RECENT DECISIONS SECURED BY
BARTH, SULLIVAN &
BEHR
SUMMARY JUDGMENT: LABOR LAW § 240(1) CLAIM DISMISSED – NO
ELEVATION-RELATED RISK INVOLVED FOR WORKER HOISTING SELF INTO GROUND FLOOR
DOORWAY
ATTORNEY: Laurence D. Behr
CASE NAME: Ames
v. Norstar Bldg. Corp.
COURT: Supreme Court, Niagara County
(Boniello, J.)
SUMMARY: The plaintiff, assigned to "scrap out" a housing unit under construction, claims to have fallen when he tried to hoist himself several feet up into the ground floor through a doorway, for which no stairs were in place. He claims that after getting up into the door and while attempting to get to his feet, one foot slipped on a small quantity of packed snow on the edge of the doorsill, causing him to fall backwards and strain his shoulder in an attempt to prevent his fall. This alleged incident was unwitnessed, and the plaintiff claims he merely sat in his truck for an hour and went home, not reporting it to anyone until the next day.
We moved for summary judgment dismissing the "absolute liability" Labor Law § 240(1) claim, arguing that merely getting oneself up into a doorway about four feet above grade, does not present an extraordinary, elevation-related risk of the sort against which this statute was meant to protect.
DECISION: Summary judgment granted dismissing claim under Labor Law § 240(1). Matter will proceed to trial on Labor Law §§ 200 and 241(6) claims, as to both of which issues of comparative negligence, and the plaintiff's credibility, will be critical. Appeal submitted for decision by Fourth Department on April 13.
"NO CAUSE" VERDICT: MOTOR VEHICLE – THIRD CAR'S DRIVER IN THREE-CAR CHAIN COLLISION HELD NOT NEGLIGENT
ATTORNEY: Philip C. Barth, III
CASE NAME: Bishop v. Quibell and Granada
COURT: Supreme Court, Livingston County (Lunn, J.)
SUMMARY: Our client operated the third car in a three-car, chain reaction accident. The plaintiff claimed that he was suddenly forced to slow down and stop his vehicle because of an elderly pedestrian in the roadway. The plaintiff claimed that the second vehicle rear-ended his vehicle, and was in turn rear-ended by our vehicle. The plaintiff claimed that both drivers behind him were negligent for following too closely and traveling at an excessive rate of speed under the conditions.
Upon cross-examination, the plaintiff admitted that he came to a sudden stop in the middle of the roadway without any prior warning. Both following drivers testified that the plaintiff initially had entered traffic so closely in front of the second vehicle, that they both had to slow sharply to avoid an accident; and then, approximately just 2 or 300 feet down the road, the plaintiff stopped suddenly without warning. We requested and received a jury charge, for sudden stopping and emergency situation.
DECISION: The jury rendered a verdict that our client was not negligent, and that the co-defendant second driver was negligent, but his negligence was not a proximate cause of the accident.
VERDICT OF MISREPRESENTATION IN APPLICATION – POLICY RESCISSION UPHELD: CONTRACTOR'S WIFE APPLIED FOR HIM, AND HAD FALSELY ANSWERED QUESTION ABOUT ROOFING WORK
ATTORNEY: Laurence D. Behr
CASE NAME: Wafer Motor Corp. v. United Frontier Mut. Ins. Co., et al.
COURT: Supreme Court, Niagara County (Kloch, J.)
SUMMARY: Owner of hotel badly water-damaged by unprecedented wind and rain storm during a re-roofing operation sued the roofer, his liability insurer (United Frontier), and its own property insurer, which had disclaimed under a policy exclusion. United had insured the roofer under a small contractor's program for which roofers were ineligible, due to the risks of such work. United had disclaimed and rescinded based on misrepresentations in the application, which denied any roofing work. The roofer cross claimed for coverage, making the hotel owner's lack of standing a moot point (see Court of Appeals' new decision on standing, Lang v. Hanover Ins. Co., discussed below).
The owner's property insurer settled for over $800,000, and took over the prosecution as the owner's subrogee. Trial was held before a Supreme Court jury in Niagara County.
