Volume XXVII, No. 10 (No. 709)
Friday, October 24, 2025
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, New Jersey, and Connecticut appellate courts and Canadian appellate courts. The primary purpose of this newsletter is to provide timely educational information and commentary for our clients and subscribers.
In some jurisdictions, newsletters such as this may be considered Attorney Advertising.
If you know of others who may wish to subscribe to this free publication, or if you wish to discontinue your subscription, please advise Dan D. Kohane at [email protected] or call 716-849-8900.
You will find back issues of Coverage Pointers on the firm website listed above.
Dear Coverage Pointers Subscribers:
Do you have a situation? We love situations. The Coverage Pointers newsletter is attached, as always.
INTRODUCING
COVERAGE POINTERS UNIVERSITY
REGISTRATION IS NOW OPEN FOR OUR FIRST COURSE OFFERING
Threshold Questions
Property Insurance Primer – What Every Claims Professional Needs to Know
[Course Description Below]
November 20th, 1:00 Eastern, 12:00 Central
When Coverage Pointers first launched back in 1999—before the internet had even reached “school-age”—our goal was simple: to bring you timely and thoughtful updates on insurance coverage decisions from across New York and, eventually, across the country. For more than 27 years, every second Friday, you’ve joined us on that journey. Now, we’re excited to take the next step together.
Hurwitz Fine is proud to announce the launch of Coverage Pointers University (CPU) — a new educational initiative designed to deliver practical, engaging insurance-law programming on the third Thursday of every month.
Taught by our own experienced faculty, CPU features four Colleges — Property, CGL, SIU/Fraud, and Coverage Litigation — each focused on providing actionable insights, updates, and training for today’s insurance professionals.
Our inaugural year’s course list includes:
- College of Property and First Party
PPI 101 – Threshold Questions : What Every Claim Professional Needs to Know
Hurwitz Fine faculty member Steve Peiper will present on key rights, duties, and obligations between insurers and insureds, and learn how the involvement of a mortgagee can further complicate those relationships. The program includes but not be limited to cover fundamental topics such as:
- Service of a Proof of Loss
- Role of the public adjuster
- Priority of mortgagee claims
- Insurable Interests
- Examinations under oath and document production
- Suit limitation issues
Whether you’re new to property claims or a seasoned handler looking for a solid refresher, this session will provide valuable insights into the core principles that shape property insurance today.
Watch for these course offerings, in the future:
- College of Casualty Coverage
- Transportation Department
+ TLI 401 – Inter and Interstate Commerce and the Interplay with the MCS 90 Endorsement
+ TLI210 – New York State No Fault Primer
+TLI 220 – New York State Supplemental Underinsured/Uninsured Motorist Coverage
- CGL Department
+CGL 210 – Analyzing the Duty to Defend and Writing an Effective Coverage Letter in New York
+CGL 220 – Analyzing the Duty to Defend and Writing an Effective Coverage Letter in New Jersey
+CGL 230 – Analyzing the Duty to Defend and Writing an Effective Coverage Letter in Connecticut
+CGL 240 - Musical Chairs - Managing Risk Transfer and Additional Insured Challenges
- Environmental and Toxic Tort Department
+ETD 301 – Navigating the Navigation Law’s Impact on Pollution Claims
- College of Coverage Litigation
+ DJL 250 – Protecting the Claims File and Deposition Preparation
+ DJL 110 - CP Round-Up : Review of the Most Noteworthy Decisions of the Last Twelve Months
- College of SIU/Fraud
+ SIU – 210 – Unraveling Misrepresentations Underwriting and Claim Presentation
Last week, Brian Webb, our firm’s Transportation Practice Group Leader, attended the annual Trucking Industry Defense Association (TIDA) Conference in San Antonio.
The conference featured a robust program of presentations and discussions addressing key legal and operational issues facing the trucking industry. In addition to gaining valuable insights from the speakers, Brian had the opportunity to connect with attorneys and claims professionals from across the country who share a commitment to the defense of the transportation industry.
He was especially pleased to meet several attendees who identified themselves as loyal Coverage Pointers subscribers—thank you for your continued support!
If you are handling or encounter trucking-related claims arising in New York, please reach out to Brian. He is always available to assist with any questions or matters within this area of practice.
For those who need to keep up to date on insurance coverage between issues of Coverage Pointers, we’re happy to help. Just follow me on LinkedIn and we’ll keep you up to date. I’m easy to find – my linked in name is (ready for this unusual and unexpected name): Kohane and you can find me here: https://www.linkedin.com/in/kohane/
Need a Mediator or Arbitrator, Give a Call:
A growing percentage of my practice has been a mediator (and sometimes as an arbitrator) in insurance coverage, commercial, personal injury, and other disputes. With a robust national client base, I am regularly called on by friends and colleagues from around the country, folks who know me and trust me, to help resolve disputes. Often, particularly in mediated matters, I know the insurers and lawyers on both (or several) sides of the dispute. Since they all trust me as a fair dealer, they feel comfortable having me try to help close the file (and avoid precedent). Just pick up the phone, 716.849.8942 or send an email to [email protected] and I’ll try to help.
Newsletters:
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 V. Christopher Potenza 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 Elizabeth Midgley at [email protected] to subscribe.
I’ll Drink to That – 100 Years Ago:
Buffalo Courier Express
Buffalo, New York
24 Oct 1925
BOOTLEGGER IS
DISGUISED TO
ELUDE POLICE
Worcester, Mass., Oct. 23 (A.P.) – Disguised as a priest of the Catholic church, even to the Roman collar and plain black vest and other garments of somber hue, Salvatore Tralando of New York, who admitted he is a professional bootlegger, was arrested this afternoon in East Brookfield after a wild chase by Corporal M. F. Riley of the state police patrol.
With Tralando was Michael Costello of New York, who was posing as the alleged priest’s chauffeur, and he was also locked up. The officer seized the car, which he found to contain 100 gallons of alcohol in five-gallon and one-gallon cans hidden in suitcases.
Tralando admitted his real identity and said he was married and had four children living in his New York home.
Peiper on Property (and Potpourri):
We are excited about the foundation of Coverage Pointers University. It has been a long time coming, but we have a great list of topics and are eager for you to hear from all of our talented lawyers that you work with every day. We’ll look forward to seeing you in a webinar soon.
Aside from our latest venture, we do have a good first party case to review this week. Coming out of the Appellate Division, Fourth Department, please take a look at the Barney v. Preferred Mutual Ins. Co. case. The insured elected not to purchase coverage for a mobile home that was kept on the back parcel of the insured property and rented to a third-party. The Fourth Department rejected the notion that a mobile home, occupied by someone other than the insured, was either a “residence premises” or a “related private structure.” Property policies cover distinctly identified properties, and the Fourth Department rightly recognized those limitations here.
That’s it for now. See you in two weeks.
Steve
Steven E. Peiper
[email protected]
Airplane Ace Speaks – 100 Years Ago:
Buffalo Courier Express
Buffalo, New York
24 Oct 1925
Rickenbacker, U.S. Flying Ace, Tells of
Dream of Aviation Transforming Life
The Great Rickenbacker, world’s most famous flying man, sees world made over by man’s ability to conquer the air. His dream of the next ten years, and life being transformed over that span by aviation, will appear in your Sunday EXPRESS tomorrow.
Rickenbacker’s interview with a correspondent of the EXPRESS is impressive and crammed full of possibilities. It will be worth your while to read Rickenbacker’s picture of commercial aviation in the United States. He tells how the automobile amazed the world. He pictures the airplane turning in the same accomplishment.
Rickenbacker’s bristling story is only one of a countless number of features to appear in your Sunday EXPRESS tomorrow. A most impressive and instructive assortment of Buffalo features will appear in your EXPRESS tomorrow. Supporting these Buffalo features will be an eight-page woman’s section devoted to articles on the home, business and love. Also, a sixteen-page magazine section with the latest fiction stories. A four-page comic section in colors and the city’s best eight-page rotogravure section will be included in your Sunday EXPRESS.
Backing up this illuminating array of features will be all the current news happenings in Buffalo, Erie County, New York state, the whole United States and Canada and the whole world.
As usual, the Sunday EXPRESS will present all the Buffalo store news in the advertising columns. All the city’s representative stores and shops will be represented in your EXPRESS tomorrow. See who’s who in the shopping district.
Now, good friends, this tells the story of the Sunday EXPRESS. Order your copy from your newsdealer today.
Lee’s Connecticut Chronicles:
Dear Nutmeggers:
Stage Fright. I still get it—every time. You’d think that after thirty years of practice, it would be old hat by now. But the moment I’m about to stand in front of a jury, a judge, or in the well of an appellate court, the nerves still kick in. And yet, I wouldn’t have it any other way. I never feel more like a lawyer than when I’m standing in that well, arguing a case for my client. The instant I get to say, “May it please the Court,” I’m right where I belong.
I had the chance to do that for one of my clients in the Second Circuit this week. It’s always a rare privilege to be back in the Thurgood Marshall Courthouse at 40 Foley Square in Manhattan—especially since the judiciary’s new monument at 500 Pearl Street opened. The 90-year-old, Classical Revival granite tower, rising 37 stories and seemingly upheld by its ten Corinthian columns, with its marble floors and ornate bronze doors, remains as awe-inspiring today as it was in 1993, the day I was sworn in to practice in federal court.
As I walked along those marble floors, the familiar echo of footsteps brought it all back—the nerves, the excitement, the quiet weight of the place. The building commands respect, not just for its architecture but for the generations who have stood there before us and, hopefully, the generations that will follow. Being back there reminded me how fortunate I am to do this work. After decades in practice, it’s easy to get caught up in the daily grind of cases and deadlines. But standing, once again, under those high coffered ceilings, I felt the same mix of awe and gratitude I did as a young lawyer. Some places—and moments—just bring that out of you.
Until next time, keep keeping safe. [PS No new cases to discuss this edition.]
Lee
Lee S. Siegel
[email protected]
Husbandia – 100 Years Ago:
The Buffalo Times
Buffalo, New York
24 Oct 1925
Is Marriage a Success?
HUSBANDIA
About the only gifts some wives receive from their husbands are the ones the husbands do not know they are giving.
Before marriage, a man will tell a woman how much she means to him while afterward he just tells her his troubles, which are about the same thing, after all.
Any woman can make a man fall in love; the important thing is to keep him from wanting to pick himself up again.
When a man says he can love forever, remember, he does not necessarily mean the same woman.
A wise wife does not try to make her husband over; she just tries to keep him somewhat as he was before she married him.
A husband’s idea of his wife’s brilliancy is usually estimated by what she is capable of listening to.
Ruffner’s Road Review:
Dear Readers,
It is a busy time of the year for sports, and I was very happy to see the Toronto Blue Jays punch their ticket to the World Series in a game 7 thriller this week! In Buffalo news, Bills are in desperate need of a bounce back game this week and then, of course, there is our beloved Sabres, again off to a rocky start.
