Court Takes a Limited-Brush Approach to Application of “Named Perils” Coverage (NJ)
In coverage disputes, courts and counsel for the insured often lose sight of the type of policy at issue and the triggering language in a coverage grant. But as one recent New Jersey decision demonstrates, most courts are still faithful to clear policy language.
In Cusamano v. NJ Insurance Underwriting Ass’n, the insureds sought coverage under their homeowner’s insurance policy after the New Jersey duplex they owned sustained damage from a leaking pipe. The insurers argued that no coverage existed because the particular water damage is not a “named peril.” The trial court had disagreed, and held that because the couple’s policy didn’t specifically exclude water damage from leaky pipes, there was enough ambiguity to resolve the dispute in their favor. But on appeal, the Appellate Division reversed, and held that there was no coverage in the first instance.
In doing so, the court reasoned that the policy was a named perils policy, meaning that it provided for loss caused by particular perils included in the policy. Because the policy did not list water damage from leaking pipes as a covered peril, no coverage existed in the first instance. For that reason, the absence of an exclusion did not revive coverage.
Cusamano is a decision that should provide some comfort to insurers. Not only does it highlight the distinction between “Open” and “Named” perils coverage, it also reaffirms principle that all coverage analysis begins with the initial coverage grant of coverage. It was also significant for reaffirming that courts need not consider an insured’s reasonable expectations when the policy language is clear.
Thanks to James Papadakis for his contribution to this post. Please email Mike Gauvin with any questions.
Read MoreDennis Wade to Speak at Federal Bar Association Art Conference in Rome on March 6, 2020
On March 5-6, 2020, the Federal Bar Association will be hosting an Art Law and Litigation event, appropriately venued in Rome, Italy. The event, entitled, Restitution & Return: Art Law in Europe, will feature an array of attorneys and other authorities from the art world, to present on developments and challenges in art law litigation, from both the European and U.S. perspective. On March 6, Dennis Wade will be among a distinguished panel of speakers, and will discuss how litigation issues often play out in the area of looted and stolen art.
For more information, please email Dennis, or click here for registration details.
Read MoreWCM Published in Pennsylvania Defense Institute’s Publication, CounterPoint, on Statute of Limitations
WCM Partner, Bob Cosgrove, and associate, Lauren Berenbaum, recently published an article entitled Recent Changes to PA’s Statute of Limitations Sparks Coverage Questions in CounterPoint, Pennsylvania Defense Institute’s official publication (article on p. 9 -11.) The article discusses the current landscape of Pennsylvania’s statute of limitations, and how recent Pennsylvania legislation provides victims of childhood sexual abuse more time to file civil lawsuits. Since Pennsylvania, unlike many other states, has not enacted legislation providing a universal civil window of two years to revive previously expired claims, Bob and Lauren also evaluate how the courts in Pennsylvania may be filling that void by permitting claims based in fraud and conspiracy to proceed against the Pennsylvania Dioceses. In doing so, the article raises numerous questions about the type of litigation that may be commenced against the Pennsylvania Dioceses. Finally, as the title also indicates, Bob and Lauren explore the potential coverage implications, such as whether the Pennsylvania Dioceses will be able to turn to their commercial general liability policies for defense and indemnity.
Please email Bob or Lauren with any questions.
Read MoreWCM is Pleased to Promote Two Attorneys as Counsel, and to Appoint One New WCM Attorney as Counsel
With effect as of February 1, 2020 WCM is pleased to announce that Paul Vitale and Matthew Care have been promoted to the rank of counsel. Paul, who is based in WCM’s New York office, is a former Assistant District Attorney in New York City. He is a trial attorney whose practice focuses on defense of complex general liability, Labor Law and premises liability claims. He has been with WCM since 2016.
Matthew started with WCM as a law clerk while at Temple University Beasley School of Law, and has been practicing in our Philadelphia office since 2015. His practice focuses on liability defense, ranging from defense of product recall, personal injury, bad faith, and property damage cases.
