News Third-Party Defendants: In For A Penny, In For A Pound (NJ) March 20, 2020 < Back Share to: The New Jersey Supreme Court recently held that a third-party defendant in a medical malpractice action was subject to contribution claims and needed to participate in the trial despite the plaintiff not having filed a direct claim against the third-party defendant, and no Affidavit of Merit being served against it. Samuel Mejia v. Quest Diagnostics, Inc. involved Quest’s failure to detect the plaintiff’s cervical cancer. The plaintiff sued as a result and the Quest defendants filed a third-party claim for contribution and indemnification against Dr. Fernandez who was the gynecologist. The plaintiff never filed a direct claim against Dr. Fernandez. Shortly before trial, Fernandez filed a motion seeking to be treated as defendants in previous similar cases. Specifically, in one such case, a third-party public entity defendant was barred from suit pursuant to the notice of claims provisions of Tort Claims Act. In another case, a professional defendant was dismissed from suit because of the plaintiff’s failure to serve an affidavit of merit. In those cases, the third-party defendants were relieved from participating at trial, but the remaining defendants were entitled to present evidence of their negligence. Such defendants were allowed credits for the percentages of fault attributed to the relieved third-party defendants. Fernandez’s motion was ultimately denied. The appellate division affirmed, and Fernandez appealed to the Supreme Court of New Jersey. Ultimately, the Supreme Court affirmed the denial. In reaching its determination, the Court held that third-party defendants are subject to contribution claims filed against them by joint tortfeasors unless there exists a right to a dismissal. The fact that the plaintiff could not recover from Fernandez directly did not mean that Fernandez’s participation was not necessary to enable the trier of fact to allocate fault. Moreover, a defendant does not have to provide an affidavit of merit against a third-party defendant, especially if the defendant serves an expert report opining that the third-party defendant deviated from the accepted standard of care. Accordingly, in professional negligence actions, parties should be aware, that an affidavit of merit is not necessarily needed to implead a third-party professional defendant. Moreover, if the plaintiff does not assert a direct claim against a third-party defendant, this does not ipso facto result in the third-party defendant not being required to participate at trial. Thanks to Mike Noblett for his contribution to this post. If you have any questions or comments, please contact Colleen Hayes. Previous Next Contact

News NJ Wrongful Death Act Trumps AICRA's Bar to Uninsured Drivers Lawsuits. June 9, 2010 < Back Share to: The New Jersey Automobile Insurance Cost Reduction Act ( AICRA) bars uninsured drivers from suing for personal injuries sustained in automobile accidents. In Aronberg v. Tolbert, the trial court granted summary judgment to the defendant's dismissing a survival action brought by an uninsured decedent's estate, but denied summary judgment as to the wrongful death action brought by his heirs. The Appellate Division affirmed, concluding that while the AICRA statutory bar may apply to survival actions brought on behalf of the decedent, it did not apply to a wrongful death action seeking damages for losses suffered by the decedent's heirs. http://www.judiciary.state.nj.us/opinions/a4896-08.pdf Previous Next Contact

News Coverage Issues Further Complicate Penn State Scandal July 26, 2016 < Back Share to: Pennsylvania Manufacturer’s Association Insurance Co. (“PMA”) filed a motion recently in the Philadelphia Court of Common Pleas seeking to bar Penn State University from introducing evidence on why it settled allegedly time-barred claims. The motion stems from a declaratory action PMA filed against Penn State seeking a judgment on whether it had to provide coverage on a $90 million settlement the school paid to abuse victims in the recent Jerry Sandusky scandal. PMA is alleging that the potential time-barred claims are blocked by the statute of limitations as it applies to abuse claims. These claims make up $4 million of the settlement. PMA argues that it did not consent to the settlements entered into by Penn State and that in order to carry its burden, the school must show that the un-consented to settlements were reasonable. PMA then stated that during depositions, school officials refused to discuss or elaborate on specifics, making it impossible for its lawyers to determine whether the school sought to toss out or validate time-barred claims. Because Penn State refused to provide discovery on these claims, PMA is requesting that the school be preclude from introducing any evidence on the subject at trial. This case highlights the already complicated realm of coverage can become even more so when mixed with multi-million dollar high-publicity cases like the Penn State abuse scandal. It also stresses the importance of monitoring statutes of limitation, as they can both hurt and help one’s case. Finally, this case also brings up the important issue of providing adequate discovery and cooperating with the other side so as to avoid adverse motions in the future, as Penn State is now facing. As if the Sandusky situation at Penn State required further complication.... Thanks to Peter Cardwell for his contribution to this post. Please email Brian Gibbons with any questions. Previous Next Contact

