Coverage Pointers - Volume XXII, No. 16

Volume XXII, No. 16 (No. 580)
Friday, January 22, 2021

A Biweekly Electronic Newsletter  

As a public service, Hurwitz & Fine, P.C. is pleased to present its biweekly newsletter, providing summaries of and access to the latest insurance law decisions from the New York and Connecticut appellate courts and Canadian appellate courts.  The primary purpose of this newsletter is to provide timely educational information and commentary for our clients and subscribers.  

In some jurisdictions, newsletters such as this may be considered Attorney Advertising.

If you know of others who may wish to subscribe to this free publication, or if you wish to discontinue your subscription, please advise Dan D. Kohane at [email protected] or call 716-849-8900.

You will find back issues of Coverage Pointers on the firm website listed above.

Dear Coverage Pointers Subscribers:

Do you have a situation?  We love situations.  More importantly – GO BILLS!

What a remarkable day, Wednesday, watching the inauguration of President Biden and Vice President Harris.  We hope and pray that we are entering a period of greater cooperation – and less vitriol – between and among the decision makers.


ruMIRNAtions:  Welcoming a New Columnist and New Column – A Focus on Diversity and Inclusion

Mirna Santiago, who joined our coverage team recently, has an abiding interest in diversity and inclusion and the empowerment of those who have not been traditionally give equal opportunity.  Diversity and Inclusion is an extremely important subject for our firm, for the insurance industry and for the legal profession. And, in addition, she will focus on ethical issues including the tripartite relationship.  As Mirna likes to ruminate, mentor and educate on that subject, we are delighted to welcome her column ruMIRNAations.  Her first column is included in the attached issue.


This Week’s Issue:

We have an array of interesting cases in this week’s issue, including the first discussion of what it means to have a business presence in New York under Carlson.  That case, you may (or may not) recall expanded the reach of New York’s disclaimer statute (Insurance Law Section 3420(d)(2)) to policies issued or delivered, not only in New York, but in other states (if the insured has a substantial business presence in New York and creates risks in New York).

We have our first appellate decision discussing what it means to have a business presence in New York.

There are also some very interesting cases relating to primacy of coverage and the expanse of underinsurance coverage.


Raising a Glass:

Congrats to our good friend April Elkovitch, just elevated to Vice President of Claims and Claims Counsel at Philadelphia Insurance Companies.  Atta Lawyer!


Risk Transfer Training:

So much of my casualty coverage work, these days, focuses on risk transfer – additional insured questions, contractual hold-harmless agreements and how the interrelationship between them impacts on the ultimate resolution of complex cases.  We are conducting, via Microsoft Teams, a regional training program on risk transfer next week for a good client.  If your shop can benefit from that training, let me know and we can arrange a date and time to help train your staff.

We have now scheduled or are in the process of finalizing the scheduling of five private sessions of this program, each one specially modified and crafted to meet the particular needs of the companies who have asked for the training.  If interested, let me know.


New York SUM Training:

Uninsured Motorists and Supplemental Uninsured/Underinsured Motorists Coverage (“SUM”) coverage is often tricky and fraught with danger to unsuspecting insurers.  A failure to seek court intervention within 20 days after receipt of a demand for arbitration can lead to a loss of substantial rights under a SUM endorsement.

We have developed a one-hour training program – which can be provided remotely – on the basics (and many of the nuances) of New York SUM coverage..  If interested in scheduling a training session, let me know.



We have other firm newsletters to which you can subscribe by simply letting the editor (or me) know, including a new publication, which was created to advise on business and employment law questions:

  • Employment & Business Pointers aims to provide our clients and subscribers with timely information and practical, business-oriented solutions to the latest employment and general business law developments.  Contact Joseph S. Brown  [email protected].

to subscribe.

  • Premises Pointers:  This monthly electronic newsletter covers current cases, trends and developments involving premises liability and general litigation. Our attorneys must stay abreast of new cases and trends across New York in both State and Federal Court and will now share their insight and analysis with you. This publication covers a wide range of topics including retail, restaurant and hospitality liability, slip and fall accidents, snow and ice claims, storm in progress, inadequate/negligent security, inadequate maintenance and negligent repair, service contracts, elevator and escalator accidents, swimming pool and recreational accidents, negligent supervision, assumption of risk, tavern owner and dram shop liability, homeowner liability and toxic exposures (just to name a few!).  Please drop a note to Jody Briandi at [email protected] to be added to the mailing list.
  • Labor Law Pointers:  Hurwitz & Fine, P.C.’s Labor Law Pointers offers a monthly review and analysis of every New York State Labor Law case decided during the month by the Court of Appeals and all four Departments. This e-mail direct newsletter is published the first Wednesday of each month on four distinct areas – New York Labor Law Sections 240(1), 241(6), 200 and indemnity/risk transfer. Contact Dave Adams at [email protected] to subscribe.
  • Products Liability Pointers:  Whether the claim is based on a defective design, flawed manufacturing process, or inadequate instructions/warnings, product liability litigation is constantly evolving.  Products Liability Pointers examines recent New York State and Federal cases as well as high court decisions from other jurisdictions, keeping our readers up-to-date with the latest developments and trends, and providing useful practice tips and litigation strategies.  This monthly newsletter covers all areas of product liability litigation, including negligence, strict products liability, breach of warranty claims, medical device litigation, toxic and mass torts, regulatory framework and governmental agencies.  Contact Brian F. Mark at [email protected] to subscribe.
  • Medical & Nursing Home Liability Pointers.  Hurwitz & Fine, P.C.’s newest legal alerts contain timely news on the impact of COVID-19 on medical and nursing home liability claims.  Contact Chris Potenza at [email protected] to subscribe.



This column, ruMIRNAtions, brings two of my passions—Diversity/Equity/ Inclusion and Insurance—together in one place. I will be discussing initiatives to increase diversity, demographic statistics in the industry, insurance cases involving equity and inclusion considerations and general ethics in legal matters (like the tripartite relationship).

Mirna M. Santiago

[email protected]


One Hundred Years Ago – Lynching:

The Birmingham Reporter
Birmingham, Alabama

22 Jan 1921


No violation can be more deplorable than one committed by law enforcement officers and guardians of peace.  The lynching of miner Baird in Walker County is a shameful incident, it is the worst of savagery, without treason and yet no more deplorable and no more in violation than the murder a few weeks ago at Lewisburg of an innocent Negro woman who lay asleep in her bed when it is charged that some ill-spirited striking miner sent off a stick of dynamite and blew her to her death and seriously injured her husband all because the husband of this home continued to work in the mines in support of his family.  There can be excuse for those who lynched young Baird who killed the soldier boy; there should be no excuse for the unapprehended who killed even without warning an innocent woman powerless to defend herself and who had committed no offense.


Peiper on Property and Potpourri:

In case you haven’t heard, the Buffalo Bills are good.  No, really, like actually relevant again.  If you’re looking for more information, we’d refer you to the multitude of space dedicated to the team in the following paragraphs.  We’re all pretty excited about it, but not all of us are hopping on an airplane headed to KC.

Football aside, winter has finally returned to WNY.  At last, some real snow to ski on.  I’ll pass on the bbq this weekend to enjoy some apres ski.  The cost of trip to KC for me, or a trip to the ski hill with two kids, is roughly equivalent.  At least, I won’t be tired on Monday.

Speaking of skiing, be sure to check out the Bruno case reviewed in this week’s column (how’s that for a professional transition?).

In that case, the Third Department tackles an interesting spoliation question.  As with most spoliation arguments these days, the dispute was over a deleted blog entry.  The kicker for the Appellate Division was not that the comment was deleted, but that plaintiff repeatedly lied about its existence and his decision to remove it.  Plaintiff’s unsportsmanlike conduct resulted in a penalty being assessed, and upon further review the call was upheld.  Points scored for the defense(ant).

In short,

  • Bills = good
  • lying = bad,
  • skiing = $$$
  • Barnas = superfan. 

That’s it for this week.

P.S. = Go Bills.

Steven E. Peiper

[email protected]


Huge Bodily Injury Verdict:

Times Union
Brooklyn, New York
22 Jan 1921



Mrs. Bella Green, of 193 Watkins street, will today receive a check for $18,000 in settlement of a suit for personal injuries resulting from being struck by a heavy automobile truck on September 29 last.  It was in her effort to save her son, Samuel,  ten months old, whom she was wheeling in a baby carriage, that she was hurt.

It was a bright, sunny day when Mrs. Green started to give her infant an outing.  She had only pushed the carriage a half-block down the street and was about to cross, when she saw a big automobile, owned by M. Rean & Company, a trucking concern, bearing down in her direction.  It was within a few feet of her and she attempted to save the baby by shoving the carriage ahead to a place of safety.  She was a moment too late, however.  The big truck struck the carriage and wrecked it.  The hood was torn from the body of the vehicle and thrown some distance.  Little Sammy, by a curious chance, was carried in the hood and landed on the pavement, unhurt.  Mrs. Green was not so fortunate.  The truck struck her and an ambulance surgeon, a few minutes later, found she had both legs broken.  She was removed to St. Mary’s Hospital.


Wilewicz’ Wide-World of Coverage:

Dear Readers,

As we continue to plug away, amidst our ubiquitous masks and sanitizers, now that we are nearing the one year mark of the pandemic, I find that I am really starting to miss travel. At first it was nice to take a break from my favorite hobby, after extensively traveling the planet in 2019. Despite outward appearances, I am a homebody and a bookworm, so it was pleasant to be trapped in a months-long snow day. Things are finally starting to wear on me, however, as my passport sits unstamped and my frequent traveler cards charge me annual fees for literally doing nothing. I’m resigned to the notion that things won’t be back to normal until at least the summer, but in the middle of this gray winter, that seems awfully far away.

In any event, in this week’s Wide World of Coverage, it turns out that the Second Circuit is not really issuing many decisions of late at all, let alone interesting coverage opinions. So, we once more turn to other Circuit Courts of Appeal to find something to bring to you. Here, we have Parker Law Firm v. Travelers, a case out of Arkansas, but with some New York connections. In that case, the Eighth Circuit analyzed an arbitration clause and also policy language under business personal property and CGL policies. At issue was whether a finding from another state (that an arbitration provision mandated arbitration) precluded a state court to find otherwise. In short, it did, and in a case involving the transfer of business funds, if there was no direct physical loss there was no coverage for loss of or damage to Covered Property. It’s an interesting and well-written decision; the summary is attached in our edition, with a link to the full opinion.

Until next time,

Agnes A. Wilewicz

[email protected]


Forget the Lie Detector, How about a Truth Detector?:

The Morning News
Wilmington, Delaware

22 Jan 1921



Possibility Says Professor Miller, of Case School of Science

Wife May Be Able to Take Picture of Voice, So Be Careful

By International News Service.