Lastly, also effective February 1, 2020, WCM welcomes Jennifer Seme as a new addition to our Philadelphia office, at the rank of counsel. Jennifer is a leading Products Liability defense attorney in the Northeast, having represented manufacturers and distributors in product liability litigation, including mass torts, for several years. Jennifer presents a strong addition to WCM’s defense practice.
Read MoreWe’ve Got Coverage Haikus Covered at WCM
Some of our lawyers just love coverage too much. To share that love, their talents and some humour for the new year, please enjoy these two haikus penned by our very own William Blake, Lauren Berenbaum. Plain language controls coverage disputes today, disclaim or reserve? The tender was sent, proper notice was given – Are you covered? No. For her next trick, Lauren will attempt to incorporate her next Haiku into a coverage position letter. And on our website, maybe we’ll have to add “Poetry” as a new practice area?Read MoreCourt Liberally Applies Continuous Representation Doctrine (NY)
In New York, an action to recover damages for malpractice, other than medical, dental or podiatric malpractice must be commenced within three years of its accrual. R.M. Kliment & Frances Halsband, Architect v. McKinsey & Co., Inc., 3 N.Y.3d 538 (2004). The Court of Appeals has recognized that the continuous representation doctrine, a principle that the limitations period for these actions is tolled if the professional continues the representation that is related to the negligent act or omission, can toll the statute of limitations only where there is a mutual understanding of the need for further representation on the specific subject matter underlying the malpractice claim. McCoy v. Feinman, 99 N.Y.2d 295 (2002). However, New York Courts have held that in seeking to assert a continuous representation tolling, the plaintiff’s pleading must assert more than simply an extended general relationship between the professional and client. West Village Associates Limited Partnership v. Balber Pickard, 49 A.D.3d 270 (1st Dept. 2008).
Most recently in Mutual Redevelopment Houses, Inc. v. Skyline Engineering, L.L.C., the Appellate Division, First Department, addressed whether the continuous representation doctrine could apply to toll the statute of limitations in a breach of contract claim where an engineering firm was retained to rectify their own alleged defect that arose in a prior agreement. Plaintiff commenced the action in 2016 alleging that it retained Skyline, an engineering firm, to perform special inspection services for Phase I of an HVAC installation project, and that Skyline negligently performed those services and breached the contract.
In support of its motion for summary judgment, Skyline demonstrated that it completed Phase I work under the contract in 2012 and that it was serving in a professional capacity as an engineering firm when it performed those services, so that the three-year limitations period applied. However, Plaintiff asserted that the action was not time barred because the continuous representation doctrine is applicable and tolled the accrual of limitations until 2014. Moreover, the Plaintiff submitted evidence showing Skyline provided special and progress inspection and testing services for Remediation of Phase I of the project, pursuant to a separate agreement.
The court recognized that although the work was completed under a separate agreement, Skyline rendered these services to correct the engineering and construction defects that it failed to identify during its Phase 1 inspection in 2012. Although the Court did consider plaintiffs action as timely and acknowledged that Skyline continued to provide services in connection with Phase I in 2014, it ultimately granted Skyline’s summary judgment motion, and dismissed the complaint as duplicative of the negligence claims, since it was based on the same facts and alleges the same damages.
It is imperative for engineers and other design professionals to recognize where a statute of limitations defense may fall short when faced against the artillery of the continued representation doctrine. In order to overcome such procedural obstacles, engineers must be sure to establish milestones within their contracts, so that all the parties understand what specific event constitutes the project’s completion. Implementing such contractual mechanisms will not only avoid ambiguities in future negotiations, but help bolster procedural defenses in litigation.
Thanks to James Papadakis for his contribution to this post. Please email Michael Gauvin with any questions.
