Coverage Pointers - Volume XXV No. 9

Volume XXV, No. 9 (No. 656)
Friday, October 13, 2023
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.


HF Coverage Pointers Header


Dear Coverage Pointers Subscribers:

Image result for we stand with israel

The horrific events in Israel are simply beyond words.  How a nation and a people recover from the slaughter of innocents is incomprehensible. 

Do you have a situation? We love situations.

Happy Friday the Thirteenth.

Last week, I had the pleasure of attending and speaking at the RiskProNet 2023 Construction Meeting in Nashville.  What a great group of people.  The highlight was listening to a three-hour program presented by my friend, Craig Stanovich, CPCU, CIC, AU, who is a Risk Management Consultant with Austin & Stanovich.  Craig has been a pen-pal and friend for many years, but we’ve never met.  What a pleasure.  Craig is one of the most well-published authors on insurance matters through IRMI. If you ever need to read an article about some exclusion, endorsement, or policy form, search Craig’s name on the Internet and you can be almost guaranteed he’s written something.


A Good Teaching Case

While I usually report on appellate cases only, I included a New York State Supreme Court decision on the impact of a late disclaimer on the right on insurers to rely upon policy exclusions.  For those who don’t know, the New York State Supreme Court is the lowest court of general jurisdiction, above which sits the Appellate Division of the State Supreme Court.  The highest court in the State is the Court of Appeals. Anyway, the case is not new law or surprising law to New York coverage aficionados.  However, for those who are not quite as familiar with New York coverage protocols, it’s a good read and a fair explanation of the rules one must live by to protect an insurer’s right to disclaim.  A 48-day delay in denying coverage led to a liability insurer’s loss of its right to rely upon policy exclusions.  That was so, even though the insurer had denied coverage to another party based on the same exclusion and irrespective of the fact that the insured knew of the reasons for the disclaimer from the earlier letter directed elsewhere.

It's the first case reported in my column.


Wedding Bells

This past weekend, my wife Chris and I traveled to Connecticut to celebrate Lee Siegel and Jill Nolan’s wedding.  Mazel Tov!



Coverage 101
the steps to analyzing general liability coverage

(Training video)

A blue earth with lights around it

Description automatically generated

Want to watch the video of a training program that can be offered to your organization’s claims staff?  Here you go:


… and More Training:

Schedule your in-house training for 2023.  Need a topic?  Here are 160 or so coverage topics from which to choose.


Need a mediator?

Coverage mediation is a thing!  Subject matter expertise may be useful.

Hey coverage lawyers.  Hey professionals. Have you and a friend, adversary, or lawyer for whom who have respect reached a stalemate on a coverage dispute?  Look, we know each other.  We know that.  We don’t want to litigate every coverage disagreement.  Why?   Because the position we oppose today may be the one we advocate tomorrow.  Face it.  We all understand that.

Let me help mediate your disagreement to see if there is some mutual agreement, we can reach that will not box us into a corner. Reach out to me.  I will be pleased to mediate your dispute.

My partners, Mike Perley and Ann Evanko, are also available to help resolve other challenges.

You don’t want adverse precedent that will bite you next time you might have a slightly different view on coverage issues. You don’t want to spend tens of thousands of dollars to litigate a coverage issue before a motion judge or appellate justice that knows as much about insurance coverage as you do about nuclear physics.  For those in the Western District of New York, I am certified by the Court and on the WDNY Mediation Panel as are Mike and Ann.

I was just appointed to the New York County Supreme Court Commercial Division Mediation panel.

Try mediation.


For those in the Philadelphia area next week we hope to see you at the American College of Coverage Counsel 2023 Insurance Law Symposium.  I was proud to be a founding Regent of the American College, some 11 years ago.  The topic:


Window Opening Statutes

Also known as lookback window statutes, Window Opening Statutes, are statutes that open, repeal, or extend a tort action statute of limitations). The panel will discuss their effect on insurance coverage disputes involving coverage for the underlying tort actions. For example, last year, President Biden signed a bill that eliminated the statute of limitations for people who were sexually abused as minors to file federal civil claims. State legislatures have passed similar laws that repeal or extend the statute of limitations for such claims. In 2019, New York State passed a “lookback window” statute, the Child Victims Act, that extended the statute of limitations for survivors of child sexual abuse in criminal and civil cases.

  • Tim Burns, Burns Bair LLP

  • Dan D. Kohane, Hurwitz & Fine P.C,

  • Laura Hanson, Meagher + Geer, P.L.L.P (Moderator)



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:

  • 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.  Medical & Nursing Home Liability Pointers provides the latest news, developments, and analysis of recent court decisions impacting the medical and long-term care communities. Contact Chris Potenza at [email protected] to subscribe.


Peiper on Property (and Potpourri):

Congratulations to our own Lee Siegel & Jill Nolan.  Many happy and healthy years to you both. 

It’s been yet another slow week on the Property & Potpourri beat.  We do review a spoliation case involving a subrogation loss, but we’ll have to wait another issue before the truly calamitous property damage cases start showing up.  If you have a property case (calamitous or not), please do consider us as possible facilitator at mediation.  There aren’t many of us who can quote the broad evidence rule from memory or describe the facts in McAnarney from where it came, but we surely can. 

On the training front, we just completed a presentation on commonly missed issues under Commercial Auto policies.  The program takes about an hour, and hopefully will be a useful primer for even the most experienced claims handlers.  If anyone has any interest in exploring it further with us, please do not hesitate to drop us a line.

That’s it for this week.  See you in two more.


Steven E. Peiper

[email protected]


Insurance a New Concept – 100 Years Ago:

Evansville Press
Evansville, Indiana
13 Oct 1923


Mr. J. B. Young, Insurance Agent, Says


          People should not be careless about protecting themselves and accident insurance is a necessity.

          Many people are very careless about insurance, and this is especially true in regard to accident insurance.  We all know the danger from accidents from automobiles, and the danger increases with the increase in numbers of machines. J. B. Young can sell you a policy that covers any kind of automobile accident, whether in or out of the machine, that is perfectly good, as it is backed by a first class company, and women as well as men are covered by this policy and costs only $5.00 per year and pays $25.00 per week for total disability from automobile accidents, $12.50 for partial disability and $40.00 per week for hospital disability, besides covers in case of loss of eye or for death.  Many men carry accident insurance but let the wife take chances. This policy is for the housewife as well as the office woman.  Call at 127 S. 4th street and learn more about this splendid opportunity to get good protection at a very low cost. 

          All kinds of insurance and surety bonds, as well as farm loans on long time and very low rate of interest. 

          Don’t forget about this automobile accident policy that anyone can get.  The best of companies and courteous treatment.  Phone 7764.


Wilewicz’ Wide-World of Coverage:    

Off to warmer waters of the Bahamas for the Fall ABA conference.  See you in two weeks.


Agnes A. Wilewicz

[email protected]


Suicide by Fraud – 100 Years Ago:

Oroville Daily Register
Oroville, California
13 Oct 1923




STOCKTON, Oct. 12.—The widow of Alex A. Kels, Lodi, butcher, who has been sentenced to be hanged on January 4, 1923, for murder, will receive every dollar of the insurance carried by him if the insurance companies failed to prove that Kels in April 1922, when he took out his insurance , planned to defraud the company by slaying a man as he did in September, 1923.

That is the opinion of Thomas G. Crothers, attorney and vice president of the Western States Life Insurance company.  He says such is the law in California.  The policies contain a suicide clause but an execution by the State cannot be interpreted as suicide, says the attorney and insurance official.

          In April 1922, Kels took out a policy for $50,000 in the New York Life, saying he wanted to protect his creditors.  Of this $25,000 was “in case of death by violence.”  This to be double indemnity, or $50,000, policy carried a two-year clause providing for non-payment of indemnity in case of suicide.  Previously in 1916, Kels took out a policy of $5000 in the New York Life, and in 1917 began to carry a $10,000 policy in the California Sate Life.

          In addition to these policies, Kels carrier out $4000 in lodge insurance.

Companies Must Pay

          Regardless of Kels’ death by hanging, if such is to be the fate of the Lodi slayer next January, San Francisco insurance experts believe that the widow will be paid $15,000, the amount of the policies in the California State Life and the New York State Life companies, taken out in 1916 and 1917, without contest.

          “But to avoid payment of the additional $50,000 insurance, the insurance company must prove that Kels intended to defraud them from the day he took out his last policy, in April of last year,” Attorney Crothers said yesterday.


Barnas on Bad Faith:

Hello again:

It is only the middle of October, but Thanksgiving and the holiday season will be here before you know it.  The DRI 2023 Insurance Coverage and Practice Symposium is also just around the corner.  The conference is back at the Sheraton New York Times Square, and this year's symposium will once again offer the unparalleled opportunity to engage with a distinguished faculty of insurance industry leaders and coverage lawyers on emerging and cutting-edge issues such as the impact of artificial intelligence, the future for coverage issues involved in "forever chemical" environmental claims, and the continuing impact of nuclear verdicts on coverage and excess insurance issues.  The early registration deadline is October 30, 2023.  I hope to see you there, and if you are looking for more information, please click here.

I have a slightly different spin on a bad faith case this week in my column.  The Fifth Circuit evaluated whether insurance proceeds should be considered the property of the estate of a tortfeasor in an involuntary bankruptcy following an accident resulting in extracontractual exposure.  The court concluded that, under the circumstances, the insurance proceeds should be considered estate property.


Brian D. Barnas

[email protected]


Dating Profiles Differ in 1923 – 100 Years Ago:

The Springfield News-Leader
Springfield, Missouri
13 Oct 1923


BACHELOR, Christian character, no bad habits, don’t use tobacco, wishes to form acquaintance of a respectable lady.  Object, matrimony.  Address F. W. W., care Republican.


Lee’s Connecticut Chronicles:

My wedding was on Sunday.  The kind editor gave me a dispensation!


Lee S. Siegel

[email protected]


Sobering Hospital Visit – 100 Years Ago:

Buffalo Courier Express
Buffalo, New York
13 Oct 1923



Dispute over bills leads to cell; $50 for sobering up course.


Mrs. Theodora Steele, 38 years old, of Montreal, Que., under the name of Mrs. Terry Steele from New York, who has been a guest at the Hotel Buffalo for ten days, was a visitor in city court yesterday, being escorted by Detective Melvin Henshaw, who charged her with making a disturbance at the hotel on Thursday night when she got into a dispute over her bill. She is said to have been drinking a bit.

"Now if I let you go will you go right down to the station?” asked Judge Lamson.

“I thought I was going to the station last night, but the bus took me to the wrong station,” she replied. She gave her promise and sentence was suspended.

There were 24 drunks yesterday, Stanislaus Mijak of No. 304 Sweet Avenue who has the reputation among the police of never being sober, was put away for six months.

When Emanuel Metzger, 54 years old, of No. 56 Gatchell street was arrested nine days ago, it was believed he was insane and he was sent directly to the city hospital from the Broadway police station, where he was seeing things. Yesterday he was returned to city court as sane but suffering from alcoholism.

"Did you have a good time at the City hospital?” asked the court.

“Yes,” replied the man.

"Then pay $50 to help defray your expense to the city," admonished the court.