Detroit, Mich., Jan. 20—Husbands of the near future, listen to this:

When you come home and tell wifey you were unavoidably detained at the office, be careful, for she may have a little “truth detector” in her home.   The “truth detector” is a possibility, said Professor Dayton C. Miller, D.S.C., of the Case School of Applied Science, speaking before a large gathering of members of the Detroit Engineering Society in the Board of Commerce.

By it wifey would be able to take pictures of your voice.  Through study of the pictures he would know whether you were really at the office or were imbibing less than 2 1-2 per cent. at a cabaret, with perhaps a little chicken on the side.

Professor Dayton had many pictures of sound, which he made while studying shell shock and allied problems for the United States ordinance corps during the war.

When he was young Dr. Dayton started out to study the flute, silver, gold and wood, to determine which was best, and why.  He is approaching the winter of life and has never had time to determine the problem of the flute, but he did find out why Caruso burst a blood vessel and why the report of a great rifle can kill a man.


Barnas on Bad Faith:

Hello again:

Greetings from Buffalo, New York, where, after many years of dormancy, Buffalo Bills fever is once again sweeping over Western New York.  I am happy to say that I tested negative for COVID and was able to attend the win against the Colts almost two weeks ago.  Since then, the Bills beat the Ravens and have advanced to play the defending Super Bowl Champion Kansas City Chiefs this coming Sunday.  I was not able to get one of the coveted tickets for the Ravens game, but I think I have a shot at getting to Kansas City on Sunday to watch the Bills play for the right to go to Super Bowl LV.  Still seems weird to use the terms “Bills” and “Super Bowl” in the same sentence and for it not to be some sick joke.  Fingers crossed and Go Bills.

I have two New York Appellate Division cases in my column this week.  In both cases, the court dismissed extra-contractual claims made by the policyholder against the insurer.  The court in the Barry’s case also dismissed claims made individually against Allstate insurance adjusters alleging tortious interference with contract.

That’s all for now.  Stay healthy and stay safe.

Brian D. Barnas

[email protected]


Enlisted at 11, Married at 15:

New York Herald
New York, New York

22 Jan 1921


A.E.F. YOUTH MARRIES AT 15. Raymond Burleigh, 29 Months  in War, Weds in Nebraska

LINCOLN, Neb., Jan. 21.—Raymond Burleigh, said to be the youngest soldier to serve with the American Expeditionary Force, was married here Tuesday to Miss Corrinne Buffum, it became known to-day.

Burleigh is said to have enlisted in 1917 at the age of eleven.  He served twenty-nine months in France.


Off the Mark:

Dear Readers,

Now that the holidays are behind us, it’s back to the grind.  To that end, it seems as though I have had depositions every other day since the start of the year.  Motion practice, discovery exchanges, and court conferences have also continued to increase.  Clearly, people are getting used to doing things virtually.

Although I have been busy, the courts are still emerging from their end of the year shutdowns.  As such, there were no construction defect decisions to be had.

Until next time …

Brian F. Mark
[email protected]


Arming the Priests, a Century Ago:

New York Herald
New York, New York
22 Jan 1921


Will Ask Permit Following Robbery Of Crucifixes and Candelabra.
Vandals Fail to Find Sacred Vessels Of Church of Nativity.

The Rev. John L. Belford has offered a reward of $100 and no questions asked for the return of the crucifixes, candlesticks and candelabra stolen by burglars Thursday night from the Roman Catholic Church of the Nativity, at Classon avenue and Madison street, Brooklyn, of which he is pastor.  He also declared yesterday that he is going to get a permit to have a shotgun about the church and rectory and that he would be ready for the next gang of thieves that tried to enter the edifice.  The church is one of the most prominent Catholic churches in the borough.

The robbery was the fourth in a Catholic church within the last month, in all of which valuable articles have been stolen. 

Boron’s Benchmarks:

We hope you are well as we write to you on President Biden’s Inauguration Day.  Those of you not from Western New York may not realize that Buffalo, New York, was the site of a presidential inauguration nearly 120 years ago, on September 14, 1901.  Theodore Roosevelt was sworn in as the 26th President of the United States at a private citizen’s home, just a handful of blocks away from where our Hurwitz & Fine Buffalo offices are located.  This was in the wake of President William McKinley’s assassination while attending the Pan-American Exposition of 1901 in Buffalo.  Roosevelt had been Vice President of the United States only 194 days when he succeeded to the Presidency, a few weeks shy of his 43rd birthday.  So young, compared to most of our recent Presidents!  There was no pomp or ceremony to Roosevelt’s Buffalo inauguration, other than the swearing-in process.  Roosevelt was sworn in not by the Chief Justice of the United States, but rather, by U.S. District Court Judge for the Western District of New York John R. Hazel.  Roosevelt won the next election, and so was able to have a full measure of pomp and ceremony at his second inauguration in March 1905 at the U.S. Capitol in Washington.  It is fascinating to me to ponder the various emotions that must have been experienced by the handful of people present at the presidential inauguration on September 14, 1901, in Buffalo. The house where Roosevelt was sworn in that day was for a time later in its history converted into a restaurant, but since November 2, 1966, has been an authorized national historic site, today called The Theodore Roosevelt Inaugural National Historic Site.  Worth a visit if you’re ever in Buffalo.

For this edition of Boron’s Benchmarks, the Coverage Pointers beat monitoring and reporting on insurance coverage decisions of the high courts of the 49 states not named New York, I’ve selected for your consideration an Opinion issued on December 18, 2020, by the Supreme Court of North Carolina in N.C. Farm Bureau Mutual Insurance Co., Inc. v. Martin.  In a declaratory judgment action commenced by the insurer, the North Carolina Supreme Court analyzed the conditional issue of household residency, ultimately holding there was no coverage under the insureds’ auto insurance policy because the defendants were not “residents” of the insured’s “household” at the time of the accident.

Have a healthy and happy next two weeks, and Go Bills!

Eric T. Boron

[email protected]


Whiskey a Go-Go:

The Buffalo Times
Buffalo, New York

22 Jan 1921

Search Train, Get 70 Quarts of Scotch

Seventy quarts of Scotch whiskey en route from New York City to Chicago were stopped here last night when Detectives Ray Delahunt and John Fridel took Abraham Goldstein and the Scotch off New York Central train No. 5.  The whiskey was confiscated and Goldstein, who is 30 years old and lives in New York, was locked up, charged with violating the Volstead act.  He is also accused of trying to hand $60 to the two detectives. 


Barci’s Basics (On No Fault):

Hello Subscribers!

I hope you are all still staying healthy and safe! I asked last time what length of time you think is required to be considered ‘living’ somewhere. For me, I think if you stay somewhere for a month or more that would be considered living. So by my own logic, I have lived in Rochester, NY; Irondequoit, NY; Ontario, NY; Canandaigua, NY; Pittsburgh, PA; Bilbao, Spain; Amherst, NY; and Tonawanda, NY. Let me know the places you consider yourself to have lived! And Go Bills!

For next time consider: What is a TV show you loved, but wouldn’t watch again?

On the no-fault front, I don’t have any cases to report to you today. Hopefully, there will be some next time!

That’s all folks,

Marina A. Barci

[email protected]


Maid Off with the Goods:

Buffalo Courier
Buffalo, New York

22 Jan 1921



Mount Vernon, N. Y., Jan. 21.—Called from her home here by a false telephone message, which reported her husband ill in New York, Mrs. William Borsdorf returned late today to find jewelry worth $2,000 and her maid missing.

Mrs. Borsdorf, the wife of a broker, attempted in vain to telephone her home when she learned the message was false.  She told the police that the maid, whom she engaged a week ago, disappeared after taking her five-year-old son to the home of a neighbor.  Cash and checks also were taken, she said.


Ryan’s Capital Roundup:

Hello Loyal Coverage Pointers Subscribers:

My wife and I were in attendance for the Buffalo Bills’ Divisional Round Playoff Game this past week, in which Buffalo hosted the Baltimore Ravens. My voice is gone, but my spirit lives on. Onwards to the AFC Championship. Hold on to your hats and remember, Chiefs, nobody circles the wagons like the Buffalo Bills. SUPERBOWL!!!

This edition, the column discusses two assembly bills that were sent to the Senate recently concerning premium reductions for completed safety courses. The first involves premium reductions for completion of boating safety courses. The second involves premium reductions regarding safety courses for for-hire vehicles.

Until next time,

Ryan P. Maxwell

[email protected]


All-Star Pitchers:

The Brooklyn Daily Eagle
Brooklyn, New York

22 Jan 1921



Now that the signing of the New National Agreement making Judge Kenesaw Mountain Landis the High Commissioner of Organized Baseball and the signing of individual pledges by the major league magnates not to throw verbal at one another have rid the sport temporarily of much of its noisy politics, fans are turning to the game itself.  That is a healthy sign.  Baseball will never be harmed by the discussion of plays and theories of plays.

In keeping with the movement back to real fan talk is the tearful lament and pertinent query from Cullen Cain, a lugubrious St. Louis roofer, as uttered in the Sporting News of St. Louis.  Brother Cain is moved to tears by the fact that the St. Louis Cardinals led the National League in time batting average in 1920 and the St. Louis Browns led the American League, yet the Cardinals finished out the first division and the Browns finished fourth.  The Cardinals, it happens, finished last in fielding, and the Pittsburg Pirates, who were last in batting, were first in fielding, and landed in fourth place on the race.

Noting the disparity between the base hits of the Cardinals and Browns and their games won, Brother Cain wrathfully concludes that the fault with both teams was inefficient pitching, and that it would have been a good idea to sell or trade some of the profound swatters for competent twirlers.  He makes the ancient and potent observation that teams that could not hit enough to keep themselves warm have one pennants when they had good pitching, but that no team of sluggers ever copped a bunting with feeble hurlers.  The lad’s right. 


CJ on CVA and USDC(NY):

Hello Readers,

It is hard to believe that another two weeks have passed by. We seem to be in the thick of the typical Buffalo winter, the wind is bitter and ski country is getting plenty of snow. The only thing that has been different this year is that the Buffalo Bills have been dominating the post season. Ever since I can remember the Bills have been, well, the Bills. We had seasons that were okay, some that were downright terrible, but this year’s team has brought a new and exciting energy to fans everywhere! This weekend the Bills will be taking on the Kansas City Chiefs in what will be an exciting contest.  I’ll be glued to the TV all day Sunday and know that all of our subscribers will be wearing their blue and red and cheering the Bills on with us.

Now onto the important things… The District courts remain more quiet than usual, but I was able to find a case discussing an issue that arises every time a client requests a declaratory judgment action related to an underlying liability suit; whether or not to include nominal, sometimes referred to as notice, parties in the DJ action. One of the considerations to evaluate is what impact this notice party will have on your ability to bring an action in a particular forum, and what may happen to your action should the named insured stipulate to the relief requested in the complaint. This week I present a case that discusses that exact issue. The moral of the story is you cannot bring an action in federal court without subject matter jurisdiction and ripeness.

