover damages for injuries they each allegedly sustained in a motor vehicle accident. The defendant moved for summary judgment dismissing the complaint on the ground that none of the plaintiffs sustained a serious injury within the meaning of Insurance Law § 5102(d).
The defendant established, prima facie, through the affirmed reports of his expert neurologist and expert orthopedist and the plaintiffs' deposition testimony, that none of the plaintiffs sustained 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; Sanchez v Williamsburg Volunteer of Hatzoloh, Inc., 48 AD3d 664; Kearse v New York City Tr. Auth., 16 AD3d 45, 47-50). The plaintiffs' respective deposition testimony that they missed little, if any, time from school or work as a result of the subject motor vehicle accident, established that their alleged injuries did not prevent them from performing substantially all of the material acts constituting their customary daily activities during at least 90 of the first 180 days following the accident (see Sanchez v Williamsburg Volunteer of Hatzoloh, Inc., 48 AD3d at 664, 665).
In opposition, none of the plaintiffs raised a triable issue of fact as to whether they sustained a serious injury (see Zuckerman v City of New York, 49 NY2d 557, 562; Lea v Cucuzza, 43 AD3d 882). The affirmed medical reports prepared by Dr. Roger Brick were not admissible to oppose the defendant's motion, as he was no longer licensed to practice medicine in the State at the time the reports were written (see CPLR 2106; Fung v Uddin, 60 AD3d 992; McDermott v New York Hosp.-Cornell Med. Ctr., 42 AD3d 346). Moreover, while the affirmed medical reports of Dr. Douglas Schwartz, which were also submitted in opposition to the motion, found significant limitations in each of the plaintiffs' respective ranges of motion, such findings were not contemporaneous with the subject accident (see Kurin v Zyuz, 54 AD3d 902, 903; Morris v Edmond, 48 AD3d 432, 433; D'Onofrio v Floton, Inc., 45 AD3d 525).
Accordingly, the Supreme Court should have granted the defendant's motion for summary judgment dismissing the complaint.
Nussbaum Diamonds, LLC v The Hanover Ins. Co.


Clayman & Rosenberg, New York (Paul S. Hugel of counsel),
for appellant.
Clausen Miller, P.C., New York (Don R. Sampen, of the State
of Illinois Bar, admitted pro hac vice, of counsel), for
respondent.
Order, Supreme Court, New York County (Milton A. Tingling, J.), entered March 13, 2008, which, insofar as appealed from, denied plaintiff's motion for summary judgment for full coverage under the subject insurance policy, affirmed, with costs.
Isaac Nussbaum, the principal of plaintiff Nussbaum Diamonds, LLC (Nussbaum), had a jeweler's block insurance policy issued by defendant The Hanover Insurance Company (Hanover), which he purchased on September 30, 1995. The policy covered Nussbaum's company against "all risks" of loss or damage to its merchandise for up to $4 million while in his store, subject to certain exclusions. Effective November 14, 2005, the parties amended the policy to add an endorsement providing coverage for up to $500,000, subject to a $10,000 deductible, for merchandise carried out of the office by a jewelry salesman named Yoel Grun. The "Insuring Conditions" section of the amended Policy contains a number of exclusions, including the following:
"(5) THIS POLICY INSURES AGAINST ALL RISKS OF LOSS OF OR DAMAGE TO THE ABOVE DESCRIBED PROPERTY ARISING FROM ANY CAUSE WHATSOEVER EXCEPT . . .:
(M) Unexplained loss, mysterious disappearance or loss or shortage disclosed on taking inventory . . ."
On October 25, 2005, the condition (5)(M) exclusion was amended as follows:
"It is understood and agreed that the Policy is extended to cover Mysterious Disappearance up to a limit of $250,000."
On the evening of November 28, 2005, Yoel Grun and Blair Grossbard left on a trip to sell diamonds for their employer, nonparty Espeka Fancy Diamonds (EFD). The two planned to make sales calls to EFD customers in Rochester, New York, and West Hartford, Connecticut. Grun rented a car and met Grossbard at EFD's offices. Grossbard collected the jewelry and separated it into two blue bags, one for each salesperson. These bags and Grun's computer bag were all placed in the back seat of the car. Although Grun worked for EFD, he occasionally sold Nussbaum's diamonds while on EFD trips. Grun was paid commissions for sales of Nussbaum's merchandise. Prior to this trip, Grun told Nussbaum about his sales meetings in Rochester and West Hartford, and he agreed to take some of Nussbaum's diamonds with him.