The roofer's application had been filled out by his wife, who had past experience as a life insurance agent. She admitted knowing that a roofing policy would be much more costly than United's policy, having called around for quotes. Answering a blanket question as to the applicant's involvement in a number of types of work, including roofing, she put "N/A" as to all—which she explained at trial as meaning, "No Answer," saying she assumed the company would ask her for details if they wanted an answer. Her husband admitted that he had done about 50 residential roofing jobs over the previous few years, and his wife was aware of them because she kept his accounts. The effort was made to paint the application question as confusing and ambiguous.
DECISION: Jury found the insured guilty of misrepresentation in the application, upholding the company's rescission of his policy.
SUMMARY JUDGMENT: COMPLAINT DISMISSED FOR FAILURE TO PROSECUTE – CO-DEFENDANT, A SUBROGATED INSURER, WAS NOT ENTITLED TO NOTICE OF OUR DEMAND TO RESUME PROSECUTION, NOR OF OUR SUBSEQUENT DISPOSITIVE MOTION.
ATTORNEY: Laurence D. Behr
CASE NAME: Rizek v. Nu-Era Services and Nationwide Mut. Ins. Co.
COURT: Supreme Court, Niagara County (Kloch, J.)
SUMMARY: Owner of automobile repossessed by former husband of woman who sold it to her sued the insured repossession agency (our client), and her own automobile insurer, which had denied the claim. After suit, and before answering, the insurer settled with the plaintiff, and, in a preliminary conference with the court's law clerk, expressed an intention to pursue our client via subrogation; the plaintiff maintained her uninsured claim for loss of use against our client. When the required one year passed after we had answered, we served a demand to resume prosecution on plaintiff—a "90-day demand" under CPLR 3216. When it was not satisfied, we moved to dismiss the complaint for failure to prosecute.
Nationwide was not served with either pleading because it had never answered the complaint nor otherwise appeared, but was informed by plaintiff of the dismissal motion. Nationwide opposed dismissal, arguing that it had not been noticed on the 90-day demand, that we knew of its presence in the case, and that it should thus be allowed to assert a cross claim against our client. Nationwide simultaneously served an answer with a cross claim, which we refused as untimely.
DECISION: Complaint dismissed. Nationwide had not appeared in the manner prescribed by CPLR 320(a)—by either answering, serving a notice of appearance, or making a motion which has the effect of extending its time to answer—and therefore was not entitled to receive notice of our 90-day demand to resume prosecution.
Nationwide could now commence a new subrogation action against our client—except that our dispositive motion purposely was not brought until the statute of limitations had expired on the underlying claim. A subrogee "stands in the shoes" of its subrogor, and its claim is subject to all defenses that would be available against its subrogor.
"NO CAUSE" VERDICT: INSURED FARMER BUILDING A FIELD ROLLER FOUND NOT NEGLIGENT WHEN ROLLER'S LARGE "WING" RAISED FOR TESTING FELL ON VISITOR
ATTORNEY: Laurence D. Behr
CASE NAME: Brodie v. Smith
COURT: Supreme Court, Monroe County (Polito, J.)
SUMMARY: Our client, insured under a farmowners' policy, was building his own field roller in his barn. It was to be a three-part steel assembly including a central roller, and two flanking wing rollers that folded up for transport. The plaintiff, a friend and neighbor, unemployed and on disability, visited often and frequently assisted around our client's farm. The entire huge assembly, not yet equipped with rollers, was supported by jack stands on the barn floor. On the day of the accident, plaintiff was standing beneath one of the wings that our client had raised, using a forklift, to test the hinge assembly. Plaintiff claimed our client asked him to prop up the end with a wooden beam, but our client claimed that he had attempted to do that on his own, despite being told not to do it. When the beam touched it, the wing slid off the forklift tines, the jack stands toppled, and the wing struck plaintiff's lower leg, severely fracturing his ankle and distal tibia.
The liability-only trial had several sharply disputed factual issues, including the reason the wing had been upraised, and whether our client had told the plaintiff's wife (herself a plaintiff), "It was all my fault." She testified that he said this at the hospital, and on cross-examination described the circumstances and location in detail and added that their daughter was present to hear it. When informed that a "missing witness" charge would be requested if the daughter did not testify for plaintiff, she was brought in to confirm her mother's claim. On cross, she gave a completely different description of the circumstances and location, and admitted that she felt that her father deserved to recover from our client.
