The New York Court of Appeals recently ruled in favor of expanding the definition of “immediate family” under the New York Zone of Danger theory of recovery to include grandparents. The certified question was whether the Appellate Division properly held a grandchild was excluded from the class of persons constituting a grandparent’s “immediate family”, and the Court answered it in the negative, remanding the action consistent with its holding.
The facts underlying this decision, as set forth in Greene v Esplanade Venture Partnership, were horrific. The plaintiff grandmother, Susan Frierson, was standing outside with her 2-year-old granddaughter when a portion of the defendant building’s façade dislodged and struck them. The child died the next day from her injuries.
Frierson sought recovery under the New York Zone of Danger rule which “allows one who is threatened with bodily harm in consequence of defendant’s negligence to recover for emotion distress flowing only from the viewing of the death or serious physical injury of a member of that person’s immediate family.” The Court of Appeals was called to address whether a grandchild may come within the limits of her grandparent’s “immediate family” for purposes of recovery under the Zone of Danger jurisprudence.
The Court, acknowledging the historical circumspection by the courts to expanding liability for emotional damages of those who witness an event in the “zone of danger,” ultimately concluded that recognition of a grandparent as “immediate family” in this context comports with the “shifting societal norms” that has evolved to recognition of the primacy and importance of grandparents’ roles in their grandchildren’s lives. To that point, the Court of Appeals noted not only legislative expansion in New York over the past 20 years of grandparents’ rights to seek custody of their grandchildren, but also evolving family structures, generally, such as “an increasing number of grandparents” who assist with, or fully, raise their grandchildren. The Court also commented on Plaintiff’s close relationship with her granddaughter, specifically.
Ultimately, it was not just the close bond between the grandparent and grandchild at issue in the case before them, but decades of evolution and recognition of grandparents’ roles, and legal rights, with respect to family structures and family law, that led the Court to the narrow expansion and recognition that grandchildren and grandparents should be viewed as “immediate family” for purposes of Zone of Danger liability.
Thanks to Vivian Turetsky for her contribution to this post. Please email Georgia Coats with any questions.Read More
Include It or Lose It: Insurance Policies v. Reservation of Rights and the Recovery of Defense Costs (NY)
Insurance policies act as binding contracts setting the scope of coverage and exclusions as the insurer sees fit, pursuant to the laws of the state. A recent court decision in New York has established that insurance policies must be confined to the four corners of its content.
The recent Second Department decision in American W. Home Ins. Co. v Gjonaj Realty & Mgt. Co. held that upon determining a duty to defend does not exist, an insurer may not recover defense costs when the policy does not explicitly provide for such recovery, regardless of its reservation of right to do so.
In this case, a personal injury action was brought against the insured for injuries sustained on the insured’s property. Consequently, the insured did not notify its insurance company until four years after the incident when a judgment was made against them. While the insurer denied coverage due to the late notice, it agreed to defend the insured after the judgment was vacated under a reservation of rights to deny coverage if the default judgment was reinstated. The insurer also reserved its right to recover from the insured any fees and costs incurred while defending them. However, such a provision was not expressly included in the insured’s policy. When the default judgment was reinstated, the insurer denied coverage and pursuant to its reservation of rights letter, sought to recoup fees and costs from the insured.
The Appellate Division held that while the insurance company correctly had no obligation to indemnify or defend the insured, it was not entitled to recoup the defense costs because the insured’s policy did not expressly provide for such reimbursement. The court’s most notable reason for its conclusion was that insurance companies should include language in its policy permitting recovery of defense costs. Such language in a reservation of rights letter only does not create a new implied contract with the insured.
This decision goes against prior New York state and federal cases which permitted recovery of defense costs. However, whether recovery is appropriate has never been explicitly addressed before. Moving forward, the outcome of this case will require insurance companies to re-examine their policies to include such specific language without relying solely on a reservation of rights to recover defense costs.
Thank you to Gabriella Scarmato for her contribution to this post. Please email Georgia Coats with any questions.Read More
In Grady v Chenango Valley Central School District, Plaintiff, then a high school senior and member of the Chenango Valley High School boys’ varsity baseball team, sustained permanent injuries to his right eye after being struck in the head by a baseball during a combined varsity and junior varsity outdoor baseball practice. Plaintiff commenced this action alleging that his injuries were caused by defendants’ negligence in, among other things, conducting multiple infield drills with multiple balls simultaneously in play without proper safety precautions and equipment. Defendants moved for summary judgment dismissing the complaint. Supreme Court granted the motion and dismissed the complaint, finding that plaintiff assumed the risk of injury. Plaintiff appeals.
The Appellate Division, Third Department upheld the lower court’s decision, holding that risks which are commonly encountered or inherent in a sport, such as being struck by a ball or bat in baseball, are risks for which various participants are legally deemed to have accepted personal responsibility.”