Read More2019: WCM’s Year in Review
To paraphrase Mark Twain, no one really knows what a perfect partnership is until they have been married a quarter of a century. Way back in the summer of 1994, Dennis, Paul and John decided to band together and take a leap of faith into the unknown by creating WCM. Over the past 25 years, all of us at WCM have benefitted from their guidance and mentorship and learned from their intelligence and integrity. As many of you who are reading this e-mail have been with us for a good portion of these many years, we think that you share our feelings. Dennis has always been the visionary, Paul the technical perfectionist and John the man who opened and closed the store. It has been a perfect partnership and we thank all of them for all that they have done in making WCM what it is today. But 2019 marks the end of an era for WCM and all of us are excited about the opportunities that lie ahead. As you all know, John retired in the not so distant past and enjoys splitting his time between woods and beach. Paul has decided that, he will be doing the same – although we think there will be more beach and less woods. Paul will fully retire from his work at WCM during 2020. Dennis will continue to focus on what he loves best – meeting with all of you and actually practicing law. With that as background, Partners Bob Cosgrove (who has been with WCM for 17 years) and Mike Bono (who has been with WCM for 16 years) have taken the helm of WCM. Bob and Mike will both be continuing in their full-time service of all of you while assuming management roles at the firm as co-chairs of the firm’s Management Committee. If you ever have any questions or concerns about what WCM can do for you, please reach out to either of them. Both of them hope that sometime in 2045, the next generation of WCM will talk about their perfect partnership as WCM then moves into its golden jubilee. 2019 marked a year of other exciting developments. First, we were pleased to welcome to the Partnership Georgia Coats, Colleen Hayes, Michael Gauvin and Heather Aquino. Colleen and Mike look forward to serving your coverage needs while Georgia and Heather will continue their dogged defense of your liability exposures. Vivian Turetsky, who focuses on coverage work, was also promoted to Counsel. Second, in February, WCM opened its fourth office location, on Long Island, allowing us to better serve Long Island clients and business partners. Brian Gibbons, who has been with WCM since 2009, is WCM’s resident partner at that office. Third, in June, Bob Cosgrove finished up his service as the President of the Philadelphia Association of Defense Counsel, the nation’s oldest defense bar organization. Fourth, at the Defense Research Institute’s annual meeting, Colleen Hayes was honored as an outstanding committee chair. Colleen received recognition for her work with the DRI’s Young Lawyers Social Media subcommittee, a group dedicated to promoting its members professional achievements and accomplishments, as well as serving as a platform to engage all members of the defense bar. Congratulations to all on their well-deserved promotions and achievements. On the legal front, WCM continued to demonstrate what our website has long advertised — results. Some of our most notable achievements include the following. First, WCM Partners Dennis Wade and Michael Bono, along with Vivian Turetsky and Douglass Giombarrese, were awarded summary judgment in a $4.5 million coverage action in the SDNY, Phillip Michael Scott v. AIG Property Casualty Company and Great Northern Ins. Co. Scott filed suit alleging that the insurers wrongfully denied his homeowner’s claim following a 2015 incendiary fire at the Insured’s Westchester, New York home. Despite having asserted in a 2013 bankruptcy filing that his monthly income was zero and that he owned virtually nothing, Scott’s sworn statement in proof of loss after the fire alleged a total loss of his residence and over $1.25 million in personal content damages. At the EUOs, Scott made blatantly contradictory statements regarding his finances and the ownership and acquisition of his personal property. Further, he denied being aware that that he obtained an AIG policy on this home, despite clear evidence that he had procured the policy and, in fact, made several requests to change the inception date. Judge Gregory Woods upheld the insurers’ disclaimers and awarded summary judgement on the basis of the Insured’s “fraud and concealment,” as well as the Insured’s failure to cooperate during the claim investigation, focusing on lies regarding the personal property inside the home at the time of the fire and the placement of the insurance itself. Citing significant portions of Scott’s sworn testimony, the District Court held that Scott’s statements were “false, willfully made, and material to the insurers’ investigation of the claims.” As to the defense of non-cooperation, the District Court parsed Scott’s EUO testimony and specifically found that his evasions and false promises of future cooperation did not satisfy the duty to cooperate under the contract of insurance. While the Court