DECISION: Client held not negligent. Several jurors stated afterwards that our argument, that there was no reason for our client to want the wing to be supported by a beam, when the forklift was adequate to raise it, was decisive for them.
SUMMARY JUDGMENT: MOTOR VEHICLE – 90-DAY DISABLEMENT "SERIOUS INJURY" HELD NOT PROVEN
ATTORNEY: Philip B. Abramowitz
CASE NAME: Harper v. McCray
COURT: Supreme Court, Erie County (Dillon, J.)
SUMMARY: The plaintiff, whose automobile was rear ended by our client, stayed out of work for 13 months, all the while treating with physicians and physical therapists. We moved for summary judgment based on her failure to satisfy the no-fault "serious injury" threshold. Her opposing papers included her treating physician's affidavit stating that "the accident was the competent producing cause of the bulges and herniations shown in the MRI reports . . . and the competent producing cause of plaintiff being disabled from her usual employment [for 13 months]". The doctor also noted "a significant loss of bodily function or system".
We had chosen not to conduct an IME, but relied on Appellate Division and Court of Appeals decisions to establish that neither plaintiff's medical records (all of which we included in our moving papers), nor her treating physician's affidavit, were sufficient to establish a "serious injury" as defined in the Insurance Law.
DECISION: Summary judgment granted and complaint dismissed. Justice Dillon issued an eight-page decision, in which he said that plaintiff had failed to submit "objective proof of the nature and degree of her injury," and that the treating doctor's affidavit was "conclusory in nature as to the opinions offered and those opinions are not supported by the requirements set forth in Toure v. Avis and subsequent cases."
SUMMARY JUDGMENT: SUBCONTRACTOR CONTRACTUALLY OBLIGATED TO DEFEND AND INDEMNIFY INSURED GENERAL CONTRACTOR FOR INJURY TO SUBCONTRACTOR'S EMPLOYEE.
ATTORNEY: Pierre "Pete" A. Vincent
CASE NAME: Newman v. Regent Contracting Corp.
COURT: Supreme Court, Erie County (Sedita, J.)
SUMMARY: Insured general contractor subcontracted an electrician to install wiring in a new office building. The subcontract's indemnification clause provided that subcontractor would defend and indemnify the general for any injury or damage arising from the sub-contractor's work, except as caused by the general contractors' sole negligence. The contract also provided that the subcontractor was responsible for maintaining the safety of the workplace.
Subcontractor's employee sued the general, alleging negligence and Labor Law violations. Her insured general sub-contractor then sued the sub-contractor as a third-party defendant. After the parties were deposed, we moved for summary judgment for contractual indemnification by the subcontractor. The subcontractor opposed, claiming to need more discovery to rule out the general contractor's negligence.
Our response stressed the sub's contractual duty to maintain workplace safety, and the clarity of its negligence established by the party depositions.
DECISION: Summary judgment granted to the general, including attorney's fees incurred defending the action to date.
"NO CAUSE" VERDICT: DRIVER NOT NEGLIGENT WHERE VEHICLE ENTERED ROAD FROM DRIVEWAY; PLAINTIFF'S MIGRAINES NOT A "SERIOUS INJURY"
ATTORNEY: Pierre "Pete" A. Vincent
CASE NAME: Sherwood v. Sprague, et al.
COURT: Supreme Court, Cattaraugus County (Himelein, J.)
SUMMARY: Our insured was driving approximately 10 miles per hour below the speed limit on a country road. Plaintiff was a passenger in the co-defendant's truck, approaching the road from a dirt driveway on the right side. Our driver first saw the co-defendant at 10 car lengths. At 3 to 4 car lengths, he observed the co-defendant entering the road, whereupon he sounded his horn, braked, and veered to his left.
The co-defendant and plaintiff both claimed that our driver was traveling too fast for road conditions, and failed to sound his horn early enough to avoid the collision. We argued that our driver did all that he was required to by law – under which, he was entitled to rely on the driver entering the road to yield—and also, all that he could do under the emergency circumstances.