After leaving EFD's offices on the evening of November 28, Grun picked up a diamond ring and four loose diamonds from Nussbaum's office, signed for them, and placed them in a 6½ inch leather pouch. He clipped the pouch inside the waistband of his pants.
Grun and Grossbard then drove to Grossbard's apartment on the Upper East Side. On the way, Grun felt uncomfortable with the pouch in his waistband. He removed it and asked Grossbard to put it in his computer bag in the back seat. She refused, telling Grun that she was nauseous and did not want to turn around in a moving car. She handed the pouch back to Grun. He thought he remembered placing the pouch in the front right pocket of his pants.[FN1]
Between Nussbaum's offices and Rochester, Grun got out of the car four times. First, he pulled over on 82nd. St and Third Avenue, near Grossbard's apartment. While Grossbard went to get her things, Grun got out of the car and went into a nearby 7-11 store. He carried the two EFD bags with him, made a cup of coffee and bought some sandwiches. A surveillance video in the store showed that Grun left the EFD bags on the floor in front of the cash register and walked away on two occasions, once for approximately seven seconds and again for approximately ten seconds. After paying with a credit card that he put into his right pants pocket, Grun returned to the car. Grossbard then came downstairs with her husband. Grun got of the car again to greet Mr. Grossbard and they placed Mrs. Grossbard's luggage in the trunk of the car. Grun exited the car on two other occasions before reaching Rochester: once to change drivers several hours into the trip and a second time to use the bathroom and buy some items at a Fastrac gas station.
At about 3:00 a.m., Grun and Grossbard arrived at the Homeward Suites hotel. The two didn't like the way the hotel looked, and without getting out of the car they proceeded to a Hyatt in downtown Rochester. When Grun parked in the Hyatt parking lot, he realized that he was not carrying the Nussbaum diamonds. He got out of the car, checked his pockets, and asked Grossbard if she had seen the jewels. She said no, and Grun searched the car, checked all of his bags in the car and in the trunk, and asked Grossbard to do the same. Grun thought it likely that he had misplaced the diamonds when he stopped at the 7-11 in Manhattan, and Grossbard called the store to see if a leather pouch had been recovered. He also asked Grossbard to call her husband to ask him to look around their apartment and on Third Avenue, where the car had been parked, to see if there was a leather pouch on the ground.
The two drove to a parking area near the Hyatt and discussed retracing their steps back to New York City. They also discussed possible locations where the diamonds could have been lost. They eventually decided that they were too exhausted to drive back to the city. They checked into the Hyatt, went to a room, and searched their bags again inside the hotel. It was now approximately 5:00 a.m.
At Grossbard's urging, Grun tried to get some sleep. At 9:00 a.m. on November 29th, Grun called Nussbaum and told him that he had lost the diamonds. Nussbaum instructed him to call the police and get a report. Grun attempted to do so. However, the Rochester police refused to issue a report because the pouch containing the jewelry had last been seen in New York City. The New York City police also refused to issue a report, contending that Rochester had jurisdiction.
On November 29, 2005, Nussbaum contacted Hanover about the lost diamonds. Hanover's claims adjuster conducted an investigation and determined that there was coverage under the policy, but that because the loss qualified as a "mysterious disappearance," the amount of the loss in excess of $250,000 was excluded. The adjuster also noted discrepancies between Grun's and Grossbard's accounts of the events. When Hanover failed to pay, Nussbaum commenced this action, seeking $490,000 (the $500,000 policy limit less the $10,000 deductible), plus interest. Hanover answered, denied liability, and asserted nine affirmative defenses. Nussbaum then brought a motion for summary judgment for (1) the $240,000 defendant conceded was owed and (2) payment of the remaining $250,000. While the motion was pending, Hanover paid the $240,000, without interest, but opposed that portion of Nussbaum's motion that sought summary judgment for the additional $250,000. The motion court granted Nussbaum partial summary judgment for the $240,000, but denied the remainder of its motion, finding issues of fact as to how the loss occurred.