See you in two weeks,

Charles J. Englert, III

[email protected]       


Watchman on the Watch:

The New York Times
New York, New York

22 Jan 1921


Watchman Cuts Sputtering Bomb Fuse; Saves Building but Is Badly Burned

In a gallant and successful effort to save the building he was guarding from being destroyed by a bomb, Tony Frankle of 191 Buffalo Avenue, Brooklyn, was burned badly about the hands and arms early this morning.

Frankle, who is 53 years old, is employed to watch the structure at 154 East Fifty-third Street, between Lexington and Third Avenue, which is being altered from a stable to a garage.  Just before 2 o’clock this morning while prowling about the premises to make sure that all was well, he saw sparks in the basement entrance.  At first he thought a fire was getting under way, but a second glance showed a puttering fuse attached to what evidently was a bomb.  The contrivance was gig enough to destroy the building if it contained high explosive.

Kneeling over it, Frankle got out his knife, opened it hurriedly and began to saw at the fuse with a dull blade.  It took him several seconds to sever the fuse, and while he worked the sparks inflicted painful injuries on his hands and arms.  But an inch and a half of fuse protruded from the bomb when Frankle succeeded in cutting it.  He grabbed the object and ran to the street where a patrolman took him to the East Fifty-first Street Station.  There an ambulance surgeon from Flower Hospital treated his injuries.  Inspector Callahan of the Bureau of Combustibles began an examination of the bomb, while detectives went out to try to determine the motive for placing it where it was found.


Dishing Out Serious Injury Threshold:

Dear Readers,

Hopefully, everyone is having a great start to the New Year. It has been a busy start to the year over here with no signs of slowing down. As we speed into 2021, let’s be grateful for making it through the difficulties of the last year and work towards a better year going forward.

In the Serious Injury Threshold world, we have two cases this issue. The first deals with a scar injury that was well healed and it being insufficient to be considered a significant disfigurement as a matter of law. The second deals with plaintiff’s expert’s failure to address preexisting conditions thereby failing to raise a triable issue of fact as to causation sufficient to defeat defendant’s motion for summary judgment.

Be well,

Michael J. Dischley
[email protected]  


Car Confiscated for Carrying Illegal Booze?  Get an Insurance Policy.:

New York Herald
New York, New York
22 Jan 1921

To Insure Automobiles Against Confiscation

ATLANTA, Jan. 21—“Confiscation insurance” for the protection of dealers and owners of automobiles which have been captured in the transportation of liquor, is now being considered by leading insurance companies, according to an announcement to-day by insurance officials here.

The movement has resulted from the recent decision by the United States Supreme Court that automobiles captured in the transportation of liquors are subject to confiscation by the Government regardless of their ownership.

Advices to insurance officials here state that the national automobile conference, composed of insurance companies that write automobile, fire, theft and liability insurance is engaged in the preparation of a policy that will protect dealers and owners alike against the loss of their cars through confiscation by the government. 


Bucci on “B”: 

Hello all.  Happy Inauguration Day (I’m writing this on Inauguration Day).  I am sure the ceremony was lovely, and I hope to catch it streaming later.   

I reported on a couple of Coverage B cases today, including one from the Second Department, short and sweet as usual.   But interesting.  Give it a read!

I’ve been keeping busy in my spare time reading A Gentleman in Moscow (thank you Andrea Schillaci).  Anyone read it ?  What are your thoughts.  I’m also back to watching A Handmaid’s Tale, which I stopped watching because it can be pretty disturbing.  But if you have a strong stomach, it is a good one. 

I do not have much more to say today (shocking).  COVID has hit very close to home and we are expecting awful news at any minute.  I’m praying (pleading) but wishing there was something I could do.   We can’t even be with my beautiful cousin and friend, because of the COVID restrictions.  

BUT, it’s a new day, with a new president, who promises to do everything in his power to make it go away!  I have very high hopes.

Diane L. Bucci

[email protected]


Predicting a Home Run Duel:

The Rock Island Argus
Rock Island, Illinois

22 Jan 1921

Baker and Ruth May Fight Home-Run Duel This Year

“Homerun” Baker may be bumping the pill  over the American league barriers again.

Last season the Yanks—to whom the Marylander belongs—wanted him might bad.  Then along came little Erin Ward and they almost forgot Frank.

Clark Griffith is making overtures to Manager Huggins for a swap that would give Washington Babe Ruth’s predecessor as a fence-buster.

The death of Baker’s wife before the 1920 season opened left with two small children to care for.  He quit the game then so he could be home.

In case of a Washington deal he could be near his family during the home stands of the Nationals.

Baker last summer played semi-pro ball near his own bailiwick.

The coming of the mighty Babe Ruth had dimmed the records that won Baker his home-run prefix.

But he can still hit ‘em.

And the Washing club surely needs swatters.

The fans would like to see Baker and Ruth in a home-run duel in 1921.

Editor’s Note:  It wasn’t much of a duel:  At the end of the 1921 season, the Babe ran away with the title.  Home Run Baker hit a mere nine dingers, ending up in 27th place.  By the way, I never before heard of “High Pockets Kelly”, who played 15 years in the National League.

1: Babe Ruth (59)

2: Ken Williams (24)

3: Bob Meusel (24)

4: Tillie Walker (23)

5: High Pockets Kelly (23)


Lee’s Connecticut Chronicles:

Dear Nutmeg Newsies:

It seems like this is a season for renewal. The times brings us a new year, a new president, a new vaccine, and just maybe some light at the end of the tunnel of a renewal of normalcy. I worked the other day with one eye on my computer and the other on the inauguration proceedings. No matter your side of the political spectrum, we’ve all seen our candidates win and lose over the years. But the renewal, every four years of a peaceful transfer of power is truly something to behold and even marvel. We should not take it for granted—and the events of the last weeks and months demonstrate that fact.

Another thing we should not take for granted is that underwriting files are only discoverable in rescission cases. In this week’s look at Connecticut insurance law, we renew our understanding of basic objections and the relevance of underwriting and claim files, as well as policy and procedure manuals.

Lee S. Siegel

[email protected]       


Black Sox and the Future of Baseball:

The Tampa Times
Tampa, Florida

22 Jan 1921



Kenesaw Mountain’s New Baseball Laws Must be Obeyed.

Chicago, Jan. 22.—Ignorance of the new rules which will govern organized baseball with the regime of Judge Kenesaw M. Landis, as baseball commissioner, will not be accepted as an excuse for their violation by the players, club owners of league officials, said President John M. Heydler, of the National League today.  In order that the public and everyone connected with baseball may be informed of the conditions under which baseball will enter the new era, Mr. Heydler is having published a pamphlet containing every agreement and contract entered into by club owners or leagues at the various meetings this winter.  This book will contain copies of the new form of players’ contract, the contract with Judge Landis, the major-minor agreement and numerous other documents.

Copies will be sent to every player and owner, to all newspapers and to anyone else who asks for one, Mr. Heydler said.

“While the newspaper accounts generally have informed the public of the new governing rules, we want everyone interested to have a copy of the import agreements entered into heretofore,” Mr. Heydler said.


Rauh’s Ramblings:

Dear Readers:

Only four days left until the AFC Championship Game!  Although I am definitely nervous for this game against the Chiefs, I really believe the Bills will come out on top!  Fingers crossed! I am hopeful that when the next Coverage Pointers newsletter comes out in two weeks, we will be getting ready to play in (and win) the Super Bowl!!  Stay tuned!

Today, I bring you two life insurance cases – one from the First Department and another from the Fourth Department.  The First Department case involves a situation where a life insurance policy lapsed due to the insured’s failure to timely pay the annual premium by the end of the grace period.  The Fourth Department case involves a Plaintiff who sued his disability insurance carrier for breaching its duty to provide the Plaintiff with residual disability benefits and total disability benefits.

Until next time…Go Bills!

Patricia A. Rauh

[email protected]


A Bargain at Twice the Price:

The Philadelphia Inquirer
Philadelphia, Pennsylvania

22 Jan 1921

Men’s All-Wool Suits at $25

Now you can choose, sir, from all-wool suits of cassimere, cheviot, in brown or gray mixtures or plain oxford gray. Well-tailored, semi-conservative suits for businessmen who recognize sound worth.  Coats are in two or three button sack style, as most men like them.

As well as fittings in regular sizes, there are suits for men who are stouter or thinner than the average.


2400 Men’s Fine Shirts, $1.55 In the Annual Men’s Sale

Shirts made of closely women 80x80 thread percale.  Colors are guaranteed fast.  Each shirt is made over Wanamaker standard dimensions which are famously large and comfortable.  Every shirt new, fresh and ready to wear.  Plenty of black, blue, brown and white stripes, and some two-tone effects.

This sale brings these thoroughly good shirts at the lowest price of the season.  Sizes 14 to 17 in each pattern.


Headlines from this week’s issue, attached:

Dan D. Kohane

[email protected]

  • Duty to Defend under Additional Insured Endorsement
  • Issues of Fact as to Whether Accident Arose out of Use of Vehicle Precluded Coverage Determination
  • Stolen Car is an Uninsured Motor Vehicle and Therefore Not Covered by Liability Policy
  • Coverage Provided by Named Insured to Additional Insured, was Primary as Between the Two Carriers
  • In Case of First Impression, Following Carlson, Court finds that NJ Corporation had “Substantial Business Presence” in New York so NY Disclaimer Rules Applied.  Failure to Send Disclaimer to Insured of Tendering Insurer, Also Found Ineffective


Steven E. Peiper

[email protected]

First Party

  • Policy Date Listed in Declarations Controlled When Annual Premium Was Due
  • Amended Complaint Rejected Where Total Disability Claim Was Time-Barred



  • Missing Blog Entry Results in Adverse Inference Charge


Michael J. Dischley

[email protected]

  • Plaintiff Was Unable to Establish that the Scar Plaintiff Sustained as a Result of the Subject Accident Was a Significant Disfigurement as a Matter of Law
  • Plaintiff Was Unable to Raise Triable Issue of Fact as to Causation Based on Expert Affidavit Failure to Address Preexisting Conditions


Agnes A. Wilewicz

[email protected]

  • Eighth Circuit Court of Appeals Finds that Bringing an Action in Another State Court to Essentially Relitigate a Decision to Arbitrate is Barred by the Rooker-Feldman Doctrine; and There is No Coverage for Business Property Where there is No Direct Physical Loss


Brian D. Barnas
[email protected]

  • Causes of Action Against Adjuster Defendants for Tortious Interference with Contract were Dismissed
  • Allegation that Insurer Refused to Make Payment Under the Policy was Insufficient to State Claim for Breach of Contract Where Evidence Refuted that Claim


Lee S. Siegel

[email protected]

  • Underwriting File Must Be Disclosed Where Ambiguity is Alleged


Diane L. Bucci

[email protected]

  • Vague Allegations Do Not Trigger Coverage; Promoting Oneself is not Disparaging Another
  • Selling Counterfeit Goods Is Not Use of Another’s Advertising Idea


Brian F. Mark
[email protected]

  • There were no newsworthy construction defect cases to discuss this edition.