News Speculation Doesn't Create an Issue of Fact (NY) December 9, 2016 < Back Share to: In Acadia Constr. Corp. v ZHN Contr. Corp. a fire broke out in the plaintiff's construction and millwork business building. The plaintiff contended that sparks from welding on the roof of the defendants’ neighboring building traveled to the roof of plaintiff’s building and down a ventilation shaft, causing the fire. The plaintiff did not see this occur, but he had smelled and heard welding on the day of the fire. The plaintiff sued the owner and tenant of the neighboring building for damage caused by the defendants’ negligence. Defendants' admitted that the construction to their building required some welding on the roof but they both denied that any welding was being done on the roof on the day of the fire. As such, the defendants moved for summary judgment, which was denied by the Kings County Supreme Court, finding there were issues of fact. But on appeal, the Appellate Division reversed, finding that the defendants established their prima facie entitlement to judgment by submitting evidence that they committed no act that a rational jury could infer negligently caused the fire. The Appellate Division concluded that the plaintiff’s claim that sparks from welding on the roof of the defendants' building caused the fire was speculative because the plaintiff did not actually see any welding being done that day, and there was no basis for the opinion that the welding that he smelled and heard was being done on the defendants' roof rather than inside a building or on the roof of a different neighboring building. Plaintiff's expert affidavit did not create an issue of fact as it was speculative, conclusory, and without any factual basis. Photographs submitted in opposition to the motions were also insufficient as they were taken after the fire and did not depict any welding. Thanks to George Parpas for his contribution to this post and please write to Mike Bono for more information. Previous Next Contact

News "Regular Use" Auto Exclusion Upheld in NJ April 25, 2012 < Back Share to: Richard Vann sought med-pay coverage from Mercury Insurance Group, his personal insurance carrier for two automobiles that he owned, after he was injured in a car accident. After the court granted summary judgment in favor of Mercury, Vann appealed. Vann was injured while driving a truck belonging to Vann Trucking, a company owned and operated by his father. Vann Trucking owned three trucks, including the Mack CH600 that Vann was driving at the time of his accident. At his deposition, Vann explained that he drove that particular truck 90% of the time while working for Vann. Moreover, he typically parked the truck close to his home so that it was easily accessible and drove the truck between three to five days per week. The Mercury policy provided med-pay coverage for injuries sustained while using "a highway vehicle not owned by or furnished or available for the regular use of the named insured." Mercury disclaimed coverage due to the "regular use" exclusion under the policy. The appellate court upheld the trial court’s decision, finding that the policy exclusion applied to the particular circumstances of this case. Specifically, the use of the subject vehicle as described by Vann during his deposition constituted a "regular use" under the policy. Thanks to Heather Aquino for her contribution to this post. http://www.judiciary.state.nj.us/opinions/a4264-10.pdf Previous Next Contact

News Can’t Stack That . . . Or can you? Federal Court in PA limits Stacking of Insurance Coverage (PA) November 15, 2019 < Back Share to: In Barnhart v. Travelers Home and Marine Insurance Company, plaintiff Mary Barnhart sought recovery of underinsured motorist (UIM) benefits after she was injured while a passenger on her husband’s motorcycle. After the motorcycle’s policy was tendered, Barnhart sought—and was denied—UIM coverage under a Traveler’s insurance policy she had purchased. U.S. District Judge Marilyn Horan of the Western District of Pennsylvania declined to extend Gallagher v. Geico, which held that members of the same household can stack their uninsured/underinsured insurance policies, so that if one member is in an accident, the coverage of other household members can be counted toward his or her claim. Gallagher further removed the “household exclusion” rule, which is a provision some insurance companies have prohibiting members of the same household from stacking their insurance policies unless every vehicle across the household is listed across every household policy. Judge Horan instead found that Gallagher did not apply, because the holding was limited to the household exclusion rule—while Barnhart dealt with a different exclusion entirely. She reasoned that Gallagher did not overrule Williams v. Geico, which upheld the regular use exclusion. Ultimately, Judge Horan’s decision has likely opened the door to potential clarification by the Pennsylvania Supreme Court, as several cases in the Pennsylvania Courts of Common Pleas have extended Gallagher to apply to other exclusions. See, e.g., Rush v. Erie Insurance Exchange, No. C-48-CV-2019-1979 (2019). Thanks to John Lang for his contribution to this post. Please email Brian Gibbons with any questions. Previous Next Contact