The man was placed on probation to pay.


Kyle's Noteworthy No-Fault:

Dear Readers,

I hope everyone is enjoying the start of fall! I spent the weekend in Ellicottville to enjoy all the annual Fall Fest activities. All went well except for, unfortunately, watching the Bills lose first thing in the morning on Sunday.

I have two no-fault cases this week. The first involves a summary judgment action brought by an insurer for a declaration it was not required to pay any claims submitted for medical services provided to the claimant, on the basis that the claimants failed to appear for examinations under oath and made misrepresentations regarding their residence and the primary garage location of the insured vehicle. The second case involves a petition to stay a no-fault arbitration pending the determination of underlying coverage issues, including whether the claimant resided with his mother, the policy holder at the time of the accident.

Until next time,


Kyle A. Ruffner

[email protected]


Rides for Votes – 100 Years Ago:

The Buffalo News
Buffalo, New York
13 Oct 1923



          The Citizens’ committee needs automobiles for use on primary day in a vigorous effort to get everyone to vote. 

          Those who are willing to lend their cars for the day are requested to call Seneca 5730 and ask for the automobile bureau.  The committee says, “There are few ways in which any citizen can be of more help than by lending us his automobiles next Tuesday.” 


Ryan’s Federal Reporter:

Hello Loyal Coverage Pointers Subscribers -

To round out last week, I put on my ESPN+ play-by-play broadcaster’s hat for a pair of NCAA Div. I Mid-American Conference volleyball matches between the Central Michigan Chippewas / Eastern Michigan Eagles and our hometown University at Buffalo Bulls. The Bulls pulled out two conference wins in Alumni Arena, defeating the Chippewas in a 5-set thriller on October 5, only to follow it up on October 6 with a 3-set win over the Eagles. The Bulls are now 15-3 on the season, (5-1 in MAC play). Those matches are available here and here, if you’re curious how it went (although you need an ESPN+ subscription to watch).

This edition, my column has a pair of COVID-19 Business Interruption decisions from the Second Circuit (hint: nothing has changed), as well as a quick hitter on another Second Circuit decision involving the duty to defend under a professional liability policy.

Until next time…


Ryan P. Maxwell

[email protected]



Test to Vote – 100 Years Ago:

Mount Vernon Argus
White Plains, New York
13 Oct 1923



          The literacy test now imposed upon new voters has heretofore been taken in the spirit of a joke. In New York City the tests were conducted by election officials who usually were content with a few jumbled words.

A decision of the appellate division of the supreme court designates the state education department as the only medium through which new may take the prescribed literacy tests.

This decision, however, is not final; for, although the board of election has not taken an appeal, the attorney general has taken the case to the court of appeals.

The new voter must either pass the tests locally prescribed by the state education department or present a certificate of the regents’ office to the effect that he has an education equal to that imposed by the eighth year of the public school courses.


Storm’s SIU:

Hi Team:

Three interesting cases for you this week I reviewed while, unfortunately, watching the Dodgers be swept by the Diamondbacks. 

  • No Coverage for Fire Damage to Insured’s Adjacent Property as it Did Not Constitute a “Residence Premises” or an “Other Structure”. 

  • Court Quashes Subpoena for Bank Records of Non-Party Without Prejudice Allowing Insurer to Issue Another That is Not Overly Invasive of Privacy in Case Asserting No-Fault Medical Provider Fraud by Several Chiropractic Corporations.

  • In Action by Administratrix to Recover for Damage from Fire Intentionally Set by the Insured, Mortgagee’s Motion to Intervene is Granted Having Satisfied a Four-Factor Test. 

Talk to you again in two weeks.


Scott D. Storm

[email protected]


Lillies for Lunch – 100 Years Ago:

Nashville, Tennessee
13 Oct 1923

Water Lily May Rival Potato

The Iowa Conservation Board makes the suggestion that we grow water lilies as a staple article of food.  It is claimed that the lily when peeled and boiled is as farinaceous and tasteful as the potato.


Fleming’s Finest:

Hi Coverage Pointers subscribers:

Since our last newsletter, I have run a marathon and been administered the Massachusetts Attorneys’ Oaths for admission to the bar. Both were special days with family and friends.

This week’s case comes from the Kentucky Supreme Court. The court considered whether a claims-made-and-reported management liability policy provided coverage when the insured did not comply with the policy’s notice requirements. Since the policy’s notice provisions were clear and unambiguous, there was no coverage after the insured failed to comply with the notice requirements. The opinion is a little older, from June, but it was modified in September and has a short and sweet discussion about occurrence-based versus claims-made polices.

Catch you later,


Katherine A. Fleming

[email protected]


Mob Rule – 100 Years Ago:

The Bradenton Herald
Bradenton, Florida
13 Oct 1923




          RICHMOND, Va., Oct. 13.—Horace Carter, a negro of Walkerston, was taken from two officers near King and Queen County Courthouse last night by a mob and shot to death.  The negro was being taken to jail for attacking a white woman, when the lynching party appeared on the scene.


Gestwick’s Greatest:

Dear Readers:

Since we last spoke, I’ve been back and forth to New York City twice, both for oral arguments. Fun and exciting? Yes. Very tiring? Also, yes. Other than that, I humbly call your attention to my cover note from last edition, wherein I projected that Tyreek Hill of the Miami Dolphins would be held to three catches, forty-one yards, and no scores in the Week Four showdown against our hometown Buffalo Bills. The final stat line? Three catches, fifth-eight yards, no scores, adding eighteen more yards on the ground. Not too shabby of a guess. This week’s prediction? Giants quarterback Daniel Jones will throw for 197 yards, two interceptions, one touchdown, and will be sacked thrice. Let’s keep this going.

More important than football is the concept that a self-insured supermarket is held to the same standard as an insurance carrier when it comes to equitable estoppel. In the case I have for you this week, a self-insured supermarket agreed to defend its landlord, in addition to itself, in a lawsuit brought by a claimant who slipped and fell on the sidewalk outside of the premises. On the eve of trial, the supermarket decided that the landlord, not itself, was responsible for the maintenance of the sidewalk, and that it should seek a setoff from the landlord. Given that this change in position creates a conflict of interest for the attorney defending both parties, the landlord suddenly found itself without a defense. The landlord’s own insurer, Zurich, stepped in, having not had a chance to participate in any discovery at all. At trial, the landlord got whacked with a $295,000 verdict against it. The question for the Court on the ensuing declaratory judgment action was whether the supermarket, as a self-insured entity, was equitably estopped from denying a defense to its landlord at that stage of the proceedings. Applying the same standard for equitable estoppel as is regularly applied to insurance carriers, the Court found in the affirmative, reasoning that the supermarket was in full control of the landlord’s defense at the time it decided to suddenly change positions, and that the landlord had not been in control of its own defense for over a year, as it had detrimentally relied on that provided by the supermarket.

That’s all for this time around. See you in two!

Evan D. Gestwick

[email protected]


Loans a Plenty – 100 Years Ago:

The Watchman and Southron
Sumter, South Carolina
13 Oct 1923



          It is very unusual that banks in this part of the country have a surplus of loanable funds at this season of year, but that is our condition, and we much prefer lending money at home than seeking outside loans, so if you need any money for a short time on satisfactory papers, we will make it interesting to you.



NEILL O’CONNELL, Pres.                                                 O. L. YATES, Cashier


On the Road with O’Shea:

Hey Readers,

The autumn season is upon us. While some enjoy pumpkin spice everything, I have an aversion to pumpkin. I never really indulged in the seasonal vegetable in my younger years. However, after working a summer in a pie factory where pumpkin pies were made all day, several times a week, the smell and sight of pumpkin products is a no-go for me. Instead, I am a cider and apple cinnamon donut connoisseur.

On another note, I have two Appellate Division cases this week. One involves a petition to file a claim against MVAIC where the First Department addressed a potential hearsay issue and whether an injured party must exhaust all coverage. Another involves an insured seeking to vacate an entry of default in an Article 75 petition by his carrier. Let’s just say delay and inaction may not qualify as a “reasonable excuse.”

See you in a couple of weeks.


Ryan P. O’Shea

[email protected]


Anti-Jewish Propaganda Increasing – 100 Years Ago:

The Buffalo Enquirer
Buffalo, New York
13 Oct 1923


Anti-Semitism Sweeping Germany.


          German Jewry is now facing one of the severest crises in its history.  Reports from Munich indicate that the anti-Semitic Agitation has now reached an unprecedented climax.  Anti-Semitic literature is widely circulated, and posters are to be seen everywhere, urging violence on the Jews.  The propaganda is continuous and despite the financial crises in Germany, does not seem to be in want of funds to carry on its nefarious work.  The Jews in Germany are in great agitation and the worst is expected at any moment.  The political disturbance is being utilized for the spreading of anti-Jewish propaganda; the latter being accused of complicity in bringing about the present deplorable condition of the fatherland.


Louttit’s Legislative and Regulatory Roundup:

Hello All,

I hope everyone is enjoying the fall. Today’s column discusses a bill which has passed through both legislative houses and could be signed (or vetoed) by New York’s Governor at any time. In short, the bill, if passed into law, would further limit the amount of time insurers can accept or reject a claim when the claim arose out of an emergency, which is not defined.  We will keep an eye on this law and its effect on the insurance industry and New York’s insureds.


Robert P. Louttit

[email protected]


Ford Waivers on Presidential Campaign – 100 Years Ago:

The Houston Post
Houston, Texas
13 Oct 1923



Does Not Say He Will Not Nor That He Will, Is Secretary’s Reply


Associated Press Report.


          DETROIT, Oct. 12.—Henry Ford does not wish to make a definite answer at present as to whether or not he will be a candidate for president. E. G. Liebold, his personal secretary, said today in commenting on news from Nebraska that the Detroit manufacturer’s name will go on the ballot in the presidential primary election in that State.

Mr. Ford is not a potential candidate in the general sense. Mr. Leibold continued, “but he is not saying that he will not be a candidate.”

The fact that he has not withdrawn his name from the Nebraska primary does not mean that he approves or disapproves of the activity in his behalf by the progressive lenders in Omaha.  Mr. Leibold added.

“Various interests throughout the country are making a constant effort to have Mr. Ford answer the question: ‘Will you be a candidate for president?’”  Mr. Leibold said.  “Mr. Ford does not wish to answer this question at the present time either with a ‘yes’ or with a ‘no.’  He is not a potential candidate in the general sense, but he is not saying he will not be a candidate.

“He does, however, feel that if certain citizens of Nebraska wish to circulate petitions bearing his name, they have a right to do so. The fact he has not withdrawn his name does not mean that he approves or disapproves of the activity in his behalf by the progressive leaders in Omaha.”

This, Mr. Leibold said, “is the policy today.  What it will be tomorrow or the next day I cannot say.”


Rob Reaches the Threshold: 

Hello Readers,

We are now in full swing of the Fall, which is a lovely time in Western New York. I am hoping we dodge the forecasted rain this weekend, as I will have a bunch of family in town from NYC for my engagement party. Oh – and the New York Football Giants just happen to play the Bills in Orchard Park in primetime this weekend. Is it a coincidence that these two events fall on the same weekend? Maybe.