recognized that the bar for granting summary judgment in a fraud case was indeed a “high one,” the Court found that the insurers had met that high standard and found in AIG’s favor. Second, in April, Georgia Coats obtained a defense verdict in a traumatic brain injury case venued in Bronx County. The plaintiff, a customer, was struck in the head by a falling awning outside of a restaurant. Our client had installed the awning and had failed to provide the restaurant with written instructions warning the restaurant to shut the awning in strong winds. At trial, we argued that the lack of written warnings was not the cause of the plaintiff’s accident and that the verbal warnings our client provided upon installation were sufficient. The jury awarded our client a defense verdict, finding that the lack of written instructions was not the cause of the accident, and placed the full $2.7 million verdict on the restaurant, which, per our argument, failed to use common sense on a windy day. Third, in June, WCM obtained a defense verdict in a Labor Law trial in June in the case of France v. Munro General Construction, Inc. et. al. Paul Vitale acted as lead counsel. The plaintiff alleged a slip and fall on a stairwell, allegedly due to our client’s drywall work, and demanded $5 million to resolve. The defense argued plaintiff fabricated the cause of his fall as the drywall dust could not have traveled through the construction site, through a hallway and up the stairs to the landing. The jury found the defense position persuasive and rendered a defense verdict. Fourth, in July, Michael Bono, Vivian Turetsky and Doug Giombarrese scored a trial victory on behalf of their homeowner client, who faced upwards of $10 million in damages as a result faulty construction on his townhouse which damaged his neighbor’s property. As a result of the damage, the client had previously been adjudged to have breached an agreement with his neighbor, and WCM was retained as trial counsel to show that the fault lay at the hands of the general contractor and subcontractor-excavator. After a month’s long trial during which the contractors argued they were not at fault, the jury found them to both be liable for 100% the damages. Having established they were negligent, WCM now seeks full indemnification on behalf of its client in post-trial briefing. We look forward to continuing to serve our friends and clients in 2020 and wish all of you a happy holiday season and healthy and prosperous new year. With warmest wishes, Mike and Bob
Read MoreCan it be Hearsay if Nothing is Actually Said?
Hearsay is a part of evidence class in law school, but given all the exceptions, exemptions, and frankly, statements that simply are not hearsay, professors could spend an entire semester examining hearsay alone. Hearsay is an out of court statement introduced into evidence by a litigant to prove the truth of the matter asserted by the statement’s declarant. What about signage though? Signs say things. When, if ever, is a sign hearsay? Consider two hypothetical cases where pictures of signs are the only factual bases for the claims against the impleaded parties.
In the first case, a picture of a truck’s signage was attached to a third party summons and complaint. The truck in the picture, with a company name on the side, was at a slip-and-fall accident scene, and a defendant used the picture of the truck to implead the truck owner. Assuming the picture is properly identified by the person who took it, the picture itself is probably not hearsay. The litigant who introduces this picture into evidence is not introducing it to prove the truth of the matter asserted by the sign, which is just that the truck is owned by the insured. Therefore, the sign on the side of the truck probably isn’t hearsay at all, and is admissible. Moreover, the litigant is likely trying to prove that the insured was present and doing work at the accident scene on the day of the accident. If the litigant were trying to introduce the sign with the limited purpose proving that the insured owned the vehicle, it would be hearsay, but admissible hearsay under rule Rule 801(d)(2)(D) as an inscription, sign, tag or label affixed in the course of business and indicating ownership. We think the sign on the truck is admissible, based on these facts.
In the second case, there is a dashboard placard, with nothing on it but the insured’s name. Specifically, a for-hire driver his holding up a sign to the plaintiff’s camera with the insured car service’s name on it. The for-hire driver, by holding up the placard for the passenger is attempting to communicate something beyond what the sign says. specifically, that “I am driving for this company right now.” This, surely, is “nonverbal conduct of a person intended by that person as an assertion.” Rule 801(a). It would not qualify as admissible hearsay under rule 801(d)(2)(D) since the driver’s expressive conduct means to assert something beyond what the sign says. Without that driver’s testimony—and indeed, he is nowhere to be found— the picture could be excluded, and prompt a dismissal of the car service from the suit.