I have two motor vehicle coverage cases for this week. In the first, the court considers whether the insurer is permitted to raise a fee schedule defense at trial for the first time. The insurer argued that this defense is in the category of non-precludable defenses, not subject to the 30-day pay or deny rule and thus should be permitted to be raised at any time up to and including trial. In the second matter, the court considered an appeal from a Supreme Court holding granting the insurers permanent stay of underinsured motorist arbitration pursuant to a default judgment issued against the claimants.
Kyle
Kyle A. Ruffner
[email protected]
All’s Well – 100 Years Ago:
Daily Sentinel
Rome, New York
24 Oct 1925
Mother and Daughter
Rescued From Well
Morrisville, Oct. 24. – When Mrs. Elmer Westcott and three-year-old daughter fell into a 25-foot well at the home of her father, Lynn Lyndon, in Eaton, the mother suffered an injured ankle and the child escaped with a few bruises.
They had been attending a family reunion and, while walking on the lawn in the darkness, they fell headlong to the bottom of the well, which contained about four feet of water.
Half an hour after the mishap others in the house happened to step outdoors and heard the screams of Mrs. Westcott. The mother had been screaming of 20 minutes, she later said, but the noise inside the house evidently drowned out her yells. The woman held the child above water during the time she was imprisoned.
Mrs. Westcott was exhausted when she was pulled to the surface by a rope.
Ryan’s Federal Reporter:
Hello Loyal Coverage Pointers Subscribers!
My Blue Jays (and hopefully your Blue Jays) are in the World Series for the first time since ‘93! It’s the first time in my adult life that my team has made it to the big one(s). Now, if only we can snatch it from the Dodgers. No easy feat, to say the least. But this team is something special. I feel it. Do you?
In this edition, my column summarizes a case out of the Second Circuit involving professional liability coverage and the proper interpretation of a misappropriation exclusion. Misappropriation means what it says, but precisely what that means depends on who you ask….
Until next time,
Ryan
Ryan P. Maxwell
[email protected]
Tough DWI Penalties – 100 Years Ago:
The Buffalo News
Buffalo, New York
24 Oct 1925
DRUNKEN DRIVER TO
SERVE THIRTY DAYS
Two Speeders and Reckless
Driver Pay $50 Each to
Court Clerk.
Thomas Nichols, 50 years old, 183 Northampton Street, was sentenced to 30 days in the Erie County penitentiary by Judge Maul in City court Friday on a charge of driving while drunk on September 26. When Nichols was first arraigned he demanded a jury trial, but when he appeared in court Thursday his condition was such that Assistant District Attorney Harry L. Neuse ordered the man locked up to insure his appearance Friday. Friday his lawyers waived the demand for jury trial and the man pleaded guilty before Judge Maul.
Nichols was arrested September 26 after a near collision with another car at Elmwood Avenue and Bryant Street, on the complaint of Carlton A. Fisher.
Storm’s SIU:
Hi Team:
What a fun World Series we have ahead of us! Two of my favorite teams – Blue Jays v. Dodgers. But got to go with the Dodgers, it has been the family’s team since they were in Brooklyn.
Ugh, let’s hope for better days for the Bills.
Two interesting cases in this edition:
- Ongoing Operations Exclusion Applied to Preclude Defense and Indemnity Coverage.
- One Year Suit Limitation Condition Runs from the Date of the Fire Not the Date of the Alleged Breach of Contract; a Bad Faith Claim Can Survive Even When the Breach of Contract Claim is Barred by the Policy's Suit Limitation Provision.
Have a great two weeks. Happy Halloween!
Scott
Scott D. Storm
[email protected]
Lonely? – 100 Years Ago:
Brooklyn Eagle
Brooklyn, New York
24 Oct 1925
Suggestion for Lonely Girls – Take
Up Scout Work.
Dear Helen Worth – So many of your correspondents are lonely that I am making this suggestion, hoping it will fill in the evenings of some young women who have written to you.
The Girl Scouts need captains, athletic young women to head the various troops throughout the city. I am informed that it is difficult to get young women to undertake this work.
The troop to which my daughter belongs has been without a captain for months, being under the supervision of a captain of another troop. This has proved too much for the young woman, and she will be greatly relieved when someone can take full charge of one troop, leaving her free to give her full time to her own group of girls.
This is such a sure way of making friends, for the girls become devoted to their captains, and should appeal to the young women who delight in the great outdoors. There will be no lonely evenings for the young woman who takes charge of one of these troops.
Girl Scout headquarters in Brooklyn is located at 102 Prospect Park West, near 6th St. C.E.M
My Dear “C.E.M” – Your suggestion is fine. Many young women could find in such work a healthful pastime as well as the vast satisfaction to be found in serving others thank you for having written. Helen Worth.
Fleming’s Finest:
Hi Coverage Pointers Subscribers:
This week’s case from the Utah Supreme Court has a lot going on. The Supreme Court considered whether a judgment had expired, the insurer breached the duty to defend based on a dispute about whether the policy had been cancelled, causation for emotional distress damages arising out of the insurer’s breach, consequential damages for the judgment, and contingency based attorney fees. There remains an open question of law as to whether Utah follows the Illinois rule (an insurer who fails to seek a declaratory judgment or defend the suit under a reservation of rights is estopped from raising policy defenses to coverage) versus the majority rule (insurer’s unjustified refusal to defend does not estop it from later denying coverage) on whether an insurer that breaches its duty to defend can later challenge its liability for the judgment that it refused to defend against.
Looking forward to going to Pittsburgh for a concert this weekend and scoping out the best bakeries in the city.
See you in a fortnight,
Kate
Katherine A. Fleming
[email protected]
Until Fraud Do Us Part – 100 Years Ago:
Daily News
New York, New York
24 Oct 1925
ROBBERS GOT MOCK NUPTIAL
RECORD, PLEA IN $100,000 SUIT
Edith Webb, the woman who insists that she was the victim of a mock marriage ceremony twenty years ago, yesterday failed to produce her wedding certificate at the hearing before trial of her action for annulment against Harry A. Bloodgood, the man she claims duped her.
She told Supreme Court Justice Morschauser in White Plains, N.Y., that she had been robbed three years after her wedding in Chicago. She stuck to her story even under the crossfire of Thomas J. O’Neill, attorney for Bloodgood, that burglars had broken into er apartment, then at 506 Jay St. Brooklyn, and had stolen the certificate, she has silverware and some jewels she admitted, at the time, but they were not touched.
“They were bold bad, bandits, weren’t they?” remarked O’Neill, but she didn’t reply.
Bloodgood is suing the woman for partial control of $100,000 worth of property in Westchester and Putnam counties, which, he claims, was purchased in her name but with his money. He asserts he never married the woman, and that he never went through any sort of wedding ceremony with her.
Gestwick’s Garden State Gazette:
Dear Readers:
In dramatic fashion, the Blue Jays are back to the World Series! This should be an interesting series. If the Jays emerge victorious, it will be quite an upset. The Bills are back after a much-needed bye week, and the Sabres are officially not going 0-82 this season. I’ll take that.
Congratulations to be fiancé, who was confirmed by her School District’s Board of Directors as a tenured Kindergarten teacher.
I have two cases for you this week. In the first, the Court decides whether a child of the insureds, who did not live with them and was using his own vehicle, is insured for an accident for which he was sued. In the second, the Court rules on an estoppel argument made in the face of a blown statute of limitations in connection with a UIM claim. Read on to find out where each decision falls.
Until next time.
Evan
Evan D. Gestwick
[email protected]
Love the Name -- Cat Eye Annie – 100 Years Ago:
Democrat and Chronicle
Rochester, New York
24 Oct 1925
ELUSIVE WOMAN
CROOK RETAKEN
FLEEING PRISON
‘Cat Eye Annie’ Sentenced
to Ten Years at Hard
Labor in Auburn.
Buffalo, Oct. 23. – (By the Associated Press) – Lillian McDowell, known internationally as a crook under the names Julia Archer and “Cat Eye Annie” was recaptured by the police to-day following her escape from the Erie County Jail on Thursday, and was soon afterward taken into County Court and sentenced to ten years hard labor at Auburn Prison.
The circumstances surrounding the woman’s escape from the top floor of the jail and her recapture to-day in a partly finished house in Kenmore, a suburb of the city, tends to prove that the sensational break from prison was wholly without outside aid. In dropping from the window where she made her exit from the kail, Annie sprained her left ankle. She entered a Delaware avenue bus, a short distance from the jail, and rode to the end of the line. From there she walked to the empty house where she remained for thirty-six hours, suffering agony from her injury and lack of food.
Workmen found her at noon to-day, recognized her as the fugitive and called the sheriff.
O’Shea Rides the Circuits:
Readers,
The Ottawa Senators returned to mediocrity this season. I personally witnessed a cudgeling of Ottawa by Buffalo last week. However, a $11 hot dog washed the troubles away. As we look forward to Halloween next week, my wife and I are procuring the bare minimum for our costumes. The most challenging item to find is a toy parakeet.
For this edition, I review a pollution case from the Eleventh Circuit interpreting a violation of a notice condition in a claims made policy. The court noted Florida lacked any direct authority on point, so it adopted the majority rule and blended the burden shifting approach under Florida law.
Happy Halloween,
Ryan
Ryan P. O’Shea
[email protected]
Brooklyn Lives are More Valuable – 100 Years Ago:
Brooklyn Eagle
Brooklyn, New York
24 Oct 1925
BORO WAS NEAR TOP
IN LIFE INSURANCE
PAYMENTS IN 1924
Total of $10,300,000 Here,
Largest Policy Being $150,000.
Publication of the payments on 1924 Insurance policy claims, just issued by the Insurance Press, which is published by the insurance companies in the United States and Canada, puts Brooklyn close to the top in the ranking by cities total payments amounting to $10,300,000. This amount, added to the Manhattan total, gives Greater New York a lead of almost 50 percent on Chicago, its nearest rival. The total for Manhattan, Brooklyn and the Bronx is $43,500,000, while in Chicago payments totaling $23,500,000 were made.
More Million Dollar Policies.
In recent years it has become increasingly common for the writing of individual policies of more than $1,000.000. There are at least 200 such policies in existence. Among the largest Insurances written in 1925 was $3,750,000 on the life of William Fox of the Fox Film Corporation. This increases the total of his policies to more than $6.500,000. Ramon Navarro of the Metro-Goldwyn-Mayer Studios is said to have bad a $3,000,000 policy taken out on his life by the company for which he works, and $1,000,000 was taken out on the life of Cecil B. DeMille.
LaBarbera’s Lower Court Library:
Dear Readers,
Nothing new from me this time around, see you in two weeks.
Isabelle
Isabelle H. LaBarbera
[email protected]
Jews Believe in Evolution – 100 Years Ago:
Democrat and Chronicle
Rochester, New York
24 Oct 1925
JUDAISM BACKS
LIBERAL VIEW
OF EVOLUTION
Central Conference Asks
For Freedom of Thought
And Speech
Cincinnati, O., Oct. 23.- (By the Associated Press) – Judaism for first time expressed its stand on the question of evolution when the Central Conference of American Rabbis here to-day adopted a committee report on the message of President Abram Simon, New York, embodying the attitude of the conference.
The report called for freedom of thought and speech and declared "that whether man is the result of millions of years of evolution or whether he was created as Biblical accounts state, does not affect the Jewish belief in God. For a million years to God are as a single day."