News Court Rules that Reasonableness Under Insurance Law 3420 Can Be a Question of Law for the Court. May 17, 2018 < Back Share to: On May 10, 2018, the Eastern District of New York handed down a total victory to Northfield Insurance Company on the insurer’s motion for summary judgment, in Northfield Insurance Company v Queens Palace Inc., issuer of a commercial general liability policy to Queen’s Palace, a nightclub, initiated the federal declaratory judgment action seeking a ruling that it had no coverage obligations to its insured or any other party in connection with the underlying wrongful death action brought by the estate of a Queen’s Palace patron tragically murdered outside of the nightclub by several of its patrons. Northfield issued a total disclaimer of coverage premised only upon the policy’s Assault and Battery Exclusion barring coverage for bodily injury arising out of any act of assault or batter “committed by any person.” The Court easily agreed with the substance of the disclaimer, even in light of the stringency of the duty to defend imposed upon insurer’s under New York law, where even a “reasonable possibility” of coverage is sufficient to trigger the duty, and the burden on an insurer relying on an exclusion to disclaim coverage to show there is only one reasonable interpretation of the allegations: that the exclusion applied. Thus, the insured and other defendants were left with one other argument: that Northfield’s disclaimer was too late, pursuant to N.Y. Ins. Law § 3420. Section 3420 imposes a duty on any insurer, in any matter involving bodily injury or death, to provide any disclaimer or denial of coverage “as soon as is reasonably possible.” Defendants argued they did not receive written notice, and submitted “return to sender” envelopes as evidence that Northfield was aware its disclaimer was not received. The Court ruled that the envelopes were not admissible evidence, and therefore could not impact the summary judgment motion. In favor of Northfield, the Court did consider the testimony submitted via affidavit from the Northfield adjuster about the dates she mailed out the disclaimers. But, as the Court noted, “the question of whether a disclaimer has been issued with reasonable promptness is in most cases a question of fact.” A question of fact would preclude granting the motion for summary judgment. The disclaimer was mailed out 19 days following Northfield’s receipt of notice of the claim. So – and significantly – the Court ruled that 19 days could be deemed reasonable as a matter of law, thus rendering Northfield’s disclaimer proper as a matter of law. The question of what constitutes “as soon as is reasonably possible” is understandably vexing to insurers, particularly in matters necessitating more complicated investigation and analysis than was necessary for Northfield here. The Northfield Court’s ruling is a helpful example of the Court’s applying a reasoned and practical approach to deciding what is “reasonable,” and represents excellent precedent on summary judgment motions where defendant’s attempt to argue the “reasonableness” question of fact alone is sufficient to preclude such a motion. Thanks to Vivian Turetsky for her contribution to this post.                   Previous Next Contact

News NJ Appellate Court Expands Bar's Liability for Drunken Patrons. March 21, 2008 < Back Share to: In the case of Bauer v. Nesbitt, A-2343-06, the decedent and his friend Nesbitt had been drinking heavily before they arrived at the C View Inn. Once at the inn, they ordered only cokes, but the decedent spiked Nesbitt's drinks to the point where Nesbitt was visibly intoxicated. Nesbitt subsequently attempted to drive the decedent home, but in his intoxicated state, caused a fatal crash instead. The decedent's estate sued the C View Inn. The trial court dismissed the action and held that because the C View Inn did not serve Nesbitt alcohol, New Jersey's Dram Shop Act, N.J.S.A. 2A:22A-1 to -7, did not apply. In reversing the trial court's dismissal of the action, the appellate court held: "if employees of the Inn recognized or should have recognized Hamby's intoxication as the result of the visible manifestations of his condition that we have described, the Inn had a duty to protect him from foreseeable injury as the result of an automobile accident by insuring that he did not drive and that he did not ride as a passenger with a patron who was similarly impaired." http://pdfserver.amlaw.com/nj/C-View.pdf Previous Next Contact

News Sad Times for Lloyd's of London. February 16, 2017 < Back Share to: All good things must come to an end, and, so at last, it seems that lunches with Lloyd's will now become more American with salads and iced teas rather than two courses and bottles of wine. The reason? Because Lloyd's has now banned drinking during working hours. Hard times for we coverage lawyers who rely upon the afternoon underwriting of risks to ensure gainful employment! To say nothing of the poor pubs and restaurants! Thank goodness for a trip I was able to make to Lloyd's a few weeks back, where there was no visible sign of prohibition at work and drinks still flowed freely during the working day. Previous Next Contact

