Volume XXVII, No. 24 (No. 723)
Friday, May 8, 2026
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. Happy Friday from your friends at Hurwitz Fine.
Happy Mother’s Day!
Legislative Alert – Tort Reform in New York -- Unofficial and Unconfirmed
As this publication is going to print, there is word from New York Governor Hochul, yet unconfirmed by legislative leaders, that there is agreement on the State budget with two major changes to provide some relief in the tort reform area.
- The elimination of “pure comparative negligence” in New York. Right now, for NY cases, if a plaintiff is more than 50% at fault, he or she can still secure a verdict for the percentage of liability not attributable to the plaintiff. So, if a jury finds the plaintiff 75% at fault and the defendant 25% at fault, the plaintiff can recover 25% of assessed damages. The change proposed is to disallow any recovery if the plaintiff was more than 50% at fault. Big change.
- Elimination of the 90/180 category of “serious injury”. To proceed with a claim for pain and suffering against a driver or owner of a vehicle in a NY auto accident, the injured party needs to establish a “serious injury”. On of the categories of serious injury a medically determined, non-permanent injury that prevents the plaintiff from performing substantially all of his or her usual and customary daily activities for at least 90 of the first 180 days following the accident. We understand the agreement is to eliminate that category, one which could easily be established without a lot of fanfare.
- Cap payouts for drivers engaging in criminal behavior at the time of the incident, including uninsured motorists and drivers in the act of committing a felony,
- Prevent insurance companies from exorbitantly raising rates by setting a legal threshold that prevents excess profits and returns savings to consumers.
- Create new regulatory safeguards to prevent insurance companies from raising rates without seeking express approval from the Department of Financial Services.
- Protect consumers by prohibiting insurance companies from setting rates based on extraneous, personal factors like homeownership status, occupation,
Apparently the agreement skuttled changes to joint and several liability rules
Happy Friday from your friends at Hurwitz Fine.
COVERAGE POINTERS UNIVERSITY
College of SIU/Fraud
SIU/Fraud Related Coverage Defenses
What Claims Professionals (and Attorneys) Must Know
May 21, 2026, 1:00 PM Eastern, Noon Central
Presented by Scott D. Storm
Interested in the latest developments in SIU and fraud Hurwitz Fine's Coverage Pointers University continues with a timely and informative presentation on fraud investigation.
Join Insurance Coverage attorney Scott Storm for a practical and engaging webinar examining key coverage defenses in fraud investigations. This session will analyze these defenses from a practical claims investigation perspective, focusing on what is required to develop and sustain a successful position through litigation.
To register click: https://lnkd.in/gFSNdCff
The program will cover the essential elements of a strong defense, common strategies used by adversaries to challenge it, and recent case law shaping these issues. It will also highlight alternative approaches that may be overlooked but can prove effective in the right circumstances.
Designed for claims professionals at all levels—including adjusters and special investigators—this webinar offers practical insight and real-world guidance to strengthen your approach to complex fraud-related coverage issues.
AVOID ACT
It was a busy week for presentations as we did three on the now, effective AVOID Act, that legislation that went into effect on April 18, and has changed the paradigm for timing of third-party practice in New York. Is your team ready for a presentation on AVOID Act strategy? Just set aside an hour, gather your team together, and we’ll be happy to present live. Remember, the statute, which shortens the time to commence third party actions in civil cases, applies to new cases sued after April 18.
Our presentation focuses on poor Mary Brushstrokes, an employee of Queen Coat Painting, who fell off a scaffold erected by Stand Tall Scaffolding on behalf of Drip Stop Plumber. You don’t want to miss her tale of woe and learn about how this new law impacts risk transfer claims.
Harmonie’s Insurance Coverage and Bad Faith Committee Presents:
2026 Regional Webinar: East Coast Legal Updates and Case Law Review
May 21, 2026 | 12:00 PM Central Time
The Harmonie Group
This webinar offers claims professionals a focused update on key insurance coverage and bad faith developments across East Coast jurisdictions. Topics include New York legislative changes, additional insured coverage, declaratory judgment strategies, and challenges with historical policies in long-tail claims.
Attendees will learn to evaluate coverage issues, document claim decisions, identify bad faith exposure, and apply these insights to claims handling strategies.
Presenters:
Dan D. Kohane, Hurwitz Fine P.C.
Brian DellaTorre, Insurance Archeology Group
Patricia McHugh Lambert, Pessin Katz Law, P.A. (PK Law)
Thomas R. Maeglin, Abrams, Gorelick, Friedman & Jacobson LLP (emcee)
Michael J. Rossi, Conn Kavanaugh
Colin Barrett, Conn Kavanaugh
Go Sabres
My son Jacob and I watched the Sabres beat the Canadians in the opening game of Round II of the Stanley Cup Playoffs. Now that was fun! My son is 41. Every moment we spend with our children is golden. My daughter is in OKC. Miss spending up close and personal time. My dad died 46 years ago and today would have been his 108th birthday.
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.
Laborer Killed During Peace Bridge Construction – 100 Years Ago:
The Buffalo News
Buffalo, New York
8 May 1926
BRIDGE WORKER CRUSHED
TO DEATH BY GIRDERS
Cameron Van Goom, 49 years old, 729 West Avenue, was crushed to death Thursday by two steel girders he was helping unload at the Fort Erie Buffalo bridge at the foot of Massachusetts avenue. He died on the way to Millard Fillmore hospital.
Peiper on Property (and Potpourri):
As easily seen above, there is much going on in Buffalo this Spring.
We continue to be overwhelmed with your support for our webinar series Coverage Pointers University. We hope you enjoy Scott Storm’s upcoming discussion on commonly seen, and commonly overcome, challenges in finding and proving fraud.
Attention Chicago Land
(and, beyond)If you’re in, or around, the 312, and you happen to handle Professional Liability Claims, please take a moment to consider the IADC’s annual Professional Liability Roundtable.
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Too Much of a Good Thing – 100 Years Ago:
Buffalo Courier Express
Buffalo, New York
8 May 1926
Dear Miss Wayne: - I am a young man aged 22, and I am deeply in love with a girl two years my junior. I have gone out with her for five months now and I think it was love at first sight, but there are a few questions which I would like to ask your advice on, please.
I love the girl right from the bottom of my heart, but she always says there is someone else and it causes me a lot of trouble. What can I do to show her that there is no one else in my heart but her?
I see this girl every night in the week. Do you think we see too much of one another?
Am I right in asking her to keep steady company with me?
This girl says she loves me, but at times, it seems that she doesn’t want to see me. How can I tell if she loves me? G.E.M.
Answer – First of all go to a proper schedule of seeing each other. Three nights a week is enough at the very most. No wonder you are both a bit bored at so much love making. A case of too much of even a very good thing.
Lee’s Connecticut Chronicles:
Dear Nutmeggers,
Not with a bang, but with a whimper. That was the sound of our last COVID-19 property damage coverage case coming to an end, as the New York Appellate Division, Second Department unceremoniously confirmed that there is no coverage for modifications to restaurants for social distancing – does anyone remember that? -- because those claims do not satisfy the standard requirement of either a material physical alteration of the premises or a complete and persistent dispossession of the property.
With that decision, at least in our office, almost seven years of litigation has come to an end. A sweeping near unanimous success story for the industry. And, of course, just in time for the next mass virus to sweep the nation and the courts. We’re keeping watch for the hantavirus and the communicable disease exclusions rushed into the market after COVID-19.
Until next time, keep keeping safe.
Lee
Lee S. Siegel
[email protected]
The Farmer's Frankenstein – 100 Years Ago:
The Buffalo Times
Buffalo, New York
8 May 1926
THE FARMER’S FRANKENSTEIN.
IN THE debate on the Haugen and Tincher bills in the House of Representatives yesterday, Congressman Andrew L. Somers, Democrat, of Brooklyn, said:
"Bring back beer and there will be no farm problem. Prohibition is the farmer's Frankenstein. They have developed it and now it is destroying them by taking away their markets for their large surpluses, so that the farmer finds himself in the position of having to turn to the Federal Government."
The point is well-taken. The words of Representative Somers are words of weight. At very outset of the civic and economic catastrophe resulting from interpolation of Prohibition fanaticism into legislation, THE TIMES pointed out the ruinous consequences of destroying the market created for the farmer's surplus by the malting industry.
Now the farmer himself is bitterly feeling the effects, and the subject comes in for an airing on the floor of Congress.
"Frankenstein" was the inhuman monster who in the famous tale by Mary Wollstonecraft Shelley, turns upon the man who gave him life and brings him to ruin and suicide.
Veritably, as Congressman Somers says, Prohibition is the farmer's Frankenstein.
