News Insurance Inspections May Be Seen and Heard in Florida June 24, 2022 < Back Share to: When Ryan and Andrea Gesten’s home suffered a plumbing leak, made a claim with their carrier American Strategic Insurance Company and hired a public adjuster. The public adjuster put ASI on notice he would video and audio record the inspection. ASI appeared as scheduled, objected to the audio recording and, after the insured insisted, the inspection was not completed. ASI brought a declaratory judgment action seeking a determination that the insured could not, over the insurer’s objection, audio record the inspectors during the inspection. The trial court agreed, granted final summary judgment in favor of ASI, and the Gestens appealed. Two of the three judge appellate panel found that ASI’s policy did not preclude audio recording, so ASI could not object to the insured audio recording the inspection. They also found that ASI’s inspector had no right of privacy while inspecting the insured’s home, thus, recording was not barred by § 934.03, the statute prohibiting the recording of conversations without mutual consent. By special concurrence, Judge Klingensmith agreed that summary judgment for ASI was not proper but disagreed with the majority’s implied waiver reasoning. Judge Klingensmith believed that because the policy did not preclude recording, and because ASI did not raise § 934.03, the statute barring recording without mutual consent, in the trial court, the judgment should be reversed. Judge Klingensmith also noted that waiver of the statute’s protections should not be implied from the policy’s failure to address the recording of inspections and that nothing prevented ASI from addressing the recording issue by amending its policy. Of Florida’s six appellate districts, only one has directly addressed the audio recording issue raised in Gesten v. ASI. If recording is the threat ASI believes it is, Florida’s property insurers are best advised to deal with the issue upfront, during underwriting, rather than after the fact during litigation. Gesten v. American Strategic Ins., 47 Fla. L. Weekly D1178a (Fla. 4th DCA June 1, 2022). Please contact Charles "Chip" George with any questions. Previous Next Contact

News No Coverage for ATV Accident Occurring on Public Road (PA) November 10, 2016 < Back Share to: In O ’Brien v. Ohio Casualty Insurance Company, the Pennsylvania Superior court was called upon to determine whether an ATV accident occurred at the policy's definition of an “insured location.” This declaratory judgment action was filed following the filing of a personal injury claim against the O’Brien’s. In the underlying case, plaintiff Charles Catania was at a party at the O’Briens’ home in Lake Ariel, PA. Catania was driving the O’Briens’ son’s ATV when he hit loose gravel and the ATV slid out of control. Catania suffered serious injuries as a result. The O’Briens then sought a declaratory judgment that their homeowners insurance would defend and indemnify them for Catania's lawsuit. Although the policy excluded coverage for entrustment of a motor vehicle, the exclusion did not apply to an ATV owned by an insured and being used on an “insured location”. The definition of insured location was broad and included "any premises used by you in connection with" their residence. Here, the specific location of the incident was on someone else's property off of a public road but the O’Brien’s argued, based on the definition of an “insured location” in the policy, that the road was “used in connection with the property,” and was therefore an insured location. However, the Court disagreed, citing to the trial court’s reasoning, which stated that the O'Briens did not repeatedly or customarily use the private property where Catania's occurred. The O'Briens admitted to never having been at the precise location of the ATV accident. Additionally, Casey O'Brien admits to only riding his ATV on the road once or twice and further, the road was public. Thus, although the ATV use may have begun on the O’Brien’s property, the ultimate accident was on a public road, and the Court affirmed the trial court’s decision. Thanks to Alexandra Perry for her contribution to the this post and please write to Mike Bono for more information. Previous Next Contact