Liberal Jewish View.
Dr. Samuel Schulman, Nep York, who presented the report, explained that Liberal Jews recognize the Bible as an "inspirational tower on which Judaism is founded. He said that the Bible cannot be incompatible with science.
"This conference must demand the right of perfect freedom in the investigation of the claims of science,” he declared.
The report also referred to the Scopes trial at Dayton, Tenn., on which the President's message requested a conference statement.
Lexi’s Legislative Lowdown:
Dear Readers,
My fiancé and I are getting ready to host a Halloween party this weekend. We are still deciding on the prize for best costume.
This week we discuss a proposed Assembly Bill that has only been introduced regarding providing policy information to claimants in child victims act cases.
Thanks for reading,
Lexi
Lexi R. Horton
[email protected]
Must Be a Slow News Day for This to Make the Front Page – 100 Years Ago:
Daily Sentinel
Rome, New York
24 Oct 1925
Schoolmates Enjoy Party
With Agnes Mumback, 10
A Halloween party was given by Agnes Mumback, 10, at her home, 305 Depeyster street, on Friday evening. Schoolmates were present. Games were played and a dainty lunch was served by the hostess’s mother, Mrs. Henry Mumback.
Victoria’s Vision on Bad Faith
Dear Readers,
I have a fun weekend ahead of me, starting with the Sabrina Carpenter concert in Pittsburgh, followed by a get-together with friends on Saturday.
This week, I have a bad faith claim in Pennsylvania, where an insurer was found to have acted in bad faith after withholding $50,000 of UIM coverage after an arbitration decision.
Have a great weekend,
Victoria
Victoria S. Heist
[email protected]
Alienation of Affections. We Checked the Newspaper for the Result – She Won an Award of $37,500 – 100 Years Ago:
The Ithaca Journal
Ithaca, New York
24 Oct 1925
Return Sealed Verdict
In Alienation Suit
Mineola, Oct. 24. (AP) - There was considerable speculation today over the attempt of two jurors to congratulate Mrs. Charles Frey after a sealed verdict had been returned in her $100.000 alienation suit against Miss Wilda Bennett, actress.
The jury, which was composed of married men, required only 26 minutes to reach a decision yesterday but Justice Faber already had left the court when they returned, so the verdict was sealed until Monday.
When the two smiling jurors approached Mrs. Frey, her attorney, Elvin H. Edwards, interfered, saying hastily, "gentlemen, do not discuss your verdict under any circumstances."
In charging the jury Justice Faber said they must not allow any opinion as to improper relations between the actress and the turfman to influence their decision. "The question for you to decide is whether Miss Bennett the pursuer or the pursued," he said.
Shim’s Serious Injury Segment
Hi Readers,
Hope you have had a great two weeks since our last column. Since that time, we have moved through the baseball postseason, and we are headed for the 121st World Series. The Toronto Blue Jays will appear in their first World Series since 1993. Their opponent, the defending World Series champion, Los Angeles Dodgers, just clinched their 5th National League Pennant since 2017. After the Dodgers won the 2024 World Series and signed Teoscar Hernandez, Blake Snell, Roki Sasaki and the best relievers on the market during the offseason, one question lingered in every baseball fan’s mind: can anyone stop the Dodgers? We are about to find out.
In this column, I have shared a case decided in Kings County Supreme Court. The Court granted defendants’ summary judgment motion on the grounds that plaintiff failed to sustain a serious injury in accordance with the statutory requirements of Insurance Law § 5102(d).
See you in the next issue!
P.S. Happy Halloween!
Stephen
Stephen M. Shimshi
[email protected]
Little Verdicts in Little Valley – 100 Years Ago:
The Buffalo News
Buffalo, New York
24 Oct 1925
VICTIM OF HOT GREASE
WINS AWARD OF $275
Mary Plonka Must Pay for
Attack in Kitchen – Auto Cases.
LITTLE VALLEY, Oct. 24. – In Supreme court here, Lottie Cyerski obtained a verdict of $275 against Mary Plonka, on her allegation that the defendant threw a skillet of hot grease in her face during a quarrel in defendant’s kitchen in Ellicottville.
The jury in the case of Mahlon Kelam against Alonzo Dreier, both of Salamanca, brought in a verdict of $100 for the plaintiff. It was an action for damages to an automobile in collision at Horseshoe Bend.
The jury in the case of John D. Vaughan of Salamanca against Louis G. Wahl of Olean, another automobile case, in which plaintiff claimed $200 damage to his car in a collision on the state road between Olean and Salamanca gave Vaugh verdict of $100.
The case of National Linoleum company against Jacob Zafron was dismissed without costs.
North of the Border:
In just a few hours, I'll be heading east to Toronto before making my way to picturesque Niagara-on-the-Lake—affectionately known as Canada’s NOLA—for the Canadian Defence Lawyers Women’s Caucus retreat. I’m looking forward to catching up with colleagues and sharing ideas in a more relaxed, scenic setting. These retreats are always a welcome change of pace, offering a rare opportunity to connect outside of the usual busy routine. Of course, come Monday, I will be back to the regular demands of work and ongoing files, but this time, re-charged.
This week’s column takes a closer look at a recent judgment addressing the duty to defend in the context of a long-tail claim. The decision presents an unexpected perspective on coverage for loss of use—though, as you’ll see, the outcome may be less surprising when you consider the policy wording in detail.
Until next time,
Heather
Heather A. Sanderson, K.C.
Sanderson Law
Calgary, Alberta, Canada
[email protected]
Headlines from this week’s issue, attached:
KOHANE’S COVERAGE CORNER
Dan D. Kohane
[email protected]
- Not an Insured Under the Policy? You Don’t Get Coverage
- Enough in a Lead Paint Complaint So That Insurer’s Claim to Dismiss Based on Documentary Evidence in Policy, Failed
- Six Year Statute of Limitation to File Arbitration Demand for SUM Benefits, Running from Date of Payment of Tortfeasor’s Limits
- The UM Carrier, Having Secured a Default Judgment Declaring That It Had No Obligation to Pay a UM Claim, Is Entitled to Rely on That Default When the Claimants File a Demand for UM Arbitration Later
- A Privity Additional Insured Endorsement Only Provides Coverage to the Party with Whom the Named Insured Had a Written Contract
PEIPER on PROPERTY (and POTPOURRI)
Steven E. Peiper
[email protected]
- Secondary Rental Dwelling at the Insured Property Does Not Qualify for Coverage
LEE’S CONNECTICUT CHRONICLES
Lee S. Siegel
[email protected]
- The Connecticut courts were quiet the past few weeks, leaving us with nothing new to talk about. Check back next edition.
RUFFNER’S ROAD REVIEW
Kyle A. Ruffner
[email protected]
- Court Declines to Consider Fee Schedule Defense Introduced by the Insurer for the First Time at Trial, Holding This Defense Is Subject to Preclusion
- Court Upholds Permanent Stay, as the Doctrine of Res Judicata Barred the Defendants from Relitigating Claim for Uninsured Motorist Benefits
RYAN’S FEDERAL REPORTER
Ryan P. Maxwell
[email protected]
- Misappropriation Exclusion in Professional Liability Policy Found to Be Ambiguous, Triggering Duty to Defend, in a Split Decision
STORM’S SIU
Scott D. Storm
[email protected]
- Ongoing Operations Exclusion Applied to Preclude Defense and Indemnity Coverage
- One Year Suit Limitation Condition Runs from the Date of the Fire, Not the Date of the Alleged Breach of Contract; A Bad Faith Claim Can Survive Even When the Breach of Contract Claim is Barred by the Policy's Suit Limitation Provision
FLEMING’S FINEST
Katherine A. Fleming
[email protected]
- Judgment Entered After Confirming Arbitration Award Was Final, Later Expired; Insurer Breached Duty to Defend; Insured Did Not Prove Breach Caused Emotional Distress; Decision Vacated Awarding Consequential Damages for Expired Judgment and Contingency-Based Attorney Fees
GESTWICK’S GARDEN STATE GAZETTE
Evan D. Gestwick
[email protected]
- No Auto Liability Coverage for Non-Resident Child Using His Own Vehicle
- No Estoppel Argument to Evade Statute of Limitations Defense Without Evidence of Ongoing Settlement Negotiations for More Than Six Months
O’SHEA RIDES the CIRCUITS
Ryan P. O’Shea
[email protected]
- Court Determines Prejudice Rule Applies to Clams of Late Notice Regarding Pollution Claims and Holds Insured Failed to Provide Timely Notice
LABARBERA’S LOWER COURT LIBRARY
Isabelle H. LaBarbera
[email protected]
- Nothing new from me this time around, see you in two weeks.
LEXI’S LEGISLATIVE LOWDOWN
Lexi R. Horton
[email protected]
- Proposed Bill to Require That, in Civil Claims Under the Child Victims Act, Liability Carriers Must Provide Information Regarding Each Known Policy of Insurance
VICTORIA’S VISION ON BAD FAITH
Victoria S. Heist
[email protected]
- Bad Faith Found When Insurer Delayed Payment of UIM Benefits Following Arbitration Award
SHIM’S SERIOUS INJURY SEGMENT
Stephen M. Shimshi
[email protected]
- Court Finds Plaintiff Failed to Sustain a Serious Injury in Accordance with the Statutory Requirements of Insurance Law § 5102(d)
NORTH of the BORDER
Heather A. Sanderson, K.C.
Sanderson Law
Calgary, Alberta, Canada
[email protected]
- A CGL Coverage Agreement That Extends to “Property Damage” Defined as “Injury to or Destruction of Tangible Property Which Occurs During the Policy Period, Including Loss of Use Thereof at Any Time Resulting Therefrom” Applies to Loss of Use Occurring Beyond the Policy Period if It Results from Injury to or Destruction of Tangible Property That Occurred During the Policy Period
Thanks for your loyal readership. We hope to see many of you, or your colleagues, at Coverage Pointers University.
Dan
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 and New Jersey.
In addition, Dan D. Kohane is a Foreign Legal Consultant, Permit No. 0119144, 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.
NEWSLETTER EDITOR
Dan D. Kohane
[email protected]
ASSOCIATE EDITOR
Agnes A. Wilewicz
[email protected]
COPY EDITOR
Evan D. Gestwick
[email protected]
INSURANCE COVERAGE/EXTRA CONTRACTUAL LIABILITY TEAM
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
Ryan P. Maxwell
Kyle A. Ruffner
Katherine A. Fleming
Evan D. Gestwick
Ryan P. O’Shea
Isabelle H. LaBarbera
Lexi R. Horton
Victoria S. Heist
FIRE, FIRST PARTY AND SUBROGATION TEAM
Steven E. Peiper, Team Leader
[email protected]
Michael F. Perley
Scott D. Storm
NO-FAULT/UM/SUM TEAM
Dan D. Kohane
[email protected]
Ryan P. O’Shea
[email protected]
Kyle A. Ruffner
[email protected]
APPELLATE TEAM
Jody E. Briandi, Team Leader
[email protected]
Topical Index
Peiper on Property and Potpourri
Lee’s Connecticut Chronicles
Ruffner’s Road Review
Gestwick’s Garden State Gazette
LaBarbera’s Lower Court Library
Lexi’s Legislative Lowdown
Victoria’s Vision on Bad Faith
KOHANE’S COVERAGE CORNER
Dan D. Kohane
[email protected]
10/22/25 Ocasio v. Metro Myrtle Avenue, LLC
Appellate Division, Second Department
Not an Insured Under the Policy? You Don’t Get Coverage
In February 2020, Ocasio commenced an action (“underlying action”) to recover damages for personal injuries she alleged she sustained in November 2019 when she tripped and fell on a sidewalk in front of premises owned by the defendants Metro Myrtle Avenue, LLC (“Metro”), and Albert Bialek Associates, Inc. (“Albert”).