Ryan’s Federal Reporter:
Hello Loyal Coverage Pointers Subscribers:
Tonight, I am coming out of retirement for the Thursday night Men’s power bar league volleyball playoffs at IV Stallions. When my phone pinged yesterday, I was a bit surprised to learn that my cousins are still playing, but I was entirely unsurprised to learn that they were desperate for players. While I can no longer jump or hit, I intend to contribute what I can on defense (my body will hate me for it). That and offense, I guess, if they make me set. What a mess that will be, if true, however. I also apologize in advance for my blocking, and I hope you can forgive me as I won’t be touching much.
Nothing from me in the column this edition. I’ll catch up with you soon.
Until Next Time…
Ryan
Ryan P. Maxwell
[email protected]
OH NO, Not That! – 100 Years Ago:
The Boston Globe
Boston, Massachusetts
8 May 1926
SMITH UPHOLDS SUSPENSION
OF STUDENT WHO MARRIED
Dr. Payson Smith, State Commissioner of Education, announced yesterday afternoon he had upheld the decision of Fitchburg State Normal School authorities in suspending George Draper of Leominster, a student who married while enrolled in the school. Draper appealed to Commissioner Smith to overturn the ruling.
Storm’s SIU:
Hi Team:
Not much in the SIU arena this week so I bring you an interesting case on appraisal:
- An Order Molding an Appraisal Award can be Treated as a Final Order; Failure to Appeal Timely can Foreclose Later Attempts to Challenge its Scope. If a Party Believes an Appraisal Award (or a Molded Version of It) Improperly Includes Items Outside Appraisal Authority or Coverage, the Proper Step is a Timely Appeal—Not Unilateral Partial Payment.
I hope to see you on May 21st for Coverage Pointers University when we will have a practical and engaging webinar examining key coverage defenses in fraud investigations. This session will analyze these defenses from a practical claims investigation perspective, focusing on what is required to develop and sustain a successful position through litigation.
To register click: https://lnkd.in/gFSNdCff
The program will cover the essential elements of a strong defense, common strategies used by adversaries to challenge it, and recent case law shaping these issues. It will also highlight alternative approaches that may be overlooked but can prove effective in the right circumstances.
Designed for claims professionals at all levels—including adjusters and special investigators—this webinar offers practical insight and real-world guidance to strengthen your approach to complex fraud-related coverage issues.
Go Sabres!
Scott
Scott D. Storm
[email protected]
Advice for the Lovelorn – 100 Years Ago:
New Orleans States
New Orleans, Louisiana
8 May 1926
Ask For a Date
DEAR MISS FAIRFAX:
I am 19 and I like a girl of 18. I don’t say I love her as I think I am too young to know the true meaning of love, but I like her better than anyone else. About three months ago she gave a little party and told me to invite some boys, which I did. None of them went, however, and so she treated me coolly and now she doesn’t speak to me. I sent her a card at Easter. I want to make a date with her, but I am afraid she will refuse me if I ask her, and that would make me feel bad. She is a nice girl, a keen dresser and looks fine all the time. I don’t see why she gets like this. How can I gain her friendship without letting her think I am running after her. BARNEY
Call her up and ask her for a date. If she refused it’s probably because she doesn’t like you and doesn’t want to have a date with you and you might as well accept that fact, strange as it may seem to you that she doesn’t like you. If she gives you a date – well the rest is up to you.
Fleming’s Finest:
Hi Coverage Pointers Subscribers:
In this edition’s case, the Colorado Supreme Court considered whether a car rental company qualifies as an insurer of customers who purchase supplemental insurance through their rental agreement and become additional insureds on the rental car company’s insurance policy. The opinion had some flair and was an interesting read.
Hope you are enjoying the nice weather.
See you in a fortnight,
Kate
Katherine A. Fleming
[email protected]
Get Out! – 100 Years Ago:
New Orleans States-Item
New Orleans, Louisiana
8 May 1926
Dear Miss Brooks:
Is 12 o’clock too late for a boy to stay at a girl’s house when he calls? PROPER
Yes.
Gestwick’s Garden State Gazette:
Nothing this week.
Evan
Evan D. Gestwick
[email protected]
No Levity Allowed – 100 Years Ago:
Brooklyn Eagle
Brooklyn, New York
8 May 1926
Justice Strong Bars
Gum Chewing, Sewing
And Levity in Court
Riverhead, L.I., May 8 – “We agree to disagree,” formally written out and signed by the jury, was a verdict that called forth an emphatic rebuke from Justice Selah B. Strong to a jury in the Supreme Court here yesterday morning.
It appeared to the Court at first that the jury was trying to indulge in a bit of levity. But Justice Strong later discharged the jury without imposing any fine for a “contempt of court.”
“Gentlemen, you can’t do that. You either agree or you do not. Some courts would consider that a contempt and fine you accordingly, but I am of the opinion that you did not intend to affront the Court by such a verdict. I have been insisting on dignity in this court by eliminating all of the gum chewing – I stopped that yesterday, along with the newspaper reading and the women’s sewing. I had hoped that you too, would uphold the dignity and not return any such verdict as this. However, when it gets known in your various villages that such a thing as this can’t be done it will have a wholesome effect.”
O’Shea Rides the Circuits:
Dear Readers,
Well, the Ottawa Senators were swept, and the Sabres keep rolling through the playoffs. Although I possess animosity towards the Sabres, it is great that they are in playoffs as Buffalo is a true Hockey City.
This week I have case de-certifying a class action suit from the Sixth Circuit regarding actual cash valuations under auto policies. I focus on the predominance issue addressed in the opinion, but there are other issues discussed that are with a read. Thank you to Paul for the submission.
Ryan
Ryan P. O’Shea
[email protected]
Hats, Hats, Hats – 100 Years Ago:
Brooklyn Eagle
Brooklyn, New York
8 May 1926
$450,000,000 Is American
Women’s Hat Bill for 1925
Atlantic City, N.J., May 8 (AP) – The women of the United States spent approximately $450,000,000 for hats last year, said Lawrence R. Ach of Cincinnati at the convention of the Millinery Association of America here. This represents an increase of from 10 percent to 15 percent over the year previous, he said.
“The working girl allows only 9 percent of her clothing budget for her hat, “continued Mr. Ach, “Whereas to be consistently clothed, she should increase this to 15 percent or 20 percent. The society woman does not use enough discretion in her choice of her hat. She will be content to put on a $5 hat when the remainder of her ensemble is worth from $500 to $1,000 thereby cheapening her appearance.
“Age is no factor when style is to be considered for the grandmother chooses the same type and color of hat as her granddaughter. Gone are the days of the bonnets and the under-the-chin tie.”
LaBarbera’s Lower Court Library:
Dear Readers:
My men’s soccer league has started back up for the ‘summer’ session. Now, I put summer in quotes, because we did indeed play in snow during our first game. I thought I left the days of outdoor snow games behind me in college - but can’t seem to escape them. Glad to report that, so far, my knees have been holding up this time around.
This week I am reporting on a decision out of Kings County, discussing a title insurance policy. The court denied the insurer’s pre-answer motion to dismiss, finding that the action was not premature, and that the insurance policy was not definitive documentary proof that there was no coverage under the title insurance policy. This one was a particularly interesting read for me personally, as someone who had not previously dealt with a title insurance policy.
Until next time…
Isabelle
Isabelle H. LaBarbera
[email protected]
Huge Wrongful Death Verdict Upheld – 100 Years Ago:
The Buffalo News
Buffalo, New York
8 May 1926
$25,000 AWARD UPHELD
The Appellate division has sustained the verdict of $25,000 awarded to the estate pf Dr. Thomas G. Allen, who was killed in July 1925, while crossing the Erie railroad tracks at Tifft street. The verdict was returned by a jury before Justic Brown in Supreme court last November in favor of Lydia Allen, sole administratrix of the estate.
Lexi’s Legislative Lowdown:
Dear Readers,
I am looking forward to spending the weekend with my mom for Mother’s Day. We are headed to Canandaigua for a day of shopping and dinner at one of her favorite places.
This week we discuss a bill that seeks to regulate the use of aerial images in connection with homeowners’ insurance.
Thanks for reading,
Lexi
Lexi R. Horton
[email protected]
Not a Good Pace for a Lighted Lantern – 100 Years Ago:
Buffalo Courier
Buffalo, New York
8 May 1926
AWARDED VERDICT OF $2,300
A jury in supreme court yesterday awarded Clara Underhill a verdict of $2,500 against Frank Major, owner of a gasoline station near Holland. The plaintiff alleged she was injured on the night of December 1, 1923, when an automobile in which she was riding stopped at the station for gasoline. It was charged that an explosion resulted from a lighted lantern being held over the gasoline tank.
Victoria’s Vision on Bad Faith
Dear Readers,
Spring has brought lots and lots of rain to Buffalo. Looking forward to warmer and sunnier weather next week in Virginia when I’m there for my sister’s college graduation, followed by a wedding the week after in Dallas.