For this issue, we examine a decision out of the First Department, which scrutinizes the admissibility and substance of medical reports submitted by a plaintiff in opposition to a summary judgment motion. As it turns out, the Court does not appreciate records which are (1) inadmissible, or (2) many years removed from a subject accident.

I hope you all enjoy the read.


Robert J. Caggiano

[email protected]


Movement to Restore Palestine as National Home – 100 Years Ago:

Lancaster New Era
Lancaster, Pennsylvania
13 Oct 1923




          Plans for furthering the movement of restoring Palestine as the Jewish National Home are being completed this week by representative Jews of Lancaster.  The work will be continued on a larger scale within the next few months.  Samuel Saretsky, executive director of the Palestine Foundation Fund, with headquarters in Philadelphia, is now in this city conferring with prominent Jews on the proposed program.

          Lancaster is part of the district which comprises Eastern Pennsylvania, Southern New Jersey and Delaware, throughout which campaigns have been held and are being planned as part of a nation-wide movement by American Jewry to develop and cultivate Palestine as a modern Commonwealth.

          The Palestine Foundation Fund is the official agency of Jewry to carry forward this project.  Among the prominent local residents who are taking an active part in formulating plans are:  M. Isecovitz, chairman of the Degel Israel committee; Morris Klevansky, David Miller, Heman Lyons, Harry Bloom and James I. Miller, president of the Degel Israel congregation.


North of the Border:

Has it only been four days since Hamas launched its brutal attack on Israel? I can’t help but think that October 7, 2023, will be a seminal date in the history of the world. Nothing in the Middle East will ever again be what it was last week at this time.  When our family gathered for our Thanksgiving dinner on Monday, I hugged them all a little closer.

The ‘pickins are slim this week …. Not much to report from the courts …. Nonetheless, I report on a Nova Scotia trial judgment on the issue of when does the limitation period begin to run on bad faith claims.


Heather A. Sanderson
Sanderson Law, Calgary, Alberta

[email protected]


Headlines from this week’s issue, attached:

Dan D. Kohane

[email protected]

  • Forty-Eight Day Delay is Disclaiming Waives Policy Exclusions.  Disclaimer to Someone Else isn’t Enough
  • Insurer’s Confirmation of Settlement Does Not Amount to Enough to Enforce Settlement
  • City’s Claim for Reimbursement of Medical Expenses for Police Officer is Not a Separate Claim but Derivative of Officer’s Claim



Agnes A. Wilewicz

[email protected]

  • On the road again. I will have plenty to report, next time around. See you in two.


Brian D. Barnas

[email protected]

  • Insurance Proceeds in Extra-Contractual Exposure Case Were Classified as Property of the Bankruptcy Estate


Lee S. Siegel

[email protected]

See you in two weeks – after all, I was married this past weekend!


Kyle A. Ruffner
[email protected]

  • Court Holds Insurer Properly Denied No-Fault Claims, as Claimants Failed to Appear for their Examinations Under Oath
  • Court Holds that Supreme Court Should Have Granted a Stay of Arbitration and Directed a Framed Issue Hearing on Coverage Issue


Ryan P. Maxwell

[email protected]

  • Pair of Summary Orders from the Second Circuit Continue to Foreclose COVID-19 Business Interruption Claims
  • Allegations Incorporating an Agreement Unrelated to the Performance of Legal Services Foreclosed Defense under Professional Liability Policy


Scott D. Storm

[email protected]

  • No Coverage for Fire Damage to Insured’s Adjacent Property as it Did Not Constitute a “Residence Premises” or an “Other Structure”. 
  • Court Quashes Subpoena for Bank Records of Non-Party Without Prejudice Allowing Insurer to Issue Another That is Not Overly Invasive of Privacy in Case Asserting No-Fault Medical Provider Fraud by Several Chiropractic Corporations.
  • In Action by Administratrix to Recover for Damage from Fire Intentionally Set by the Insured, Mortgagee’s Motion to Intervene is Granted Having Satisfied a Four-Factor Test. 


Katherine A. Fleming

[email protected]

  • No Coverage under Claims-Made-And-Reported Management Liability Policy When Insured did not Comply with the Policy’s Notice Requirements


Evan D. Gestwick

[email protected]

  • Self-Insured Supermarket Held to be Equitably Estopped from Denying Defense to its Own Landlord on the Eve of Trial


ON the ROAD with O’SHEA
Ryan P. O’Shea

[email protected]

  • Only One Tortfeasor Needed to Commence Action Against MVAIC and Police Report Admissible Hearsay Where MVAIC Relied Upon it in Opposition to Petition
  • Insured’s Choice to Ignore Petition to Stay Arbitration Results in Lack of Default Vacatur of Arbitration Claim


Robert P. Louttit

[email protected]

  • Claims Settlement Timeframe Legislation


Robert J. Caggiano

[email protected]

  • First Department affirms Order Granting Summary Judgment for Defendant Finding Plaintiff did not Sustain a Serious Injury under Any Asserted Category of § 5102(d) where Plaintiff’s Only Admissible Medical Record in Opposition was not Contemporaneous with the Subject Accident


Heather A. Sanderson
Sanderson Law, Calgary, Alberta

[email protected]

  • A Mandatory Policy Condition Stating that All Actions for Recovery Under a Policy of Insurance Must be Commenced within Two Years for the Loss or Damage Occurring Applies to All Claims, Including Bad Faith Claims, that an Insured has Against an Insurer


Stay well, hug your family, and pray for those who have been victims.



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]

Evan D. Gestwick

[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

Scott D. Storm

Brian D. Barnas

Eric T. Boron

Robert P. Louttit

Ryan P. Maxwell

Joshua M. Goldberg

Kyle A. Ruffner

Katherine A. Fleming

Evan D. Gestwick

Ryan P. O’Shea


Steven E. Peiper, Team Leader
[email protected]

Michael F. Perley

Scott D. Storm

Brian D. Barnas


Dan D. Kohane

[email protected]

Alice A. Trueman

Joshua M. Goldberg


Jody E. Briandi, Team Leader
[email protected]


Topical Index

Kohane’s Coverage Corner

Peiper on Property and Potpourri

Wilewicz’s Wide World of Coverage

Barnas on Bad Faith

Lee’s Connecticut Chronicles

Kyle’s Noteworthy No-Fault

Ryan’s Federal Reporter

Storm’s SIU

Fleming’s Finest

Gestwick’s Greatest

On the Road with O’Shea

Loutit’s Legislative and Regulatory Roundup

Rob Reaches the Threshold

North of the Border


Dan D. Kohane
[email protected]


10/10/23       New York Marine and Gen. Ins. Co. v. Rockingham Ins. Co.
New York State Supreme Court, New York County (plenary court)
Forty-Eight Day Delay is Disclaiming Waives Policy Exclusions.  Disclaimer to Someone Else isn’t Enough

NY Marine, Stateside Construction and The Astra sought an order that Rockingham Insurance Company is obligated to defend and indemnify Stateside and Astra in an underlying personal injury action (the "Mendoza Action") as additional insureds on, and in accordance with the terms of, the insurance policy that Rockingham issued to non-party B&H Contracting Corporation ("B&H").

In support of their motion, the plaintiffs submitted the

  • pleadings in the underlying Mendoza Action, in which the plaintiff, Jonathan Mendoza, asserts negligence and Labor Law claims against Stateside, Astra, and B&H for injuries he allegedly sustained when he was caused to fall from a scaffold while performing masonry work at premises in Brooklyn (the "Premises") owned by Astra;

  • the contract between Stateside, which Astra retained as general contractor for the construction work at the Premises, and B&H, a subcontractor retained by Stateside to perform masonry work, pursuant to which B&H was required to purchase and maintain commercial general liability insurance, naming Stateside and Astra as additional insureds, which would be primary and non-contributory to Stateside' s and Astra's own insurance;

  • the contract between B&H and SMJ Contracting LLC ("SMJ"), pursuant to which SMJ provided laborers, including Mendoza, to perform B&H' s masonry work at the Premises;

  • the commercial general liability insurance policy issued by Rockingham to B&H for the period covering Mendoza's alleged injury, which includes an endorsement providing for primary, non-contributory additional insured coverage to any entities that B&H agreed to name as such with respect to liability for injuries that were caused, in whole or in part, by B&H' s acts or omissions, or the acts or omissions of those acting on B&H's behalf;

  • the insurance policy issued by New York Marine to Stateside and Astra, which provides that coverage under the policy is excess over any other primary insurance available to them as additional insureds;

  • letters sent to Rockingham by Stateside and Astra, dated July 7, 2020, and January 11, 2021, tendering to Rockingham the defense and indemnification of Stateside and Astra in regard to the claims asserted against them in the Mendoza Action, together with

  • the United States Postal Service ("USPS") tracking data showing that the second of these tender letters was mailed on January 12, 2021, and received on January 16, 2021; and

  • Rockingham's letter to Stateside and Astra, dated March 1, 2021, denying coverage based on a pair of policy exclusions, together with USPS tracking data showing that the denial letter was mailed on March 4, 2021, and received on March 8, 2021.

The plaintiffs' submissions establish, prima facie, that B&H agreed to name Stateside and Astra as additional insureds on its commercial general liability policy, and to provide them with primary, non-contributory coverage; that the allegations in the Mendoza Action present a reasonable possibility that Mendoza's purported injuries were caused, in whole or in part, by B&H' s acts or omissions, or the acts or omissions of those acting on B&H' s behalf at the Premises; and that, by virtue of these facts, the additional insured endorsement in the Rockingham policy issues to B&H was triggered, extending primary, non-contributory coverage to Stateside and Astra as additional insureds, and entitling them to defense and indemnity with respect to the claims asserted against them in the Mendoza Action. As such, the plaintiffs have demonstrated their prima facie entitlement to judgment as a matter of law. Rockingham, in opposition, fails to raise any triable issue of fact. Indeed,

Rockingham does not dispute Stateside' s and Astra's status as additional insureds but argues instead that coverage was properly denied because the claims asserted by Mendoza in the underlying Mendoza Action are subject to a pair of policy exclusions. However, even assuming that the relevant policy exclusions apply to the plaintiffs' coverage claims, which the plaintiffs do not meaningfully contest, Rockingham cannot rely on those exclusions because its denial of coverage was untimely.

It is well-settled that, if insurer intends to rely on a policy exclusion, the disclaimer must be provided to the claimant "as soon as reasonably possible," as required by Insurance Law§ 3420(d). An insurer's failure to provide notice as soon as is reasonably possible precludes effective disclaimer," and "[t]he timeliness of an insurer's disclaimer is measured from the point in time when the insurer first learns of the grounds for disclaimer of liability or denial of coverage."

Rockingham delayed 48 days, until March 4, 2021, before disclaiming coverage. Given that the grounds for disclaiming Rockingham's delay in disclaiming coverage was unreasonable as a matter of law.  delay in disclaiming coverage found unreasonable where only a cursory investigation was necessary to determine if additional insured had timely notified insurer of claim;

Rockingham contends that its delay should be excused because, more than a month before disclaiming coverage to Stateside and Astra, it had denied coverage to B&H for the claims asserted in the Mendoza Action, citing the same policy exclusions and coping Stateside' s and Astra's attorneys. This contention is devoid of merit. The disclaimer to B&H makes no mention of either Stateside or Astra, let alone clearly disclaim coverage to them. Indeed,

Rockingham itself plainly did not consider the denial of coverage to B&H to also be an effective denial to Stateside and Astra, or else there would have been no reason to subsequently issue them a separate disclaimer.