Plaintiff testified that he has played baseball since he was a young child and had played on his school’s modified, junior varsity and varsity teams in previous years. Plaintiff voluntarily participated in baseball practices, including the multiple ball infield drill and the testimony makes clear that plaintiff appreciated the risk of getting hit by an errant throw.
Although plaintiff asserts that the presence of a screen between certain players may have provided a false sense of security that they would be protected, thereby creating a dangerous condition beyond the normal dangers inherent in the sport, this argument is belied by his testimony unequivocally establishing that he did not rely upon the screen for safety but, rather, thought that the drill was unsafe even in the presence of the screen.
The Court’s majority ruled the evidence showed that plaintiff was an experienced baseball player who “knew of the risks, appreciated their nature and voluntarily assumed them,” defendants demonstrated their prima facie entitlement to summary judgment under the primary assumption of risk doctrine.
In dissent, Justice Pritzker believed there was a question of fact as to whether the plaintiff could have assumed the risk when the safety screen, he deemed, was inadequate. The purpose of the screen was to make the drill reasonably safe; however, instead of choosing a screen because it was a particular size or shape, the screen they utilized was chosen out of convenience, as it was what was the largest one available. Notably, plaintiff’s expert opined that the screen was too small and was not positioned in a manner so as to protect plaintiff at first base. Accordingly, it is my opinion that this case is more properly analyzed using the standard employed in cases involving inadequate safety equipment.
Thanks to Paul Vitale for his contribution to this post. Please email Georgia Coats with any questions.Read More
UIM Coverage and Avoidance of Forum Selection Requirements? Court Holds That’s Too Much to Ask For Following an Invalid Waiver (PA)
In Matthews v. Erie Insurance Group, the plaintiff’s action arose following a motor vehicle accident. The plaintiff appealed from the trial court order sustaining Erie Insurance Group (“Erie”)’s preliminary objections to venue and transferring the case from Philadelphia County to Bucks County. The Superior Court affirmed the trial court’s decision.
The Appellant, Matthews, was operating a motor vehicle insured by Erie, under a policy issued to Ion Construction. Appellant was a named insured under the policy. Appellant asserted Ion Construction never rejected underinsured motorist coverage (“UIM”) and therefore the policy should include such coverage. The court recognized the remedy would be reformation of the contract to provide UIM coverage. But, as Erie stated in preliminary objections, Erie’s standard UIM benefits contain a clause establishing venue in any legal action involving UIM coverage to be the county where the plaintiff is domiciled. Appellant argued the trial court was incorrect in enforcing a forum selection clause to transfer venue that was not contained in the original insurance contract.
The Court balanced multiple factors in determining whether reformation of a contract to provide coverage must also include the forum selection provision which would have attached to such coverage in the absence of a waiver. The Court referenced 75 Pa.C.S. § 1731(c.1) which dictates reformation of a contract in the case of an invalid waiver, and also took into account a related declaratory action which is also being litigated in Bucks County. Lastly, the Appellant raised issues on appeal – including the prematurity of the court’s decision to transfer venue before it had been determined UIM coverage was appropriate – that were not argued before the trial court. Therefore, the Superior Court declined to hear such arguments. Yet, the Court noted that even if such arguments were not waived, transferring the matter is valid and in the interest of judicial economy.
This case displays the Court’s concern about inconsistent ruling, given a declaratory action regarding the same legal issues are being litigated in Bucks County. Judicial economy was held the most weighted factor, and thus the Superior Court affirmed the trial court’s order of transferring Matthews v. Erie Insurance Group from Court of Common Pleas of Philadelphia to Court of Common Pleas of Bucks County.
Thanks to Madeline Troutman for her contribution to this post. Please email Georgia Coats with any questions.Read More
In Spruck v. Pollack and Academy of Dance Arts, plaintiff was allegedly injured while participating in a dance program run by defendants. During a rehearsal for a dance recital, plaintiff was participating in a choreographed dance when another dancer was spinning with her leg in the air and the other dancer’s foot came into contact with plaintiff’s head. Plaintiff continued with the rehearsal after the incident. Defendants [Dance instructor and school] moved for summary judgment dismissing the complaint on the grounds that the doctrine of assumption of the risk is applicable. Defendants argued that Plaintiff assumed the risk and that getting struck by other dancers during a choreographed dance is part of dancing. The lower Court granted Defendants’ motions and plaintiff appealed.