Eric T. Boron

[email protected]

  • Auto Insurance – Summary Judgment for Insurer Upheld - Relatives of Named Insured Not Entitled to UIM Benefits or Medical Payments Because They Were Not Residents of Named Insured’s Household and Therefore Not Insureds Under the Policy


Marina A. Barci

[email protected]

  • No cases to report this issue, check back next time!


Ryan P. Maxwell

[email protected]

  • Assembly Passes Bill That Would Remove Mandatory Language Related To Premium Reductions Upon Completion of Boating Safety Course
  • Assembly Passes Bill That Would Ensure A Premium Reduction For-Hire Vehicles Does Not Impact Other Personal Auto Rate Reductions


CJ on CVA and USDC(NY)
Charles J. Englert III

[email protected]

  • A Party Cannot be “Nominal” for Purposes of Diversity Jurisdiction but “Real” for Purposes of Deciding Whether there is an Actual Controversy that Would Support the Court’s Continuing Jurisdiction


Patricia A. Rauh

[email protected]

  • Plaintiff is Not Entitled to Coverage Under the Policy Because the Policy Had Lapsed Before the Insured’s Death
  • Defendant Did Not Breach its Duty to Pay Plaintiff Residual Disability Coverage and the Alleged Breach to Pay Plaintiff Total Disability Benefits is Time-Barred as the Relation-Back Doctrine Does Not Apply Here


Mirna. M. Santiago

[email protected]

  • Diversity (or the Lack Thereof) in the Insurance Industry


That’s all there is and there is no more.  We love hearing from you.



Hurwitz & Fine, P.C. is a full-service law firm providing legal services throughout the State of New York and providing insurance coverage advice and counsel in Connecticut.

In addition, Dan D. Kohane is a Foreign Legal Consultant, Permit No. 000241, issued by the Law Society of Upper Canada, and authorized to provide legal advice in the Province of Ontario on matters of New York State and federal law.


Dan D. Kohane
[email protected]

Agnes A. Wilewicz
[email protected]

Patricia A. Rauh
[email protected]


Dan D. Kohane, Chair [email protected]
Steven E. Peiper, Co-Chair [email protected]
Michael F. Perley
Agnieszka A. Wilewicz
Lee S. Siegel

Brian F. Mark
Diane L. Bucci

Mirna Martinez Santiago
Scott D. Storm
Brian D. Barnas

Eric T. Boron
Marina A. Barci
Ryan P. Maxwell
Charles J. Englert
Patricia A. Rauh
Diane F. Bosse
Joel R. Appelbaum


Steven E. Peiper, Team Leader [email protected]
Michael F. Perley
Scott D. Storm
Eric T. Boron
Brian D. Barnas


Dan D. Kohane

[email protected]

Marina A. Barci


Jody E. Briandi, Team Leader
[email protected]
Mirna Martinez Santiago
Diane F. Bosse

Topical Index

 Kohane’s Coverage Corner

Peiper on Property and Potpourri

Dishing out Serious Injury Threshold

 Wilewicz’s Wide World of Coverage Barnas on Bad Faith

 Lee’s Connecticut Chronicles Off the Mark

 Boron’s Benchmarks

 Bucci on “B”

 Barci’s Basics (on No Fault)

 Ryan’s Capital Roundup CJ on CVA and USDC(NY)

 Rauh’s Ramblings ruMIRNAtions


Dan D. Kohane
[email protected]

01/21/21       First Mercury Insurance Co. v. Preferred Contractors Ins. Co.
Appellate Division, First Department
Duty to Defend under Additional Insured Endorsement

In this action between insurers, plaintiff First Mercury (“FMIC”) seeks a declaration that Lloyd's has a duty to defend and indemnify FMIC's insured, the property owner, in the underlying personal injury action, pursuant to an "additional insured" endorsement in the policy Lloyd's issued to the owner's construction manager.

At this stage, the pleadings are sufficient to allege, and the documentary evidence does not conclusively refute, that Lloyd's named insured proximately caused the underlying accident, and thus that under the policy, there is a reasonable possibility of coverage that could trigger at least a duty to defend. Editor’s Note: Carrier submitted the policy, the underlying pleadings and the trade contract to refute its insured’s involvement, but it was not enough as the allegations in the complaint included claims against the owner’s agents, which included the construction managers.


01/20/21       Progressive Direct Insurance Company v. Riviccio
Appellate Division, Second Department
Issues of Fact as to Whether Accident Arose out of Use of Vehicle Precluded Coverage Determination

Riviccio allegedly sustained personal injuries when a vehicle operated by Peter McArdle (“Peter”) and owned by Maureen McArdle struck her, pinning her against a vehicle operated by Daniel J. Hall (“Daniel”) and owned by the Edmund J. Hall (“Edmund”). Riviccio claimed that Peter, who was then her boyfriend, was driving slowly beside her, attempting to convince her to get into his vehicle. Daniel allegedly arrived on the scene "at a high rate of speed" and parked his vehicle in front of Peter's "in such a manner as to prevent [Peter's] vehicle from moving." Daniel allegedly exited his vehicle, which was illegally parked and still running, and began punching Peter through the window of his car. As Riviccio proceeded to walk between the two vehicles, Peter's vehicle allegedly rolled forward, pinning her against the Hall vehicle and causing her to sustain injuries.

Riviccio sued, among others, Daniel and Edmund. Edmund moved for summary judgment dismissing the underlying complaint claiming he could not be held vicariously liable for Riviccio's injuries under Vehicle and Traffic Law § 388(1) because they were not the result of the "use and operation" of the Hall vehicle.

Progressive insured Hall and claimed that the accident did not "aris[e] out of the ownership, maintenance, or use" of the Hall vehicle. The lower court denied Progressive's motion on the ground that the issue was previously decided in the underlying action and, therefore, Progressive was collaterally estopped from contesting the issue. Progressive appeals.

Progressive was not collaterally estopped from litigating the issue of whether the accident arose "out of the ownership, maintenance, or use" of the Hall vehicle.

Specifically, the order denying Edmund's motion for summary judgment in the underlying action did not necessarily decide that issue.

However, Progressive's motion for summary judgment was properly denied as it failed to establish, prima facie, that the accident did not arise out of the ownership, maintenance, or use of the Hall vehicle.


01/20/21       Hartford Accident & Indemnity Company v. Dellegrazie
Appellate Division, Second Department

Stolen Car is an Uninsured Motor Vehicle and Therefore Not Covered by Liability Policy

On April 4, 2016, a thief stole a business truck owned by Dellegrazie and ran him over in the course of the theft, resulting in Dellegrazie's death. Dellegrazie had insured the vehicle under a business auto policy with the petitioner, Hartford. The administratrix of Dellegrazie's estate (hereinafter the administratrix) made a claim for uninsured motorist coverage under the policy.

In a letter dated September 6, 2016, Hartford disclaimed coverage on the ground that, pursuant to the definitions in the policy, the term "uninsured motor vehicle" did not include a vehicle that was insured under the liability coverage of the policy. Hartford asserted that although the vehicle was stolen at the time of the accident, it did not meet the definition of an "uninsured motor vehicle" because it was otherwise insured under the liability coverage of the policy.

The administratrix made a demand for arbitration of the claim. Hartford then commenced this proceeding to permanently stay the arbitration.

First of all, even though the petition was not filed within 20 days, it was not late, because the coverage denial was based on the grant of coverage rather than an exclusion. A late application will not create coverage where none existed.

However, Uninsured Motorists Coverage should have been provided here.

The SUM endorsement in the subject policy contains the required language. As relevant, it defines the term "uninsured motor vehicle" to include a motor vehicle that through its use results in bodily injury to an insured and for which no bodily injury liability insurance policy applies because at the time of the accident the vehicle was stolen. Immediately after that provision, the SUM endorsement states that the term "uninsured motor vehicle" does not include a motor vehicle that is insured under the liability coverage of the policy.

Once it was determined that the subject vehicle was stolen, it "became an uninsured vehicle pursuant to the terms of the [Hartford] policy" (Matter of Liberty Mut. Ins. Co. v Saravia, 271 AD2d at 535; see Rowell v Utica Mut. Ins. Co., 77 NY2d at 640) and was not a vehicle "[i]nsured under the liability coverage of [the] policy" at the time of the accident”.


01/20/21       Harco Construction, LLC v. First Mercury Insurance Company
Appellate Division, Second Department
Coverage Provided by Named Insured to Additional Insured, was Primary as Between the Two Carriers

Harco Construction, LLC (“Harco”), entered into a contract with the plaintiff 301- 303 West 125th, LLC (“301-303”), to perform construction services on 301-303's premises. Harco subsequently entered into a subcontract with the defendant Disano, the demolition contractor. Disano was required to procure and maintain a commercial general liability insurance policy naming the plaintiffs as additional insureds.

First Mercury Insurance Company (“FMIC”) issued a primary policy of CGL policy to Disano, which included an endorsement specifying that "Who Is An Insured is amended to include as an additional insured any person or organization for whom you are performing operations when you and such person or organization have agreed in writing in a contract or agreement that such person or organization be added as an additional insured on your policy."

Harco had its own policies of commercial general liability insurance and excess liability insurance from Mt. Hawley and the Mt. Hawley policy provided that it was excess over other primary insurance for which the insured had been added as an additional insured, and further provided that "[i]f the insured has rights to recover all or part of any payment we have made under this Coverage Part, those rights are transferred to us  At our request, the insured will bring 'suit' or transfer those rights to us and help us enforce them."

On September 20, 2011, a partially demolished five-story building on 301-303's premises collapsed, causing debris to fall onto the street and a bus. As a result of that occurrence, Harco was named as a defendant in numerous personal injury actions.

On a prior appeal, they determined that because FMIC failed to provide timely notice to Harco of FMIC's denial of coverage on the basis of a policy exclusion, FMIC is estopped from disclaiming insurance coverage on that ground. So, Harco moved for summary judgment declaring that FMIC is obligated to reimburse it for certain defense and indemnification costs incurred on its behalf in the underlying personal injury actions.

Harco established that since FMIC's disclaimer to it was invalid, that it qualified as an additional insured under FMIC's policy, which was primary, noncontributory, and applicable to the underlying personal injury actions, and that its coverage under the Mt. Hawley policies was excess over FMIC's policy.

Accordingly, FMIC had to reimburse Mt. Hawley for defense costs it incurred in defending its insured, since it was the excess carrier.


01/12/21       Vista Engineering Corporation v. Everest Indemnity Ins. Co.
Appellate Division, First Department
In Case of First Impression, Following Carlson, Court finds that NJ Corporation had “Substantial Business Presence” in New York so NY Disclaimer Rules Applied. Failure to Send Disclaimer to Insured of Tendering Insurer, Also Found Ineffective

Under the Carlson case, Insurance Law § 3420(d)(2) applies when (1) a policy covers risks located in New York, and (2) the insured is located in New York. An insured company is "located in" New York if it has a "substantial business presence there" (Carlson v American Intl.Group, Inc., 30 NY3d 288, 306 [2017].