10/04/23       Phipps v. Conifer Realty, LLC
Appellate Division, Second Department
Insurer’s Confirmation of Settlement Does Not Amount to Enough to Enforce Settlement

In 2017, Phipps sued for personal injuries she allegedly sustained when she slipped and fell in a stairwell of an apartment building that was owned and operated by Conifer. In January 2020, Conifer’s insurance carrier informed Conifer’s attorney that it had settled the action with the plaintiff for $50,000.

Thereafter, the Conifer’s attorney sent various letters and emails to the plaintiff's attorney attempting to confirm the settlement and have the Phipps sign various documents related to the settlement.

After the plaintiff failed to sign the documents, Conifer moved, inter alia, to enforce the alleged settlement agreement between the parties. In an order dated February 15, 2022, the court, among other things, denied that branch of the motion.

The appellate court did not enforce the settlement. CPLR 2104 provides, in relevant part, that an agreement between parties "is not binding upon a party unless it is in a writing subscribed by him [or her] or his [or her] attorney." "To be enforceable, a settlement agreement must set forth all material terms, and there must be [a] clear mutual accord between the parties".

An email that merely confirms a purported settlement is not necessarily sufficient to bring the purported settlement into the scope of CPLR 2104".

The email from the defendant's insurer to the defendant's counsel stating that the action had been settled, and the email exchange between the defendant's counsel and plaintiff's counsel regarding the plaintiff's execution of various documents related to the alleged settlement, did not evidence a clear mutual accord between the plaintiff and the defendant and did not contain all of the material terms of a settlement.

Editor’s Notes:  Seems to me that there was sufficient confirmation in the emails between the attorneys following the carrier’s earlier emails to make the settlement enforceable, but what do I know?


09/29/23       Lewczyk v. Safeco Insurance Company
Appellate Division, Fourth Department
City’s Claim for Reimbursement of Medical Expenses for Police Officer is Not a Separate Claim but Derivative of Officer’s Claim

This one was ours.  Mike Perley, with the assistance of Richelle Kloch, handled the appeal.  It took a long time to reach the right result.  The accident occurred in March 2012.

Lewcyzk was an on on-duty police officer who was injured in an auto accident.  She sued the driver and owner of the other car. She commenced an action against the driver and the owner of the other motor vehicle (tortfeasors), which was insured under a Safeco policy with limits of $100,000 per person/$300,000 per accident. Policy issued to the owner by defendant Safeco Insurance Company of America, doing business as Safeco Insurance (Safeco). A passenger in her vehicle also commenced an action against the tortfeasors, and the tortfeasors commenced a third-party action against, inter alia, plaintiff and the City for contribution and indemnification.

The City answered and asserted, inter alia, a counterclaim against the tortfeasors, pursuant to General Municipal Law § 207-c (6), for reimbursement of sums it had paid to plaintiff for lost wages and for medical treatment and hospital care.

Safeco notified Lewcyzk and the City that their claims must be settled from the single per person policy limit of $100,000. Plaintiff, the City, and Safeco (the parties) entered into a settlement agreement and release pursuant to which plaintiff and the City released the tortfeasors and Safeco from liability in exchange for certain payments from Safeco to plaintiff and the City that aggregated to $100,000.

The parties agreed that Lewcyzk would commence a declaratory judgment action to determine whether the $100,000 per person limit of liability for bodily injury applied separately to her claim and that of the City. The parties agreed that, if it [was determined that the policy limit applied separately to the claims, additional settlement monies would be paid.

The lower court declared that the City's "statutory claims for reimbursement of benefits paid to or on behalf of [plaintiff] give rise to a separate and distinct claim from [plaintiff's] bodily injury claims under the liability limits contained in [Safeco's] insurance policy and trigger a second, distinct application of the 'per person' policy limits under the Safeco policy." Safeco appealed and the Fourth Department reversed.

The policy, the court found, was not ambiguous and that there is a $100,000 policy limit for "each person" sustaining bodily injury. The policy provides that the limit of bodily injury liability for "each person" is the "maximum limit of liability for all damages, including damages for care, loss of services or death, resulting from any one auto accident" for bodily injury not resulting in death of "any one person" (emphasis added).

The City here asserted a claim against the tortfeasors pursuant to General Municipal Law § 207-c (6), which creates a cause of action for municipalities for reimbursement of "such sum or sums actually paid as salary or wages and or for medical treatment and hospital care as against any third party against whom the police officer shall have a cause of action for the injury sustained or sickness caused by such third party." The municipality's right to recover "is derived from its insured employee's cause of action in negligence against the person causing such injury," and the "right to bring the direct action is bottomed on the employee's cause of action in negligence" (City of Buffalo v Maggio, 21 NY2d 1017, 1018 [1968]). Accordingly, the City's statutory claim and plaintiff's claim both result from the injuries sustained by plaintiff and are both included in the same $100,000 per person limit of liability in the policy.


Steven E. Peiper

[email protected]


09/28/23       Philadelphia Indem. Ins. Co. v. Addison PHS Corp.
Appellate Division, First Department      
Notice of Removal of Failed Water Heater, Avoid Spoliation Sanction

Philly commenced this action in subrogation after it paid a water loss sustained by its insured, 220 Fifth Avenue.  The loss was caused by a failure of a hot water heater which was installed by defendant Addison.  Specifically, Philly asserted that the heater was improperly installed, was not piped to code, a water and leak sensor was not installed, and that Addison failed to confirm proper pressure inside of the heater was appropriate at the time of installation.

In the ensuing litigation, defendant made a motion seeking spoliation sanctions against Philly therein alleging that it, or 220 Fifth Avenue, destroyed and discarded the water heater during the course of the litigation.  The First Department quickly rejected the spoliation claim by noting that Addison was on notice that the heater was going to be removed, was provided ample time to inspect the property, and likewise could have performed any demonstrative testing it wished prior to removal of the property. 

In addition, the Court also rejected the argument that 220 Fifth Avenue’s video of the tank showing its alleged defects was improperly withheld and inaccurately depicted the failure.  The Appellate Division noted that arguments as to the accuracy of the video were, in effect, appropriate discussions for cross-examination. 


Agnes A. Wilewicz

[email protected]

On the road again, but will surely have plenty to report back, next time around.


Brian D. Barnas

[email protected]

10/06/23       Law Office of Rogelio Solis PLLC et al. v. Curtis
United States Court of Appeals, Fifth Circuit
Insurance Proceeds in Extra-Contractual Exposure Case Were Classified as Property of the Bankruptcy Estate

This case arises out of a December 19, 2020, motor vehicle accident in which a tractor-trailer owned by Josiah’s Trucking LLC (the “Debtor”) crashed into a vehicle (in which Carlos Tellez, Jr. and Anna Isabel Ortiz were riding, ultimately resulting in their deaths. Ortiz was survived by her mother, Ana Gomez, and father, Reyes Adrian Ortiz (collectively, the “Ortiz Family”). Tellez was survived by Sonia Tellez, Carlos Tellez, Rose Mary Rodriquez, and I. Tellez (collectively, the “Tellez Family”).

At the time of the Accident, the Debtor was insured by Brooklyn for a policy limit of $1,000,000. Soon after the accident, both families engaged counsel and began the insurance claims process. Gomez employed the Solis Law Firm, and the Tellez family engaged Escobar & Cardenas. In the weeks following the Accident, the Tellez Family engaged in discussions with Brooklyn Specialty and ultimately filed suit against the Debtor, the Debtor’s owner, and the driver. In contrast, Gomez, through the Solis Law Firm, made a Stowers demand on Brooklyn Specialty for the limits of the policy. Texas law imposes a basic tort duty, known as the Stowers doctrine, under which insurers, when faced with a settlement offer within policy limits, must accept the offer when an ordinarily prudent insurer would do so in light of the reasonably apparent likelihood and degree of that insured's potential exposure to a valid judgment in the suit in excess of policy limits. 

On January 12, 2021, Brooklyn Specialty transferred $1,000,000 to the Solis Law Firm’s IOLTA in settlement of Gomez’s claims.  That same day, Brooklyn Specialty informed the Tellez Family that the policy limit had been exhausted. Then, on January 18, 2021, two checks were issued: one for $680,000 to Gomez for settlement of her claims, and the other for $320,000 to the Solis Law Firm for attorneys’ fees.

On January 24, the Tellez Family, who received nothing from the policy proceeds, commenced an involuntary bankruptcy proceeding against the Debtor. On February 9, the Trustee” brought an adversary proceeding against Gomez and the Solis Law Firm seeking to avoid and recover the transfer of the policy proceeds pursuant to the Bankruptcy Code.  Gomez and the Solis Law Firm moved to dismiss on the ground that the Trustee failed to allege a transfer of the Debtor’s property because the Debtor had neither legal title in nor a contractual right to receive the Policy Proceeds, and otherwise lacked control over their disbursement.

The court relied upon In re OGA Charters, which held that in limited circumstances such as where a siege of tort claimants threatens the debtor’s estate over and above the policy limits, policy proceeds are classified as property of the estate.  Such an interest does not bestow upon the debtor a right to pocket the proceeds, but instead serves to reduce some claims and permit more extensive distribution of available assets in the liquidation of the estate.  Here, there were over $8 million in claims against the Debtor’s estate arising from the accident, far beyond the policy limit.  Thus, the court concluded that the insurance proceeds, in these circumstances, should be considered property of the estate.



Lee S. Siegel

[email protected]

On honeymoon.


Kyle A. Ruffner

[email protected]


09/14/23       State Farm Mut. Auto. Ins. Co. v. Abetree Chiro., P.C. et al.
Supreme Court, New York County
Court Holds Insurer Properly Denied No-Fault Claims, as Claimants Failed to Appear for Their Examinations Under Oath

In this no-fault declaratory judgment action, State Farm moved for summary judgment against multiple answering defendants, contending it was entitled to a judgment declaring that it is not required to pay any claims submitted for medical services provided to the claimant. According to State Farm, there was no coverage for the claims because it had requested that claimants appear for examinations under oath (EUOs) and the claimants failed to appear. Further, State Farm asserted that the claimants made misrepresentations regarding residence and the primary garage location of the insured vehicle.

The opposing defendants each submitted an affirmation in opposition contending that plaintiff failed to establish its prima facie burden as it did not establish that its EUO requests were timely made or that it timely denied claimant's claims. Further, these defendants argued that the proof submitted in support of State Farm’s motion contains inconsistencies regarding claimant’s purported non-appearances, barring summary judgment.

As explained by the court, pursuant to 11 NYCRR 65-3.5(b) and (d), an insurer has the right to seek additional verification, including an EUO, if it believes that such verification is necessary to establish proof of the claim. Attendance at a timely and properly scheduled EUO is a condition precedent to coverage, and a claimant's failure to appear vitiates coverage. To meet its prima facie burden for summary judgment where it has denied a claim for no-fault benefits based on a patient's failure to appear for an EUO, the insurer must establish that it requested EUOs in accordance with the procedures and time frames set forth in the no fault implementing regulations and that the patient did not appear.