The Appellate Division, First Department upheld the lower Court decision that Defendants’ demonstrated that plaintiff voluntarily engaged in the activity of dancing and as an experienced dancer knew the risks inherent in the activity. Plaintiff had been enrolled in defendants’ dance academy for three years and participated in five to six dance competitions each year. The video of the accident submitted by Defendants further demonstrated Plaintiffs experience as a dancer. Moreover, the video of the accident established that the dance moves at the time the accident occurred did not create a dangerous condition over and above the usual dangers inherent in dancing. Plaintiff’s argument, that no one specifically informed her that getting kicked in the head was one of the risks, was found to be an unavailing argument, as it is not necessary that she foresee the exact manner for which the injury might occur, so long as there is a general awareness for potential of injury due to engagement in the activity.
Thanks to Paul Vitale for his contribution to this post. Please email Georgia Coats with any questions.Read More
In Yong Qiao Zhao v. ATC Construction Group Corp., the Second Department held that if a plaintiff construction worker travels to use a public dumpster unaffiliated with the property on which the construction work is happening, then strict liability pursuant to Labor Law 240(1) cannot attach to the unaffiliated property owner.
In this action, plaintiff had been hired by defendant A.T.C. Construction Group Corp. to perform renovation work in connection with a construction project located at 225 Rector Place in Manhattan. At some point, plaintiff traveled to the site of a separate and unrelated A.T.C. project taking place at 237 Henry Street, evidently to dump construction debris associated with the Rector Place project. Plaintiff used a ladder to access the dumpster to dispose of the debris, but fell and sustained injuries. He thereafter initiated the lawsuit against his employer A.T.C. as well as the owner of 237 Henry Street, alleging various causes of action including a violation of Labor Law 240(1). Defendant 237 Henry Street moved for summary judgment dismissing the 240(1) cause of action asserted against it, which was granted by the trial court. Plaintiff appealed, and the Second Department affirmed on the basis that Labor Law 240(1) strict liability requires some nexus between the owner and worker by which to establish liability. Plaintiff failed to establish this nexus between himself and the owner of 237 Henry Street, because he had been hired to work at the 225 Rector Place project, never worked at 237 Henry Street for any entity or was suffered to work at that location, and the construction debris he was dumping in front of 237 Henry Street was from the project at 225 Rector Place.
Thanks to Shira Straus for her contribution to this post. Please email Georgia Coats with any questions.Read More
In Kaffash v. Village of Great Neck Estates, the Appellate Division, Second Department addressed whether the defendants were entitled to summary judgment on the issue of liability after the defendant struck the plaintiff while operating a snowplow.
On the date in question, one of the defendants was operating a snowplow owned by his employer (co-defendant). While moving the plow in reverse, the rear bumper struck the plaintiff in the back while plaintiff was walking in the middle of the street. The defendants eventually moved for summary judgment dismissing the complaint as asserted against them.The court stated, “A snowplow operator ‘actually engaged in work on a highway’ is exempt from the rules of the road and may be held liable only for damages caused by an act done in ‘reckless disregard for the safety of others”. (citations omitted). Reckless disregard requires more than a momentary lapse in judgment. (citations omitted). “This requires a showing that the operator acted in conscious disregard of a known or obvious risk that was so great as to make it highly probable that harm would follow”. (citations omitted).
The defendants were able to show they were entitled to summary judgment by submitting the testimony of the defendant – operator which stated: 1) he was traveling at a speed of five to seven miles per hour; 2) that the lights and beeping alert were activated at the time of the accident; and 3) that the defendant was looking in the mirrors of the snowplow and did not see the plaintiff prior to the accident. As such, the Court held that the defendant did not act recklessly, and plaintiff failed to show a triable issue of fact.
This decision serves as a reminder that the plaintiff has a higher burden to meet when alleging personal injuries against the operator of a snow plow while engaged in work on a highway.
Thanks to Corey Morgenstern for his contribution to this post. Please email Georgia Coats with any questions.Read More
The Court of Common Pleas of Monroe County recently denied a plaintiff’s attempt to bring legal action against third-parties after previously executing a settlement release. In Slinger v. Sal-Mart, the court found that the unambiguous language of the settlement release barred any potential claims the plaintiff had against third-parties.
The incident occurred when the plaintiff, a customer at Sal-Mart at the time, was allegedly struck by a truck driven by Robert Hulme. In his lawsuit, the plaintiff alleged that Sal-Mart was negligent in failing to properly treat the ice on its property which resulted in the accident. Thereafter, Sal-Mart filed a joinder complaint against Robert Hulme and his wife, Linda Hulme. However, prior to commencing the lawsuit, the plaintiff executed a release that provided for the discharge of the additional defendants and “their heirs, executors, administrators, agents, and assigns, and all other persons, firms, or corporations liable or, who might be claim to be liable…” In exchange for the executed release, the plaintiff received a sum of $250,000.00.