In March 2021, Metro and Albert commenced a third-party action, against AmGUARD Insurance Company (“AmGUARD”), alleging that AmGUARD was obligated to defend and indemnify them in the main action as additional insureds under a policy of insurance issued to the tenants of the subject premises. Subsequently, AmGUARD moved for summary judgment dismissing the third-party complaint insofar as asserted against it and declaring that it has no duty to defend or indemnify Metro and Albert in the main action.
The party claiming insurance coverage bears the burden of proving entitlement and the terms of the policy must clearly evince such intent. A party is not entitled to coverage if it is not named as an insured or additional insured on the face of the policy as of the date of the accident for which coverage is sought.
Here, AmGUARD established, prima facie, that neither Metro nor Albert was an insured or additional insured under the insurance policy at issue. There was no need for further discovery.
Editor’s Note: An atta-lawyer goes out to Yale Glazer at Lazare Potter, counsel for AmGUARD. A very fine lawyer in a very fine firm representing a very solid company.
10/15/25 60 East 196, LLC Tokio Marine Specialty Insurance Company
Appellate Division, Second Department
Enough in a Lead Paint Complaint So That Insurer’s Claim to Dismiss Based on Documentary Evidence in Policy, Failed
69 East commenced this action against the defendant Tokio Marine Specialty Insurance Company (“Tokio Marine” ), among others, for a judgment declaring, inter alia, that Tokio Marine is obligated to defend and indemnify the plaintiff in an underlying personal injury action entitled R.P. v 60 East 196, LLC, (the “underlying action). In the underlying action, an infant, by his mother and natural guardian, and his mother suing derivatively, alleged that the infant sustained personal injuries while he was living at premises owned by the plaintiff. They also alleged that the infant was diagnosed with elevated blood lead levels and lead poisoning due to the presence of lead-based paint at the premises, resulting in serious injuries. The plaintiff allegedly sought coverage related to the underlying action under an insurance policy issued by Tokio Marine, but Tokio Marine denied coverage to the plaintiff. Tokio Marine moved pursuant to CPLR 3211(a)(1) and (7) to dismiss the complaint insofar as asserted against it.
In determining a dispute over insurance coverage, the court looked to the language of the policy". As with any contract, unambiguous provisions of an insurance contract must be given their plain and ordinary meaning, and the interpretation of such provisions is a question of law for the court. The test for ambiguity is whether the provision is 'susceptible of two reasonable interpretations. 'If the terms of a policy are ambiguous . . . , any ambiguity must be construed in favor of the insured and against the insurer.
Here, the policy expressly stated that coverage will be provided where "the insured becomes legally obligated to pay as a result of a claim for bodily injury or property damage arising out of contamination" if, inter alia, “t]he contamination first commences: . . . on or after the Retroactive date scheduled onto the policy."
It is undisputed that the retroactive date of the policy is November 4, 2020. Contrary to Tokio Marine's contentions, it did not establish that the language of the policy utterly refuted the plaintiff's allegations that the alleged contamination "commenced" within the period alleged in the complaint or show that a material fact as claimed by the plaintiff is not a fact at all.
Editor’s Note: Motions to dismiss based on documentary evidence are tough to win.
10/15/25 Liberty Mutual Insurance Company v. Pascarella
Appellate Division Second Department
Six Year Statute of Limitation to File Arbitration Demand for SUM Benefits, Running From Date of Payment of Tortfeasor’s Limits
This was an application to stay a SUM arbitration.
On December 18, 2012, Pascarella allegedly was involved in an automobile accident with a motor vehicle insured by Allstate. At the time of the accident, Pascarella had her own automobile insurance policy issued by the petitioner, Liberty Mutual which included supplementary uninsured/underinsured motorist (hereinafter SUM) coverage.
Allstate tendered the bodily injury policy limit in the sum of $50,000 in settlement of Pascarella's claim on March 25, 2014, and Pascarella cashed the settlement check on May 16, 2014. After Allstate tendered the policy limit, Pascarella submitted a claim for SUM benefits pursuant to the Liberty Mutual policy, which Liberty Mutual denied. Subsequently, on November 16, 2023, Pascarella made a demand upon Liberty Mutual to arbitrate her claim for SUM benefits. In December 2023, Liberty Mutual commenced this proceeding pursuant to CPLR article 75, inter alia, to permanently stay arbitration of Pascarella's claim for SUM benefits. In an order dated April 15, 2024, the Supreme Court granted that branch of the petition which was to permanently stay arbitration. Pascarella appeals.
Generally, a demand for arbitration is subject to a six-year Statute of Limitations, which begins to run 'when all of the facts necessary to the cause of action have occurred so that the party would be entitled to obtain relief in court. A claimant's cause of action does not accrue until it possesses the legal right to be paid and to enforce its right to payment in court'.
As a condition precedent to the obligation of the insurer to pay under the supplementary uninsured/underinsured motorists insurance coverage, the limits of liability of all bodily injury liability bonds or insurance policies applicable at the time of the accident shall be exhausted by payment of judgments or settlements" (Insurance Law § 3420[f][2][A]). Thus, the right to payment for underinsurance coverage is triggered upon payment of the policy limits of the underinsured vehicle.
Here, Pascarella's right to payment for the underinsurance coverage accrued, at the latest, on May 16, 2014, when she cashed the check settling her bodily injury claim for the policy limit of $50,000. Since Pascarella's demand for arbitration was not filed until November 16, 2023, more than six years after May 16, 2014,
10/15/25 Hereford Insurance Company v. Shelly
Appellate Division, Second Department
The UM Carrier, Having Secured a Default Judgment Declaring That It Had No Obligation to Pay a UM Claim, Is Entitled to Rely on That Default When the Claimants File a Demand for UM Arbitration Later
This was an application to stay an uninsured motorist arbitration.
On June 13, 2018, Shelly and Hargrove (“the claimants”) were the occupants of a vehicle insured by the Hereford Insurance Company (“Hereford”), when the vehicle was involved in an accident. In March 2019, Hereford commenced an action in the Supreme Court, New York County, against, among others, the claimants for a judgment declaring, inter alia, that Hereford had no duty to pay claims related to the accident and was entitled to a permanent stay of all no-fault arbitrations and lawsuits commenced by the claimants relating to the accident (hereinafter the 2019 action).
The claimants defaulted and the court declared that Hereford had no duty to pay claims related to the accident and was entitled to a permanent stay of arbitration.
Not content that they lost once, the claimants served a demand for arbitration on Hereford, and Hereford commenced this proceeding pursuant to CPLR article 75, among other things, to permanently stay arbitration of the claim. In an order dated May 25, 2023, the Supreme Court granted that branch of the petition which was to permanently stay arbitration. The claimants appeal.
"A defaulting defendant is deemed to have admitted all factual allegations contained in the complaint and all reasonable inferences that flow from them. The doctrine of res judicata bars a party from relitigating any claim which could have been or should have been litigated in a prior proceeding
Having litigated, defaulted and lost, the claimants did not have the opportunity to relitigate the same questions.
10/14/25 600 Associates LLC v. Illinois Union Insurance Company
Appellate Division, First Department
A Privity Additional Insured Endorsement Only Provides Coverage to the Party with Whom the Named Insured Had a Written Contract
600 Associates LLC and others (“600 Associates”) are the owners of premises located at 600 East 156th Street Bronx, N.Y. They contracted with Mega Contracting Group, LLC (“Mega”) to perform certain construction work at the premises. 600 Associates and Mega (collectively "Plaintiffs") bring this third-party action against defendant Illinois Union Fire Insurance Company (“Illinois”) for a declaration that Illinois must defend and indemnify them as additional insureds on a policy of insurance Illinois issued to its insured nonparty Len & Mar Drywall Corp. (Len & Mar).
Mega subcontracted with Allen Blvd Interiors (“Allen”) who subcontracted part of its work with Len & Mar. In the agreement between Allen and Len & Mar, Len & Mar agreed to defend, indemnify and procure insurance in favor of "owner/contractor" which in the contract is defined to mean Allen. There is no reference to plaintiffs in the agreement between Allen and Len & Mar.
The policy of insurance issued by defendant to Len & Mar contains a privity additional insured endorsement that reads in relevant part: "A. The following is added to Paragraph C. who is an insured: 3. Any person(s) or organization(s) for whom you are performing operations is also an additional insured, if you and such person(s) or organization(s) have agreed in writing in a contract or agreement that such person(s) or organization(s) be included as an additional insured on your policy . . ."
Plaintiffs assert they are additional insureds under the Illinois policy issued to its insured Len & Mar. Defendants moved for summary judgment to dismiss the action asserting that plaintiffs are not additional insureds. Plaintiffs have no written agreement with Len & Mar, as required by the endorsement. Therefore, plaintiffs are not additional insureds under that policy.
Editor’s Note: A privity AI endorsement means what it says and says what it means. It only provides AI coverage to the party with whom the named insured contracted.
PEIPER on PROPERTY (and POTPOURRI)
Steven E. Peiper
[email protected]
10/10/25 Barney v. Preferred Mut. Ins. Co.
Appellate Division, Fourth Department
Secondary Rental Dwelling at the Insured Property Does Not Qualify for Coverage
Plaintiffs own a parcel of property on which their primary residence is located. On that same parcel, there was a mobile home that plaintiffs rented as a private residence. That mobile home was destroyed by fire, and plaintiff presented a claim to Preferred to recover damages as a result. Preferred denied the claim on the basis that the mobile home was not within the anticipated scope of coverage set forth in the policy plaintiffs purchased. When the trial court agreed with Preferred that the claim was properly denied, the appeal to the Fourth Department followed.
The Appellate Division noted that the Preferred policy covered “the ‘residence’ on the ‘insured premises’.” Coverage also extended to “related private structures on the ‘insured premises’ which are not attached to ‘your residence’.” Importantly, the term “insured premises” was defined as the “described location.” That definition was further clarified to provide that the “insured premises” meant the “residence…and related private structures and grounds at the location.”
The Court held that because plaintiffs did not reside in the mobile home it was not part of the “insured premises.” Further, the mobile home could not be characterized as a “related private structure.” Notably, the mobile home was identified by a recognized address that was different than the address for plaintiffs’ residence. And the policy was endorsed to provide coverage for only the “insured premises” which corresponded to the address of the plaintiffs’ home. Indeed, the mobile home was accessed by an entirely different road and was serviced by utilities that were separate and apart from the utility service to plaintiffs’ residence. Finally, the mobile home was also not identified as a “related private structure” on the Declarations Page. Yet, plaintiffs did include a pole barn on the insurance which indicated that they certainly could have included the mobile home on the Preferred policy if they intended to secure coverage.