Here, the court determined that State Farm proved it timely and properly sent EUO letters to the claimant through the affirmation of State Farm’s counsel, copies of the subject EUO scheduling letters, and proof of mailing. State Farm’s attorney further affirmed that his firm sent the letters by certified mail to claimant and that claimant failed to appear for the scheduled EUOs. The attorney had sufficient personal knowledge of his office's business practices and was personally present at his office on the days that claimant failed to appear for his EUO. In contrast, the court held that the opposing counsels' affirmations came from individuals without personal knowledge. Further, these affirmations created no material issue of fact for trial, as an affidavit or affirmation of an attorney without personal knowledge of the facts cannot supply the evidentiary showing necessary to successfully resist a motion for summary judgment.

Accordingly, as State Farm submitted affidavits from people with personal knowledge of the mailing of the EUO letters and of claimants' non-appearance at the EUOs, it satisfied its burden of proving that the letters were mailed and that the claimants failed to appear, and the opposing defendants fail to raise a triable issue of fact. Accordingly, the court held that coverage was vitiated, and State Farm was not required to deny the claims within the statutory timeframe. As such, the court granted State Farm’s summary judgment motion on its declaratory judgment action.


09/28/23       In the Matter of U.S. Auto. Ass’n v. Tevin Mickens
Supreme Court, Appellate Division, First Department
Court Holds that Supreme Court Should Have Granted a Stay of Arbitration and Directed a Framed Issue Hearing on Coverage Issue

The claimant Tevin Mickens sustained extensive injuries after he was struck by a car while riding a bike in Manhattan.  Following the accident, he applied to USAA for no-fault benefits, including claims for uninsured motorist bodily injury or underinsured motorist bodily injury. However, his claim was denied because, according to the insurer, the claimant did not reside with his mother who was the policyholder at the time of loss. The claimant made a demand for arbitration, which USAA petitioned to stay, and the Supreme Court denied the petition on the basis that USAA failed to meet its burden that respondent did not reside primarily with his mother.

On appeal, the court held that the evidence presented raised an issue of fact as to whether respondent resided primarily with his mother. While USAA submitted hospital billing records and respondent's no-fault benefits application listing a New York address as the claimant’s residence, the police accident report it submitted reflected the mother's Pennsylvania address as respondent's home address. The claimant’s driver's license, voter registration card, and recent tax documents also showed the Pennsylvania address as his residence. The claimant argued that he leased his New York City apartment eight months before the accident in anticipation of his employer reopening its New York office and moved in two months later, but that he continued to work remotely from his family's home in Pennsylvania and was in New York approximately 40% of the time.

Accordingly, the Appellate Court held that the Supreme Court should have granted a temporary stay of arbitration and directed a framed issue hearing on the issue of whether respondent resided primarily in New York or in Pennsylvania at the time of the accident.


Ryan P. Maxwell

[email protected]


10/10/23       Stetson Real Estate v. Sentinel
Mario Badescu Skin Care v. Sentinel
Second Circuit Court of Appeals
Pair of Summary Orders from the Second Circuit Continue to Foreclose COVID-19 Business Interruption Claims

Unwavering, the Second Circuit ruled in a pair of Summary Orders issued this week that COVID 19 does not trigger insurance policy provisions that provide coverage for losses arising from “direct physical loss” of or “physical damage” to covered property, absent some meaningful distinction from what “[t]his court and the state courts of New York have consistently and repeatedly held.” It remains to be seen what, if any, meaningful distinction may exist. Until then, we expect this trend to continue.


10/10/23       LePatner v. RSUI Group
Second Circuit Court of Appeals
Allegations Incorporating an Agreement Unrelated to the Performance of Legal Services Foreclosed Defense Under Professional Liability Policy

In this matter, a law firm sued its professional liability insurer, RSUI Group, Inc., seeking, among other things, a defense in underlying litigation. The underlying litigation asserted that the firm had breached their contract, engaged in unfair or deceptive practices under the Connecticut Unfair Trade Practices Act (CUTPA), and were negligent, specifically because of certain specified failures to properly perform services described in the LPS Agreement.

Finding no defense obligation was owed, the Second Circuit provides that “based on the four corners of the complaint and the language of the Policy, that RSUI was under no duty to defend [the firm] because the Policy covers only professional services provided as a lawyer, and the Nusseibehs’ complaint alleges no claim against [the firm] falling within that scope of coverage.” Specifically, the complaint alleged that all contractual failures were “under the LPS Agreement,” and that agreement expressly provided that it “pertains solely to project management services that do not include the performance of legal services.”


Scott D. Storm

[email protected]


05/13/22  Adirondack Ins. Exchange v. DiMarco
Supreme Court, New York County.
No Coverage for Fire Damage to Insured’s Adjacent Property as it Did Not Constitute a “Residence Premises” or an “Other Structure.”

[Abridged] Adirondack Insurance Exchange granted a judgment declaring that the policy it issued to the defendant Mario DiMarco does not provide coverage for DiMarco's claim for real property loss stemming from a fire at one of his two adjacent residential properties and to dismiss DiMarco's two counterclaims for policy reformation and breach of contract.

DiMarco submitted an application for several types of insurance, including homeowners’ insurance for the "Premises", to his broker, MGM. In the application, DiMarco represented that he resided at the Premises and that he did not own any other residences. In response, MGM presented DiMarco with an Insurance Proposal that included his application, as well as an Optional Coverage and Endorsement Section providing coverage for an "Other Structure On Residence Premises," with a description as "storage." An exterior and interior inspection of the Premises was conducted, which documented a pair of structures on the Premises—the house in which DiMarco resided and a freestanding two-car garage/shed. Thereafter, the plaintiff issued DiMarco a policy for the Premises for the period 2015-2016, and renewals of the policy were issued annually through the period 2020-2021.

The Policy, by its express terms, provides homeowners insurance coverage for DiMarco's dwelling on the "residence premises" as defined in the Policy Declarations, as well as other structures on the "residence premises" set apart from the dwelling. The Policy Declarations pages, in turn, define the "residence premises" as the Premises and, consistent with MGM's Insurance Proposal, include an endorsement for $150,000 in additional coverage for "Other Structures On Residence Premises," with a description of such "other structures" as "storage."

DiMarco submitted a claim under the Policy for fire damage to a second residence he owned, the "Loss Location". Though they are adjacent to each other, it is undisputed, and confirmed by property assessment data, that the Loss Location and the Premises are located on different lots. The plaintiff sent DiMarco a letter stating that his claim was denied because the Loss Location was not DiMarco's residence premises, as defined in the Policy Declarations pages.

Thereafter, the plaintiff commenced this action seeking a declaration that DiMarco's claim for damage to the Loss Location was barred because it is not the property covered under the Policy. DiMarco filed his Answer with Counterclaims seeking reformation and breach of contract. DiMarco filed a Third-Party Complaint against MGM, alleging, in essence, that he had requested that MGM obtain insurance coverage for both the Premises and the Loss Location, and that MGM was negligent in only obtaining coverage for the Premises and in misrepresenting that the Policy also provided coverage for the Loss Location. MGM filed its Answer with crossclaims, asserting a crossclaim against the plaintiff for reformation.

The plaintiff's motion for summary judgment is granted. "A contract is to be construed in accordance with the parties' intent, which is generally discerned from the four corners of the document itself. Consequently, `a written agreement that is complete, clear and unambiguous on its face must be enforced according to the plain meaning of its terms.'". "Moreover, provisions contained in an insurance policy which limit coverage to certain premises are enforceable."

Here, the Policy unambiguously limits DiMarco's homeowners’ insurance coverage to the dwelling and other structures located at the "residence premises," which is expressly defined as the Premises. There is no mention of the Loss Location anywhere in the Policy. DiMarco's insistence that coverage for the Loss Location is provided by the Policy's "other structures" endorsement is misplaced, as the additional coverage provided for "other structures" is itself expressly limited to other structures "on the residence premises." Plainly, this cannot include the Loss Location, as it is undisputed that the Loss Location and the Premises are two separate and distinct properties. "An unambiguous "`residence premises' provision ... must be accorded its plain and ordinary meaning."   Indeed, in his affidavit, the plaintiff's underwriter avers that the underwriting guidelines applicable to the Policy do not even allow for coverage of two separate properties under a single policy.

Accordingly, the plaintiff has demonstrated its prima facie entitlement to summary judgment declaring that the Policy does not cover DiMarco's insurance claim for the fire damage to the Loss Location and dismissing DiMarco's counterclaim for breach of contract based on the plaintiff's denial of his insurance claim.

The plaintiff has likewise established that both DiMarco's counterclaim and MGM's crossclaim for reformation are subject to dismissal for failure to state a claim. "A claim for reformation of a written agreement must be grounded upon either mutual mistake or fraudulently induced unilateral mistake."  "In the case of mutual mistake, it must be alleged that the parties have reached an oral agreement and, unknown to either, the signed writing does not express that agreement, whereas in the case of unilateral mistake, it must be alleged that one party to the agreement fraudulently misled the other, and that the subsequent writing does not express the intended agreement." Whether based upon mistake or fraud, a claim for reformation must be pleaded with the requisite particularity necessitated under CPLR 3016(b). "The burden upon a party seeking reformation is a heavy one ... [because] [t]he proponent of reformation must show in no uncertain terms not only that mistake or fraud exists, but exactly what was really agreed upon between the parties."  "Moreover, once an insurance policy has been received, it constitutes presumptive knowledge of its terms and limits."

Both DiMarco and MGM appear to allege a theory of mutual mistake, asserting in conclusory fashion that both DiMarco and the plaintiff intended for the Policy to cover the Loss Location. However, neither DiMarco nor MGM plead their claims for reformation with the particularity required under CPLR 3016(b). In particular, neither sets forth specific factual allegations stating that, prior to the issuance of the Policy, DiMarco communicated on any specific date, by any specific means, to either MGM or the plaintiff, that he wanted the Loss Location covered by the Policy, and, perhaps more importantly, that on any specific date, by any specific means, a specific representative of the plaintiff agreed to provide such coverage, let alone to do so under the same Policy insuring the Premises.

To the contrary, the evidence submitted by the plaintiff demonstrates that DiMarco's application for insurance only sought coverage for the Premises and "Other Structures on the Residence Premises," and gave no indication that coverage was also sought for the Loss Location. Indeed, DiMarco, in his application, expressly denied that he even owned any other residences. Similarly, the inspection report prepared in connection with the issuance of the Policy was limited to the Premises and made no mention of the Loss Location. And the Policy itself, which is the best evidence of the plaintiff's intent, expressly limits coverage to the Premises. Further, the unrebutted affidavit of the plaintiff's underwriter states that the applicable underwriting guidelines did not allow for coverage of two separate properties under a single homeowners insurance policy. In short, neither DiMarco nor MGM allege specific facts in support of their conclusory assertions that the plaintiff intended to insure the Loss Location under the same Policy that provided coverage for the Premises, and the evidence before the court uniformly demonstrates that the plaintiff only intended for the Policy to cover the Premises and was unaware of DiMarco's alleged desire to also insure the Loss Location.