News Marinara Sauce Too Hot to Handle? (NJ) August 5, 2021 < Back Share to: Pizza, Spaghetti, and Mozzarella Sticks. What these three commonly enjoyed food items have in common is that they are regularly eaten with tomato or marinara sauce. The flavor combination of flour, wheat, bread, cheese, and tomato sauce is something that virtually everyone enjoys. But what happens when the sauce is capable of inflicting second or third degree burns? The matter of Valdez v. Brooklyn’s Coal Burning Brick Oven Pizzeria is a case that involves this very issue. In that matter, the plaintiff and her husband ordered a pizza and mozzarella sticks from Brooklyn’s. When brought back to their car, the pizza was placed on the floor while the plaintiff carried the container of mozzarella sticks and container of sauce (which were both in a bag) on her lap. Plaintiff testified that she knew from previous trips to the pizzeria that the container which held the sauce was hot enough that she had to put the container down when holding it. On their way home, plaintiff started to “feel the burn.” She looked down and saw marinara sauce on her jeans. Feeling the sauce burning her thigh, plaintiff threw the bag containing the mozzarella sticks and sauce out of her car. Plaintiff later went to the hospital. Her medical expert opined that she sustained a third to second degree burn on her thigh. Six months later, an investigator retained by plaintiff purchased some mozzarella sticks from Brooklyn’s and found that the marinara sauce was 178 degrees Fahrenheit. According to plaintiff’s medical expert, a hot liquid at 162 degrees can cause second or third degree burns to human skin. After being sued, Brooklyn’s moved for summary judgment, arguing that plaintiff spoliated the most relevant piece of evidence. Plaintiff had alleged two theories of liability: (1) negligent packaging; and (2) negligent sale of flaming hot sauce. The trial court granted the motion and dismissed the complaint, reasoning that lesser discovery sanctions would not contribute to plaintiff being able to prove her claim nor provide an avenue for Brooklyn’s to defend itself. The appellate division reversed. It reasoned that plaintiff should only be barred from pursuing a claim of negligent packaging since the actual packaging had been spoliated by plaintiff who, the court felt, should have been aware that a lawsuit was probable at the time she sustained the burn in her car. However, the loss of the container did not irreparably prejudice Brooklyn’s ability to defend itself against the claim that the sauce was too hot when sold. This lawsuit is reminiscent of the famous McDonalds “hot coffee” case, which took years of litigation and appellate practice to finally result in a nominal settlement after appellate practice found that the jury award was extremely excessive (recall that the jury awarded millions of dollars to the injured plaintiff in the McDonalds case). However, this case is a reminder to restaurants (and their insurers) that these types of claims continue to be brought and steps should be taken to ensure that the food items they serve are as safe as possible. Thanks to Mike Noblett for his contribution. Please email Colleen Hayes with any questions. Previous Next Contact

News Valuation Of Property In Court’s Purview Says Pennsylvania Court May 19, 2017 < Back Share to: Pennsylvania court holds that a dispute over the value of property, for purposes of insurance coverage, is a material fact that must be settled by the court. In Brown v. Everett Cash Mut. Ins., the insureds’ home was totally destroyed by a fire. Following the loss, the insurer, based on an investigation conducted by its adjuster, issued the insureds a reimbursement check for the replacement cost of the property less depreciation. The insureds refused to sign the check, and ultimately commenced a lawsuit against their insurer claiming, inter alia, they were entitled to the full replacement value of the property (as opposed to the actual cash value, which was paid by their insurer). Eventually, the insurer moved for summary judgment, which was granted by the lower court. On appeal, the Pennsylvania Superior Court concluded that given the “rather large discrepancy” between the insureds’ and the insurer’s value of the property, this discrepancy gave rise to a material fact that only the trial court could address. As such, the Pennsylvania Superior Court concluded the lower court improperly granted summary judgment on this issue. Consequently, this case suggests that an undefined “large dispute” over the value of a claimed loss could act as bar to an insurer prevailing in a motion for summary judgment, as a Pennsylvania court may deem this to be a genuine issue of material fact. Thanks to Colleen Hayes for her contribution to this post.     Previous Next Contact

News NY Courts to Begin Adjudicating Non-Essential Matters on 4.13.20 April 10, 2020 < Back Share to: As we delve into our second month of COVID-19 restrictions, social distancing, and closed courts, we have been monitoring court updates throughout NY, NJ and PA. Our April 3, 2020 update is linked here. On April 9, 2020, J. Marks, the Chief Administrative Judge in NY, issued an updated indicating that, effective April 13, 2020, Courts will work remotely to address pending, non-essential matters. Specifically, the Courts will look to decide pending motions, conference pending, non-essential matters, and resolve pending discovery disputes. The Courts will not be accepting new filings yet, with the implication being, the Courts will address pending backlog before "opening the floodgates" of new motions and other filings which have been piling up over the past several weeks. Hopefully, this Order represents the first step toward a return to normalcy in the coming weeks. In the interim, we'd like to wish a Happy Passover and a Happy Easter to all who celebrate. Previous Next Contact