LEE’S CONNECTICUT CHRONICLES
Lee S. Siegel
[email protected]
The Connecticut courts were quiet for the past few weeks, leaving us with nothing new to talk about. Check back next edition.
RUFFNER’S ROAD REVIEW
Kyle A. Ruffner
[email protected]
09/29/25 Blano Medical, P.C. a/a/o Nwanji v. Hereford Ins. Co.
Kings County Civil Court
Court Declines to Consider Fee Schedule Defense Introduced by the Insurer for the First Time at Trial, Holding This Defense Is Subject to Preclusion
At the beginning of the trial in this no-fault matter, the defendant insurer abandoned its medical necessity defense and proceeded on a fee schedule defense. However, the Court order sending the case to trial, as well as the previously denied motion for summary judgment of the insurer, did not address fee schedule as a defense for trial, only medical necessity. Defendant argued that fee schedule is a non-precludable defense which can be brought up at any time up to and including at trial, relying on prior cases which held an 11 NYCRR § 65-3.8 (g) (1) amendment rendered fee schedule as a non-precludable defense not required to comply with the 30-Day Denial Rule.
In relevant part, the authority relied upon by the insurer held that, although the amendment does not change plaintiff's prima facie burden, the new language establishes that a fee schedule defense is not precluded if it is not asserted within 30 days of receipt of the claim, as11 NYCRR 65-3.8(g)(1) imposes no deadline on the insurance company's determination. Based on this interpretation of HN6 11 NYCRR 65-3.8(g)(1), defendant argued it may assert in this action a defense that plaintiff's claim exceeds the applicable fee schedule.
While the Court in this case agreed in part with the holding that the amendment did not change plaintiff's well established prima facie burden citing Viviane Etienne Med. Care v. Country-Wide Ins. Co. (25 NY3d 498, 510 [2015]), it determined that it does not render fee schedule defense as a non-precludable defense not required to comply with the 30-Day Denial Rule. The court emphasized it is well established that the courts should not be engaged in judicial activism by legislating from the Bench in encroaching upon the legislature. Particularly, where interpretation not previously ruled upon by appellate court, notwithstanding varying statutory interpretations by lower limited courts of concurrent of jurisdiction, which are not binding. The court is to interpret the natural plain language of the law, as well as legislative intent deduced from the legislative history and consider the comprehensive context of the totality of the entire text of the statute in tandem with the amendment at issue and if any related predated case law precedents."
Here, this Court in interpreting the natural plain language of the law did not agree that fee schedule is a non-precludable defense. Although the word "precluded" was used in the comments as a concern, it appears in context to the balancing of the equities of both the medical providers and insurers by mandating that only the disputed portion of the fee schedule is to be withheld by the insurer. Moreover, if legislature intended with this amendment to render fee schedule defense as non-precludable, as had been done previously for the coverage defense, it would have in plain language stated so specifically. The legislature did not do so.
Therefore, Defendant conceded no denial for fee schedule defense was provided pursuant to 11 NYCRR § 65-3.8 and therefore failed to put on any defense. Accordingly, judgment was issued in favor of the plaintiff provider.
10/15/25 Hereford Insurance Company v. Sarben-Sarpond Shelly
Appellate Division, Second Department
Court Upholds Permanent Stay, as the Doctrine of Res Judicata Barred the Defendants From Relitigating Claim for Uninsured Motorist Benefits
The claimants were the occupants of a vehicle insured by the petitioner, which was involved in an accident. The insurer commenced an action against the claimants for a judgment declaring that it had no duty to pay claims related to the accident and was entitled to a permanent stay of all no-fault arbitrations and lawsuits commenced by the claimants relating to the accident. The Supreme Court, among other things, granted the insurers motion for leave to enter a default judgment against both claimants, declaring the insurer had no duty to pay claims related to the accident and was entitled to a permanent stay of arbitration.
Thereafter, the claimants served a demand for arbitration on the insurer, which commenced this proceeding pursuant to CPLR article 75 to permanently stay arbitration for uninsured motorist benefits. The Supreme Court granted the branch of the petition to permanently stay arbitration, and the claimants appealed.
The court noted that "a defaulting defendant is deemed to have admitted all factual allegations contained in the complaint and all reasonable inferences that flow from them" (LD Acquisition Co. 9, LLC v. TSH Trade Group, LLC, 211 AD3d 928, 930 see Matter of Capital Equity Mgt., LLC v. Sunshine, 222 AD3d 640, 642). Moreover, a judgment by default that has not been vacated is conclusive for res judicata purposes and encompasses the issues that were raised or could have been raised in the prior action. The doctrine of res judicata bars a party from relitigating any claim which could have been or should have been litigated in a prior proceeding. One requirement of res judicata is that the doctrine applies only when a claim between the parties has been previously brought to a final conclusion, at which point all other claims arising out of the same transaction or series of transactions are barred, even if based upon different theories or if seeking a different remedy.
Here, contrary to the claimants' contention, the court held the Supreme Court properly granted the branch of the petition to permanently stay arbitration of the claim for uninsured motorist benefits arising out of the accident. The prior court orders and judgment granted the insurer leave to enter a default judgment against the claimants and declared, among other things, that the insurer was entitled to a permanent stay of arbitration and had no duty to pay claims, including uninsured motorist benefits, related to the accident. The claimants were parties to prior action. Accordingly, the court properly granted the petition to permanently stay arbitration.
RYAN’S FEDERAL REPORTER
Ryan P. Maxwell
[email protected]
10/23/25 Marcus & Cinelli, LLP v. Aspen Am. Ins. Co.
United States Court of Appeals, Second Circuit
Misappropriation Exclusion in Professional Liability Policy Found To Be Ambiguous, Triggering Duty to Defend, in a Split Decision
Barbara Stewart owed substantial unpaid legal fees to her former law firm, Patterson Belknap Webb & Tyler LLP (“Patterson”). Patterson obtained a judgment against Stewart for over $2 million and served her with a Restraining Notice under New York law, prohibiting her from transferring any property until the judgment was satisfied. After Patterson withdrew, Stewart hired Marcus & Cinelli, LLP (“M&C”), to represent her and also accrued unpaid legal fees to them.
In 2014, Patterson’s attorney informed M&C of the Restraining Notice and Patterson’s superior claim to any proceeds Stewart might receive from her divorce. In 2016, M&C, through attorney David Marcus, facilitated the private sale of Stewart’s 24.79-carat diamond ring through Sotheby’s. Marcus did not inform Sotheby’s of the Restraining Notice and assured them Stewart could transfer the ring “free and clear of any claims or encumbrances.”
The sale netted $2.375 million. M&C directed the proceeds into its own account and transferred about $1.4 million to itself, with the remainder going to other law firms, but none to Patterson. Patterson then sued M&C in state court, alleging fraudulent conveyance, tortious interference with its judgment collection, and contempt of court, arguing that M&C knowingly took funds to which Patterson had a superior legal claim, in violation of the Restraining Notice.
M&C sought coverage and a defense from its professional liability insurer, Aspen American Insurance Company (“Aspen”), which denied coverage, arguing the conduct did not involve professional services and was excluded as “misappropriation.” While the district court sided with Aspen, the Second Circuit reversed, holding that the allegations involved professional services and that the policy’s misappropriation exclusion did not clearly apply, thus requiring Aspen to defend M&C in the underlying action.
The insurance policy at issue—M&C’s professional liability policy with Aspen—required the claims to arise from acts or omissions “in the performance of professional services.” The court first explained that “professional services” was defined in the policy as services performed by M&C for a client in its capacity as a lawyer or in a similar fiduciary capacity. The court looked at the nature of the conduct alleged in the underlying complaint and found that the actions—such as facilitating the sale of the diamond ring, providing legal opinions about title, negotiating and signing the sale agreement, and handling the proceeds in client accounts—were all acts that required the special acumen and training of a lawyer and thus constituted professional services.
While Aspen had argued that the underlying action was merely a fee dispute and did not implicate professional services, the court rejected this, finding that the complaint’s allegations “arguably arise from” the rendering of professional services.
After finding that coverage was triggered, the Second Circuit turned to the relevant misappropriation exclusion. The policy did not define “misappropriation,” so the court looked to its common meaning. Black’s Law Dictionary defined it as “[t]he application of another’s property or money dishonestly to one’s own use.” Notably, this definition required using someone else’s property without their consent, rather than merely using property unlawfully or unethically. Here, the underlying complaint alleged that M&C acted improperly and even fraudulently in selling the diamond ring and allocating the proceeds, but it did not allege that M&C used the client’s property in a way that was unauthorized by the client (Stewart). While the complaint indicated that M&C acted in violation of a restraining notice, it did not allege a lack of consent from Stewart.
While the Second Circuit recognized that “misappropriation” could also, reasonably be read as using property unlawfully even with consent, the exclusion could not be applied to defeat coverage because it was ambiguous and must be read in favor of coverage from Aspen for, at minimum, a duty to defend.
The court made it clear that the issue of indemnity was far from settled. And, a strong dissent, in a 2-1 decision, sided with the insurer.
STORM’S SIU
Scott D. Storm
[email protected]
09/30/25 Union Mutual Fire Insurance Company v. Rodriguez, et al
United States District Court, Eastern District of New York
Ongoing Operations Exclusion Applied to Preclude Defense and Indemnity Coverage
Rodriguez owned a property in Queens, N.Y. and leased a storefront to La Perla De Oriente Corp. Without Rodriguez's permission, La Perla changed the signage and awning in front of the storefront, hiring Monsalve, who worked for a company run by Angel Coronel, to perform the work. While cleaning the newly installed awning, Monsalve fell off a ladder and subsequently sued Rodriguez in state court in June 2022.
Rodriguez had a general liability insurance policy with Union Mutual, which included the property as a covered risk location, but Union Mutual declined to defend or indemnify Rodriguez, citing two policy exclusions: the Independent Contractor/Subcontractor Exclusion and the Ongoing Operations Exclusion.
The Ongoing Operations Exclusion bars coverage for "construction, renovation or repair work" at the insured location unless performed by independent contractors who meet specific insurance requirements, which were not met in this case. The court found that Monsalve's activities constituted "renovation" or "repair" under the policy's plain meaning, as the work restored the awning to a good state and newness of appearance. The court determined that Rodriguez failed to show Monsalve met the independent contractor exception criteria.
The court rejected Rodriguez's arguments that the policy language was ambiguous and that the insurer's underwriting guidelines should control interpretation. The mere fact that a contractual term is undefined does not render it ambiguous per se. It is the common practice of New York courts to refer to dictionaries to determine the plain and ordinary meaning of the words in a contract. To renovate means to restore freshness, purity, or newness of appearance. Renovation, Webster's New Int. Dictionary (2d ed. 1946). Where the terms of an insurance policy are clear and unambiguous, they should be given their plain and ordinary meaning, and courts should refrain from rewriting the agreement. Courts may only consider extrinsic evidence where the policy is ambiguous and susceptible to two reasonable interpretations.