The insured was “East Coast”.

In this case, there was no dispute that the policy here covers risks located in New York. Further, Vista submitted sworn testimony showing that East Coast did not perform any physical work at its New Jersey office, that East Coast maintained a space in New York to stage or coordinate its work and store equipment, and that all of East Coast's workers at the time of the underlying incident were hired from a New York based painting union, and that East Coast's work on the subject painting project took two years to complete and cost approximately $2 million.

That was enough for the First Department, in a case of first impression, to conclude East Coast has a substantial business presence in New York, and consequently is "located in" New York for purposes of Insurance Law § 3420(d)(2). Accordingly, the prompt disclaimer requirements of the statute applied.

Vista's insurer was not seeking contribution on its own behalf, but acting on behalf of Vista for Vista's coverage. Accordingly, Insurance Law § 3420(d)(2) applied, and Everest's disclaimer, issued two months after its third-party administrator requested a copy of Vista's contract with the New York City Transit Authority and a copy of the full underlying complaint, and with no explanation as to the two-month delay, was untimely as a matter of law.


Steven E. Peiper
[email protected]

First Party

01/14/21       Bonem v. William Penn Life Ins. Co.
Appellate Division, First Department
Policy Date Listed in Declarations Controlled When Annual Premium Was Due

In this life insurance case, the annual policy term expired on January 14, 2002. Thus, in order to confirm coverage, premium for the 2002/03 policy year needed to be submitted at, or before, that time. The policy did provide a 31-day grace period which would have permitted the late premium to be cured if it was received on or before February 14, 2002.

The insured died on February 26, 2002 after the policy had lapsed, and coverage was denied. Plaintiff argued that the premium should have been due on January 31, 2002 as January 31st was the date the policy was previously issued, premiums were previously paid and coverage commenced. The argument was belied by the unambiguous terms of the policy which provided the premium was due on the “Policy Date” described in the Declarations which was January 14th.


01/12/21       Weinrauch v. New York Life Ins. Co.
Appellate Division, First Department
Amended Complaint Rejected Where Total Disability Claim Was Time- Barred

Plaintiff commenced this action seeking to recover benefits under a policy issued by NY Life that provided residual disability coverage. In a proposed Amended Complaint, plaintiff proposed adding a second cause of action alleging that NY Life also failed to provide total disability coverage during a period of time which extended from 2003 through 2009.

In affirming the trial court, the Appellate Division rejected plaintiff’s argument that he did not file the total disability claim due to misinformation he received from a representative of NY Life. Rather, documentary evidence established that plaintiff never inquired about total disability coverage in 2002. Further, in 2009, plaintiff claimed that his total disability did not start until 2007.

In addition to plaintiff’s failure to establish he presented a claim in 2002, the Court also ruled that the attempted amendment was futile because the proposed Cause of Action was time-barred. Here, the initial Complaint only asserted claims for residual disability coverage. As there was never any reference to total disability coverage, the initial Complaint did not provide notice of a new claim in order to invoke the protections of the relation-back doctrine.


01/14/21       Bruno v. Peak Resorts, Inc.
Appellate Division, Third Department
Missing Blog Entry Results in Adverse Inference Charge

Plaintiff’s claim centered around a skiing incident that occurred in March of 2016. In summary, plaintiff alleged his injury was resultant from the defendant’s failure to properly close a certain ski trail. Throughout discovery, and in response to questions in his deposition, plaintiff denied making any statements about the condition of the ski hill on social media.

In fact, defendants discovered that months after the accident, plaintiff had, in fact, made comments about the trail conditions on the date of his injury. Plaintiff later deleted the comments. Defendants argued that they had been prejudiced by plaintiff’s decision to delete the commentary, and as such moved for spoliation sanctions.

In opposition, plaintiff produced other social media comments he made about the incident, his injuries and activities since the incident. In granting the application, the trial court found that plaintiff’s decision to delete this discrete blog entry was sufficient to warrant an adverse inference charge at trial. The court also noted that the sanction could be avoided if plaintiff could recovery the discarded blog entry.

In addressing the trial court’s decision, the Appellate Division first noted that a discovery sanction is appropriate even when the loss involves the negligent destruction of material before the opposing party has had an opportunity to inspect the information. Nevertheless, the destroying party must have had an obligation to preserve the material and chose to discard it with a culpable state of mind. Moreover, the party seeking discovery sanctions must further demonstrate that the information requested was relevant to his or her claims/defenses.

With regard to the blog comment, the Court noted that the defendant produced screenshots of an online blog that showed plaintiff had submitted a post and deleted the same. Importantly, the deletion of the entry was after plaintiff was represented by counsel. Thus, he was under an obligation to preserve the material.

The court also found a culpable state of mind was inferred when plaintiff denied making any such comments in earlier discovery responses and in response to questioning at his deposition. It was only under the threat of the dismissal of his lawsuit that he recalled the possibility that he may have made a posting inquiring about whether the trail where he had sustained injury was closed.

Having met the first two prongs of the test for sanctions, the Court next looked at whether defendant had established the relevancy of the missing blog post. Here, the defendant’s main point in opposition is that the trail was closed to skiers at the time of plaintiff’s injury. Any blog post about the condition of the trail by plaintiff “went directly” to the proffered defense.

As a result, the Appellate Division elected to affirm the discretion of the trial court. In so holding, the Court also noted its decision was driven, in part, by the lack of candor exhibited by plaintiff throughout the discovery process.


Michael J. Dischley

[email protected]

01/12/21       Jovito Galindo v. Christian J. Hodminson
Appellate Division, First Department
Plaintiff Was Unable to Establish that the Scar Plaintiff Sustained as a Result of the Subject Accident Was a Significant Disfigurement as a Matter of Law

In an action to recover damages for personal injuries, the plaintiff appeals from an order of the Supreme Court, Bronx County (John R. Higgitt, J.), entered on or about July 1, 2020, which, to the extent appealed from, denied plaintiffs' motion for summary judgment on their claim that plaintiff Clementina Rodriguez Apolonio (Apolonio) sustained a serious injury resulting in significant disfigurement under Insurance Law § 5102(d).

On appeal, the Appellate Court found that plaintiffs failed to establish prima facie that Apolonio's scar constitutes a significant disfigurement under Insurance Law § 5102(d). Although the scar is in a prominent location on her forehead and is a little more than 2½ inches long, it is well healed and not discolored or raised.

Contrary to plaintiffs' contention, the length and the permanence of the scar are not dispositive as to whether the scar is a significant disfigurement. The photographs show a slightly depressed, faint scar near the middle of Apolonio's forehead that a reasonable person may or may not find objectionable.

As such, the Appellate Court unanimously affirmed the Supreme Court decision, without costs.


01/07/21       Xiu F. Wang v. Cara S. Levy
Appellate Division, First Department
Plaintiff Was Unable to Raise Triable Issue of Fact as to Causation Based on Expert Affidavit Failure to Address Preexisting Conditions

In an action to recover damages for personal injuries, the plaintiff appeals from an order of the Supreme Court, Bronx County (Mary Ann Brigantti, J.), entered on or about August 6, 2019, which, to the extent appealed from as limited by the briefs, granted defendants Cara S. Levy and The Institutes of Applied Human Dynamics Inc.'s (hereinafter, defendants) motion for summary judgment dismissing the claim of serious injury to the lumbar spine within the meaning of Insurance Law § 5102(d).

On appeal, the Appellate Court found that defendants established prima facie that plaintiff did not suffer a serious injury to his lumbar spine by submitting plaintiff's MRI report of his lumbar spine and the report of their orthopedic surgeon, who opined that the conditions identified in the MRI report, including osteophytes, were indicative of chronic multilevel disc disease, which preexisted the subject motor vehicle accident.

In opposition, Appellate Court found that plaintiff failed to raise an issue of fact as to causation, as none of his physicians adequately addressed the evidence of preexisting conditions in his own medical records or explained why the preexisting conditions could not have been the cause of his current complaint.

As such, the Appellate Court unanimously affirmed the Supreme Court decision, without costs.


Agnes A. Wilewicz

[email protected]


01/12/21       Parker Law Firm v. The Travelers Indemnity Company
United States Court of Appeals, Eighth Circuit
Eighth Circuit Court of Appeals Finds that Bringing an Action in Another State Court to Essentially Relitigate a Decision to Arbitrate is Barred by the Rooker-Feldman Doctrine; and There is No Coverage for Business Property Where there is No Direct Physical Loss

Parker Law Firm sued PS Finance, LLC, and The Travelers Indemnity Company in relation to a dispute involving a contractual obligation to provide PS Finance with certain payments that the law firm had received on behalf of a client. PS Financed had sued the firm in New York State Court after learning that the firm had received the payments. The New York Court had ruled that the dispute was covered by an arbitration clause in an agreement between the parties, and thus directed them into arbitration. Travelers, in turn, declined to defend the claims brought by PS Finance on the ground that there was no possible basis for coverage under their policy. The firm then sued PS Finance and Travelers in Arkansas State Court, and the case was removed to Federal Court.

The case arose from the law firm’s “representation of Eureka Woodworks, Inc. In 2012, Eureka entered into a contract with PS Finance to provide Eureka with business funding. In exchange, Eureka agreed to assign to PS Finance certain proceeds that the company obtained from a claim against British Petroleum. The claim was for losses that Eureka suffered as a result of the 2010 Deepwater Horizon oil spill in the Gulf of Mexico. Appellants represented Eureka in negotiating the contract with PS Finance and in pursuing claims before a claims facility established by British Petroleum.”

The contract between Eureka and PS Finance provided that Eureka “shall “shall repay [PS Finance] from the proceeds of the settlement, judgment and/or verdict in his/her case.” The agreement further states that PS Finance “is to be paid only if such proceeds are received through settlement, judgment or verdict.” The contract also included an arbitration clause: “Any controversy or claim arising out of or relating to this contract” will be subject to “binding arbitration administered by the American Arbitration Association,” and the arbitration will occur in “Richmond County, New York.” Appellants acknowledged in the agreement that they must distribute any proceeds of Eureka’s claims arising from the oil spill to PS Finance, after subtracting attorney’s fees and costs. Appellants also agreed that any proceeds would not be paid to Eureka until Eureka’s lien to PS Finance was satisfied.

At issue were a couple of things. First, whether the prior claims were properly dismissed on the basis of the Rooker-Feldman doctrine. “Rooker and Feldman established that the inferior federal courts generally lack subject matter jurisdiction over “cases brought by state-court losers complaining of injuries caused by state-court judgments rendered before the district court proceedings commenced and inviting district court review and rejection of those judgments.””