This week, I report on a decision from the First Department, upholding a plaintiff/insured’s demand for punitive damages in a bad faith case against their medical malpractice insurer.
Have a good weekend,
Victoria
Victoria S. Heist
[email protected]
One Too Many Kisses – 100 Years Ago:
Buffalo Courier
Buffalo, New York
8 May 1926
“Kiss Addict”
Presses Lips
Once Too Often
New York, May 7. – A kiss is a tonic, an ecstasy, sometimes a pastime and, in this case, a hobby.
He had been in forty-six states and kissed a girl – at least one girl – in each of them. Then he came to New York.
He is Nicholas de Buono, sixteen, Philadelphia, arraigned for kissing fourteen-year-old Margarett Goodwin as she proceeded jauntily schoolward.
He got this habit, he said, while “playing in Hollywood.”
“Now,” he added, “I am going back to Philadelphia as fast as I can.”
“Well. Not too fast,” cautioned Magistrate Douras. “Ten days in the workhouse.”
Shim’s Serious Injury Segment
Hi Readers,
Hope everyone is well and had a great two weeks since our last column. I find it appropriate to acknowledge a moment in history this week.
While standing at Ground Zero beside FDNY and other first responders, former President George Bush took the megaphone and said, “I can hear you. The rest of the world hears you. And the people who knocked these buildings down will hear all of us soon.” Over the weekend (May 2), we reached the 15-year anniversary of the day that Osama bin Laden, the criminal architect behind the attacks of September 11, 2001, heard all of us. The May 2, covert operation 15 years ago, executed by the elite and talented U.S. Navy SEAL Team Six, brought about the end of a 10-year man hunt following the attacks of September 11, 2001.
Although I was very young when the attacks occurred, I recall witnessing graphic news coverage and learning about it in school. I have also been to the 9/11 Memorial to pay my respects to the thousands of great Americans who lost their lives. As we pass this milestone anniversary, I find myself continuing to solemnly reflect on the lives that were lost and how our great nation, and the world, changed forever. As a native New Yorker and proud American, I firmly believe it was the darkest day in American history. We will soon reach the 25th anniversary of 9/11, a far more solemn milestone.
Please take a moment to remember the civilians who lost their lives and keep them in your prayers. It is yet another reminder that we must never take our nation or its liberty and security for granted.
This week I have shared a case decided by the Supreme Court, New York County, which granted, in part, the defendants’ motion for summary judgment on the basis that the plaintiff did not suffer a “serious injury” within the meaning of Insurance Law § 5102(d).
See you in the next issue!
Stephen
Stephen M. Shimshi
[email protected]
Cross Dresser Sent to Workhouse – 100 Years Ago:
Buffalo Courier
Buffalo, New York
8 May 1926
Easier to Get
Job Dressed as
Girl, Says Man
New York, May 7 (AP) – Chester Sawyer, who for twenty of his twenty-eight years masqueraded as a girl, today was sentenced to sixty days in the workhouse, after he testified the difficulty of obtaining employment when wearing man’s apparel had let him to steal.
“I was raised by my mother as a girl,” he testified, “and when I left home to obtain work I found it comparatively easy for an attractive girl to get a job any time she wanted it.”
He said that girls had been his companions during that time, but that a desire to dress as other men caused him to discard his woman’s clothing. He was charged with taking three shirts and a dozen neckties from a department store.
New England Almanack
Dear Readers,
All quiet on the coverage and bad faith front in terms of recent reported decisions from the New England courts. Alex and I traveled to Chicago today for the American College of Coverage Counsel Annual Meeting, a great opportunity to connect with stellar insurer and policyholder side coverage attorneys from around the US and Canada (including our CP North of the Border contributor, Heather Sanderson) while keeping on top of recent developments and emerging coverage risks.
Barbara
Barbara A. O’Donnell
[email protected]
Alex
Alexander G. Henlin
[email protected]
Iryna
Iryna N. Dore
[email protected]
A Wife Should Be Paid for Being a Wife. – 100 Years Ago:
The Buffalo Times
Buffalo, New York
8 May 1926
LABOR CONTRACT
PLAN FOR WIVES
Women’s Party Head
Suggests Salary of Half
Mate’s Wages.
By JULIAN SNYDER.
WASHINGTON, May 8. – Salaries and working agreements for wives is the latest suggestion of leaders of the National Women’s Party for bettering the condition of women and for establishing complete equality and freedom from the “bondage of men” in the home.
The prospective bride would demand an age contract with the husband-to-be, Mrs. O.H.P. Belmont, president of the Women’s Party, told the United Press today.
The wife, she said, under the agreement, should receive a definite salary for being for wife, her working hours should be fixed and provision made for “overtime.” She should receive half of the husband’s income as salary, Mrs. Belmont suggested.
Washing the supper dishes or pacing the floor at night with the crying baby should be considered “overtime” work and equal shifts for the husband at this “labor” provided.
Mrs. Belmont said she considered the housewife’s task as requiring considerable “intelligence,” but that all the menial duties around the home had been shouldered upon the woman by the men. These duties should be divided with the husband.
Mrs. Belmont blamed man for the “inequality” in the home.
North of the Border:
I just returned from the April 30, 2026, Canadian Defence Lawyers Insurance Coverage Symposium in Toronto. It really drove home how useful these professional groups are. When you’re in a field that keeps changing so fast, it helps to be in a room with other lawyers, in-house counsel, and insurance people who are all dealing with the same issues. The formal talks are useful, but honestly, some of the best insights come from the casual conversations afterward, when people start comparing notes on what’s actually happening in practice. Groups like this help lawyers stay grounded, understand what clients and colleagues are really worried about, and get a better feel for how the other side thinks. They also make the work feel a little less isolating, which matters more than people might think.
My column this week discusses how the Quebec Court of Appeal dealt with a CGL duty to defend case in a construction dispute.
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]
- What Does it Mean to “Reside” in a “Household”. Court Searches for Ambiguity when One Spouse Doesn’t Live in the Residence Premises Full Time
- While Post Accident Executed Indemnity Agreements Can be Enforced, there Needs to be Proof that the Agreement was Made Prior to the Accident and that the Parties Intended it to Apply as of that Prior Date
PEIPER on PROPERTY (and POTPOURRI)
Steven E. Peiper
[email protected]
- Rearranged Floor Plans Do Not Constitute Direct Physical Loss, Dealing Yet Another Loss on Covid-19 Business Interruption Claims
LEE’S CONNECTICUT CHRONICLES
Lee S. Siegel
[email protected]
- See you in two weeks.
RYAN’S FEDERAL REPORTER
Ryan P. Maxwell
[email protected]
- Nothing from me in the column this edition. I’ll catch up with you soon.
STORM’S SIU
Scott D. Storm
[email protected]
- An Order Molding an Appraisal Award can be Treated as a Final Order; Failure to Appeal Timely can Foreclose Later Attempts to Challenge its Scope. If a Party Believes an Appraisal Award (or a Molded Version of It) Improperly Includes Items Outside Appraisal Authority or Coverage, the Proper Step is a Timely Appeal—Not Unilateral Partial Payment
FLEMING’S FINEST
Katherine A. Fleming
[email protected]
- Offering Supplemental Insurance to Customers Through Rental Car Company’s Own Insurer Does Not Impose on Car Rental Company a Nondelegable Duty to Act as an Insurer
GESTWICK’S GARDEN STATE GAZETTE
Evan D. Gestwick
[email protected]
- See you in two.
O’SHEA RIDES the CIRCUITS
Ryan P. O’Shea
[email protected]
- Individual Issues Predominate Actual Cash Value Dispute, Therefore Nullifying Class Action
LABARBERA’S LOWER COURT LIBRARY
Isabelle H. LaBarbera
[email protected]
- Pre-Answer Motion to Dismiss Denied, Court Finds Action is Not Premature and Policy is not Definitive Documentary Proof Coverage is Precluded under Title Insurance Policy
LEXI’S LEGISLATIVE LOWDOWN
Lexi R. Horton
[email protected]
- Proposed Legislation Relating to the Use of Aerial Images for the Purposes of Homeowners’ Insurance
VICTORIA’S VISION ON BAD FAITH
Victoria S. Heist
[email protected]
- First Department Upholds Plaintiff/Insured’s Demand for Punitive Damages; Dismisses COA
SHIM’S SERIOUS INJURY SEGMENT
Stephen M. Shimshi
[email protected]
- Supreme Court, New York County, Grants the Defendants’ Motion for Summary Judgment, in Part, on the Basis That the Plaintiffs Did Not Suffer a “Serious Injury” Within the Meaning of Insurance Law § 5102(d)
NEW ENGLAND ALMANACK
Barbara A. O’Donnell
Alex G. Henlin
Iryna N. Dore
- New England courts are quiet.
NORTH of the BORDER
Heather A. Sanderson, K.C.