Signs, signs, everywhere signs…..Thanks to Jon O’Brien for his contribution to this post. Please email Brian Gibbons with any questions.
Read MoreWCM Pleased to Appoint Three Attorneys as Partners
Effective October 1, 2019, Wade Clark Mulcahy LLP is pleased to announce the elevation of three of its attorneys to the Partnership.
First, WCM has named Heather Aquino to the Partnership. A graduate of St. John’s Law School (where she was the recipient of the Vincentian Scholarship) and William Paterson University (where she was an academic all American field hockey player), Heather is based in WCM’s New Jersey office. She focuses her practice on New Jersey liability defense work.
Second, WCM has promoted Michael (Mike) Gauvin to the Partnership. A graduate of the University of Notre Dame Law School (where he received the American Jurisprudence Award in Morality and the Law) and a magna cum laude graduate of Providence College, Mike is based in WCM’s New York office. He focuses his practice on New York liability and specialty coverage work.
Finally, WCM has appointed Colleen Hayes to the Partnership. A graduate of Villanova University School of Law (where she graduated magna cum laude and was inducted into the Order of the Coif) and Villanova University, Colleen is based in WCM’s Philadelphia office. She focuses her practice on liability coverage work in Pennsylvania and New Jersey and specialty coverage work in New York.
For more information about this post please e-mail Bob Cosgrove.
Read MoreThis and That by Dennis Wade
“You can’t judge a book by its cover,” my mother drilled into my head. But as a coverage attorney, I preach a different variation; “You can’t judge whether a Duty to Defend exists by the labels plaintiff affixes to the counts in the complaint.” AIX Specialty v. Amy Dginguerian, a recent coverage contest decided in the Southern District of Florida, nicely illustrates the wisdom of my coverage adage.
As with many recent coverage cases of note, this one involved sex–well, a racy photograph stolen from Sarah Underwood’s Facebook page and used by Porky’s Cabaret, a nightclub featuring pole dancers (you get the idea) to advertise a “Back to School Party” hosted by Porky’s.
Ms. Underwood, a former Playboy model, was understandably upset; she was not a stripper or a pole dancer, in fact, she never had any association with Porky’s at all. Ms. Underwood (and other models whose photographs had been purloined) sued Porky’s which was insured by AIX under a Commercial Lines Policy. The causes of action alleged by the models charged Lanham Act violations and parallel violations under Florida law styled “False Advertising,” “Right of Publicity,” and “Unauthorized Misrepresentation of Names/Likeness.”
AIX brought a declaratory judgment action, seeking a ruling that the claims asserted–and as pleaded–were not covered; and thus, they owed no defense obligation. AIX relied upon an Intellectual Property (IP) exclusion to the Advertising Injury Coverage grant, contending that the claimed violations of intellectual property rights as alleged in the complaint were specifically excluded from coverage.
But to determine AIX’s defense obligation, the District Court looked past the “labels” affixed to the causes of action and focused on the facts alleged and concluded that Ms. Underwood, without labeling it, alleged a covered cause of action–Defamation. In particular, the Court stated the facts alleged by Ms. Underwood satisfied the elements of a defamation claim under Florida law:
(1) Cabaret made a statement — the advertisement; (2) that was false — by associating Ms. Underwood with Cabaret or the striptease lifestyle; (3) to a third party — any person who viewed the Facebook page; (4) which has resulted in harm to Ms. Underwood’s reputation by “impugn[ing] her character.” (Id. ¶ 294 (alteration added)). That Ms. Underwood does not bring a specific cause of action for “defamation” or “disparagement” does not matter. Analysis of the duty to defend turns on the fairly read “grounds for liability expressed by allegations of fact in the underlying complaint[]”— not the specific label of the cause of action. (emphasis supplied).Having found a coverage trigger, not actually pleaded as such, the court ruled that AIX had a defense obligation to defend the entire case. The moral here is analyze the facts, not the labels, before making a final coverage determination.
And that’s it for this This and That: oink oink!
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