Here, the law firm sought a declaratory judgment that PS Finance’s claims in New York had no merit and were wrongly pursued. However, they were really trying to appeal the New York Court’s decision compelling arbitration. By proceeding with the claims in the district court, appellants necessarily asked the federal court to review and reject the New York court’s ruling that claims concerning amounts owed under the contract must be resolved in arbitration. The claims against PS Finance are thus barred by the rule of Rooker and Feldman.

Secondly, the firm also challenged the dismissal of their claims against Travelers for breach of contract. Interpreting the insurance policy here plainly, it provided coverage for business personal property and commercial general liability. While the firm argued that there was coverage for the alleged losses when the payments were transferred to Eureka, this was not what was contemplated. The business property coverage provided that it would pay for direct physical loss of or damage to Covered Property. That did not apply. Even if it did, the policy excluded the voluntary parting of property. Even if they could get out of this limiting language, they were unable to get at the “direct physical loss” language. As such, Travelers was found to have properly declined coverage for business personal property. On the CGL side, there was no “occurrence” (or accident) in the first place, and thus the policy interpretation did not even make it past the insuring grant.

Brian D. Barnas

[email protected]

01/20/21       Barry’s Auto Body v. Allstate Fire & Casualty Ins. Co.
Appellate Division, Second Department
Causes of Action Against Adjuster Defendants for Tortious Interference with Contract were Dismissed

Barry's Auto Body of NY, LLC, is an automobile repair shop located on Staten Island. Barry’s commenced this action against Allstate and multiple adjusters. The plaintiff asserted causes of action against Allstate to recover damages for breach of contract (first and second causes of action) and violations of General Business Law § 349 (third and fourth causes of action). The causes of action asserted against the adjuster defendants sought to recover damages for tortious interference with contract (seventh through tenth causes of action).

Plaintiff alleged that it had contracted with Allstate's insureds to repair the insureds' vehicles to their "pre-accident condition," and that Allstate agreed to pay for such repairs. The plaintiff alleges that Allstate routinely misled these insureds into believing that Allstate would pay the reasonable cost to repair their vehicles, but in fact, Allstate paid less than the reasonable cost, leaving a deficiency on each of the insureds' claims and damaging the plaintiff. The plaintiff further alleges that the adjuster defendants were aware of the plaintiff's repair agreements with the insureds, and that the adjuster defendants intentionally interfered with such agreements for no legitimate purpose and with the sole purpose of harming the plaintiff.

Allstate moved to dismiss. First, the court concluded that the plaintiff sufficiently alleged that Plaintiff’s complaint stated cognizable causes of action alleging violations of General Business Law § 349. In so doing, Plaintiff also submitted an affidavit of its managing member detailing the allegedly deceptive conduct.

However, the complaint failed to state a cause of action against the adjuster defendants to recover damages for tortious interference with contract. The complaint failed to sufficiently allege that the contracts with the insureds were breached and would not have been but for the adjuster defendants' actions. Accordingly, the causes of action against the adjuster defendants were dismissed.


01/13/21       Kastin v. GEICO General Insurance Company
Appellate Division Second Department
Allegation that Insurer Refused to Make Payment Under the Policy was Insufficient to State Claim for Breach of Contract Where Evidence Refuted that Claim

On June 6, 2016, the plaintiff allegedly sustained personal injuries while operating a vehicle which was struck in the rear by another vehicle. Plaintiff had supplementary uninsured/underinsured motorist (SUM) coverage with Geico with a limit of $250,000 per person.

In September 2017, the plaintiff sent a letter to the defendant to demand that it tender the policy limit. In a responsive letter, the Geico stated that it was willing to negotiate in good faith upon completion of its review of the claim. In October 2017, the plaintiff commenced this action seeking damages for breach of contract and fraud, and alleging, among other things, that the defendant refused to make payment. Geico moved to dismiss.

The evidentiary material submitted in support of the defendant's motion conclusively established that the plaintiff's allegation that the defendant refused to make payment under the subject policy was not a fact at all. Thus, the plaintiff failed to state a cause of action alleging breach of contract.

Furthermore, the plaintiff failed to state a cause of action alleging fraud. A cause of action based on a misrepresentation or fraud must state the circumstances constituting the wrong in detail, and the plaintiff's conclusory allegations that the defendant had no intention of paying the plaintiff the benefits owed under the policy were insufficient to state a cause of action alleging fraud. The plaintiff also failed to state a cause of action alleging a violation of General Business Law § 349, since this action simply involves a private contract dispute involving coverage under the subject policy, in contrast to deceptive conduct aimed at the public at large.


Lee S. Siegel

[email protected]


01/12/21       Admiral Ins. Co. v. Versailles Med. Spa, LLC
United States District Court, District of Connecticut
Underwriting File Must Be Disclosed Where Ambiguity is Alleged

A common discovery battle in coverage disputes in whether to produce a carrier’s underwriting file, as well as its procedures and best practices manuals. Federal Magistrate Judge Thomas O. Farrish ruled that where the insured claims that coverage is ambiguous, the carrier is required to disclose its underwriting file.

Admiral issued Versailles Medical Spa a claims-made errors and omissions policy, covering the insured for claims of professional negligence. A patient brought suit against Versailles, claiming that its treatment of her skin condition was negligent. Versailles tendered the claim and Admiral provided a defense, but only at first. Admiral claimed that it learned in discovery that the plaintiff’s negligence claim pre-dated the policy and withdrew its defense. Admiral then commenced this declaratory judgment action seeking a finding of no coverage.

The complaint generally asserted that the claim was first made prior to the policy period and that the insured insured’s pre-policy inception knowledge of facts and circumstances that might result in a claim ran afoul of the policy’s prior knowledge exclusion. Versailles counterclaimed, making various claims that Admiral acted in bad faith.

Following a Rule 26 conference, Versailles served a number of interrogatory and discovery demands on Admiral, seeking its underwriting file, claim file, similar cases, and its guidelines and best practices manuals. Admiral objected on a variety of grounds. Versailles moved to compel.

First, Versailles claimed that it was surprised by the objections because Admiral said it would produce the documents. Admiral, however, reserved its right to object in the Rule 26 report, and the court found that the writing trumped an alleged oral understanding. As Ronald Reagan told us a generation ago, trust but verify—get your agreements in writing.

The Court then in turn quickly dispensed with Admiral's burdensomeness, overbroad, and vague objections, because such objections ordinarily cannot be sustained without “affidavits or ... evidence revealing the nature of the burden.” Admiral provided none.

The Court then proceeded to analyze the relevance of the insured’s discovery requests. The court found the underwriting file discoverable. Although acknowledging that underwriting files are not discoverable in all cases,

Connecticut courts have held that they are subject to disclosure when the policyholder has “alleged ambiguity in the [insurer's] policy language and there has been no determination concerning whether the language at issue is ambiguous.” Thompson v. Nat'l Union Fire Ins Co. of Pittsburgh PA, No. 3:14-cv- 00259 (WWE/HBF), 2015 WL 753721, at *3 (D. Conn. Feb. 23, 2015) (emphasis

in original). The court continued that in such cases, “[t]he underwriting file is relevant to determining the risks that [the insurer] expected to cover in the policy, how it interpreted the various policy terms, and whether the terms of the policy are ambiguous in the first instance.” Id. Therefore, the court determined that the underwriting file was discoverable. “[A]n insured is entitled to explore what risks the insurer expects to cover in the policy through discovery of underwriting materials.”

The Defendants’ requests for production of Admiral's claim and coverage files, the court also found to be relevant to Versailles’ counterclaims and discoverable. “The Defendants allege in substance that Admiral withdrew its defense without first conducting an adequate investigation (ECF No. 23, ¶¶ 78-84); mismanaged the Voigt lawsuit (id. ¶¶ 86-106); and failed properly to consider whether Voigt's allegations of injury to her scalp and forehead merited a different coverage analysis. (Id. ¶¶ 107-18.)” The court wrote that Admiral's claim and coverage files “will likely shed light on these allegations.” Admiral’s objections that the bad faith claims are infirm was unavailing. “[I]t is well established that discovery ordinarily should not “be denied because it relates to a claim or defense that is being challenged as insufficient.” Wright & Miller, 8 Fed. Prac. & Proc. Civ. § 2008 (3d ed.) (citing cases).”

But all was not lost for Admiral. The court held that the insured did not demonstrate the relevance of the demand for policies and procedures manuals or for the disclosure of similar cases. So, that relief at least was denied to the insured.


BUCCI on “B”
Diane L. Bucci

[email protected]


01/07/21       EMD Millipore Corporation v. HDI-Gerling America Ins. Co.
United States District Court, District of Massachusetts
Vague Allegations Do Not Trigger Coverage; Promoting Oneself is not Disparaging Another

Merck KGAA, Darmstadt Germany (“MKDG”) and Merck & Co., Inc. (“Merck”) had a common heritage but had been unrelated for over a century. In order to coexist in the marketplace, they entered into coexistence agreements, which governed what each company could and could not do in various jurisdictions around the world regarding the use of “MERCK” trademarks. According to Merck, pursuant to these agreements, MKDG could not use “MERCK,” or attempt to acquire rights in any trademark containing “MERCK,” in the United States or Canada. The companies had various disputes about their respective uses of “MERCK” on the internet and otherwise in multiple jurisdictions.

Merck brought suit against MKDG alleging that it “holds itself out to be Merck, thereby infringing and diluting the distinctive quality of the MERCK mark and trade names.” Merck alleged causes of action for federal trademark infringement, trademark dilution, unfair competition, false advertising, and cybersquatting, and New Jersey (where the action was pending) state law claims for trademark infringement, trademark dilution, unfair competition, deceptive trade practices, and breach of contract in connection with MKDG’s use of Merck or other misleading similar names on the internet website of its parent company, EMD.

HDI, MKDG’s insurer, denied coverage contending that none of the claims fit within a defined offense of “adverting and personal injury.” In the declaratory judgment lawsuit that followed, MKDG argued that Merck’s complaint alleged “personal and advertising” injury arising out of MKDG's alleged use of Merck's advertising idea, and/or “personal and advertising injury” arising out of MKDG's alleged publication of material that disparages Merck's goods, products, or services. In this regard, the policies applied to:

Personal and advertising injury means injury, including consequential ‘bodily injury’, arising out of one or more of the following offenses: ... Oral or written publication, in any manner, of material that slanders or libels a person or organization or disparages a person's or organization's goods, products or services; [or] ... The use of another's advertising idea in [an insured's] ‘advertisement’

The court turned to Merck’s allegations in the New Jersey case, which included that MKDG promoted its products, “SedalMerck®,” “Merckognost®,” and “MRCKβ Protein,” on EMD's website and used the “MERCK” on its Facebook and Twitter pages and YouTube channel.  It also allegedly used MERCK on press releases and “U.S. Merck” on signage at its kiosks at multiple industry conferences. Merck further alleged that MKDG’s marketing campaigns were specifically intended to confuse consumers as to MKDG's history, referring to itself as “the Original Merck” and referring to Merck as MKDG's “younger brother/sister.” Finally, Merck alleged that MKDG registered a number of website domain names virtually identical to Merck's trademark registration, which redirected consumers to MKDG's website.