In its opinion, the Court stated that, absent fraud, accident, or mutual mistake, a party who executes a release waiving all claims and discharging all parties are precluded from thereafter suing a party who did not contribute towards the release. The Court noted that the plaintiff claimed a mutual mistake occurred because both parties believed the release only pertained to the settling parties and not to any more potentially liable parties.
However, the Court determined that this contention conflicted with the clear language of the release and the deposition testimony of the parties. Specifically, the plaintiff previously testified that he read the release and had time to consult an attorney prior to its execution. As such, the Court concluded that evidence existed that the plaintiff knew what he was signing, was not hurried, and could have easily made inquiries about any questions he had about the release prior to signing. Additionally, the Court stated that the plaintiff failed to demonstrate by clear, precise, and convincing evidence any facts showing a mutual mistake as to essential facts by the parties that would invalidate the release. Given this, the Court gave the language of the release its plain meaning, viewed the evidence in the light most favorable to the plaintiff, and found that the executed release barred any action brought against the defendants.Thanks to Zhanna Dubinsky for her contribution to this post. Please email Georgia Coats with any questions.Read More
Who is responsible when you order a defective product from the middleman? Due to the COVID-19 pandemic, the world has seen the importance of online shopping. Websites such as Amazon have thrived during this time while in person shopping remains impossible in certain parts of the globe. But what happens when that item you ordered from Amazon is defective in some way and the buyer sustains damages to person or property?
New York has seen a growing number of cases regarding this exact topic. At the outset, Amazon sells its goods in three ways: (1) Amazon sells, processes, and ships the products; (2) a third-party sells, processes and ships the product but Amazon does not take possession of the product; and (3) a third-party sells the product and Amazon fulfills the order by storing, processing, and shipping the product through its “Fulfillment by Amazon” logistical program. It is through this last scenario that Amazon has found trouble with liability within the courts of New York. The “Fulfillment by Amazon” program allows sellers to store their inventory at Amazon’s warehouse until the product is purchased, upon which time Amazon retrieves the product, packages it, and ships it, giving Amazon significant control over these products.
According to New York law, anyone in the distribution chain of a defective product may be liable, including retailers and distributors. In the recent case, State Farm Fire and Casualty Company v Amazon.com Services Inc., 2020 N.Y. Misc. LEXIS 10352, 2020 NY Slip Op 20326 (Sup. Ct.), a subrogating carrier brought suit against Amazon for property damages sustained as a result of a fire caused by a defective thermostat ordered through Amazon. The thermostat was ordered through the above mentioned “Fulfillment by Amazon” program. Amazon argued that it merely stored the product rather than took control of it. However, the court determined that Amazon exercised sufficient control through this program by storing the product and maintain possession at its warehouse. However, because Amazon’s contract with the seller included an indemnification clause, Amazon could seek indemnification from the seller.
While this case was decided in the trial court of New York and is contradictory to two federal decisions in New York, this case connotes the shift in how courts are viewing Amazon and other websites in products liability cases when such sellers maintain sufficient control over third-party products. As similar cases loom on the horizon in Texas and Pennsylvania, courts are leaning more towards holding these internet giants accountable for defects.Thanks to Gabriella Scarmato for her contribution to this post. Please email Georgia Coats with any questions.Read More
In a split-decision, the New York Court of Appeals recently ruled in favor of excess insurer Insurance Company of the State of Pennsylvania (ICSOP), finding that the policy follow-form provision did not override the policy’s defined limits of coverage.
The coverage dispute involved the insurance contracts covering general contractor Kam Cheung Construction for a personal injury suit brought by Plaintiff Jin Ming Chen. Kam Cheung had a procured primary general liability coverage from Arch, and excess follow form coverage from ICSOP. The Arch policy provided $1 million in coverage per occurrence, and covered certain accrued interest under a supplementary payments provision. During the course of the underlying personal injury action, Arch initiated and prevailed on a declaratory judgment action voiding its policy due to material misrepresentations made by the insured in the insurance application.
Following rescission of the Arch policy, Kam Cheung sought coverage under ICSOP’s follow form policy, arguing that the excess insurer must “drop down” to cover interest payments that Arch would have covered pursuant to that policy’s supplementary payments term. The Court disagreed, finding the ICSOP policy terms clear in defining the scope of the excess coverage as losses in excess of that covered by the controlling underlying insurance, regardless of the bankruptcy, insolvency or “inability to pay” of that underlying insurance. Here, the rescission of the Arch policy equated to an “inability to pay.”
ICSOP, by its terms, covered only losses in excess of those covered by Arch, both the $1 million limits and the supplementary payments amounts. “Follow form” does not mean the excess policy “drops down” in the event that the primary policy is voided. The Court held that the coverage gap was unavoidable, and a direct result of the insureds actions in making material misrepresentations.
Thanks to Vivian Turetsky for her contribution to this post. Please email Georgia Coats with any questions.Read More