On appeal, Nussbaum argues that because it had an "all risks policy," upon a showing of a loss of covered property, it was Hanover's duty to establish that the loss constituted a "mysterious disappearance." Hanover counters that it met its burden on the motion, that it paid $250,000 less the $10,000 deductible, and that the "mysterious disappearance" exclusion bars recovery of any greater sum.
To obtain summary judgment, Nussbaum was required to demonstrate (1) the existence of a valid "all risks" policy; (2) an insurable interest in the subject of the policy; and (3) the fortuitous loss of covered property, i.e., the diamond ring and the four loose diamonds (International Multifoods Corp. v Commercial Union Ins. Co., 309 F3d 76, 83 [2d Cir 2002]). Nussbaum was not required to establish the cause of the loss of the jewelry in support of its claim (Great N. Ins. Co. v Dayco Corp., 637 F Supp 765, 777 [SD NY 1986]; see also In re Balfour MacLaine Int'l Ltd., 85 F3d 68, 77-78 [2d Cir 1996]; Atlantic Lines Ltd. v American Motorists Ins. Co., 547 F2d 11, 13 [2d Cir 1976]).
The burden then shifted to Hanover to negate coverage based upon an enumerated exclusion in the policy, here, the "mysterious disappearance" exclusion. Hanover was required to establish "that the exclusion is stated in clear and unmistakable language, is subject to no other reasonable interpretation, and applies in [this] case" (Continental Cas. Co. v Rapid-American Corp., 80 NY2d 640, 652 [1993]; see Neuwirth v Blue Cross & Blue Shield of Greater N.Y., Blue Cross Assn., 62 NY2d 718 [1984]). Accordingly, to show that the "mysterious disappearance" exclusion applies in this case, Hanover was required to show that there was no plausible explanation for the loss of Nussbaum's diamonds. Factual issues regarding the events preceding the loss preclude such a finding at this stage in the litigation.
In Maurice Goldman & Sons v Hanover Ins Co., (80 NY2d 986 [1992], affg 179 AD2d 388 [1992]) the Court of Appeals first addressed the application of the same "mysterious disappearance" exclusion invoked by Hanover here. The plaintiff in that case was on a business trip when he realized that a bag containing his company's jewelry was missing. He filed a claim under an "all risks" policy with an identical "mysterious disappearance" exclusion, which was denied. Plaintiff brought an action, and the insurer moved for summary judgment. The motion was granted. On appeal, plaintiff argued that the "mysterious disappearance" clause was ambiguous, because it was susceptible to the interpretation of excluding only a loss discovered on taking inventory. Both this Court and the Court of Appeals disagreed, finding that each of the three enumerated casualties under the exclusion — unexplained loss, mysterious disappearance, or loss or shortage disclosed on taking inventory - constituted an independent basis for exclusion. However, in direct contrast to this case, the plaintiff in Goldman conceded, and the appellate courts held, that the loss was "mysterious," and thus outside the ambit of coverage based upon the exclusion (id. at 988).
A case with facts more similar to those presented here is S. Bellara Diamond Corp. v First Specialty Ins. Corp. (287 AD2d 368 [2001]). In S. Bellara, a package of diamonds disappeared from a jeweler's desk. The "all risks" insurer denied coverage, on the ground that the loss constituted a "mysterious disappearance." In opposition to the insurer's motion for summary judgment, the jeweler could only "surmise" that as the diamonds were wrapped in paper, he may have accidentally thrown them into the waste basket as he hurriedly cleaned off his desk before leaving for lunch. This Court affirmed the denial of the insurer's motion for summary judgment, stating that the jeweler's explanation, "if believed by the trier of fact, could reasonably support an inference that the diamonds were accidentally thrown away" (id. at 369).
Similarly, in Gurfein Bros v Hanover Ins. Co. (248 AD2d 227 [1998]), plaintiff's diamonds disappeared from the trunk of a salesman's car sometime during a two day road trip from Memphis, Tennessee to Jackson, Mississippi. The salesman surmised that the diamonds could have been stolen from the trunk of his car when he pulled over on the highway to change a flat tire (id. at 227). However, the salesman did not see or hear anyone near his car as he was fixing the flat, and there was no direct evidence of theft. The motion court granted the insurer summary judgment based upon the "mysterious disappearance" exclusion, and this Court reversed. We held that circumstantial evidence of a theft was not "so illogical, implausible or speculative as to warrant summary judgment for the insurer" based upon the mysterious disappearance exclusion, and we reinstated the complaint (id. at 231).