Moreover, both DiMarco and MGM had the Policy since early 2015 and are thus presumed to have knowledge of its terms and limits, including its express limitation of coverage to the "residence premises." And yet, there is no allegation in either of their pleadings that either DiMarco or MGM ever directed the plaintiff to change the policy coverage to include the Loss Location, so as to conform the coverage to the parties' alleged mutual intent and rectify their purported mistake.

09/26/23 State Farm Mut. Auto. Ins. Co., et. al. v. Alexander Khait, D.C., et al.
United States District Court, E.D. New York
Court Quashes Subpoena for Bank Records of Non-Party Without Prejudice Allowing Insurer to Issue Another that is Not Overly Invasive of Privacy in Case Asserting No-Fault Medical Provider Fraud by Several Chiropractic Corporations

[Abridged] Non-party 2641 Group, Inc. filed a motion to quash a non-party subpoena Plaintiffs State Farm Mutual Automobile Insurance Company and State Farm Fire and Casualty Company served on T.D. Bank, N.A. for 2641 Group's bank account records, on the grounds that it seeks irrelevant information and violates 2641 Group's privacy interests. For the following reasons, the motion to quash is granted.

Plaintiffs filed this action against Defendants Alexander Khait and several chiropractic corporations seeking a declaratory judgment and asserting claims of common law fraud, aiding and abetting fraud and unjust enrichment.  Plaintiffs allege that, beginning in 2014 and continuing to the present, Defendants engaged in a scheme to defraud Plaintiffs by submitting inflated charges to State Farm for medically unnecessary healthcare services, which were provided pursuant to a predetermined treatment protocol.  Plaintiffs allege that Defendants paid "illegal kickbacks to non-party healthcare providers who controlled access to patients at various no-fault clinics in exchange for patient referrals as part of the fraudulent scheme."

Plaintiffs served a subpoena on non-party TD Bank seeking documents for the accounts held by 2641 Group for the period from January 1, 2014, to the present, specifically,

[a]ll documents related to the above-referenced account numbers and/or all documents related to any account that has been maintained by the above-referenced account holder, including: copies of all transaction statements, deposits, and/or withdrawal transactions and slips (including offsets), items of deposit (e.g., deposited checks), canceled checks, electronic fund transfers, wire transfers, account ledgers, account formation and governance documents, corporate resolutions, signature cards, account opening documents, powers of attorney, and all correspondence relating to the account(s).

2641 Group moved to quash the subpoena, arguing that "the complaint does not mention 2641 Group anywhere" and that "there is nothing resembling an allegation that some unknown entity — such as 2641 Group — is a fraudulent layperson owner of a medical provider Defendant." The letter motion asserts that "my client's personal privacy should not be sacrificed to spice and sex up the Plaintiff's prosaic allegations of `medically unnecessary' and `predetermined treatment protocol' insurance company opinion driven pleadings — the epitome of layperson medicine."

In opposition, Plaintiffs assert that they "obtained bank records in discovery showing that at least three corporate Defendants made payments to 2641 Group between 2015 and 2016, totaling approximately $34,607.44," but that Defendants have not provided any explanation for the payments. Plaintiffs argue that the subpoenaed bank records are relevant in light of "2641 Group's apparent relationship with at least three of the corporate Defendants."  Plaintiffs also allege that 2461 Group's owner, Vladimir Kutsyk, "has a long history of being involved in no-fault fraud schemes," and cite a criminal case "directly tying Kutsyk to a fraudulent scheme as the controller of several no-fault clinics." In reply, 2641 Group argues that State Farm mischaracterized the criminal involving Mr. Kutsyk and implies that the subpoena is a "fishing expedition."

Federal Rule of Civil Procedure 45 permits a party to serve a document subpoena on a non-party. See Fed. R. Civ. P. 45(a)(1)(A)(iii). A court must quash a subpoena "that: (i) fails to allow a reasonable time to comply; (ii) requires a person to comply beyond the geographical limits specified in Rule 45(c); (iii) requires disclosure of privileged or other protected matter, if no exception or waiver applies; or (iv) subjects a person to undue burden." See Fed. R. Civ. P. 45(d)(3). A court may also issue a protective order prohibiting compliance with a subpoena that exceeds the scope of discoverable information under Rule 26, i.e., "nonprivileged matter that is relevant to any party's claim or defense and proportional to the needs of the case." Fed. R. Civ. P. 26(b)(1); 26(c)(1).

As a starting point, only a subpoena's recipient may challenge it—a non-recipient "has standing to challenge the subpoena `only if it has a privilege, privacy or proprietary interest in the documents sought.'" Where a non-recipient lacks standing to challenge a subpoena on relevance or proportionality grounds, "the court may nevertheless exercise its inherent authority to limit irrelevant or non-proportional discovery."

Courts are generally in agreement that financial records (including banking records) fall within the scope of information to which a party enjoys a personal right or privilege." "Nevertheless, a court will order tax returns and other sensitive financial information produced where it is relevant to the action and there is a compelling need for the documents because the information is not otherwise readily available." In some circumstances, financial and banking records may be discoverable to prove claims involving alleged insurance fraud kickback schemes.

2641 Group seeks an order quashing the subpoena on relevance and privacy grounds. As discussed, lack of relevance is not a valid basis for a motion to quash, and 2641 Group does not have standing to seek a protective order based on the purported irrelevance of the documents. 2641 Group has standing only to move to quash the subpoena based on the asserted privacy interest. The Court may, however, exercise its inherent power to limit the subpoena if it exceeds Rule 26's scope.

The Court finds that Plaintiffs have established that a very limited number of the bank records may be relevant to Plaintiffs' claims. As discussed, the complaint alleges that Defendants engaged in a scheme to defraud State Farm by submitting inflated charges for medically unnecessary healthcare services. Plaintiffs seek to show that Defendants paid kickbacks to non-parties and seek to determine whether payments to 2641 Group were part of the scheme. Some of 2461 Group's bank account records, therefore, might arguably be relevant to Plaintiffs' claims, although Plaintiffs only speculate as to the illegitimate nature of the payments.

The Court finds that, as currently written, the subpoena seeks far more than the few limited documents that relate to the allegedly suspect transactions. Thus, it is overbroad and overly invasive of 2641 Group's privacy interests under both Rules 26 and 45. The subpoena seeks, inter alia, "all documents related to 2641 Group's account numbers," including transaction statements, items of deposit including checks, electronic fund transfers, wire transfers, account ledgers, and "all correspondence related to the account," for an approximately nine-year period. Plaintiffs seek nine years' worth of records because that is the period during which State Farms alleges the fraudulent activity has taken place, although they only state they have obtained documents showing a few payments in 2015 and 2016. They do not offer evidence that any association with 2641 Group continued beyond 2016, despite their access to Defendants and Defendants' records.

The subpoena is also not sufficiently limited in scope because it is not limited to documents related to the Defendants. Plaintiffs have not shown evidence or even offered an explanation as to how the operations of 2641 Group beyond transactions with Defendants could be relevant. The vast majority of the responsive records that T.D. Bank would be required to produce upon processing the subpoena would likely be irrelevant. Because most of the responsive documents would be irrelevant but would reveal private and potentially sensitive financial information, the subpoena unnecessarily compromises 2461 Group's privacy interests.

Accordingly, the Court quashes the subpoena without prejudice. Plaintiffs may issue another subpoena that is tailored to the documents that they can demonstrate are relevant to their claims and that is not overly invasive of privacy.

9/20/23 Terri Balint v. Allstate Ins. Co.
United States District Court, M.D. Pennsylvania.
In Action by Administratrix to Recover for Damage from Fire Intentionally Set by the Insured, Mortgagee’s Motion to Intervene is Granted Having Satisfied a Four-Factor Test 

[Abridged] Presently before the Court is a motion to intervene filed by, LLC. loanDepot's motion to intervene be granted.

At the time of his death, Havir owned and resided at the "Property".  Allstate and Havir entered into a Deluxe Homeowners Policy for fire and other casualties. Havir died intestate, and Balint was appointed Administratrix of his estate. Residing at the Property on the date of loss and for six years leading up to the date of loss, was Havir's son, Christopher Havir. According to Balint, the relationship between Havir and his son was contentious and, on the morning following Havir's death, Balint instructed Christopher to vacate the Property immediately. The following day, Christopher Havir set fire to the dwelling on the Property, causing complete destruction, and took his own life. Following the fire, Balint made a claim for coverage under the Policy, which Allstate denied.  The stated basis for denial of coverage is that Christopher Havir was an "insured person" within the meaning of the Policy at the time he set fire to the Property, the Policy does not cover loss to the Property caused by the intentional or criminal acts of any insured person, and the loss was caused by the intentional or criminal acts of an insured person, i.e., Christopher Havir.

Balint, as Administratrix of the Estate of Kenneth Havir, commenced this action for the loss to the Property asserting Allstate breached the Policy by its failure and refusal, despite demand, to pay for the covered losses caused by the fire.  As relief, Balint seeks declaratory judgment and payment of all losses for the damaging-causing fire up to the limits of the Policy in the amount of $272,000, plus interest and costs. loanDepot filed a petition to intervene seeking "intervention of right" under Federal Rule of Civil Procedure 24(a)(2) in order to protect its interest as the mortgagee of record in the Property. loanDepot alleges that pursuant to the terms of the Mortgage and the Policy, it has first priority over any insurance proceeds distributed by Allstate, especially because loanDepot foreclosed on the property when the Mortgage fell into default and obtained an in rem judgment.

Rule 24(a)(2) states, in relevant part:

(a) Intervention of Right. Upon timely application, anyone shall be permitted to intervene in an action . . . (2) when the applicant claims an interest relating to the property or transaction which is the subject of the action and the applicant is so situated that the disposition of the action may as a practical matter impair or impede the applicant's ability to protect that interest, unless the applicant's interest is adequately represented by existing parties.

The Third Circuit Court of Appeals utilizes a four-factor test to determine whether the intervening party has a right to intervene under Rule 24(a). This test requires:

1) a timely application for leave to intervene, 2) a sufficient interest in the underlying litigation, 3) a threat that the interest will be impaired or affected by the disposition of the underlying action, and 4) that the existing parties to the action do not adequately represent the prospective intervenor's interests.

Each of the factors must be satisfied for intervention under Rule 24(a) to be granted and the burden is on the party seeking intervention. 

The first issue the Court must address is whether loanDepot's intervention is time-barred. "The timeliness of a motion to intervene is `determined from all the circumstances' and, in the first instance, `by the trial court in the exercise of its sound discretion.'"  Factors to consider in making the timeliness determination include "(1) [h]ow far the proceedings have gone when the movant seeks to intervene, (2) the prejudice which resultant delay might cause to other parties, and (3) the reason for the delay." 

The mere passage of time . . . does not render an application untimely…However, the critical inquiry is: what proceedings of substance on the merits have occurred? This is because the stage of the proceeding is inherently tied to the question of the prejudice the delay in intervention may cause to the parties already involved.