Relying on Holyoke Mut. Ins. Co. in Salem v. Vibram USA, Inc., 106 N.E.3d 572, 577 (Mass. 2018), the court recognized that the undefined policy term “advertising idea” is interpreted broadly and finding a “wide variety of concepts, methods, and activities related to calling the public's attention to a business, product, or service constitute advertising ideas.” In Holyoke, the underlying plaintiffs, the heirs barefoot marathon runner, Abebe Bilika, were alleging that the insured was using “Bilika,” as a name for its running shoes. The heirs operated a store a store called Abebe Bilika, and wrote a biography of his life, and used the name in other contexts, as well. The Holyoke court agreed with the insured that the heirs’ use of the name was their advertising idea and by advertising its running shoes with that name, the insured was using another’s advertising idea.

MKDG argued that as in Holyoke, it was being accused of using MERCK, which is how Merck advertises. Consequently, MKDG argued, it was using Merck’s advertising idea. HDI countered that the use of either “Original” or “125 Years” was MKDG’s advertising idea, not Merck’s. Nor were they similar to campaigns used by Merck.

Because Merck, in its complaint, was vague with respect to its advertisements or the style, manner, or method in which it advertises, the court could not agree that the claim involved the use of Merck’s advertising but instead about the extensive and widespread sales and promotional efforts in relation to MKDG’s own products.

MKGD next argued that its advertising campaign disparaged Merck by implying that it, not Merck, was the original “MERCK” entity and that MKDG has been operating in the United States longer than Merck has.

The court agreed with HDI that MKDG did not disparage Merck but instead attempted to emulate and associate itself with Merck. The court held that MKDG’s attempt to raise its own profile could not be construed as disparagement of another’s. Such an interpretation, according to the court, would be akin to holding restaurants liable for disparagement for stating that their food was fresh and delicious because such statement would imply that a competing restaurant’s food was not.

The court noted that disparagement included “to lower in rank and estimation by actions or words, or to speak slightingly of.” Id. (quoting Bos. Symphony Orchestra, Inc. v. Com. Union Ins. Co., 545 N.E.2d 1156 (Mass. 1989)(citations omitted). MKDG argued that calling Merck its younger brother/sister fit into that category. The court noted that even assuming that accusing one company as being younger was an insult, there was no disparagement because the statement was not made in connection with any good, product, or service as necessary to constitute disparagement under Massachusetts law. (citing HipSaver, Inc. v. Kiel, 984 N.E.2d 755, 763 (Mass. 2013).


01/20/21       Pro's Choice Beauty Care, Inc. v. Great N. Ins. Co.
Appellate Division, Second Department
Selling Counterfeit Goods Is Not Use of Another’s Advertising Idea

Bumble and Bumble, LLC (“B&B”) brought suit against Great Northern’ s insured, Pro's Choice Beauty Care, Inc., seeking remedies for, inter alia, trademark infringement. B&B alleged that Pro’s Choice sold counterfeit B&B products using a likeness of its trademark(s) thereby infringing on its trademark and engaging in the advertising, sale and distribution of hair-care products bearing unauthorized reproductions, counterfeits, copies and/or colorable imitations of the marks.

Great Northern denied coverage for B&B’s claims.

In the declaratory judgment action that followed, both Great Northern and Pro’s Choice agreed that the matter involved an advertising injury. At issue was the application of the policy exclusion for “advertising injury ... arising out of, giving rise to or in any way related to any actual or alleged ... infringement or violation by any person or organization (including the insured) of any intellectual property law or right,” which was defined to include trademarks. The trial court denied cross-motions for summary judgment because it could not determine if the exclusion applied on the record.

The Appellate Division, Second Department, held that clearly the exclusion applied noting that “[a]mong other things,…[B&B] alleged that Pro’s Choice counterfeited and infringed on another's trademark and engaged in the sale and distribution of offending goods.”

The exclusion contained an exception for injury that “is caused by an offense described in the definition of advertising injury; and does not arise out of, give rise to or in any way relate to any actual or alleged assertion, infringement or violation of any intellectual property law or right, other than one described in the definition of advertising injury.” The Policy defined "advertising injury" in relevant part as follows:

"Advertising injury' means injury, other than bodily injury, property damage or personal injury, sustained by a person or organization and caused by an offense of infringing, in that particular part of your advertisement about your goods, products or services, upon their:

  • copyrighted advertisement; or
  • registered collective mark, registered service mark or other registered trademarked name, slogan, symbol or title."

To obtain coverage, Pro’s Choice had the burden of establishing that the exception to the exclusion applied. Great Northern took the position that the claim involved unfair competition based on the passing off of products as B&B products, not advertising. The Second Department held that Pro’s Choice did not carry its burden because B&B’s infringement allegations were unrelated to Pro Choice’s advertising.

It was not completely clear, at least to this writer, why the exception would apply in any event. Was Pro’s Choice accused of advertising its own goods or services or B&B’s goods or services? Upon review of B&B’s complaint, Pro’s Choice was not actually accused of advertising anyone’s products. Instead, B&B alleged that CVS was advertising and selling the counterfeit products, which included the imitation B&B mark. In fact, B&B brought the lawsuit against CVS because CVS allegedly breached settlement agreements regarding these activities. Pro’s Choice was alleged to be one of the defendants that provided the offending products (with imitated marks) to CVS. Although B&B alleged that all of the defendants advertised and sold the offending products, the complaint does not allege that Pro’s Choice advertised for CVS, or to CVS, to promote its imitation supply, nor was there any suggestion that CVS was not aware that the products were inauthentic.

Apparently, the Pro’s Choice v. Great Northern court did not find it necessary to examine the Knowing Violation of Rights of Another Exclusion. I would have been interested to see if it applied.


Brian F. Mark
[email protected]

There were no newsworthy construction defect cases to discuss this edition.


Eric T. Boron

[email protected]


12/18/20       N.C. Farm Bureau Mutual Insurance Company, Inc. vs. Martin
Supreme Court of North Carolina
Auto Insurance – Summary Judgment for Insurer Upheld - Relatives of Named Insured Not Entitled to UIM Benefits or Medical Payments Because They Were Not Residents of Named Insured’s Household and Therefore Not Insureds Under the Policy

The plaintiff auto insurer N.C. Farm Bureau Mutual Insurance Co., Inc. (the “insurer”) brought a declaratory judgment action against its named insured's daughter-in-law and teenage granddaughter seeking an Order of the court declaring the named insured’s daughter-in-law and granddaughter were not residents of the named insured's household, and thus were not insureds entitled to underinsured motorist (UIM) benefits or medical payments. The trial court entered summary judgment in favor of the insurer. The Court of Appeals affirmed, and the North Carolina Supreme Court affirmed, holding the daughter- in-law and granddaughter were not residents of named insured's household and, therefore, were not “insureds”.

Here’s the background for this case. Subsequent to an automobile collision in which both the daughter-in-law and granddaughter of the named insured under the insurer’s auto policy were injured, the daughter-in-law and granddaughter sued the driver of the other vehicle for negligence. Settlement reached in that case resulted in the other car’s driver’s liability insurer paying its maximum liability coverage limits in the amount of $25,000 to the daughter-in-law and granddaughter.

The daughter-in-law and granddaughter also sought additional coverage, under two different automobile insurance policies issued by the insurer to members of the family of the daughter-in-law and granddaughter.  The first policy specifically identified the daughter-in-law as a named insured, and listed three covered vehicles, including the Ford automobile the daughter-in-law was driving at the time of the accident. The policy provided medical payments coverage of up to $1,000 per person and uninsured/underinsured motorist coverage of up to $50,000 per person/$100,000 per accident. Because the daughter-in-law and granddaughter both qualified as “insureds” under this particular policy, the insurer paid the applicable policy limits of $1,000 each to the daughter-in-law and granddaughter under the medical payments coverage and $25,000 each under the underinsured motorist coverage of that policy.

The daughter-in-law and granddaughter asserted that they were also entitled to medical payments and underinsured motorist coverage under a second policy of the insurer, one the insurer had issued to the paternal grandmother of the teenage granddaughter.   This second policy designated the paternal grandmother of the teenage granddaughter Mary as the named insured, identified two covered drivers (neither of whom were the daughter-in-law or granddaughter) and listed one covered vehicle, which was not the vehicle involved in the collision at issue This Policy provided medical payments coverage of up to $1,000 per person and uninsured/underinsured motorist coverage of up to $100,000 per person/$300,000 per accident. This Policy contained the following provisions that are relevant to this appeal:


Throughout this policy, “you” and “your” refer to:

  1. The “named insured” shown in the Declarations; and
  2. The spouse if a resident of the same household.


“Family member” means a person related to you by blood, marriage, or adoption who is a resident of your household. This includes a ward or foster child.

On the date of the accident, the paternal grandmother was sole owner of a farm - a 76-acre property that contained two separate houses located on the property. At all relevant times, the paternal grandmother lived in the “main house” on the farm, while the daughter-in-law and granddaughter lived in a separate “guest house” also situated on the farm. The two houses had separate street addresses, and it took approximately 3-5 minutes to walk between them.

It was undisputed that the paternal grandmother and the daughter-in-law and granddaughter defendants were related “by blood, marriage, or adoption”. The sole coverage issue for the North Carolina Supreme Court to determine was whether the daughter-in-law and granddaughter qualified as “residents” of the paternal grandmother’s “household.” The Policy at issue did not define the terms “resident” or “household”.

The North Carolina Supreme Court’s Opinion cited and analyzed prior cases decided in North Carolina demonstrating that the question of who is considered to be a resident of a household requires a particularized, fact-intensive inquiry into the circumstances of the parties’ current and prior living arrangements.

Supreme Court found the case law made clear that one basic prerequisite exists when a party seeks coverage under this type of provision contained within a relative's insurance policy—namely, the party seeking coverage must show that they actually lived in the same dwelling as the insured relative for a meaningful period of time.

Supreme Court found it to be clear that the daughter-in-law and granddaughter were not residents of the paternal grandmother’s household within the meaning of the Policy. The record unambiguously demonstrated that the daughter-in-law and granddaughter had never actually lived in the same residence as the paternal grandmother. Their respective houses on the property had separate addresses and post office boxes. Although they would occasionally spend the night at each other's houses, they never actually lived together in one dwelling. Instead, they lived and slept primarily in their own homes and stored their clothing, furniture, and personal belongings in their own respective residences. Thus, under the particular and undisputed facts of this case, the daughter-in-law and granddaughter were not residents of the paternal grandmother's household within the meaning of the Policy, said the North Carolina Supreme Court’s Opinion.