The court granted summary judgment in favor of Union Mutual, holding that it had no duty to defend or indemnify Rodriguez in the underlying state court action.
08/05/25 Benson v. Grange Mut. Cas. Grp.
United States District Court, Western District of Pennsylvania
One Year Suit Limitation Condition Runs From the Date of the Fire, Not the Date of the Alleged Breach of Contract; A Bad Faith Claim Can Survive Even When the Breach of Contract Claim is Barred by the Policy's Suit Limitation Provision
Plaintiffs owned a home in Manor, PA, which was insured by Grange. The property was destroyed by fire on 10/19/23, resulting in total loss. Plaintiffs alleged that Grange conceded the fire was a covered loss but failed to provide fair compensation and refused to pay the amounts claimed. Plaintiffs initiated their lawsuit by filing a Praecipe for Writ of Summons on April 28, 2025, approximately 18 months after the fire.
Under 42 Pa.C.S. §5525 there is a general four-year statute of limitations for breach of contract. However, 42 Pa.C.S. §5501 allows parties to contractually shorten limitations periods if not "manifestly unreasonable". 40 P.S. §636(2) requires a one-year suit limitation in fire insurance policies.
Grange filed a Motion to Dismiss. The court found that under PA law the policy’s one-year contractual limitation period for suit is valid and enforceable. Because the plaintiffs filed suit nearly a year and a half after the fire, their breach of contract and special injunction claims were dismissed with prejudice as time barred.
The phrase "loss or damage occurs" in the policy's limitations provision refers to the date of the fire itself, not the date of the alleged breach of contract. The court rejected plaintiffs' argument that the limitations period should run from the date of the alleged breach rather than from the date of the fire. When interpreting a contract under Pennsylvania law, the entire contract should be read as a whole and every part interpreted with reference to the whole, so as to give effect to its true purpose.
A claim for special injunction cannot survive when the underlying breach of contract claim is dismissed. For the special injunction claim, the court noted that plaintiffs acknowledged they must show they are "likely to prevail on the merits" of their contract claim to obtain injunctive relief. Since the contract claim was dismissed as time-barred, the special injunction claim necessarily failed as well.
The court held that the bad faith claim under 42 Pa.C.S. § 8371 is a separate cause of action and not barred by the contractual limitations period. A bad faith insurance claim can survive even when the breach of contract claim is barred by the policy's limitations provision.
To establish a bad faith claim under PA law, a plaintiff must show by clear and convincing evidence that the insurer did not have a reasonable basis for denying benefits under the policy and knew or recklessly disregarded its lack of a reasonable basis in denying the claim. Bad faith on the part of an insurer is any frivolous or unfounded refusal to pay proceeds of a policy; it is not necessary that such refusal be fraudulent. For purposes of an action against an insurer for failure to pay a claim, such conduct imports a dishonest purpose and means a breach of a known duty, good faith and fair dealing, through some motive of self-interest or ill will; mere negligence or bad judgment is not bad faith. An insurer may defeat a claim of bad faith by showing that it had a reasonable basis for its actions.
The bad faith claim was found deficient for lack of specific factual allegations, but the court granted leave to amend this claim within 30 days. Rule 15(a)(2) of the Federal Rules of Civil Procedure provides that leave to amend should be freely granted when justice so requires; and the grant or denial of an opportunity to amend is within the discretion of the District Court. Plaintiffs' bad faith claim consisted primarily of generalized accusations without specific factual support. The complaint essentially alleged only that Grange refused to pay the amounts requested, without specifying "who, what, when, why or how" Grange acted in bad faith. Conclusory allegations of bad faith without supporting factual details are insufficient to state a plausible claim. The order states that if plaintiffs do not amend their complaint within 30 days, the bad faith claim will also be dismissed with prejudice.
FLEMING’S FINEST
Katherine A. Fleming
[email protected]
10/17/25 Farm Bureau Mut. Ins. Co. v. Weston
Utah Supreme Court
Judgment Entered After Confirming Arbitration Award Was Final, Later Expired; Insurer Breached Duty to Defend; Insured Did Not Prove Breach Caused Emotional Distress; Decision Vacated Awarding Consequential Damages for Expired Judgment and Contingency-Based Attorney Fees
In 2004, Jared Weston and LaMoin Larkin were involved in an auto accident that resulted in Larkin’s death. Larkin’s insurer, Farm Bureau Mutual Insurance, paid property damages, personal injury protection benefits, and uninsured motorist benefits to Larkin’s estate. After making those payments, FBMI stepped into the estate’s shoes and filed a claim against Weston for negligently causing the accident. In addition to the negligence claim against Weston, the complaint also sought a declaration that Farmers Insurance Exchange provided Weston coverage under his parents’ policy. The FBMI further alleged that FIE’s cancellation of Weston’s policy was ineffective.
In early 2008, while the declaratory judgment action remained unresolved, Weston and the FBMI agreed to arbitrate the negligence claim. The arbitrator found Weston wholly at fault for the accident. FBMI presented the arbitration award to the court, and in March 2009, the court confirmed the award. The question of whether Weston was insured at the time of the accident still needed to be decided. Additionally, Weston alleged that FIE breached its duties of good faith and fair dealing by (1) refusing to defend him against the FBMI’s claims even though the complaint’s allegations triggered its duty to defend and (2) failing to indemnify him for the 2009 judgment. The district court determined that FIE properly cancelled the policy prior to the accident due to a late payment by Weston’s mother. The insurers cross moved for summary judgment, and the court determined that FIE breached its duty to defend Weston. The court reasoned that the complaint alleged FIE had not complied with the statutory requirements before cancelling, so there was a dispute regarding whether the policy had been cancelled properly.
In April 2016, the FBMI applied for and obtained a writ of execution on the judgment it had obtained against Weston more than seven years earlier. Weston moved to quash the writ of execution because the 2009 judgment was nonfinal. The case then moved forward to a second bench trial to determine the damages Weston suffered due to the defendant insurer’s breach of its duty to defend. Prior to the bench trial, the court ruled that, as a matter of law, Weston could not recover damages for the arbitration award because Weston had presented no evidence that the arbitration award would have changed if he had been provided a defense. FBMI asked the court to amend the judgment based on its revised ruling on damages in 2018, but Weston and FIE argued that the 2009 judgment could not be amended because it had expired under Utah law. The district court ruled that the 2009 judgment against Weston had not expired because the 2009 judgment based on the order confirming the arbitration award was not a final, enforceable judgment under Utah law since it did not resolve all the claims in the case.
The court of appeals reviewed the district court’s rulings on the following issues: (1) whether the 2009 judgment had expired, (2) whether the defendant insurer had properly cancelled Weston’s insurance policy, (3) whether the defendant insurer breached its duty to defend, and (4) whether Weston was entitled to damages for the defendant insurer’s breach of the duty to defend. The court of appeals affirmed the first three rulings—on expiration, cancellation, and breach. The court also partially affirmed the fourth ruling—on damages—agreeing with the district court that Weston had not shown he suffered emotional distress from the breach of the duty to defend. However, the court split on whether an insurer that breaches its duty to defend can later challenge its liability for the judgment that it refused to defend against.
The Utah Supreme Court found the judgment had expired in 2017 and was no longer enforceable, so the court did not need to reach the merits of the cancellation issue. The parties agreed the 2009 arbitration award judgment was not final under the final judgment rule due to pending claims, but the Supreme Court concluded that the judgment fit within the statutory exception to the rule as it was a final judgment entered pursuant to the state’s arbitration act. When FBMI’s judgment expired in 2017, Weston’s legal obligation to pay expired along with it. By extension, any legal obligation FIE had to indemnify Weston also evaporated. As for the duty to defend, the Supreme Court explained that if the allegations in the complaint may fall within the scope of coverage, then the insurer must defend. Further, a genuine dispute of fact regarding proper cancellation renders coverage uncertain and requires a defense until the dispute is resolved. Finally, the Supreme Court found that the appellate court erred in awarding Weston damages based on the expired 2009 judgment. The Supreme Court looked at three types of damages: damages based on the 2009 judgment, emotional distress damages, and attorney fees.
First, the majority of the appellate court applied the Illinois rule that if the insurer fails to seek a declaratory judgment or defend the suit under a reservation of rights it is estopped from raising policy defenses to coverage. Therefore, the majority concluded that FIE was liable to Weston for damages equal to the amount of the 2009 judgment. The dissenting judge argued that Utah case law was more in line with the majority rule that an insurer’s unjustified refusal to defend does not estop it from later denying coverage under its duty to indemnify. The Supreme Court declined to decide whether Utah follows the Illinois rule or the majority rule because there was no longer a valid judgment that FIE could be ordered to pay, and it vacated the court of appeals’ decision regarding the Illinois rule versus majority rule. This issue remains an open question of law in Utah. Second, the Supreme Court agreed that the court of appeals correctly affirmed the lower court’s determination that Weston had not proven that FIE caused him emotional distress by not assigning defense counsel. The court of appeals found the majority of the stress was from the judgment as opposed to the refusal to provide a defense, and since it was a close call, under the clear error standard of appeal, the Supreme Court did not conclude the determination was against the clear weight of the evidence. Third, the Supreme Court reversed the court of appeals’ decision awarding Weston forty percent of the 2009 judgment plus interest and costs as attorney fees because the judgment had expired.
GESTWICK’S GARDEN STATE GAZETTE
Evan D. Gestwick
[email protected]
10/14/25 State Farm Indem. Co. v. Van Pelt
United States District Court, District of New Jersey
No Auto Liability Coverage for Non-Resident Child Using His Own Vehicle
The Van Pelts’ son, Michael, owned a vehicle registered in Florida, where he resided. Michael was home in New Jersey, where his parents resided, working as a pizza deliverer using his Florida-registered vehicle, when he struck and injured a third party. Said third party brought suit for her injuries. State Farm, the Van Pelt parents’ auto insurer, denied Michael’s request for coverage. This litigation followed.
The State Farm policy defined an insured as “you” (i.e., the named insureds) and their resident relatives, for the ownership, maintenance, or use of: (1) “your” car; (2) a newly acquired car, or (3) a trailer, as well as for the maintenance or use of a non-owned car, or a temporary substitute vehicle. The policy otherwise defined an “insured” to be any other person for their use of either: (1) “your” car; (2) a newly acquired car; (3) a temporary substitute car; or (4) a trailer while attached to a car described elsewhere in the definition, as long as the vehicle was used within the scope of consent provided by one of the named insureds.
State Farm denied coverage on the basis that Michael did not qualify as an “insured,” because he was not a resident relative, and was not operating a vehicle owned by his parents, a newly acquired car, or a temporary substitute car. A default judgment was ultimately entered in State Farm’s favor upon a finding that State Farm sustained its burden of establishing its meritorious cause of action for a declaratory judgment.
Editor’s Note: Had Michael been using his parents’ car, the result would have been the same. While he would have qualified as an “insured” under the second portion of the definition (the one without the residency requirement), the policy also contained an exclusion applicable to the use of vehicles in connection with an insured’s employment.