Here, Allstate argues that loanDepot's claims are time-barred because paragraph 12 of the Policy states that, "No suit or action may be brought against up unless there has been full compliance with all policy terms. Any suit or action must be brought within one year after the inception of loss or damage." "Pennsylvania law recognizes as valid suit limitation clauses in insurance policies."  loanDepot correctly asserts that the motion to intervene is not a lawsuit against Allstate and, therefore, is not barred by the limitations period set forth in paragraph 12 of the Policy. loanDepot maintains that the instant lawsuit was timely commenced by Balint, as Administratrix of the Estate of the insured, and loanDepot "simply seeks to intervene."

Nevertheless, the undersigned finds that the motion to intervene is timely because the case is in its early stage and the existing parties are not prejudiced. The date of loss in this case was April 15, 2022.  On November 21, 2022, loanDepot commended an action in mortgage foreclosure against Balint and the unknown heirs of Kenneth Havir in the Court of Common Pleas of Lackawanna County. On February 21, 2023, default judgment was entered in favor of loanDepot, which was amended to $98,649.59 on March 27, 2023. Balint commenced this action in the Court of Common Pleas of Lackawanna County by filing a precipice to issue writ of summons on April 12, 2023, and a complaint on June 21, 2023. After giving notice on July 3, 2023, loanDepot timely filed its state court petition to intervene on July 10, 2023. After Allstate removed this action to the Middle District on July 18, 2023, loanDepot filed the motion to intervene on August 4, 2023. On August 10, 2023, Balint filed an amended complaint. Considering the totality of the circumstances, the record before the Court reveals that the underlying action has not progressed to any proceeding of substance on the merits, and the pleading stage is not yet closed. Therefore, the undersigned finds loanDepot's motion to intervene timely.

Second, the Court must address whether loanDepot has a sufficient interest in the underlying litigation.  "An intervenor's interest in the litigation must be direct, substantial, and legally protectable to satisfy the interest requirement of Rule 24(a)(2)."  To meet this prong of the test, a prospective intervenor must fundamentally demonstrate that its interest relates to the subject of the underlying proceeding, i.e., that it is "significantly protectable."  The asserted interest must be "a cognizable legal interest, and not simply an interest `of a general and indefinite character.'" 

In opposition to the motion to intervene, Balint argues that loanDepot does not have a sufficient interest in this litigation to permit intervention because its claim as a mortgagee is separate and apart from Balint's claim on behalf of the estate. Balint further argues that loanDepot's claim will not be affected or impaired by the disposition of the instant action. The undersigned disagrees.

As recounted in loanDepot's motion to intervene, Havir executed a mortgage on the Property on February 10, 2018, in the principal amount of $91,676.00 to Mortgage Electronic Registration Systems, Inc., as nominee for loanDepot.  To ensure the collateral would cover the debt, loanDepot required Havir to maintain a homeowners insurance policy on the Property and required that loanDepot be named as loss payee on the policy.  The present action affects the disbursement of the proceeds of the Policy. Pursuant to the terms of the Mortgage and the Policy, loanDepot is the mortgagee of record in the Property that is the subject of this action and has first priority over any insurance proceeds distributed by Allstate. Therefore, the undersigned finds loanDepot has a sufficient interest in the Property and Policy that is the subject of this action.

Third, the Court must determine whether loanDepot's legal interest will be impaired or affected by the disposition of the underlying action.  Under this element of the test, loanDepot must demonstrate that its legal interests "may be affected or impaired, as a practical matter by the disposition of the action."  In making this determination, the Court is required to assess "the practical consequences of the litigation," and "`may consider any significant legal effect on the applicant's interest.'"  It is not sufficient that the claim be incidentally affected; rather, there must be "a tangible threat" to the applicant's legal interest. 

Here, the undersigned finds that loanDepot has demonstrated that its legal interest would be affected by this litigation. After Havir passed away, the Mortgage fell into default and loanDepot commended an action in mortgage foreclosure against Balint and the unknown heirs of Kenneth Havir.  A default judgment was entered in favor of loanDepot. Given loanDepot's first priority over any insurance proceeds distributed by Allstate and the unpaid foreclosure judgment, the undersigned finds that the instant action between Balint and Allstate could have an immediate, adverse effect on loanDepot's legal interest. 

Lastly, the Court must determine whether the existing parties to the action adequately represent loanDepot's interests.  A court must conduct a "separate inquiry into whether the government or other existing parties will adequately advocate the applicant's interest."  No party has asserted that the existing parties may adequately represent loanDepot's interest in the litigation. Inadequacy of representation is sufficiently demonstrated "if the applicant shows that representation of his interest may be inadequate; and the burden of making that showing should be treated as minimal."  Although Balint and loanDepot may share a general alignment of interest, the undersigned finds that representation is inadequate. If Allstate does distribute insurance proceeds under the Policy, loanDepot maintains first priority over any distributions pursuant to the Mortgage. Balint would only receive a portion of the distribution if there were excess funds after loanDepot's losses were satisfied. Therefore, the undersigned finds that loanDepot is in a better position to assert and protect its own interest rather than relying upon Balint to do so. 

Accordingly, because loanDepot has satisfied the four-factor test to determine whether an intervening party has a right to intervene under Rule 24(a), the undersigned finds that loanDepot may intervene as of right pursuant to Rule 24(a)(2). 

Katherine A. Fleming

[email protected]


09/28/23        Ky. State Univ. v. Darwin Nat’l Ass. Co.
Kentucky Supreme Court (originally published June 15, 2023)
No Coverage Under Claims-Made-And-Reported Management Liability Policy When Insured did not Comply with the Policy’s Notice Requirements

Darwin National Assurance Company, now known as Allied World Specialty Insurance Company (“Allied”) issued a claims-made-and-reported management liability policy (“Policy”) to Kentucky State University (“KSU”). The Policy allowed claims made against KSU within the policy period to be reported to Allied up to ninety days after the end of the policy period, which was September 29, 2015, in this case. During the policy period, two professors submitted Notices of Charges of Discrimination to the United States Equal Employment Opportunity Commission (“EEOC”) and Kentucky Commission on Human Rights (collectively, “EEOC Charges”) related to their employment at KSU. KSU received written notice of the EEOC Charges on June 23, 2015. On September 2, 2015, the professors brought employment-related claims against KSU. On October 2, 2015, KSU notified Allied of the litigation and sought coverage. Allied denied coverage.

KSU filed a third-party complaint against Allied, requesting a declaration of rights under the Policy and asserting various claims including breach of contract. The circuit court did not interpret the Policy’s provisions to provide that KSU forfeited coverage by failing to properly notify Allied. Instead, the circuit court concluded that Kentucky’s notice-prejudice doctrine applied, meaning there was coverage unless Allied could demonstrate prejudice. Allied could not show prejudice based on a three-day delay in reporting the claim, so the circuit court determined Allied had to indemnify KSU. The circuit court also noted the Policy was unclear as to how notice was to be given, so it could be timely if a mail-box rule were applied. On appeal, the Kentucky Court of Appeals disagreed and held that the Policy’s terms were clear about the reporting period and how to report claims, so the notice-prejudice rule did not apply. The Court of Appeals distinguished policy language that would require “prompt notice,” as opposed to a specified reporting timeline, without defining prompt notice or warning of a forfeiture.

The Kentucky Supreme Court concluded that the Policy provisions clearly warned KSU that noncompliance with the notice requirements would result in forfeiture of coverage. The Policy expressly informed KSU that a condition precedent to coverage was giving written notice of a claim as soon as possible but in no event later than ninety days after the end of the policy period. The Policy also informed KSU that there would be no coverage if the notice provisions were not met. Since there was no ambiguity in the notice provisions, the application of the notice-prejudice rule was unwarranted.

The Kentucky Supreme Court discussed whether Kentucky would apply the notice-prejudice rule to claims-made-and-reported insurance policies as well as occurrence-based policies. Occurrence-based policies have different provisions because they provide coverage for incidents that occur during the policy period even if there is a claim after the policy period. By contrast, for claims-made-and-reported policies, timely notice of a claim triggers coverage and defines its scope because there is only coverage for claims made and reported during the policy period regardless of when the underlying incident occurred. Given the distinction between the two types of policies, the Kentucky Supreme Court clarified that generally the notice-prejudice rule does not apply to claims-made-and-reported policies with unambiguous notice requirements as a condition precedent to coverage. The Kentucky Supreme Court reasoned that parties are bound by the clear and unambiguous terms of their contracts, so claims-made-and-reported policies must be construed as written under the facts of the case.


Evan D. Gestwick

[email protected]


10/02/23       Zurich Am. Ins. Co. v. First Spec. Ins. Corp.
New York State Supreme Court, County of New York
Self-Insured Supermarket Held to be Equitably Estopped from Denying Defense to its Own Landlord on the Eve of Trial

An individual tripped and fell on the sidewalk outside of Western Beef Supermarket and brought an underlying personal injury action against the supermarket and its landlord to recover for his injuries. The supermarket, being self-insured, retained counsel on its own, assigning such counsel to defend both the supermarket and its landlord in the underlying action. Initially, the supermarket accepted that it was liable for the alleged defect in the sidewalk that allegedly caused the claimant’s injuries.

On the eve of trial, however, the supermarket changed its tune, taking the position that its landlord, and not itself, was responsible for the maintenance of the sidewalk on which the claimant fell, and thus, liable to the claimant for his injuries. The supermarket advised its attorney, who, again, was retained by the supermarket to defend both the supermarket and its landlord in the underlying action, that a conflict of interest likely existed, and asked it to drop the defense of the landlord.

Zurich, the insurer of the landlord, stepped up and began the defense of the landlord, having not even participated in the discovery proceedings, or any other prior point in the litigation. At trial, the landlord was ordered to pay nearly $300,000 in damages to the claimant. This litigation ensued. The question answerable by this Court was whether Western Beef, a self-insured supermarket, is equitably estopped from denying coverage to the landlord, the same way an actual insurance carrier would be.

It is a long-standing rule in New York that the doctrine of equitable estoppel applies in the context of insurance coverage when, at the time it denied coverage, the insurer controlled the defense of its insured. Other than that, equitable estoppel may also apply in situations where an insurer is not obligated to provide coverage in the first place, but does so anyway, without reserving its rights, where the insured loses the right to control its own defense.

Finding that the supermarket was equitably estopped from refusing to defend its landlord in the underlying action, the Court reasoned that the supermarket, by reason of its being self-insured, “stepped into the shoes of an insurance company through a self-insured retention and controlled the underlying litigation for over a year.” Therefore, the same principles of equitable estoppel that apply to an insurance carrier were applied to the supermarket. Given that the supermarket had this change of heart only on the eve of trial, it is evident that discovery had long been concluded, and therefore, that the landlord had detrimentally relied upon the defense with which it was being provided, courtesy of the supermarket.