Finally, in Stella Jewelry Mfg., Inc. v Naviga Belgamar (885 F Supp 84 [SD NY 1995]), the president of a jewelry company was collecting two bags of jewelry from a friend's house. He parked his car in the circular driveway, and placed the bag next to his foot while he made room for it in the car's trunk. Approximately 10 seconds elapsed, during which time the man did not see or hear anything. He then bent down to pick up the bag, but it was gone. He made a claim with his insurer, under an "all risks" policy with a "mysterious disappearance" exclusion. The insurer invoked the exclusion on the ground that the loss was a "mystery" because the man did not see or hear anything during the 10 second interval in which the bag disappeared (id. at 85). The District Court granted the insured's motion for summary judgment, finding the exclusion inapplicable as a matter of law. It stated:
"The facts as testified to by the only witness, Plaintiff's president, bespeak only of theft, albeit a mysterious theft with no evidence of a thief . . . There is no evidence from which one could deduce that the nylon bag had blown away or been lost in any other manner than by theft. Under those circumstances no reasonable jury could reach the conclusion that the loss occurred otherwise" (id. at 86).
In contrast to Stella Jewelry, here, as in S. Bellara and Gurfein Bros, there are issues of fact precluding a determination, at this juncture, whether the "mysterious disappearance exclusion" is applicable. There are a number of explanations proffered by plaintiff for the disappearance of the small leather pouch of diamonds. The trip took over six hours, and Grun got out of the car at least four times between Nussbaum's office and Rochester. It is uncontested that while he was in the car, Grun removed the jewels from his waistband, where they were clipped as he left Nussbaum's office. Grun believes that he was carrying the jewels in his right pants pocket, which is also where cameras showed him putting the credit card used to purchase items at the 7-11. When Grun discovered that the diamonds were missing, his initial thought was that he might have misplaced them at the 7-11. While the surveillance cameras at the 7-11 do not specifically show the pouch falling from Grun's pocket, they do show that Grun was careless with the bags of EFD diamonds entrusted to him. The cameras show Grun leaving the EFD bags unattended on two occasions while in that store. It is also possible that the pouch somehow was stolen between New York City and Rochester, or that it fell to the ground when Grun and Grossbard switched drivers, or at the Fastrac bathroom or convenience store. Because questions as to the plausibility of plaintiff's explanations cannot be resolved on the existing record, we affirm the determination of the motion court to deny plaintiff's motion for summary judgment.
All concur except McGuire, J. who concurs in a separate memorandum as follows:

McGUIRE, J. (concurring)
I agree that Supreme Court correctly denied Nussbaum's motion for summary judgment, but my reasoning differs from the majority's.
Unlike Stella Jewelry Mfg., Inc. v Naviga Belgamar (885 F Supp 84, 86 [SD NY 1995]), this is not a case in which the facts asserted by the insured "bespeak only of theft, albeit a mysterious theft with no evidence of a thief." Although Grun got out of the car at least four times between Nussbaum's office and Rochester, there was no testimony that he in fact was in physical possession of the diamonds when he got out of the car. If Grun was not in physical possession of them, their disappearance would be "mysterious," especially given the evidence that he and Grossbard conducted a thorough search of the car and the bags in the car, and that Grun searched his pockets. With respect to the possibility that Grun had been in physical possession of the diamonds on these occasions, Grun surmised that they may have fallen out of his right pants pocket. His earlier statement that he "remembered" putting the diamonds in his pocket was undercut by his later, equivocal testimony. But even assuming that the diamonds were in his pocket, no plausible explanation was provided bearing on how they got out of his pocket. To be sure, the security cameras at the 7-11 showed him putting into his right pants pocket the credit card he used to purchase items. On this record, however, it cannot be said that a reasonable jury could only conclude that the pouch fell out of his pocket when he took out his credit card, even putting aside that it is not clear that he put the credit card back in the same pocket from which he removed it. Moreover, although the security cameras show that Grun was not careful with the bags of jewels, the video certainly does not dispel the mystery as it does not show anyone touching the bags during the brief periods when Grun walked away from them. Although it is possible that the pouch somehow was stolen or somehow fell to the ground somewhere, these are mere speculative possibilities.