Sanderson Law
Calgary, Alberta, Canada
[email protected]
- Québec Court of Appeal Confirming the Mere Possibility Threshold in a CGL Duty to Defend Case Concerning Delay in Construction
Today would have been my dad’s 108th birthday. He’s been gone for 46 years. Still miss him.
Best to all the mothers, of all types and denominations.
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
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
Barbara A. O’Donnell
Brian F. Mark
Scott D. Storm
Alexander G. Henlin
Iryna N. Dore
Ryan P. Maxwell
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
Jessica L. Deren
Ryan P. O’Shea
[email protected]
APPELLATE TEAM
Jody E. Briandi, Team Leader
[email protected]
Topical Index
Peiper on Property and Potpourri
Lee’s Connecticut Chronicles
Gestwick’s Garden State Gazette
LaBarbera’s Lower Court Library
Lexi’s Legislative Lowdown
Victoria’s Vision on Bad Faith
New England Almanack
KOHANE’S COVERAGE CORNER
Dan D. Kohane
[email protected]
05/05/26 MIC General Insurance Corporation v. Eckart
Appellate Division, First Department
What Does it Mean to “Reside” in a “Household”. Court Searches for Ambiguity when One Spouse Doesn’t Live in the Residence Premises Full Time
Odd procedural posture, as the court was considering a motion to vacate a default judgment. In the affidavit of merit, insurance questions were raised.
As to the merits, issues of fact exist concerning the meaning of various terms of the subject policy, including whether the property was Kathryn Eckart's "residence" as the term is used in the policy, and whether Kathryn and her husband George Eckart were part of the same "household." The terms of insurance policies are interpreted in a manner that "affords a fair meaning to all of the language employed by the parties in the contract and leaves no provision without force and effect” and ambiguities in the policy must be construed against the insurer.
Here, the policy contemplates coverage for the Tanners Neck Lane property, where the underlying incident took place, and lists only Kathryn Eckart as the Named Insured. While the policy extends coverage to Kathryn Eckart and her spouse (George Eckart) if they are a resident of the same "household," the policy does not define the term "household." The policy likewise does not sufficiently define "reside" or "residence" such that it can be determined, on this record, that Kathrn Eckart, who lived elsewhere but owned the property and visited periodically, was not a "resident" for purposes of coverage.
04/24/26 Mock v. New York Athletic Club of City of New York
Appellate Division, Fourth Department
While Post Accident Executed Indemnity Agreements Can be Enforced, there Needs to be Proof that the Agreement was Made Prior to the Accident and that the Parties Intended it to Apply as of that Prior Date
Mock commenced this Labor Law and common-law negligence action seeking damages for injuries he sustained when he fell from a scaffold at defendant-third-party plaintiff New York Athletic Club of City of New York (NYAC).
NYAC sought contractual indemnification from another party, Next Level.
Here, the indemnification agreement between NYAC and Next Level, by its terms, pertained to "claims . . . actually or allegedly arising out of or relating to [Next Level's] work or the work of any subcontractor retained by [Next Level]." Next Level established on its motion that Anderson, plaintiff's employer, did not work for Next Level, and that plaintiff's injuries did not arise out of and were not related to Next Level's work.
Another party, Anderson, moved to dismiss NYAC's contractual indemnification and breach of contract causes of action against it. There is no dispute that the indemnification agreement between NYAC and Anderson was executed after plaintiff's accident. "An indemnification agreement that is executed after a plaintiff's accident . . . may only be applied retroactively where it is established that (1) the agreement was made as of a date prior to the accident and (2) the parties intended the agreement to apply as of that prior date".
Anderson met its initial burden on its cross-motion by establishing that it did not sign the agreement before the accident and that the agreement was not made "as of" a date prior to the accident establishing that the agreement was not intended to be applied retroactively. In opposition, NYAC failed to raise a triable issue of fact. Indeed, NYAC submitted no evidence that Anderson and NYAC made the agreement as of a prior date, or that "the parties intended the agreement to apply as of a prior date".
PEIPER on PROPERTY (and POTPOURRI)
Steven E. Peiper
[email protected]
05/06/26 Abruzzo Docg, Inc. v. Acceptance Indemnity Ins. Co.
Appellate Division, Second Department
Rearranged Floor Plans Do Not Constitute Direct Physical Loss, Dealing Yet Another Loss on Covid-19 Business Interruption Claims
In one of the last (potentially) Covid-19 cases, plaintiff commenced this action challenging Acceptance’s denial of damages under a commercial “all risk” policy. Acceptance denied plaintiff’s claims for business interruption because their restaurants did not sustain “direct physical loss” which is a triggering requirement for any claim for coverage.
The Appellate Division began its analysis by reciting the general principles that “direct physical loss” required a “material alteration or complete and persistent dispossession of insured property.” Further, “direct physical loss” cannot be demonstrated by simply showing “impaired functionality” and/or “loss of use.” Finally, the Court reiterated that “direct physical loss” must show a “material, physical alternation to the property.”
Against those important factors, plaintiff argued that Emergency Regulations passed by New York State did, in fact, rise to the level of a physical alteration. Specifically, plaintiffs argued the Executive Orders governing Covid-19 behavior forced them to erect physical barriers in restaurants and/or otherwise reconfigure physical space. Further, to comply with various Orders, plaintiff also undertook plans to prioritize takeout service, erect barriers to prevent areas of congregation and rearranged its floor plans to reduce overall population density.
The court ruled, however, that each of the solutions employed by plaintiff to meet Covid-19 regulations did not constitute a “material physical alteration” or a “persistent dispossession” of impacted properties. Accordingly, because plaintiff could not satisfy its initial threshold of demonstrating “direct physical loss” its claims could not fall within the scope of coverage afforded by Acceptance’s policy.
LEE’S CONNECTICUT CHRONICLES
Lee S. Siegel
[email protected]
See you in two.
RYAN’S FEDERAL REPORTER
Ryan P. Maxwell
[email protected]
Nothing from me in the column this edition. I’ll catch up with you soon.
STORM’S SIU
Scott D. Storm
[email protected]
04/20/26 Nationwide Mut. Fire Ins. Co. v. Brant
Superior Court of Pennsylvania
An Order Molding an Appraisal Award can be Treated as a Final Order; Failure to Appeal Timely can Foreclose Later Attempts to Challenge its Scope. If a Party Believes an Appraisal Award (or a Molded Version of It) Improperly Includes Items Outside Appraisal Authority or Coverage, the Proper Step is a Timely Appeal—Not Unilateral Partial Payment
Nationwide appealed an order granting the insured’s petition to enforce a prior trial-court order that molded an appraisal (umpire) award in a homeowners insurance dispute. Nationwide issued a homeowners policy to Brant. A large tree fell and damaged the home, the contents and surrounding structures and landscaping. Brant retained a public adjuster. Nationwide disagreed with the PA’s assessment and denied portions of Brant’s claim.
Pursuant to the policy’s appraisal provision, the parties requested court appointment of an appraisal “umpire”; the trial court ordered the appointment of an umpire. The umpire issued an appraisal award of $688,677.35, exceeding either party’s estimate. Nationwide moved to strike/vacate, asserting the umpire exceeded his authority. The trial court found the umpire exceeded his authority by considering costs beyond the parties’ submissions and setting some costs above the estimates. Instead of vacating, the court molded the award to conform to the submission terms and directed Nationwide to pay “the maximum amount between the differences submitted…for each line item.”
After the molded-award order, the total of the higher submitted estimates was $576,232.90, but Nationwide paid only $329,745.68, withholding payment for items it deemed excluded from coverage. Nationwide filed a praecipe to discontinue. Brant filed a petition to enforce the November 2023 order for the unpaid line items. Trial court held an enforcement hearing. Trial court granted enforcement and ordered Nationwide to comply with the November 2023 order and pay the remaining molded-appraisal balance, $206,296.41, to the estate of Floyd Brant. Nationwide filed this appeal.
The issues were: whether the trial court, in enforcing the molded appraisal order, improperly “granted coverage” for dwelling and contents items Nationwide contended were excluded and allegedly not timely challenged within the policy’s two-year suit limitation period; and whether the trial court improperly admitted/considered evidence at the enforcement hearing relating to items Nationwide contended were excluded from coverage and outside the scope of the appraisal/enforcement proceeding.
The Superior Court affirmed. Because Nationwide did not appeal the November 2023 molded-award order (a final, appealable order), the trial court properly limited the enforcement proceeding to compliance with that order and properly required Nationwide to pay the remaining $206,296.41. The trial court also did not abuse its discretion in admitting evidence at the enforcement hearing because the evidence was relevant to Nationwide’s asserted basis for noncompliance and the court made no new coverage determinations.
The court held the November 2023 order molding the appraisal award was final and appealable because it resolved all claims as to all parties. Neither side appealed it. Once 30 days passed, the trial court lacked jurisdiction to reconsider or modify that order.