10/09/25 Chenel v. Allstate Ins. Co.
New Jersey Superior Court, Appellate Division
No Estoppel Argument to Evade Statute of Limitations Defense Without Evidence of Ongoing Settlement Negotiations for More Than Six Months
On June 16, 2017, Chenel was injured in a motor vehicle accident while operating a motor vehicle insured by Allstate. Chenel sued the tortfeasor, and on April 21, 2021, obtained State Farm’s consent to settle the tort action (Chenel also asserted a claim for Uninsured Motorist Benefits (“UIM”) with State Farm the day after the accident).
According to Chenel, his attorney continued to negotiate with State Farm from the day he settled the third-party case until the day he filed suit (October 30, 2023). However, Chenel alleged that those supposed settlement negotiations fell flat, prompting him to bring this action for UIM benefits. Upon receipt of the action, State Farm made a pre-answer motion to dismiss, since the six-year statute of limitations applicable to such actions—which runs from the date of the accident—has expired.
In response to State Farm’s motion, Chenel argued that State Farm should be estopped from invoking its statute of limitations defense, since, according to Chanel, State Farm lulled it into inactivity through the ongoing settlement negotiations that ultimately proved fruitless. State Farm pointed out a number of flaws in Chenel’s argument. Principally, there was only one settlement communication in the record dated after the date Chenel settled the third party claim, dated April 20, 2022—meanwhile, the statute expired on June 16, 2023. While Chenel argued that his counsel’s paralegal took the lead in negotiating the settlement, and communicated with State Farm regularly, State Farm had no record of such communications, and Chenel was unable to produce any, allegedly because such communications existed solely on the paralegal’s personal email to which his attorney had no access (sadly, said paralegal passed away). State Farm also pointed out the unusual nature of a paralegal conducting settlement negotiations with no oversight by an attorney, even surmising that Chenel’s counsel of record would have been (or at least should have been carbon copied on such correspondence).
State Farm additionally noted that the paralegal’s untimely death occurred six months prior to the expiration of the statute of limitations. To invoke the doctrine of estoppel, a party must show that the party to be estopped acted in such a way to cause the other party’s reasonable reliance on their actions. Here, the Court noted that there was no evidence in the record that anyone touched Chenel’s file after April 2022, and that even if there were, the plaintiff had a full six months prior to the expiration of the statute of limitations to make new correspondence with State Farm, and elected not to do so.
O’SHEA RIDES the CIRCUITS
Ryan P. O’Shea
[email protected]
10/15/25 L. Squared Indus. V. Nautilus Ins. Co.
United States Court of Appeals, Eleventh Circuit
Court Determines Prejudice Rule Applies to Clams of Late Notice Regarding Pollution Claims and Holds Insured Failed to Provide Timely Notice
L Squared operates gas stations throughout Florida. L Squared’s principals purchased the company in 1974. The gas stations contain UST systems that store regulated substances to minimize the release and discharge of pollutants. L Squared procured Storage Tank Liability Insurance from Nautilus for the USTs located at an Exxon station. The policy remained in effect from July 18, 2018, to July 18, 2019, and operated as a claims made policy. The policy’s notice condition states:
VI. REPORTING OF A POLLUTION CONDITION, CLAIM OR SUIT
1. You must see to it that we are notified as soon as reasonably possible, but in any event, not more than seven (7) days after the insured first became aware of, or should have become aware of a pollution condition which may result in a claim or any action or proceeding to impose an obligation on the insured for cleanup costs . . . .
In September 1985, the Exxon at issue suffered a discharge and the State determined the discharge qualified for the State’s reimbursement program (“FDEP”). In 1990, the discharge became eligible for remediation funding. In 2006, the Exxon’s previous tanks were removed and replaced with the UST system. In May 2017, after L Squared purchased the Exxon, an FDEP inspection revealed damage to the components of the UST system. After water and soil testing, the FDEP determined a new discharge occurred, unrelated to the 1985 event. The FDEP instructed L Squared to conduct additional testing to determine the extent of contamination and to submit a Discharge Report Form. In March 2018, L Squared’s principal submitted a Discharge Report Form to the FDEP and documented the date of discovery as July 2017, which was the date of the hydrotesting. L Squared did not conduct further testing.
L Squared then had a dispenser sump replaced and retained Taylor Environmental Consulting (“Taylor”) to conduct assessment in connection to the pump replacement. Taylor noticed groundwater contamination and believed it could be related to the 1985 discharge or the 2017 discharge. L Squared received a copy of Taylor’s report outlining the contamination in August 2018 but did not notify Nautilus of the discharge until April 2019. Nautilus denied coverage in June 2019.
On appeal the court identified the policy contained two notice conditions. The first condition pertained to notice of a claim discovered within the policy period and reported to Nautilus in writing. The second condition outlined above required L Squared to provide Nautilus with notice within seven (7) days upon awareness of a pollution condition that may result in a claim, action or proceeding to impose an obligation for cleanup costs. As L Squared notified Nautilus within the policy period, it satisfied the first notice condition. Instead, L Squared violated the second notice condition since it failed to notify Nautilus of the potential pollution upon receipt of Taylor’s report in August 2018.
In the context of pollution claims, the court adopted a prejudice standard since Florida authority remained silent on the specific issue presented. Florida law generally finds a presumption of prejudice if an insured breaches a notice condition, which can be rebutted by showing a lack of prejudice to the insurer. Thus, L Squared bore the burden to create an issue of fact as to whether Nautilus suffered prejudice.
L Squared did not present the lack of prejudice argument its motion for summary judgment and raised the issue in its motion for reconsideration without citing to the record. The circuit court affirmed summary judgment in favor of Nautilus since L Squared raised the prejudice issue for the first time in its motion for reconsideration and the court lacked any obligation to search the record for an issue of fact, particularly where L Squared failed to cite the record in its papers filed in support of the motion to reconsider.
LABARBERA’S LOWER COURT LIBRARY
Isabelle H. LaBarbera
[email protected]
Nothing new from me this time around, see you in two weeks.
LEXI’S LEGISLATIVE LOWDOWN
Lexi R. Horton
[email protected]
10/24/25 New York Senate Bill A8519
New York State Senate
Proposed Bill to Require That, in Civil Claims Under the Child Victims Act, Liability Carriers Must Provide Information Regarding Each Known Policy of Insurance
Assembly Bill A8519 introduced on May 20, 2025, would require that in civil claims under the child victims act, adult survivors act, or a civil sex trafficking claim, any insurer who may provide liability coverage for a claim shall upon request from the claimant, provide information regarding each known policy of insurance.
The Bill would also provide that a person bringing a civil claim in sex trafficking need not disclose their immigration status.
The proposed bill would amend insurance law by adding a new section, Section 346 Disclosure of Certain Insurance Information. The bill provides that within 30 days of receiving a written request by a potential or actual claimant or the claimant’s attorney, provided a sworn statement, under oath, setting forth the following information
(1) Name of the insurer;
(2) Name of each insured, including additional insureds
(3) The limits of liability coverage; and
- A statement of any policy or coverage defense which such insured reasonably believes is available to such insured at the time the statement is signed.
VICTORIA’S VISION ON BAD FAITH
Victoria S. Heist
[email protected]
10/17/25 Dina Devincenzo-Gambone et al. v. Erie Insurance Exchange
In the Superior Court of Pennsylvania
Bad Faith Found When Insurer Delayed Payment of UIM Benefits Following Arbitration Award
In this case, Plaintiff Dina Devincenzo-Gambone ("Gambone") was in a vehicle accident on February 24, 2004. Her vehicle was insured by Erie Insurance Exchange ("Erie") and after settling with the tortfeasor, she filed an under-insured motorist ("UIM") claim against Erie. Gambone and Erie agreed to submit the UIM claim to arbitration in the Court of Common Pleas of Montgomery County.
At arbitration, the arbitrator found the stacking provisions of Gambone's policy applied and awarded $300,000. After the arbitration decision was issued, Gambone dismissed her UIM claim against Erie. Erie then tendered $250,000 to Gambone, withholding $50,000.
Erie then filed a petition to modify the arbitration award in the Court of Common Pleas of Montgomery County and in response, Gambone filed a complaint alleging breach of fiduciary duty and bad faith. The court denied Erie's petition to modify the arbitration award and three years after the arbitration decision, tendered the remaining $50,000.
The court found Erie acted in bad faith by withholding $50,000, and awarded Gambone $1,754,188.24 in damages, consisting of interest, attorneys' fee, court costs, and more than $800,000 in punitive damages.
Erie filed a motion seeking a judgment non obstante verdicto, which requests that a verdict be set aside as unreasonable, which was denied by the trial court. Erie then appealed to the Pennsylvania Superior Court.
In its decision, the Court discussed the standard for bad faith, stating "the Court has consistently held that there can be no finding of bad faith where an insurer withholds a portion of an arbitration award because an issue regarding stacking remains unresolved." However, the Court found there was sufficient evidence to support the trial court's verdict on bad faith as the parties agreed to submit to binding arbitration, and Erie never communicated that it reserved its right to appeal the arbitration decision or to reject the arbitrator's determination. The Court stated that Erie only challenged the arbitration award after the UIM claims against Erie were dismissed.
However, the Court found that the trial court did not set forth sufficient explanations regarding its assessment of the attorneys' fees awarded and thus abused its discretion in awarding attorneys' fees.
Erie also challenged the interest assessment made by the trial court, arguing that interest must run at the time of the arbitration decision and that bad faith interest cannot be compounded. The Court also found that the trial court correctly determined that the "claim”, and thus interest, on the bad faith claim began to run when Gambone first made her UIM claim in 2006, not when the arbitration decision was rendered in 2016. However, the Court found that the Pennsylvania bad faith statute did not permit compound interest.
Ultimately, the Court affirmed the finding of bad faith against Erie but vacated and remanded the case for further proceedings on the issues of attorneys' fees and interests.
SHIM’S SERIOUS INJURY SEGMENT
Stephen M. Shimshi
[email protected]
10/10/25 Cherfilus v. McAlmon
Kings County Supreme Court
Court Finds Plaintiff Failed to Sustain a Serious Injury in Accordance with the Statutory Requirements of Insurance Law § 5102(d)
This case involves personal injuries suffered by plaintiff, Artelien Cherfilus, in connection with a motor vehicle accident that occurred on June 9, 2023. According to plaintiff’s bill of particulars, he suffered the following injuries: (1) lumbar sprain; (2) right shoulder sprain; (3) right knee sprain; and (4) suprapatellar effusion of right knee joint. Plaintiff’s complaint did not specify which categories of serious injury his injuries fell under but made allegations that his injuries were permanent (“That by reason of the foregoing and the negligence of the said defendants, this plaintiff, ARTELIEN CHERFILUS, is informed and verily believes his aforesaid injuries are permanent and that he will permanently suffer from the effects of his aforesaid injuries and he will be caused to suffer permanent embarrassment and continuous pain and inconvenience”). Defendants moved for summary judgment to dismiss the complaint on the grounds that plaintiff’s injuries did not satisfy the threshold of serious injury pursuant to the statutory categories enumerated in Insurance Law § 5102(d).