ON the ROAD with O’SHEA
Ryan P. O’Shea

[email protected]


10/03/23       Matter of Richardson v Motor Veh. Acc. Indem. Corp.
Appellate Division, First Department
Only One Tortfeasor Needed to Commence Action Against MVAIC and Police Report Admissible Hearsay where MVAIC Relied Upon it in Opposition to Petition

Richardson alleged that on March 4, 2021, she was injured as a pedestrian in a crosswalk after a two-motor-vehicle accident that involved a BMW and Cadillac. A police report stated Richardson had been struck by the Cadillac after its driver disobeyed a traffic light and hit the BMW, the driver of the Cadillac then fled. The police later found out the plate on Cadillac did not match the vehicle. Richardson then sought a petition under NY Ins. Law § 5218 to bring an action against the Motor Vehicle Indemnity Corporation (“MVAIC”). The trial court denied Richardson’s petition.

On appeal the First Department noted Richardson supported her petition with the police accident report, a disclaimer letter from the BMW’s insurer, and a sworn Notice of Intention to Make a Claim attesting the Cadillac’s driver was unknown and the vehicle had a fake license plate. On this evidence, the Appellate Division reversed. It found Richardson met her burden establishing her injury involved an accident where the owner and operator of the Cadillac was not ascertainable through reasonable efforts.

The court noted that while the police report is generally inadmissible hearsay, MVAIC also relied upon it in opposition to the petition, and thus, could be considered in support of the Notice of Intention to Make a Claim. The court further rejected MVAIC’s argument that Richardson could not commence an action because the BMW’s owner and operator were ascertainable and needed to exhaust her remedies before commencing an action against MVAIC. The court reasoned there was no indication that the BMW’s owner and operator were potential tortfeasors, nor did Richardson implicate the BMW’s owner in her petition.


9/27/23         Matter of Owens v Integon Natl. Ins. Co.
Appellate Division, Second Department
Insured’s Choice to Ignore Petition to Stay Arbitration Results in Lack of Default Vacatur of Arbitration Claim

Owens alleged that on June 3, 2019, he was injured when his vehicle was struck by another motor vehicle. On February 24, 2020, Owens served Integon with a demand for arbitration for a claim of uninsured motorist benefits. On March 10, 2020, Integon filed a petition pursuant to CPLR Article 75 to permanently stay the arbitration. Owens did not answer or appear at the proceeding because he believed the second vehicle might have insurance coverage. On June 30, 2020, Integon filed and served a “Notice of Settlement” of a proposed order granting the petition on default. Owens again did not appear or respond. The trial court then granted Integon’s unopposed petition to stay arbitration.

In August 2020, Owens was advised in writing that the other vehicle did not have insurance coverage. Around March 2021, Owens commenced the present action seeking to vacate the prior order, restore the proceeding to the active calendar, and compel arbitration. The trial court denied the motion and determined Owens failed to demonstrate a reasonable excuse for default.

Based on the facts of the prior proceeding, the Second Department affirmed the dismissal. It found Owens failed to provide a reasonable excuse for delay and potentially meritorious claim or defense pursuant to CPLR 5015(a)(1). It noted that a reasonable excuse rests with the sound discretion of the trial court and that Owens failed to provide a reasonable excuse for his default. Thus, there was no need to consider whether Owens had a meritorious claim or defense.


Robert P. Louttit

[email protected]


01/23/23       A2078
02/27/23       S5201
Claims Settlement Timeframe Legislation

New York’s legislature regarding the Claims Settlement Timeframe passed both houses (A2078 and S5201) and presently awaits either the Governor’s veto or signature. The purpose of the bill is to establish claim investigation and settlement standards for insurance companies to follow in the event of a disaster.

In this regard, this bill would require every insurer authorized to write policies in New York State that cover loss or damage to real property, personal property, or other liabilities for loss of, damage to, or injury to persons or property to begin investigating a claim arising from a declared disaster or emergency and inform the insured of all items, statements, and forms that the insurer believed will be required of the claimant in accordance with regulations promulgated by New York’s Superintendent of Financial Services. In addition, insurers would have to allow claimants to make certain repairs to property to protect health and safety and to accept an alternative proof of loss from the Claimant.

Within fifteen business days after receiving all the items, statements, and forms that this insurer required from the claimant, the insurer would be required to advise the claimant in writing whether the insurer has accepted or rejected the claim. The insurer may seek a one-time fifteen-day extension of time to decide whether to accept or reject the claim. If signed by the Governor, the law would take effect immediately.

The bill, if signed into law, would place additional stress on insurance companies to respond to claims within shorter time frames. In addition, the term emergency is rather broad and could lead to uncertainty as to when this potential law could apply. Hopefully, further amendments to the bill can be made to lessen these concerns. We will keep track of this bill going forward.  



Robert J. Caggiano

[email protected]


09/28/23       Torres v. Rivera
Appellate Division, First Department
First Department Affirms Order Granting Summary Judgment for Defendant Finding Plaintiff did not Sustain a Serious Injury under Any Asserted Category of § 5102(d) where Plaintiff’s Only Admissible Medical Record in Opposition was not Contemporaneous with the Subject Accident

Plaintiff Alejandro Torres appealed an Order from Supreme Court, Bronx County, which granted a motion for summary judgment submitted by Defendant, Abraham Rivera. Specifically, the Supreme Court’s granted Defendant’s motion on the ground that Plaintiff did not sustain a serious injury within the meaning of New York Insurance Law § 5102(d). 

By way of background, this matter stems from a motor vehicle accident which occurred in December 2013. As a result, Plaintiff alleged injuries to the left shoulder, cervical spine, and lumbar spine.

Defendant moved for summary judgment, arguing that Plaintiff did not sustain any serious injury as alleged. Defendant relied upon reports of an orthopedic surgeon who, upon physical exam of Plaintiff, found full range of motion or only slight limitations. Additionally, Defendant produced reports from radiologists who reviewed Plaintiff’s MRI, and opined that these imaging studies showed preexisting conditions which were not causally related to the subject loss. Notably, Defendant also produced medical records from Plaintiff’s doctors which documented preexisting arthritis and other conditions, and documents regarding a prior work-related claim made by Plaintiff for an injury to his lumbar spine.

On review, the First Department found that this evidence submitted by Defendants was sufficient to meet the requisite prima facie burden for summary judgment. However, the First Department found that Plaintiff failed to raise an issue of fact in opposition, due to multiple issues with the submissions relied upon.

First, although Plaintiff submitted multiple medical records from his own physician in opposition, most of the records were found to not be in admissible form. The First Department noted that these records did not become admissible merely because Defendant’s expert reviewed them. Moreover, Plaintiff’s physician made no comment as to the findings of preexisting arthritis or other conditions or explain why said findings could not be the cause of plaintiff’s alleged injuries.

The only admissible which the First Department deemed to be admissible in Plaintiff’s opposition was the report of a doctor who examined him seven years after the accident of record. It was found that this treatment record was not contemporaneous with the accident. Since this report was the only admissible record in opposition, Plaintiff failed to raise a triable issue of fact to defeat summary judgment in favor of Defendant. The underlying Order was unanimously affirmed, without costs.


Heather A. Sanderson
Sanderson Law
Calgary, Alberta

[email protected]


09/01/23       Hart v. Allstate Insurance Company of Canada
Nova Scotia Supreme Court
A Mandatory Policy Condition Stating that All Actions for Recovery Under a Policy of Insurance Must be Commenced within Two Years for the Loss or Damage Occurring Applies to All Claims, Including Bad Faith Claims, that an Insured has Against an Insurer

The fertile and lush Annapolis Valley lies in an east to west trough between two mountain ranges (Albertans would call them hills) in western Nova Scotia. The valley is 126 kms (78 mi) in length from Digby and the Annapolis Basin in the west to Wolfville and the Minas Basin in the east, spanning the counties of Digby, Annapolis, and Kings. The valley is historically famous for growing fruit and vegetables and is now a wine producing region.

The picturesque village of Coldbrook is in Kings County and within the Valley.  And it was there on August 15, 2019, that an 84-year-old man, driving a pickup truck, pulled out from his driveway intending to cross a main road to another property that he owned.

Assuming that this driver intended to turn right onto the main road rather than cross it, Shawn Hart, then aged 28, who was driving his Ford F-150 pickup on that main road, failed to slow or stop for this vehicle that was ahead. The front of Hart’s vehicle collided with the passenger side of the other pickup. Hart’s truck caught fire. The man who was driving the other truck was trapped in the wreckage until he was rescued by first responders. That driver died in hospital two weeks after the collision.

According to CBC News, Shawn Hart was initially charged with impaired driving causing bodily harm and driving with a blood-alcohol level over the legal limit causing bodily harm.  With the death of the opposing driver, the bodily harm charge was upgraded to impaired driving causing death. A police accident reconstruction report concluded that Hart’s impairment was not the proximate cause of the collision.  On July 21, 2020, Hart pled guilty to the breathalyzer charge and the other charges were withdrawn,

Allstate Insurance had issued a Nova Scotia Standard auto policy to Hart that was in effect on the date of this collision. The policy contained collision coverage. On June 16, 2021, Hart submitted a sworn proof of loss in the amount of $30,000 for the loss of his truck. He filed a civil action for that amount on December 17, 2021. Upon receipt of the action, Allstate stated that the action was out of time; that there is a mandatory policy condition requiring all actions for loss or damage to be commenced within two years of the loss or damage and that all claims filed on or after August 16, 2021, including this one, are statute barred.

Hart argued that the Limitation of Actions Act of Nova Scotia took precedence over that policy condition and that Act contains a ‘discoverability’ threshold where the claim is statute barred if it is not filed within two years of when the claim was discovered. At the outset of its investigation, Allstate denied any potential claim that Hart may have for the damage to his truck premised upon a policy exclusion for claims caused by driving under the influence. Allstate seemed to waiver in its position with the receipt of the accident reconstruction and the outcome of the criminal proceedings. The action was filed after Hart’s legal counsel asked for clarification of Allstate’s position and none was received.

The Court held that under the policy condition the claim for collision damage was out of time. If the discoverability rule applied (and that was not decided) then the two-year period began to run when Hart was originally told by Allstate that his claim was being denied, which was August 19, 2019. Noting that throughout that Hart had access to counsel, the Court stated:

 “Mr. Hart did not need to know that he would have a successful claim in order to commence action against Allstate.  Nor did he need to marshal all of the possible evidence he might have as to why a policy exclusion did not apply.  Mr. Hart received a Denial Letter from Allstate on September 13, 2019.  This letter clearly advises Mr. Hart that he, not Allstate, was responsible for damages to his vehicle.”

The Court also held that the language of the mandatory policy condition extended the two-year limitation to any bad faith claim that Hart may have had against Allstate. In doing so, the Court noted that there are two lines of authority in Canada: One that says that a bad faith claim is a contractual claim for wrongful denial of benefits and the other that it is an independent tort for breach of a duty of good faith and fair dealing. 

Regardless, the policy requires that all actions against the insurer are to be commenced within two years of the loss or damage occurring. That means that the limitation began to run on the date of the collision and not two years from “…the time Mr. Hart pleads guilty or not to relevant criminal charges, impairment by alcohol is confirmed, Mr. Hart has evidence in hand suggesting a defence against the operation of a Policy exclusion, or from the time he files a completed Proof of Loss form.”  This is the case even if a discoverability standard is applied to the bad faith claim.

Given the result in this case one can envision that Mr. Hart’s counsel will be calling on his errors and omissions coverage to pay his client’s collision damage.

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