Enforcement proceedings generally address compliance with an existing order, not relitigating coverage/merits arguments that should have been raised on direct appeal.
Given the unappealed final order, the enforcement hearing’s proper scope was limited to whether Nationwide complied with the directive to pay the maximum of the parties’ submitted differences for each line item. Nationwide conceded it did not pay the full molded amount because it unilaterally treated certain items as excluded.
Nationwide’s appellate arguments effectively challenged what the molded award included (i.e., whether certain line items should have been included given coverage disputes). The Superior Court declined to reach those arguments because they pertained “solely” to the unappealed November 2023 order. Nationwide’s remedy was to appeal the November 2023 order rather than withhold payment.
The Superior Court agreed that the parties’ discussion of “coverage” arose because Nationwide asserted coverage exclusions as its reason for not paying certain line items. The evidence was therefore relevant to compliance. The trial court did not make new coverage determinations and, in any event, could not revisit the merits of the November 2023 order.
Order granting the petition to enforce was affirmed; Nationwide was required to pay the remaining molded-appraisal balance of $206,296.41 to the estate of Floyd Brant.
FLEMING’S FINEST
Katherine A. Fleming
[email protected]
04/27/26 Hertz Corp. v. Babayev
Colorado Supreme Court
Offering Supplemental Insurance to Customers Through Rental Car Company’s Own Insurer Does Not Impose on Car Rental Company a Nondelegable Duty to Act as an Insurer
Rakhimov, a nonparty, rented a car from Hertz. As part of his rental agreement, Rakhimov opted to purchase, for an additional $18.85 per day, supplemental insurance, which included uninsured/underinsured (“UM/UIM”) coverage for all occupants of the rental car. The next day, another vehicle collided with the rental car and fled the scene. Babayev and Chikov (“plaintiffs”) sustained injuries as passengers in the rental vehicle. Plaintiffs submitted claims as additional insureds for medical expenses under the auto policy issued by ACE American Insurance Company (“Chubb”) to Hertz as the named insured. Chubb’s third-party claims administrator (“ESIS”) began investigating and sent a letter to plaintiffs advising ESIS and Hertz were not insurance companies, ESIS was the TPA for Chubb, and Hertz was the named insured under the Chubb policy. Plaintiffs were also advised that Chubb was ultimately responsible for coverage decisions and payments.
Plaintiffs sued Hertz after receiving payments that were less than the medical expenses claimed, alleging breach of contract, common-law bad faith breach of an insurance contract, and unreasonable delay or denial of insurance benefits in violation of the relevant Colorado statute. Plaintiffs asserted that Hertz was their insurer, which Hertz denied, because Hertz had engaged in the business of insurance by providing supplemental insurance coverage as part of its rental agreement. Hertz explained that plaintiffs’ insurer was Hertz’s own insurer, Chubb, and that the Chubb Policy had provided plaintiffs UM/UIM coverage as part of the supplemental insurance purchased by Rakhimov. The district court held that Hertz was not a statutory insurer or a common-law de facto insurer. The district court reasoned that the legislature had clearly distinguished between car rental companies and insurers under the relevant statute. Because Hertz was not in the business of making contracts of insurance, the court held that Hertz did not qualify as an insurer under the statute. Under the common law, the district court recognized that Hertz had a significant financial interest in the resolution of the plaintiffs’ claims based on a risk-allocation agreement executed with Chubb, but the court concluded that whatever control Hertz may have exerted during the initial investigation of plaintiffs’ claims did not amount to primary responsibility for processing those claims. On appeal, a division of the court of appeals reversed, determining that Hertz was a statutory insurer. The appellate court found nothing in the statutory definitions precluded a rental car company from being deemed an insurer, so because Hertz had offered Rakhimov and his passengers supplemental insurance encompassing UM/UIM coverage, the division concluded that Hertz was plaintiffs’ statutory insurer. Further, the appellate court determined that there were disputed issues of fact as to whether Hertz regularly performed the functions of an insurer and should thus be deemed a common-law de facto insurer.
The Colorado Supreme Court held that while a car rental company may offer its customers supplemental insurance through its own insurer, that arrangement does not impose on the car rental company a nondelegable duty to act as an insurer. The Colorado Supreme Court focused on the legislature’s amendments to the relevant statute and efforts to specifically distinguish insurers from car rental companies as well as car rental agreements from auto insurance policies. The Colorado Supreme Court reasoned that the legislature enacted multiple provisions to establish that (1) car rental companies are not insurers, (2) a car rental agreement offering insurance is not an automobile insurance policy, (3) the sale of insurance in a car rental agreement does not qualify as transacting insurance business, and (4) agents of car rental companies offering insurance through car rental agreements are not insurance producers. Under the common law, although Hertz had some involvement in administering plaintiffs’ insurance claims and a financial incentive in the outcome of those claims, Hertz did not carry primary responsibility for claims handling and was not a TPA responsible for underwriting the risk, adjusting claims, or issuing payments. Further, the plaintiffs were told early on in the litigation that Chubb was ultimately responsible for coverage decisions and payments and that ESIS investigated, adjuster, and paid claims on Chubb’s behalf. As a result, the Colorado Supreme Court held that Hertz was not a de facto insurer either.
GESTWICK’S GARDEN STATE GAZETTE
Evan D. Gestwick
[email protected]
See you in two.
O’SHEA RIDES the CIRCUITS
Ryan P. O’Shea
[email protected]
04/24/26 Clippinger v. State Farm Auto Ins. Co.
United States Court of Appeals, Sixth Circuit
Individual Issues Predominate Actual Cash Value Dispute, Therefore Nullifying Class Action
In this case, the court addressed whether the formula used to calculate “actual cash value” is the basis to form a class action suit. The Sixth Circuit joined the Third, Fourth, Fifth, Seventh, and Ninth Circuits in answering in the negative.
The policy in question permitted State Farm to pay actual cash value of a vehicle minus depreciation and provided the process used to determine the actual cash value. However, the parties must agree on the actual cash value and if a disagreement occurs, then the right of appraisal can be invoked. A Tennessee regulation, Tenn. Comp. R & Regs. § 0780-01-05-.03(1), provided optional ways to compute the value.
The statute permits insurers to insurer may: (1) look to the "cost of two or more comparable automobiles in the local market"; (2) look to the "cost of two . . . or more comparable automobiles" in nearby markets; (3) ask two or more "licensed dealers" in the local market for "quotations" if the first two methods are unavailable; or (4) use a general "source for determining statistically valid fair market values. Under the fourth method, the general source must give primary consideration to the values of vehicles in the local market" and contain a "database" that can estimate the value of 85% of all vehicles on the market for the last 15 years.
State Farm followed the fourth approach. It relied on a database of millions of advertised or recently sold vehicles compiled by a company named Audatex. After inspection of a damaged vehicle and collection of the vehicle’s pre-accident condition, State Farm would upload this information to Audatex and receive a report that proposed the fair market value for the vehicle. Adjusters would then review the report for accuracy, make other necessary adjustments, and approve the final report. State Farm employed this practice with Clippinger.
Clippinger’s report identified the comparable price of her vehicle in the range of $15,800 to $18,803. The report reduced the price between $790 and $4940 dollars due to typical negotiation type adjustment, and then reduced the prices further based on mileage and features in comparison to Clippinger’s vehicle. The report averaged the reduced process to a fair market value of $14,490. Clippinger and State Farm agreed to this amount, whereafter State Farm tendered payment. A year later Clippinger had second thoughts due to the typical negotiation adjustment. Clippinger then brought suit and invoked the appraisal clause.
Clippinger alleged that State Farm’s use of the above process reduced the advertised prices for comparable vehicles to fictional sales prices breached the policy and the implied duty of good faith and fair dealing. Clippinger asserted that the modern used-car market operates mostly on internet platforms where parties can comparison shop, which caused increased competition and transparency that left no room for negotiation. She further claimed Sate Farm used biased data that overestimated the number of used cars selling below their advertised price. Essentially, Clippinger’s claim was that State Farm undervalued its customer’s carts due to the use of the typical-negotiation adjustment. Apart from this adjustment, though, Clippinger agreed that State Farm conducted a "detailed, sound, and reliable appraisal" process.
After the appraisal occurred, State Farm paid over $4,000 more due to the appraisal award. However, the court claimed Clippinger’s claim was still not moot and that a reasonable jury could find the alleged breach caused injury due the incurred appraisal costs due to the undervaluation. Clippinger then moved to certify a class against State Farm.
State Farm’s successful argument looked at the fact that individual issues predominate the suit. Predominance requires the court to first identify the potential common questions that this suit presents before we can weigh those questions against the individual ones that the court must decide on a class-member-by-class-member basis.