News Be Careful With That “Reply All” Button . . . First Department Finds That A Series Of Emails Can Constitute An Enforceable Settlement Agreement May 6, 2022 < Back Share to: In Matter of Philadelphia Ins. Indem. Co. v. Kendall, 197 A.D.3d 75 (1st Dep’t 2021), the First Department found that an email exchange constituted a valid settlement agreement. In Kendall, the parties had presented their cases to an arbitrator. After the arbitration, but before the arbitrator rendered his decision, the parties settled the case for $400,000. The arbitrator then informed the parties that he awarded $975,000 to the respondent, who then refused to execute the settlement agreement for $400,000. The petitioner requested that the court enforce the settlement agreement for $400,000. Ultimately, the court upheld the agreement for $400,000. The court found that the email exchange constituted a valid offer and acceptance. The court disagreed with the respondent’s claim that there was an issue of authentication because the email lacked a formal signature. The court found that informal email signatures have become common practice, and paper or written correspondence is subject to the same pitfalls of inauthenticity such as forgery. Further, the emails in Kendall demonstrated not only valid offer and acceptance, but clearly stated the material terms of the settlement, and indicated a mutual assent to be bound. The court cautioned, however, that each case should be decided on a fact specific basis. Its ruling was not a bright-line rule whereby all email exchanges could be considered valid settlement agreements. Thanks to John Lang for his contribution to this post. Should you wish to discuss, please feel free to contact Tom Bracken. Previous Next Contact

News PA Appellate Court Clarifies Collateral Review Concerning In Camera Review of Disputed Discovery (PA) July 9, 2021 < Back Share to: On June 25, 2021, in Fisher v. Erie Ins. Exchange, the Superior Court clarified when a party had an immediately appealable right, pursuant to Pa.R.A.P. 313, concerning the forced production of discovery materials for which a party asserts a privilege that the court denies. Typically, for an order to be considered a collateral order and therefore immediately appealable under Pa.R.A.P. 313, it must meet three separate prongs: (1) it is collateral to the main cause of action since it may be analyzed without analyzing the central issues of the case; (2) it implicates important rights too important to be denied review; and (3) such important rights will be lost if review is postponed. Here, in Fisher, the dispute centered around attorney-client privilege and production of documents for in camera review – but not to the opposing party - in which Erie asserted said privilege. Specifically, after a discovery dispute, Erie asserted privilege and withheld production of documents, while Fisher filed a motion to compel said production. After a hearing, the trial Court required Erie to produce the documents for in camera review. This appeal followed. The only issue on appeal was the third prong as to whether the discovery order was a collateral order and therefore immediately appealable, i.e., where an important right will be lost if review is postponed. The critical question was whether production to a court for in camera review would also equate to the loss of an important right – here, the attorney-client privilege. Specifically, case law is clear that the production of documents, for which a party asserts attorney client privilege, and is compelled to produce, satisfies prong three. However, if the production is only required to be produced to a court for an in camera review, the question became: does this still qualify as a “lost” right? The Fisher Court answered in the negative. The trial court held, and the appellate court agreed, that Erie’s objections were boilerplate objections and the trial court was well within its discretion to review the documents to assess whether the asserted privilege was valid. Ultimately, the Superior Court determined that an in camera review does not satisfy the third prong of the collateral order test, as the adverse party will not have the contested documents. Moreover, if the trial court ordered the production of the disputed documents to an adverse party, Erie would then have had the opportunity to appeal said order. This case stands for the propositions that specific objections should be asserted and a court reviewing documents itself does not result in an irrevocable “lose” of rights. Thanks to Matt Care for his contribution to this post. If you have any questions or comments, please contact Colleen Hayes. Previous Next Contact

News Assumption of the Risk Does Not Extend to Wet Bowling Shoes (NY) November 25, 2013 < Back Share to:   The assumption of risk doctrine, which we have discussed in previous posts, bars a claim where the plaintiff is injured due to a risk that is inherent in or arises out of the nature of the activity the plaintiff is engaged in at the time of the accident. Typically, this applies to sporting activities. Risks inherent in a sporting activity are those which are known, apparent, natural, or reasonably foreseeable consequences of participation. A participant does not assume the risks that result in a dangerous condition over and above the usual dangers inherent in the activity at issue. What qualifies as a dangerous condition over and above the usual dangers inherent in an activity is not easily ascertained. In Ortiz v. Ciolfar Bowl, Inc. http://pdf.wcmlaw.com/pdf/Ortiz.pdf , the First Department refused to apply the doctrine to bar a plaintiff’s claim. There, the plaintiff slipped and fell at the defendant’s bowling alley as she started to throw her ball. Plaintiff claimed that her shoes had become wet since she had twice walked over a soaking wet carpet near the establishment’s entrance. Never mind that plaintiff chose to walk outside, twice, while it was raining, and returned a short time later to resume bowling. The lower court denied the defendant’s motion and the First Department affirmed, finding a question of fact as to whether plaintiff knew her shows were went when she approached the lane and the heightened risk of bowling with wet shoes. Special thanks to Gabe Darwick for his contribution. For more information, contact Denise Fontana Ricci at dricci@wcmlaw.com . Previous Next Contact