Plaintiff claimed as her principal injury, intense, frequent migraines as a result of the accident. We argued that for the injury to qualify, it must be measured by objective evidence, not subjective complaints of pain by the plaintiff.
DECISION: Jury found our client not negligent, and also ruled that the plaintiff did not sustain serious injury, precluding any recovery against the co-defendant whom they found negligent.
SUMMARY JUDGMENT: PUNITIVE DAMAGES CLAIM NOT PERMITTED, BASED SOLELY ON DRIVER'S INTOXICATION
ATTORNEY: Pierre "Pete" A. Vincent
CASE NAME: Paul v. Ireland
COURT: Supreme Court, Erie County (Siwek, J.)
SUMMARY: Our client, defendant driver in a motor vehicle accident claim, admitted in deposition that she dropped a cigarette, and took her eyes off the road to look for it, prior to the collision. The accident occurred in the early morning hours, after our client had left a bar where she had consumed a few drinks. Plaintiff had included a punitive damages claim. We moved to dismiss such claim, arguing that intoxication by itself is insufficient to support punitive damages, and that additional evidence demonstrating egregious conduct or reckless behavior is required, for such damages to be awarded.
We had to distinguish Fourth Department authorities, holding that the level of intoxication, and also subsequent DWI proceedings, may be considered in the punitive damages analysis. We argued that these cases only considered such factors, where they were indicative of egregious conduct (e.g., where the BAC level was at twice the legal limit, or there was a prior DWI conviction).
In our case, the evidence was that our defendant driver was operating at or near the speed limit, and there were no prior DWI convictions, so that these factors were not indicative of egregiousness. In addition, no other typical factors showing egregiousness (running a stop light, speeding, operating negligently in a congested area) were present. Indeed, plaintiff had advanced no evidence of recklessness, except for the alleged alcohol consumption.
DECISION: Summary judgment granted dismissing punitive damages claim. Case settled immediately thereafter.
NEW YORK DECISION ROUNDUP
- NEW YORK – LABOR LAW § 240(1) – "Recalcitrant Worker" Doctrine Finally Recognized by Court of Appeals - Jury Question Presented Whether Worker's Failure to Follow Instructions to Use Available Safety Devices Is Sole Cause of His Injury
In Cahill v. Triborough Bridge and Tunnel Authority, decided December 21, 2004, the Court of Appeals at long last recognized and applied the so-called "recalcitrant worker" doctrine, developed in many Appellate Division cases. The employer had proven that the safety devices required by Labor Law § 240(1) for his work, which involved climbing on forms, were available; and also, that the plaintiff had been instructed to use them, but failed to do so. The court rejected an argument that the instruction had been given to plaintiff too long before the accident, stating:
"The word 'recalcitrant' fits plaintiff in this case well. He received specific instructions to use a safety line while climbing, and chose to disregard those instructions. He was not the less recalcitrant because there was a lapse of weeks between the instructions and his disobedience of them. The controlling
question, however, is not whether plaintiff was "recalcitrant," but whether a jury could have found that his own conduct, rather than any violation of Labor Law § 240(1), was the sole proximate cause of his accident."
In language destined to be the official formula for the "recalcitrant worker" doctrine for years to come, the Court of Appeals stated:
" Here, a jury could have found that plaintiff had adequate safety devices available; that he knew both that they were available and that he was expected to use them; that he chose for no good reason not to do so; and that had he not made that choice he would not have been injured. Those factual findings would lead to the conclusion that defendant has no liability under Labor Law § 240(1), and therefore summary judgment should not have been granted in plaintiff's favor."
- NEW YORK – Injured Party Lacks Standing to Bring Declaratory Action to Determine Coverage
The Court of Appeals has resolved a longstanding conflict among the Appellate Divisions, as to whether an injured claimant may contest an insurer's denial of coverage, prior to obtaining a judgment and thereby acquiring the right to bring an enforcement action under Insurance Law § 3420 (the so-called "direct action" statute). Siding with the Fourth Department on this issue, Lang v. Hanover Ins. Co., 3 N.Y.3d 350, holds that the claimant must first obtain a judgment and sue to collect, in order to contest the coverage disclaimer.