The Court found a lack that even if Clippinger established commonality, she could not satisfy the predominance element to create a certified class. Indeed, if the member-by-member issues predominate the suit as opposed to common issues, then no class is formed.
Significantly, a jury would have to determine the actual cash value of each class member’s car before it could resolve the breach and damages elements. As Tennessee does not recognize an independent tort for breach of implied duty of good faith and fair dealing, the breach of contract claim was analyzed. Such specific valuations would require a fact-intensive review of each member’s claim which involves the analysis of several factors. For instance, vehicle condition, mileage, features, the comparison of prices of similar vehicles across several dealers. For these reasons, the court held that a jury would have to study the unique characteristics of reach used car. But unlike specific adjusters, the jury or juries would have to do so for some 90,000 vehicles. Further, state Farm itself could invoke the appraisal clause to further limit the focus on each individual member vehicle. Thus, the facts confirmed the individualized nature of the suit.
The Court further noted that State Farm the District Court violated the Rules Enabling Act. By finding that the State Farm could not use evidence outside of its adjustment practice. Rather, the lower court found it could re-calculate the value of each vehicle using State Farm’s own methodology except for the use of the typical negotiation adjustment. In doing so, the court refused to allow State Farm to introduce evidence outside of the Autosource Reports. As noted, the policy does not limit the evidence State Farm may use to determine the value of the vehicle. Also, the Tennessee Regulation provided State Farm to choose from mother valuation methods. Under this reasoning the Court explained:
“In other words, State Farm would have the contractual and regulatory right to introduce myriad evidence apart from the Autosource Reports—other valuation sources, other expert appraisers, other comparable vehicles, or the like—to convince a jury that it paid a class member actual cash value despite its use of the typical-negotiation adjustment.”
By limiting State Farm’s ability to use alternative methods, the District Court would have deprived State Farm of its substantive, contractual, and statutory rights. Further, other class member’s rights would be eliminated. For the above and other reasons, the Sixth Circuit found nullified the class action status of Clippinger’s suit under the class action test.. On the cohesion element to create commonality, the court noted no policy language prevented State Farm from using the typical-negotiation adjustment . Significantly, the court reasoned the question of whether a breach occurred depends on comparing what State Farm paid a class member to the fair market value of the class member's car. Indeed, the policy states that both parties must determine the actual cash value through agreement or appraisal, thus if parties voluntarily agree to an amount, then there is no breach.
The court provided hypotheticals that posed basic questions as to (i) what if Autosource Report overvalued vehicles, despite the use of the typical-negotiation adjustment; (ii) State Farm uncovered that the buyers of vehicles within the report negotiated an actual sales price below the State Farms’s adjustment; or (iii) that a jury believed State Farm’s initial appraisal was correct. Each class member would have received what State Farm promised, despite use of the typical-negotiation adjustment’s claimed illegitimacy. Indeed, each member would receive “actual cash value” through an agreement or appraisal. Clippinger lacked citation to any policy provision that prohibited such adjustment. Rather, Clippinger asserted the Tennessee Statute was read into the policy and that State Farm violated the law. However, the Court noted that State Farm only would have done so if they paid less than the fair market value of a class member’s car. But this could not occur due to the agreement or appraisal conditions.
LABARBERA’S LOWER COURT LIBRARY
Isabelle H. LaBarbera
[email protected]
04/16/26 Bikes by Olga LLC v. AmTrust Title Ins. Co.
New York State Supreme Court, Kings County
Pre-Answer Motion to Dismiss Denied, Court Finds Action is Not Premature and Policy is not Definitive Documentary Proof Coverage is Precluded under Title Insurance Policy
Bikes by Olga LLC (the “Insured”) filed an action against AmTrust Title Insurance Company (the “insurer”) seeking coverage under a title insurance policy for property purchased at a tax lien foreclosure sale for $2,300,000. On or about the same day of purchase, the Insured purchased a title insurance policy from the insurer. The policy provides coverage for any and all loss or damage, not exceeding $2,300,000, that is sustained or incurred by the insured for various reasons, including encroachments, encumbrances, adverse circumstances affecting title, or title being unmarketable.
After purchasing the property, the City of New York, and related entities for the Williamsburg Bridge infrastructure, occupied the property. The occupants identified that the property title was held by New York and refused to vacate.
The Insured brought an action against New York State, seeking a declaration that the Insured owned the property, and had exclusive rights to possess, use, and enjoy the property. On March 15, 2022, the court declared that the Insured was the lawful owner of the property. After an appeal, the Appellate Division reversed the judgment, declaring that the Insured’s rights in and to the property were subject to a recorded easement for maintenance of the Williamsburg Bridge. Subsequently, the Insured filed a second action against the City, seeking damages and asserting a de facto taking against the City. This action remains pending, and damages related issues have yet to be determined.
Plaintiff submitted written claims to the insurer, seeking coverage under the insurance policy. By letter dated May 23, 2024, the insurer denied coverage moving forward, resulting in the Insured commencing a declaratory judgment action.
In the Complaint, the Insured alleges that the value of the property without the easement exceeds $2,300,000. The Insured alleges that as a result of the easement, the Insured sustained actual loss of value to the property, exceeding the policy limit. It is further alleged that the insurer refused to pay the entirety of the policy limit, plus interest, from December 28, 2020, onwards.
In the pre-answer motion to dismiss, the insurer argued: (1) that the action was premature, resulting in a lack of subject matter jurisdiction, because the underlying action had not been fully resolved; and (2) the claim is barred by the policy’s exclusion for right of tenants or parties in possession; and (3) the claim is barred by the policy’s exclusion for assumption of encumbrances which were present upon purchase, since the property was purchased “subject to” existing conditions at the foreclosure. The insurer alleges that it satisfied all obligations under the policy, upon the determination that the Insured held title to the property.
Section 9(b) of the Policy provides that the carrier, “shall have no liability for loss or damage until there has been a final determination by a court of competent jurisdiction, and disposition of all appeals, adverse to the Title, as insured.”
The Insured argued that the Appellate Division’s finding of a recorded easement constitutes a final determination adverse to title sufficient to trigger coverage. Plaintiff alleges that a de facto taking is distinct from the issue of the title, because it seeks different damages. Further, the Insured contends that the parties in possession exception does not apply where the interest asserted arises from a recorded instrument appearing in the chain of title. Lastly, the Insured argued that the Insured did not specifically agree to assume the title defect, because the insurer chose to insure against the easement by removing it as an exception.
Taking each point in turn, the court found, first, that the action was not premature. The court identified that the unresolved de facto takings lawsuit, does not concern the existence of a defect or encumbrance on title. As such, the Appellate Division determination that the property is subject to a recorded easement establishes the existence of an encumbrance on title sufficient to present a justiciable controversy. As such, the court denied the insurer’s motion to dismiss under CPLR 3211(a)(2).
Further, the court found that the Insured had sufficient plead a cause of action for breach of contract, viewing the allegations in the complaint as true and affording every benefit of favorable inference to the Insured.
As to the portion of the pre-answer motion to dismiss under CPLR 321(a)(1), the court did acknowledge that policy materials constitute documentary evidence, for the purpose of the motion. However, the court found that the policy materials did not conclusively establish the insurer’s defense. Instead, the Court found that the policy does not utterly refute the allegations and instead presents a question of applicability of policy exceptions and exclusions, which is a question of interpretation that cannot be resolved solely with documentary evidence.
Based on the above, the court denied the insurer’s motion to dismiss in its entirety.
LEXI’S LEGISLATIVE LOWDOWN
Lexi R. Horton
[email protected]
05/06/26 New York Senate Bill S9156
Proposed Legislation Relating to the Use of Aerial Images for the Purposes of Homeowners’ Insurance
Senate Bill S9156, introduced on February 9, 2026, seeks to impose requirements for the use of aerial images of an insured property for the purposes of homeowners’ insurance.
The bill seeks to regulate the manner in which insurance companies are permitted to use aerial images in a decision to change, cancel, or reduce coverage. The justification provides that there are concerns with the use of aerial images as, in some instances, insurers have made adverse underwriting decisions based solely on images that are outdated or taken from angles that do not accurately depict the condition of a property.
The bill would require that if an insurer makes an adverse decision based on an aerial image, the insurer must include date-stamped images showing the specific conditions that did not comply with the underwriting standards. Further, insurers would be required to establish a clear process for appeal, including the option of an in-person inspection, and a process for remediation, giving the homeowner 60 days to address the issues. The legislation would prohibit insurers from relying on aerial images that are over one hundred eighty days old.
VICTORIA’S VISION ON BAD FAITH
Victoria S. Heist
[email protected]
04/30/26 Stumacher v. Medical Lia. Mut. Ins. Co.