This is an odd case. Putting aside a theft by Grun himself, which would trigger a separate exclusion, one that Hanover did not rely on, it appears that there are only two possibilities: the diamonds were stolen from Grun or they fell from his pocket (or otherwise were lost). Although Nussbaum would be entitled to full indemnification if either of these two possibilities caused the loss, the uncertainties on this record regarding precisely what happened to them (i.e., whether they were so stolen or lost) preclude full indemnification. Rather, these uncertainties raise a material issue of fact that precludes the conclusion that the "mysterious disappearance" exclusion is not applicable. A contrary conclusion would read that exclusion out of the policy.
THIS CONSTITUTES THE DECISION AND ORDER
OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.
ENTERED: JULY 28, 2009
CLERK
Footnotes

Footnote 1: A month after the trip, Grun testified that he remembered placing the pouch in his front right pants pocket. However, about five months later, he gave a more equivocal account. He testified that he believed that he put the pouch in his front right pocket, but he was not sure.

 

Colavito v. Steyer


Calendar Date: May 27, 2009
Before: Mercure, J.P., Rose, Kane and Garry, JJ.

Montfort, Healy, McGuire & Salley, Garden City
(Donald S. Neumann Jr. of counsel), for appellant.
Basch & Keegan, L.L.P., Kingston (Derek J. Spada of
counsel), for respondent.
MEMORANDUM AND ORDER

Kane, J.
Appeal from an order of the Supreme Court (Lynch, J.), entered June 19, 2008 in Ulster County, which denied defendant's motion for summary judgment dismissing the complaint.
Plaintiff commenced this action to recover for injuries to her right shoulder allegedly sustained in a motor vehicle accident. Defendant moved for summary judgment dismissing the complaint on the basis that plaintiff did not suffer a serious injury (see Insurance Law § 5102 [d]; § 5104 [a]). Supreme Court denied the motion, prompting defendant's appeal. We affirm.
Defendant failed to meet his initial burden of proving, as a matter of law, that plaintiff did not sustain a serious injury (see Smalls v AJI Indus., Inc., 10 NY3d 733, 735 [2008]; Santos v Marcellino, 297 AD2d 440, 441 [2002]). Defendant's experts, relying on an MRI taken shortly after the accident, opined that plaintiff's symptoms were related to a preexisting condition and, thus, were not causally related to the accident. Yet the experts failed to address any aggravation of the preexisting condition, which had reportedly been asymptomatic prior to the accident (see Ashquabe v McConnell, 46 AD3d 1419, 1419 [2007]; Madden v Dake, 30 AD3d 932, 936 [2006]). The experts — one of whom examined plaintiff 18 months after the accident and the other who did not examine her at all — also did not adequately address plaintiff's condition or limitations within the first 180 days following the accident, which was necessary to foreclose the 90/180-day category of serious injury (see Ames v Paquin, 40 AD3d 1379, 1380 [2007]; Lowell v Peters, 3 AD3d 778, 780 [2004]). Accordingly, Supreme Court correctly held that defendant failed to prove his entitlement to summary judgment.
Supreme Court also correctly held that had defendant met his initial burden, plaintiff's response raised triable factual issues. Plaintiff submitted her own affidavit which denied any preexisting problems with her shoulder and detailed her inability to perform most ordinary and customary tasks of daily living. She also submitted an affirmation from her physician, who treated plaintiff within the first 180 days following the accident. That physician opined that plaintiff's symptoms were caused by the accident and necessitated surgery, she was asymptomatic prior to the accident and was permanently incapable of returning to her preaccident physical condition. Medical records, including quantified results of plaintiff's limited range of motion, were attached to the affirmation to support these opinions (compare Wolff v Schweitzer, 56 AD3d 859, 862 [2008]). Consequently, plaintiff's response raised triable issues regarding whether she suffered a serious injury as a result of this accident, requiring the denial of defendant's motion (see Madden v Dake, 30 AD3d at 936; Mrozinski v St. John, 304 AD2d 950, 952-953 [2003]).