Of course, various factors may persuade the insurer itself to initiate a declaratory action, and obtain a stay of the injury case until coverage is determined. These include the desirability of avoiding loss of control of a serious claim, especially where the disclaimer's validity may present factual issues requiring a trial (such as the lateness of notice). Another such factor may be the novelty of the coverage issue on which the disclaimer depends.
- NEW YORK – Additional Insured's Coverage Primary and Does Not Share Equally with Its Own CGL Policy; Blanket Endorsement's Clause Negating "Other Insurance" Clause of Policy Held Controlling
HRH Construction Interiors, Inc. v. Royal Surplus Lines Insurance Company, (N.Y. App., 1st Dept., March 1, 2005), held that specific and blanket Additional Insured Endorsements on the same policy should be read together. This coverage dispute arose from an underlying action alleging a fatal fall at a construction site. HRH was the general contractor; the worker was employed by a subcontractor; National was HRH's general liability insurer; and Royal was the subcontractor's general liability insurer. The contract between HRH and the subcontractor required the subcontractor to indemnify and hold HRH harmless from all losses arising out the subcontractor's work, and also required the subcontractor to procure primary insurance naming HRH as an additional insured. National's policy with HRH and Royal's policy procured by the subcontractor contain identical "Other Insurance" clauses to the effect that the policy was primary, unless there was other insurance that was also primary, in which event the insurer would share the loss equally.
Royal's policy with the subcontractor also contained a blanket additional insured endorsement including as an insured any organization for which the subcontractor was obligated to provide insurance by written contract, and providing that if such contract required such insurance to be primary, then Royal's policy "shall be primary as respects [the subcontractor's] negligence.... Other insurance does not apply, but only with respect to coverage provided by this policy."
Also part of Royal's policy was an endorsement that was labeled "Schedule of Additional Insureds," which specifically listed HRH. Thus HRH was an insured by virtue of both the blanket and scheduled additional insured endorsements. The endorsement was silent as to other insurance.
Royal argued that the specific endorsement superseded the blanket additional insured endorsement; and, that because the specific endorsement did not contain any language pertaining to other insurance, National and Royal were co-primary insurers equally responsible for HRH's defense. The court disagreed, concluding that the specific endorsement was meant to be read in addition to the blanket endorsement, and not to replace it. Accordingly, Royal was held to have the sole primary insurance position.
- NEW YORK – No Fault Payments Not Required, Despite Absence of Timely Denial, Where Limits Exhausted.
Mount Sinai Hospital v. Zurich American Insurance Company (N.Y. App., 2nd Dept., Feb. 22, 2005), court held that a carrier is not required to pay a No Fault claim where the limits allegedly were exhausted. Plaintiff hospital demonstrated its entitlement to judgment as a matter of law by establishing that it had submitted the requisite documents to recover payment for medical services, but the insurer had neither paid nor denied the claims--required to occur within 30 days under the No Fault regulations. The court concluded, that the regulations do not require a carrier to pay a claim where the policy limits have been exhausted. Zurich demonstrated that there were issues of fact as to whether it had exhausted the coverage limits of the policy through making other No Fault payments, and whether such payments were in compliance with 11 NYCRR 65.15(n).
- NEW YORK - Fraud and Misrepresentation
Pipo Bar and Restaurant, Inc. v. Certain Underwriters at Lloyd's at London (N.Y. App., 2nd Dept., Feb. 22, 2005), held that plaintiff's fraudulent misrepresentations regarding the total loss of two pool tables following a fire vitiated the policy in accordance with its terms, and the insurers properly disclaimed coverage. The policy is rendered void where the plaintiff has "'willfully and fraudulently placed in the proofs of loss a statement of property lost which [it] did not possess, or has placed a false and fraudulent value upon the articles which [it] did own.'"
- NEW YORK – Defense Agreement Controls Over Policy
In Royal Sun Alliance Insurance Company v. Travelers Insurance Company (N.Y. App., 2nd Dept., Feb. 22, 2005), Royal Sun sought a judgment declaring that Travelers was obligated to indemnify its named insured, after the plaintiff insurer's primary policy was exhausted and before its excess policy was reached. The court held that Travelers was not so obligated until after both of the plaintiff's policies were exhausted. The plaintiff insurer had expressly agreed to "fully defend [Travelers Insurance Company's insured] and to fully indemnify [it] without any reservation, to the limit of the applicable insurance coverage" in connection with the underlying personal injury action. The plaintiff had issued a general liability policy and an umbrella policy, both of which were applicable to the underlying action. The unambiguous terms of the agreement indicated that the plaintiff intended to have its policies exhausted before resorting to the policy issued by Travelers.