New York Appellate Division, First Department
First Department Upholds Plaintiff/Insured’s Demand for Punitive Damages; Dismisses COA
In August 2024, Plaintiff Richard Stumacher commenced an action in New York County Supreme Court against, amongst others, MLMIC, alleging bad faith, breach of the covenant of good faith and fair dealing, and punitive damages pursuant to MLMIC's actions in handling a medical malpractice case against Richard Stumacher. The Complaint also alleges legal malpractice against Dr. Stumacher's attorneys in the underlying lawsuit.
The underlying medical malpractice action was commenced by an underlying plaintiff and patient, Redish, against Dr. Stumacher and six other doctors that treated the Redish, two of which were also insured by MLMIC.
In 2019, the underlying medical malpractice case went to trial, resulting in a jury verdict of $110,000,000. The Appellate Division, First Department upheld the verdict, but reduced the non-economic damages. The value from the date of entry after the Appellate Division decision was approximately $23,000,000, with interest running from January 23, 2020. The jury held Dr. Stumacher 25% liable for Redish's injuries.
Stumacher's Complaint alleges that MLMIC failed to conduct good faith negotiations with the Redish and failed to settle the lawsuit within policy limits, $1,300,000. Stumacher also alleged that MLMIC erred in assigning one law firm to represent its three insureds instead of appointing separate counsel. Stumacher alleges MLMIC's actions resulted in a preventable excess verdict.
MLMIC filed a motion to dismiss Stumacher's complaint to dismiss the punitive damage cause of action, stating, in part, that punitive damages are not recoverable in a bad faith claim such as this one. The Court denied MLMIC's motion, finding Stumacher's cause of action for punitive damages pleads facts beyond a simple breach of contract action and satisfied the pleading standard.
MLMIC appealed the Court's decision to the First Department. The First Department affirmed the lower court's decision, holding the Plaintiff's Complaint alleges "egregious conduct directed not only at [Plaintiff] but more broadly at MLMIC's other insureds within the State of New York and nationwide." The First Department found MLMIC's behavior was beyond failure to settle the underlying claim within policy limits and contemplated the disregard of an excess verdict, the assignment of a single firm to represent three insureds, and failure to notify Stumacher of settlement offers.
Thus, the First Department found that Stumacher adequately pleads punitive damages, but dismissed the cause of action for such relief, because there is no separate cause of action for punitive damages.
SHIM’S SERIOUS INJURY SEGMENT
Stephen M. Shimshi
[email protected]
04/21/26 Zibak v. New York City Transit Auth. & John Doe
New York County Supreme Court
Supreme Court, New York County, Grants the Defendants’ Motion for Summary Judgment, in Part, on the Basis That the Plaintiffs Did Not Suffer a “Serious Injury” Within the Meaning of Insurance Law § 5102(d)
Plaintiff was a passenger on bus #1266 and alleged that she sustained injuries while exiting the bus. On March 12, 2018, when plaintiff was nine months pregnant with her second child, she boarded the bus at 96th Street and York, 2nd Ave to travel to 24th Street and Second Avenue. As plaintiff began to exit the bus at 24th Street and Second Avenue, the bus driver inadvertently closed the bus wheelchair ramp on plaintiff’s foot, which resulted in her foot having been caught between the ramp and the floor of the bus. The wheelchair lift allegedly contacted her toe and shin. Plaintiff was concerned for her unborn child because she “almost fell.” Plaintiff went to the emergency room at New York Presbyterian Hospital. Labor and Delivery said that plaintiff’s baby should not be injured. Clinicians bandaged plaintiff’s foot, suggested that she keep her foot elevated, refrain from carrying heavy items, stay off her feet, and use cold compresses/ice on her foot. At her deposition, plaintiff testified that she did not receive any further treatment for her alleged injuries. Plaintiff’s child was born one (1) week later. According to plaintiff’s verified bill of particulars, she sustained a bruised right shin and a cut on her right big toe. At her deposition, plaintiff testified that she also had a scar as a result of the subject accident. When asked where her scar was, plaintiff stated that her “toenail never grew back straight.”
Defendant New York City Transit Authority ("NYCTA") moved for summary judgment to dismiss the complaint on the basis that the plaintiff did not suffer a serious injury within the meaning of Insurance Law § 5102(d).
The Supreme Court, New York County, determined that only four (4) “serious injury” categories could be applicable in this case: (1) permanent consequential limitation of use of a body organ or member; (2) significant limitation of use of a body function or system; (3) significant disfigurement; and (4) a medically determined injury or impairment of a non-permanent nature which prevents the injured person from performing substantially all of the material acts which constitute such person's usual and customary daily activities for not less than ninety days during the one hundred eighty days immediately following the occurrence of the injury or impairment (i.e., 90/180-day category).
"Permanent consequential" or "Significant" limitations of use
The Court held that the NYCTA met its prima facie burden under this category). Minor bruises are insufficient to make a prima facie case of "serious injury within the meaning of Insurance Law § 5102 (d) (Peel v Jordan, 202 AD2d 485, 485, 609 N.Y.S.2d 74 [2d Dept 1994]). Despite the fact that the NYCTA did not proffer and expert affirmation from, “subjective pain cannot form the basis of a serious injury” (Canner v Diamond, 187 AD3d 1127, 131 N.Y.S.3d 574 [2d Dept 2020]). In opposition, plaintiff submitted an affirmation from a podiatrist, who opined that, plaintiff sustained a permanent and consequential limitation to the tissues and bone of her right toe because plaintiff was still in pain after the accident, which constituted a “a permanent and consequential limitation to that organ and system.” According to plaintiff’s expert, plaintiff lacked full range of motion of the big toe because of pressure exerted upon the toe causes pain.
Notwithstanding the foregoing, the Court held that plaintiff failed to raise a triable issue of fact requiring the denial of summary judgment. A big toe is not an organ of the human body, and the tissues of the foot are not a body system, the Court stated. The “[p]laintiff's subjective complaints of pain, in the absence of corroborating objective medical evidence, is insufficient to establish a serious injury under Insurance Law § 5102(d)” (Ortiz v City of New York, 198 AD3d 603, 604, 153 N.Y.S.3d 839 [1st Dept 2021]). Furthermore, “minor, intermittent pain is insufficient to establish serious injury under these categories” (Huther v Sickler, 21 AD3d 1303, 1304, 802 N.Y.S.2d 581 [4th Dept 2005]; Stadier v Findley, 148 AD2d 600, 539 N.Y.S.2d 65 [2d Dept 1989]). The Court determined that the plaintiff’s podiatrist’s findings did not constitute objective medical evidence because he relied on plaintiff's subjective complaints of pain.
As such the Court granted defendants’ summary judgment motion thereby dismissing the plaintiff’s claims of serious injury based on the categories of permanent consequential limitation of use or significant limitation of use of a body function or system.
Significant Disfigurement
Defendants failed to meet their prima facie burden for summary judgment under this category because they failed to submit any records or photographs depicting the appearance of the toenail of plaintiff's big toe. See, Knight v M & M Sanitation Corp., 122 AD3d 683, 684, 996 N.Y.S.2d 330 [2d Dept 2014]; Sidibe v Cordero, 79 AD3d 536, 913 N.Y.S.2d 78 [1st Dept 2010]. As such, the Court denied defendants’ summary judgment motion dismissing the plaintiff's claims of serious injury under the category of significant disfigurement category.
90/180-day category
The plaintiff testified that she missed approximately one (1) to two (2) months of school because of her injuries allegedly suffered in connection with the accident. “The ability to return to school supports a legitimate inference that plaintiff must have been able to perform at least most of her usual and customary daily activities.” See, Hernandez v Adelango Trucking, 89 AD3d 407, 408, 931 N.Y.S.2d 317 [1st Dept 2011]; Zamore v Peralta, 50 AD3d 423, 424, 855 N.Y.S.2d 480 [1st Dept 2008]; Copeland v Kasalica, 6 AD3d 253, 254, 775 N.Y.S.2d 276 [1st Dept 2004] Jackson v Doe, 173 AD3d 505, 506, 104 N.Y.S.3d 90 [1st Dept 2019]; Correa v Saifuddin, 95 AD3d 407, 943 N.Y.S.2d 86 [1st Dept 2012]. Based on the foregoing, the Court granted defendants’ summary judgment motion dismissing plaintiff's claims of serious injury under the 90/180-day category.
In light of the above, the Supreme Court, New York County, Ordered that defendants’ motion for summary judgment was granted in part to the extent that plaintiff's claims of serious injury under the categories of permanent consequential limitation of use, significant limitation of use of a body function or system, and the 90/180-day category were dismissed. However, the remainder of the action was Ordered to continue.
NEW ENGLAND ALMANACK
Alexander G. Henlin
[email protected]
Barbara A. O’Donnell
[email protected]
Iryna N. Dore
[email protected]
New England courts were quiet.
NORTH of the BORDER
Heather A. Sanderson, K.C.