In order to make out a prima facie case that plaintiff did not suffer a serious injury in accordance with Insurance Law § 5102(d), a defendant must “rule out all categories claimed in the bill of particulars (see Diaz v. Nightingale Bakery & Beverage Distrib., Inc., AD3d, 2025 NY Slip Op 04630 [2d Dept 2025]; Santos v. Fiktus, 232 AD3d 698 [2d Dept 2024]; Curiale v. Delfavero, 211 AD3d 905), and/or must establish that whatever injuries are claimed by the plaintiff did not proximately result from the subject motor vehicle accident (see Lemieux v. Horn, 39 NY3d 1108 [2023], affg 209 AD3d 1100 [3d Dept 2022]; Franklin v. Gareyua, 29 NY3d 925 [2017], affg 136 AD3d 464 [1st Dept 2016]; Rivera v. Fernandez & Ulloa Auto Group, 25 NY3d 1222 [2015], affg 123 AD3d 509 [1st Dept 2014]).” If the defendant makes such a showing, the burden then shifts to the plaintiff to submit evidence to establish that there are material issues of fact regarding serious injury (see Franchini v. Palmieri, 1 NY3d 536 [2003]; Grasso v. Angerami, 79 NY2d 813 [1991]).
Here, plaintiff failed to claim any serious injurious categories in his bill of particulars. Plaintiff's counsel indicated that a supplemental bill of particulars asserting serious injury categories was served upon Defendants, but said document did not appear in the record. As such the Court rejected plaintiff’s arguments with respect to significant limitation and 90/180. Citing to Epstein v. MTA Long Island Bus, 161 AD3d 821 [2d Dept 2018], the Court “discerned” that plaintiff’s complaint alleged “permanent injuries,” and his bill of particulars specified injuries to the lumbar spine, right shoulder, and right knee. The Court deemed that plaintiff alleged serious injuries under the following categories: (1) dismemberment; (2) permanent loss of use of a body organ, member, function or system; and (3) permanent consequential limitation of use of a body organ or member.
First and second categories alleged (dismemberment and a permanent loss of use of a body organ, member, function or system):
Defendants’ IME doctor examined Plaintiff's lumbar spine, right shoulder, and right knee. The foregoing were capable of movement. As such, the Court found that defendants made a prima facie showing that Plaintiff did not sustain dismemberment or a permanent loss of use of a body organ, member, function or system, the latter category requiring there to be a total loss. Oberly v. Bangs Ambulance, 96 NY2d 295 [2001].
Third category alleged (permanent consequential limitation of use of a body organ or member):
Range of motion testing of the lumbar spine defendants’ IME doctor revealed complete range of motion. Regarding plaintiff’s right shoulder, range of motion was also complete with respect to abduction, adduction, flexion, extension, and external rotation. However, range of motion with respect to internal rotation was limited to 70/ 80 degrees. Right knee extension was normal but flexion was at 130/150 degrees. The Court held that the limitations of 12.5 percent in right shoulder internal rotation and 13.3 percent in right knee flexion, respectively, were of “no consequence” because relevant case law has established that low-level limitations are insignificant (see Cebron v. Tuncoglu, 109 AD3d 631 [2d Dept 2013] [10 percent]; McLoud v. Reyes, 82 AD3d 848 [2d Dept 2011] [12 percent]; Il Chung Lim v. Chrabaszcz, 95 AD3d 950 [2d Dept 2012] [13 percent]; Chinnici v. Brown, 295 AD2d 465 [2d Dept 2002] [10-15 percent]; Arrowood v. Lowinger, 294 AD2d 315 [2d Dept 2002] [2-4 percent, 5-10 percent, and 7-14 percent]; Waldman v. Dong Kook Chang, 175 AD2d 204 [2d Dept 1991] [15 percent]).
In opposition plaintiff relied on his own affidavit, medical records and reports, to argue that there is an issue of fact concerning serious injury. In reviewing them it is clear that no body part was dismembered. Neither did Plaintiff sustain total loss of any body part.
In assessing whether there was an issue of fact as to “permanent consequential limitation of use of a body organ or member,” the Court found that the only consequential limitations (20 percent or more) in the evidence proffered in support of plaintiff’s opposition pertained to his right shoulder. When plaintiff was first examined in July 2023, he had a 27.8% limitation in abduction. However, there was only a 16.7% limitation by August 2023. As such the Court found that it was no longer consequential. In October 2023, plaintiff’s abduction limitation was at 25%, and flexion, was limited by 30.6%. In April 2024, however, plaintiff’s left shoulder was almost completely normal. At plaintiff’s most recent, examination (August 2025), flexion was limited by 22.2% and internal rotation at 57.1%. previously, internal rotation was not examined, “mildly restricted,” or normal. Plaintiff’s experts failed to explain these fluctuations.
Based on the foregoing, the Court held that plaintiff failed to demonstrate that there was an issue of fact to place before a jury concerning serious injury. As such, the Court granted defendants’ motion for summary judgment dismissing the complaint.
NORTH of the BORDER
Heather A. Sanderson, K.C.
Sanderson Law
Calgary, Alberta, Canada
[email protected]
10/06/25 His Majesty the King in Right of Ontario v. Royal & Sun Alliance Insurance Company of Canada, et al
Ontario Superior Court of Justice
A CGL Coverage Agreement That Extends to “Property Damage” Defined as “Injury to or Destruction of Tangible Property Which Occurs During the Policy Period, Including Loss of Use Thereof at Any Time Resulting Therefrom” Applies to Loss of Use Occurring Beyond the Policy Period if It Results From Injury to or Destruction of Tangible Property That Occurred During the Policy Period
Catfish Creek runs roughly southward from the town of Alymer, Ontario. and empties into the north shore of Lake Erie at Port Bruce. It is a significant creek as it supports a unique forest where sassafras, sycamore and walnut trees grow –the only area in Canada where these trees are found. In late February 2018, Catfish Creek was flooding following days of heavy rain. Roads were washing out and entire neighbourhoods in the surrounding county of Elgin were under water.
On February 23, 2018, Scott Barber was driving a 1999 Western Star dump truck over a bridge that crossed Catfish Creek into Port Bruce…he told CBC news that “Initially I thought it was a tire going on the truck…Less than a second [later], I was looking up at the grey sky, in the water.”
Barber was unhurt. The truck was damaged. The bridge was a total loss. Lawsuits followed.
The Province of Ontario designed and constructed that bridge in 1964. In 1997, Ontario transferred jurisdiction and control of the highway including that bridge to Elgin County.
The County of Elgin sued Ontario and various engineering and technical companies, alleging that Ontario and the other defendants are responsible for the costs of replacing the bridge, including costs associated with removing debris from the collapse and other associated costs. Ontario denied liability. In a second lawsuit, Ron Jones Construction sued Elgin County for the loss of use of the dump truck and environmental cleanup costs it incurred as a result of a fuel spill into Catfish Creek. Elgin denied liability and third partied Ontario.
In its claim and in its third-party claim, Elgin County alleged that the bridge collapsed due to corroded anchor rods; that Ontario was liable for the collapse due to the corrosion that occurred between 1964 and 1977 when it transferred jurisdiction and control of the bridge to Elgin County.
These allegations triggered the insurance coverage held by Ontario over the 54.2 years during the lifespan of the bridge. Ontario brought this application compelling two of its insurers to defend.
When did the Property Damage & Loss of Use Occur?
In both actions, Ontario is facing Elgin’s allegations that the bridge collapsed due to corroded anchor rods that began soon after the bridge was constructed through to its collapse in 2018. The Court held that Elgin’s allegations in the third-party notice in the Jones action mirror those in its action against Ontario. There is no difference in Elgin’s allegations in the two actions. The court held that if the insurers have a duty to defend Ontario in the Elgin action, then there is a corresponding duty to defend Elgin’s third-party claim in the Jones action.
Ontario argued that, as of 1997, Ontario no longer had jurisdiction over the bridge and therefore would not be liable beyond that date. One of its insurers, RSA, argued that both the Elgin action and its third-party claim allege damage to property that occurred in 2018 when the bridge collapsed. Aviva acknowledged that property damage could be inferred to have occurred from 1964 to 2018. Both insurers argued that the Ron Jones claim concerns damage to the truck, not the bridge and there was no duty upon them to defend Elgin’s third-party claim in that action.
The Court held that the substance of the action is for the gradual corrosion of the anchor rods that began in 1964 and ended with the collapse of the bridge in 2018. Ontario’s negligent conduct ended in 1997, but the property damage caused by that conduct continued through to 2018. A surprising finding was the court’s view as to coverage for the claims of loss of use of the bridge. The definition of property damage in the Aviva and RSA policies was virtually identical in both policies: “injury to or destruction of tangible property which occurs during the Policy period, including loss of use thereof at any time resulting therefrom.” The Court agreed with Ontario that “at any time resulting therefrom” means that if the property damage occurred during the policy period, then the insurer is liable for the loss of use that results from that property damage even if it occurs outside the policy period.
Does the “Owned Property” Exclusion Apply?
Aviva and RSA jointly argued that Ontario had care, custody and control of the bridge from 1968 to 1977 and therefore the policy does not apply to the property damage that occurred during that period. However, in view of the court’s holding that the policy provides coverage for the loss of use that extends beyond the policy period that arises from property damage that occurs during the policy period, the “ owned property” exclusion does not apply to that loss of use.
Allocation of Defence Costs
Following the Ontario Court of Appeal’s decision in Loblaw, the court allocated defence costs on the basis of “time on risk”; Aviva, who insured Ontario for three of the 54.2 years, was ordered to pay 5.5% of the defence costs, and RSA, who insured Ontario for six of the 54.2 years, paid close to double that percentage, 11.1%.
Disposition
Aviva and RSA were ordered to defend Ontario and pay defence costs in the percentages based upon the time that they insured Ontario. Costs are to be spoken to.
Comment
As this is a duty to defend case, the prospects of an appeal appear dim; but the appeal period is still running. Time will tell."
This is one of the first reported ‘long-tail’ cases that has been reported in Ontario since the Loblaw decision. The court’s analysis of the duty to defend the allegations of physical damage is consistent with previous Canadian decisions, as well as Loblaw as is the finding as to the allocation of defence costs amongst insurers who have issued consecutive policies. However, its interpretation that the coverage for loss of use arising from physical damage in the policy period, is, in a word, novel, but the definition of “property damage” in the policies in issue does say “at any time arising therefrom”.
It is difficult to comment on the coverage for the Jones action as the pleadings are not set out in detail in the judgment, but if Elgin is alleging in its third-party claim in the Jones action that it not liable for damage and loss of use of the truck that occurred in 2018, but that Ontario is liable for that damage, then that damage is what is in issue in Elgin’s third-party claim in the Jones action. Same allegations, but different damage.
But as a practical matter, the defence of the Jones claim is identical to defence of the Elgin claim. Both the Elgin action and the Jones action are being tried together and, therefore, in the context of whether AIG and RSA owe Ontario a duty to defend, there does seems to be little advantage to argue coverage for the Jones action at this stage.
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