OTHER JURISDICTIONS
• CALIFORNIA: Total Pollution Exclusion
In Garamendi v. Golden Eagle Ins. Co. (2005) ___ Cal.App.4th ___, 05 C.D.O.S. 2096, the California Court of Appeal for the First Appellate District affirmed the judgment of the trial court in favor of Golden Eagle concluding that its denial of coverage for claims asserted by workers for "silica-related injuries and damages" was proper based on the total pollution exclusion contained in its CGL policy.
• CALIFORNIA: Contribution / Excess Insurance / "Other Insurance" Clauses
In Carmel Development Co. v. RLI Ins. Co. ___Cal.App.4th ___, 05 C.D.O.S. 1100, the California Court of Appeal for the Sixth Appellate District reversed the trial court and held that a contribution claim did not exist between an excess and umbrella insurer for a common insured because the insurers did not provide the same level of coverage.
• CONNECTICUT: Attorney Client Privilege in Bad Faith Cases
In Marie J. Hutchinson, Administratrix et al. v. Farm Family Casualty Insurance Company, 2005 WL 418605, ___ A.2d ___ (Conn. March 1, 2005), the Connecticut Supreme Court limited the right of an insured who makes allegations of bad faith against an insurer arising from a first-party insurance claim for benefits under a policy to obtain discovery from the insurer, of materials protected by the attorney-client privilege.
• PENNSYLVANIA:
Intentional Act Exclusion / Duty to Defend
In Strouss v.
Fireman's Fund Ins. Co., No. 03-5718 (E.D. Pa. February 22, 2005), a
federal district court held that a homeowner's insurer had a duty to defend
claims involving shots fired by the insured's son who was psychotic and suffered
from paranoid schizophrenia.
• TEXAS: Application of Business Pursuits Exclusion in Homeowners Policy
In Allstate Ins. Co. v. Hallman, No. 03-0957, 2005 WL 563110, 48 Tex. Sup. Ct. J. 474, (March 11, 2005), the Texas Supreme Court addressed for the first time the application of the business pursuits exclusion in a homeowners insurance policy. Held: No coverage for blasting-related damage to adjacent residences, caused by limestone mining operations on insured premises pursuant to a mining rights lease.
• TEXAS: Additional Named Insureds and the "Known Loss" Doctrine
In United States Fire Ins. Co. v. Gnade, 2005 WL 552473 (Tex.App.–Waco 2005, no pet. hist.), US Fire argued that the "known loss" or "fortuity" doctrine precluded coverage for its additional insured, because additional insured endorsement was added to the policy after all of the accidents for which coverage was sought had occurred. The trial court had found that there was no evidence of what the insured or the additional insured knew about the accidents, and no evidence that the insured or the additional insured made any misrepresentations or concealed any information from the insurers. As a result, the court of appeals found the "known loss" doctrine to be inapplicable. Such holding is of doubtful validity under New York case law applying the fundamental requirement, that casualtyt insurance be sold only to protect against fortuitous losses.
• TEXAS: Misrepresentation in Sale of Home / "Property Damage" Not Alleged / "Mental Anguish" not Covered "Bodily Injury"
In the recent case of Allstate Texas Lloyd's v. Meyers, et al, 2005 WL 33112 (N.D. Tex. 2005), a homeowners policy issued by Allstate agreed to defend and indemnify the Dubays against claims "for damages because of bodily injury or property damage caused by an occurrence to which coverage applies." In the underlying action, the Meyers, who bought the Dubays' house, alleged that the Dubays knew that their representations about its condition were false and that the Dubays knowingly concealed the true condition of the property. Alternatively, the Meyers alleged negligent misrepresentations by the Dubays.
The court held that neither the alleged conduct nor the alleged damages implicated Allstate's duty to defend and indemnify the Dubays.