Sanderson Law
Calgary, Alberta, Canada
[email protected]
The content of this column also appears in the “Liability & Insurance,” a monthly newsletter focusing on Canadian coverage and published by Heather Sanderson. Contact her for a subscription.
04/17/26 Northbridge General Insurance Corporation v. Construction YGC
Québec Court of Appeal
Québec Court of Appeal Confirming the Mere Possibility Threshold in a CGL Duty to Defend Case Concerning Delay in Construction
According to its Facebook page, Construction YGC is a general construction contractor that is involved in residential and commercial construction. In keeping with its scope of work, in 2021, YGC entered into a contract with Immeubles LCL Inc. to expand an existing industrial building in Victoriaville, Québec. Under that contract, YGC served as general contractor and held both a builders’ risk and a commercial general liability (CGL) policy issued by Northbridge General Insurance Corporation.
The concrete slab delaminated shortly after it was poured. Expert opinion was to the effect that the delamination was due to entrapped water/air and possibly an admixture added at the cement plant. In coordination with its builders’ risk insurer, YGC demolished and repoured the slab. The repour was satisfactory. However, the repour did not solve all issues arising from the delamination.
It took time to demolish and repour. Tenants of the building, namely Industries Sainox inc. and Groupe Plombaction inc. alleged income losses. LCL, the building owner, also alleged a loss of use during the reconstruction period as represented by loss of rents. Sainox, Plombaction and LCL sued YGC, claiming $368,556.34.
Northbridge declined to defend under the CGL, prompting YGC to seek what is known in Québec as a Wellington order (called a duty to defend application in common-law Canada) compelling a defence and reimbursement of defence costs.
The immediate issue on the Wellington application was whether the pleadings and exhibits disclosed a mere possibility that the true nature of the claim could fall within the CGL policy, triggering Northbridge’s duty to defend, pending determination of indemnity. The court applied the settled Wellington framework (known as “the pleadings rule” in common law Canada): the duty to defend is distinct and broader than the duty to indemnify; the insured bears a low burden to show a mere possibility that the coverage read generously together with the pleadings would require the insurer to indemnify and therefore, defend; the insurer must defend unless it clearly shows the claim is outside coverage or specifically excluded.
YGC’s Argument in Favour of Coverage
YGC emphasized that “property damage” under the CGL includes “deterioration or destruction of tangible property, including resulting loss of use,” and that the tenants’ and owner’s loss‑of‑use claims flowed from the slab’s deterioration. YGC further argued that the delamination could constitute an “occurrence” given the broad, fact‑specific understanding of “accident” in construction contexts, and that exclusions (including “your work/your product” and “damage to property”) did not clearly apply at this stage.
Northbridge’s Argument: No Duty to Defend
Northbridge’s position was that the claims were purely economic delay losses not constituting “property damage,” were not caused by an “occurrence,” and were barred by exclusions (including contractual liability and “your work/your product”). It also argued such delay‑type losses are the province of wrap‑up insurance, not a CGL. Northbridge argued (1) no “property damage,” characterizing the claim as delay‑based economic loss is more suited to wrap‑up insurance; (2) there is no “occurrence” as defects in workmanship fall outside CGL; and (3) exclusions b, k, and l (and h) barred any coverage.
The Underlying Decision
The application judge noted the policy definition of “property damage” expressly includes deterioration or destruction of tangible property and resulting loss of use, and found it possible that the pleaded loss‑of‑use claims fit within that grant of coverage On “occurrence,” the policy defined it as “any accident,” and the court, guided by the principles discussed by the Supreme Court of Canada in Progressive Homes, held that inadvertent construction defects can be an occurrence depending on the facts; the expert report suggested multifactorial causes (including admixture at the plant and premature finishing), preserving the possibility of an occurrence. As to exclusions under paragraphs 2(b), (h), (k), and (l), the court found Northbridge had not shown that any clearly and unequivocally removed coverage on the partial record, noting possible inapplicability to non‑contracting tenants and potential non‑application of “your work/your product” if the admixture at the plant was the cause of the delamination.
The application judge held it was at least possible that the loss of use resulted from deterioration/destruction of tangible property— which is covered “property damage” under the CGL and that they were not solely economic losses for delay.
The Court then moved on to determine if an occurrence has been alleged. Reading “occurrence” as broadly as “accident,” the court held that inadvertent construction defects can qualify, and the record—including the expert evidence—left open the possibility that delamination was caused by accidental conditions, including plant admixture and premature finishing. The court found a possibility that the delamination constituted an “occurrence,” at least in part, sufficient to trigger the duty to defend pending trial.
Northbridge did not discharge its burden to show exclusions clearly and unequivocally removed coverage, particularly given questions about “your work/your product” vis‑à‑vis third‑party admixture. The court held exclusions 2(b), (h), (k), (l) did not clearly apply on the record, so the duty to defend was engaged.
The application judge allowed the Wellington application; Northbridge was ordered to assume YGC’s defence and reimburse reasonable defence costs to date, with costs. Northbridge appealed.
Argument on Appeal
On appeal, Northbridge challenged the Superior Court’s grant of the Wellington order, arguing error in characterizing the true nature of the claim, in treating delay‑based economic losses as “property damage,” and in rejecting the exclusions. The Court of Appeal dismissed the appeal, endorsing the application judge’s application of the Wellington framework and the “mere possibility” threshold. The Court of Appeal recited that the Wellington duty to defend is of public order, distinct and interlocutory, triggered by the mere possibility that the true nature of the claim falls within the policy; the insured bears the initial burden; once met, the insurer must establish a clear exclusion. The Court held the motions judge correctly found a possibility that the loss‑of‑use claims constituted “property damage” resulting from an occurrence, and that the exclusions had not been shown to clearly remove coverage. The Court of Appeal rejected this argument.
The Court of Appeal’s Reasoning
Completion/put‑into‑service timing: The parties debated whether CGL coverage applied only post‑completion and whether the slab or project had been “put into service” when delamination occurred. The Court held that, on these particular facts, the possibility of coverage could not be ruled out at the Wellington stage, which sufficed to sustain the defence obligation. The Court addressed the timing of damage and put‑into‑service arguments, concluding that, in this case’s specific circumstances, the possibility of coverage could not be excluded at the interlocutory stage.
“Delay” vs. multifactor causation: The Court agreed that characterizing the claim solely as delay was unwarranted on the record; multifactorial causes surrounding delamination and reconstruction could support loss‑of‑use as “property damage,” an issue reserved for trial. The Court of Appeal endorsed the application judge’s view that the delay argument could not succeed on a multifactor record and that it remained possible the claim reflected covered loss of use stemming from delamination.
“Occurrence”: As to “occurrence,” the Court reiterated that construction defects can, depending upon facts, constitute an accident, and found no reviewable error in the application judge’s conclusion that an occurrence remained possible on the record. The Court rejected the insurer’s “performance guarantee” framing and upheld the motions judge’s finding that an occurrence was possible, leaving the ultimate characterization to the trial judge.
Application of the Exclusions: As to the exclusions, while acknowledging the application judge’s brevity, the Court held that interpreting exclusions (2)(b),the contractual liability exclusion; (h), the multi-part work being performed / owned property exclusion; (k), the performance/impaired property exclusion; (l) the sistership/recall exclusion overlapped materially with unresolved factual questions and that Northbridge had not established that one or more of the exclusions clearly and unequivocally applied. The Court concluded no reviewable error was shown in finding that the insurer failed to prove a clear and unequivocal exclusion.
The Court of Appeal upheld the application judge’s decision issuing the Wellington order which compelled Northbridge to defend YGC.
Implications for Canadian Common Law Lawyers
Duty to defend threshold. Quebec’s appellate affirmation underscores that in Quebec, as in common-law Canada, the pleadings rule determines whether a CGL insurer must defend. If there is a mere possibility that if the pleadings are accepted as true, an insurer must indemnify its insured, then the insurer must defend that pleading.
Property damage and loss of use. Loss‑of‑use claims tied to physical deterioration can fall within “property damage,” even where insureds also purchased builders’ risk and where timing/completion is debated. This applies equally in common-law Canada.
Occurrence remains a fact‑sensitive analysis. Inadvertent construction defects may qualify as an “occurrence/accident” depending on the circumstances, especially where third‑party materials or processes are implicated. Both levels of court treated “occurrence” broadly and left the classification of the delamination to trial, noting the expert evidence on plant admixture and finishing timing was in issue.
Exclusions: As in common law Canada, exclusions can and will nullify the duty to defend but the onus is on the insurer to demonstrate that they clearly and unequivocally apply to remove any possibility that there is an obligation to indemnify. At the defence stage, both levels of court were hesitant to apply “your work/your product,” contractual liability, and related exclusions to the claims of the tenants.
Reserve early and analyze narrowly but be prepared that courts will read the pleadings generously and require clarity to deny a defence.
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