BARCI’S BASICS (on No Fault)
Marina A. Barci

[email protected]

No cases to report this issue, check back next time!


Ryan P. Maxwell

[email protected]

01/12/21       Clarification to Premium Reductions for Boating Insurance
New York State Assembly
Assembly Passes Bill That Would Remove Mandatory Language Related To Premium Reductions Upon Completion of Boating Safety Course

Last week, the Assembly passed a bill (Bill No. A00955) that proposes to make clarifying changes to Chapter 355 of the Laws of 2020, which required insurers to provide a premium rate reduction to insureds upon the completion of a boating safety course.

Currently, Insurance Law § 2336-b(1)(c) provides that “[a]n insurer, upon approval of the superintendent, shall upon submission of a completion certificate by an insured, provide an actuarially appropriate reduction of the premium for such insured's yacht or boating liability insurance.” This bill, if passed into law, would replace “shall” with “may”.

According to the Sponsor Memorandum, the relaxing of the mandatory reduction “would allow insurers flexibility in providing reductions to ensure stability for insurance producers and by allowing case-by-case evaluations of policies based on each insurer's assessed risk and underwriting criteria.”

The Bill was delivered to the Senate and currently resides with the Senate Rules Committee.


01/12/21       Clarification to Premium Reductions for Commercial Risk Insurance Covering For-Hire Vehicles
New York State Assembly
Assembly Passes Bill That Would Ensure A Premium Reduction For-Hire Vehicles Does Not Impact Other Personal Auto Rate Reductions

Last week, the Assembly passed a bill (Bill No. A00959) that proposes to make clarifying changes to Chapter 347 of the Laws of 2020, which authorized associations representing for-hire vehicles with a capacity of eight or more persons to create safety programs and required insurers to provide appropriate premium reductions to insureds upon successful completion of such programs.

Notably, the Sponsor Memorandum indicates that

“Sections two and three of the bill would ensure that for-hire vehicle drivers that elect to take and complete a for-hire vehicle safety course can receive a premium rate reduction on their commercial vehicle policy and still be eligible for a personal motor vehicle policy reduction if such individuals were to take and complete the national defensive driving course.”

However, it is a mystery to me how the textual changes proposed by the Bill accomplish the above in those sections. For example, Section 2 of the Bill would amend Insurance Law § 2353(f) to provide—without mentioning personal motor vehicle insurance—that

“Any insured who successfully completes a course of instruction on for-hire motor vehicle safety pursuant to this section and receives a premium reduction on the insured's commercial risk insurance policy covering the for-hire vehicle shall not, during the period set forth in subsection (e) of this section, also be eligible for an additional premium reduction on the insured's commercial risk insurance policy covering the for-hire vehicle for successful completion of the motor vehicle accident prevention course, known as the national safety council's defensive driving course, or any driver improvement course approved by the department of motor vehicles as being equivalent to the national safety council's defensive driving course, authorized under section two thousand three hundred thirty-six of this article.”

A similar amendment to Insurance Law § 2336(a) under Section 3 of the Bill provides—again without mentioning personal motor vehicle insurance—that:

“Any insured who successfully completes a course pursuant to this subsection and receives a premium reduction on the insured's insurance policy covering the for-hire vehicle, shall not, during the period set forth in subsection (e) of section two thousand three hundred fifty-three of  this  article,  also  be  eligible for an additional premium reduction on the insured's commercial risk insurance policy covering the for-hire motor vehicle for successful completion of the for-hire safety motor vehicle course authorized under section two thousand three hundred fifty-three of this article.”

If there was supposed to be a pathway under this Bill for an insured to receive both a premium rate reduction on their commercial vehicle policy a personal motor vehicle policy, the execution appears lacking—although maybe it’s just the reading comprehension of yours truly.


CJ on CVA and USDC(NY)

Charles J. Englert III
[email protected]

01/14/21       Kemper Independence Insurance Company v. William Hughey
United States District Court, Southern District of New York

A Party Cannot be “Nominal” for Purposes of Diversity Jurisdiction but “Real” for Purposes of Deciding Whether there is an Actual Controversy that Would Support the Court’s Continuing Jurisdiction

Plaintiff originally filed this action against Anthony Porto and William Haughey (“defendant”) seeking a declaration that it was not required to either provide a defense or indemnify Porto, its insured, in connection with a lawsuit that Haughey has filed against Porto in this Court, Haughey v. Cty. of Putnam (the “Underlying Action”). Despite acknowledging that Kemper and Haughey were both citizens of Florida, the Complaint suggested that the lack of complete diversity did not matter because defendant was “included” in the case only “as a nominal party.” When diversity was originally challenged, plaintiff argued that defendant asserted claims against plaintiff’s named insured, any claims defendant may have against plaintiff were speculative and may never mature. The Court then proceeded with the case, agreeing that there were no issues with diversity.

As the case progresses the Court so ordered a stipulation dismissing all of plaintiff’s claims against Mr. Porto and declared that Kemper was “entitled to the relief” that it “sought in this action” — namely, it is “not obligated to provide insurance coverage” to Porto for the Underlying Action and that Kemper “does not have a duty to defend and/or indemnify” Porto for the Underlying Action. The Court then raised the question as to whether or not it still had jurisdiction over the case in light of the dismissal of all claims against Porto, and plaintiff’s earlier assertions that defendant’s claims against Kemper may never materialize. At the Courts request the parties filed a joint letter arguing that the Court retained jurisdiction notwithstanding the dismissal of Kemper’s claims against Mr. Porto, asserting that the case should continue.

The Court Disagreed. To be justiciable, a “case must be ‘ripe’ — not dependent on ‘contingent future events that may not occur as anticipated, or indeed may not occur at all.’” Trump v. New York, 141 S. Ct. 530, 535 (2020). Holding that the ripeness requirement, which is derived from Article III of the United States Constitution, “circumscribes federal jurisdiction to real conflicts so as to preclude the courts from gratuitously rendering advisory opinions with regard to events in dispute that have not matured to a point sufficiently concrete to demand immediate adjudication and thus that may never materialize as actual controversies.” Dow Jones & Co. v. Harrods, Ltd., 237 F. Supp. 2d 394, 406 (S.D.N.Y. 2002), aff’d 346 F.3d 357 (2d Cir. 2003) (per curiam). The Court held that any claims plaintiff may have against defendant were not ripe because defendant had no standing to challenge Kemper’s duty not to defend Mr. Porto in the Underlying action, and defendant cannot currently bring a claim for indemnification against plaintiff. The Court acknowledged the parties’ contention that federal courts often allow a liability insurer to bring a declaratory judgment action against all the parties in an underlying lawsuit involving an insured prior to a judgment being issued, that is not the case in the instant matter. The Court pointed out that there are no live claims against the insured party. The Court concluded that it no longer had jurisdiction over this matter as there was no longer diversity of parties and plaintiff had no claims against defendant, the case should be closed.


Patricia A. Rauh

[email protected]

01/14/21       Bonem v. William Penn Life Ins. Co. of N.Y.
Appellate Division, First Department
Plaintiff is Not Entitled to Coverage Under the Policy Because the Policy Had Lapsed Before the Insured’s Death

The Appellate Court held that the Plaintiff is not entitled to the $1 million dollars that the lower court awarded him under a life insurance policy (the “Policy”). The Plaintiff was not entitled to the life insurance proceeds because the Policy had lapsed before the insured’s death. The language of the Policy was clear and unambiguous and provided that the due date for payment of annual premiums is determined by the “Policy Date”, which was January 14, 2002 – not January 31, 2002, the anniversary of the date on which the insured received a physical copy of the Policy, made his first premium payment, and coverage commenced. The insured failed to make the 2018 premium payment by January 14, and thus the 31-day grace period, which began January 14, expired before the insured’s death on February 26, 2018. Accordingly, the Plaintiff was not entitled to the Policy proceeds.


01/12/21       Weinrauch v. New York Life Ins. Co.
Appellate Division, First Department
Defendant Did Not Breach its Duty to Pay Plaintiff Residual Disability Coverage and the Alleged Breach to Pay Plaintiff Total Disability Benefits is Time-Barred as the Relation-Back Doctrine Does Not Apply Here

Plaintiff alleged that Defendant breached its obligation to pay Plaintiff for residual disability coverage between 2003 and 2009. Plaintiff then filed an amended complaint also alleging that the Defendant failed to pay him for total disability coverage from 2003 to 2009.

The Court properly dismissed Plaintiff’s new claim in the amended complaint. Plaintiff alleged that he did not file a timely claim for total disability because he received incorrect information from a customer service representative in 2002. However, the evidence showed that Plaintiff learned he could not file for partial disability coverage in 2002, but there was no discussion concerning total disability coverage under his policies. Further, in a 2009 letter from the Plaintiff to the Defendant insurer, the Plaintiff indicated that he may have been entitled to total disability as of 2007, but never indicated that he was entitled to total disability in 2003, nor did he ever submit a request for such coverage.

Additionally, the Court held that the Plaintiff’s claim was time-barred. Contrary to Plaintiff’s argument, the relation-back doctrine does not apply here. Since the initial complaint only discussed the denial of residual disability coverage, the Defendant did not have notice of a new claim alleging a breach of its obligations to pay the Plaintiff total disability coverage as of 2003.

Mirna M. Santiago
[email protected]

Diversity (or the Lack Thereof) in the Insurance Industry

As in most other industries in the United States, insurance has not kept up with the demographic shifts in population over the years. For example, although women make up fully 51% of the population, they only comprise 23% of leadership in the insurance industry. insights/featured/diversity-in-insurance And although BIPoC are at least 40% of all Americans, they only make up 21% of insurance industry workers. Id.

While the insurance industry has made modest improvements over the years, most agree that it is not enough. “The percentage of Black or African American employees in the insurance workforce was 12.4% in 2019, up from 9.0% in 2010. Meanwhile, Asians represented 6.2% of the workforce in 2019, an increase from 4.4% in 2010. Those in the "other" category, which includes but is not limited to American Indian, Alaska Native, Native Hawaiian or other Pacific Islanders, represented 2.7% of the workforce. People of Hispanic or Latino ethnicity are not specifically broken out in the data set as they could have selected any race.” headlines/black-representation-in-insurance-grows-slowly-as-industry-seeks-to- diversify- 60718539?utm_campaign=corporatepro&utm_medium=contentdigest&utm_sour ce=diversity_insurance

With the calls for racial equality and social justice still ringing in everyone’s ears after the death of George Floyd in 2020, insurance regulators have listened and taken up the cause. The National Association of Insurance Commissioners (NAIC) has launched a Special Committee on Race and Insurance to examine levels of diversity in the industry. The hope is not just to increase diversity in the lower rungs of the insurance industry, but to drive actual representation of BIPoC in positions of leadership.

I look forward to seeing NAIC’s findings, and—more importantly—what solutions they implement to increase diversity, equity, and representation in insurance.

© Hurwitz & Fine, P. C. 2021
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