News Western District of Pennsylvania Denies Reformation of Service Contract's Indemnity and Insurance Provisions (PA) May 12, 2023 < Back Share to: In the recent case captioned Complaint of Borghese Lane, LLC, No. 2:18-CV-00533-MJH, 2023 WL 3060705 (W.D. Pa. Apr. 24, 2023), the District Court for the Western District of Pennsylvania granted a motion for partial summary judgment in favor of a party which claimed it had suffered a breach of contract to the extent that it was not named as an additional insured on its contract partner’s insurance policies. The court’s opinion contains a helpful overview of Pennsylvania law concerning reformation of contracts that pertain to contractual insurance and indemnification requirements. In brief, the matter at issue in Borghese arose out of a service contract entered into by ITS (a marine and industrial services company) and McKees Rocks (a harbor services company). The contract concerned a barge mooring area on the Ohio River in Western Pennsylvania, The contract contained an indemnity provision whereby McKees Rocks was to indemnify ITS for claims arising out of McKees Rocks’ services at the mooring area. Additionally, the contract contained an insurance provision whereby McKees Rocks was to name ITS as an additional insured on its policies. However, McKees Rocks did not name ITS as an additional insured on its policies; McKees Rocks also refused to defend and indemnify ITS. McKees Rocks claimed that the obligations imposed on it by the contract were done so in error and that those obligations should have been imposed on a third party, Borghese (a marine transport and towing company), for the benefit of ITS and McKees Rocks. ITS moved for partial summary judgment against McKees Rocks on the issue of breach of contract and contractual indemnity. In response, McKees Rocks sought reformation of the contract and argued that it is not bound by the terms of the indemnity and insurance provisions as drafted because the contract was the result of a mutual mistake of the parties. The court disposed of McKees Rocks’ reformation argument because the evidence presented demonstrated that while McKees Rocks retained Borghese to perform certain functions, McKees Rocks itself was responsible for management of the mooring area. The court looked to testimony about the extensive drafting process, including rounds of negotiations, that preceded the execution of the final contract. Thus, the court found no mutual mistake and, on that basis, denied McKees Rocks’ request for reformation. The court then disposed of McKees Rocks’ substantive argument regarding indemnity and insurance because, with no reformation of the contract, McKees Rocks breached the contract by failing to name ITS as an additional insured on its policies. Thank you to Jason Laicha for his contribution to this post. Should you have any questions, contact Matthew Care.   Previous Next Contact

News Car Salesperson Not Obligated To Assess Ability Or Mental Or Physical Fitness Of Customer January 26, 2009 < Back Share to: In Cook v. Schapiro, defendant Elaine Schapiro, an eighty-year old woman, purchased a car from co-defendant Mt. Kisco Chevrolet Cadillac, Inc. Two days later, while Ms. Schapiro operated her vehicle, she struck a car and fatally injured the plaintiffs' decedent. Plaintiffs commenced an action, in part, against Mt. Kisco Chevrolet, accusing it of negligently entrusting a car to Ms. Schapiro. Mt. Kisco Chevrolet's motion to dismiss for failing to state a cause of action pursuant CPLR §3211(a) (7) was denied by the trial court. The Appellate Division, Second Department reversed the trial court’s order, converted the motion to one for summary judgment pursuant CPLR §3211(c) and granted the motion to dismiss. The Court held that since the car dealership possessed no “special knowledge” regarding Ms. Schapiro or the car, there can be no viable cause of action for negligent entrustment. Moreover, the Court refused to impose a higher a duty upon Mt. Kisco Chevrolet to evaluate ability or mental or physical fitness of its customers. http://www.nycourts.gov/reporter/3dseries/2009/2009_00328.htm Previous Next Contact

News Pennsylvania Supreme Court Redefines “Operation” for Vehicle Liability Exception to Governmental Immunity (PA) August 31, 2018 < Back Share to: The Supreme Court of Pennsylvania recently issued a decision that will make it easier to file a lawsuit against state government agencies involved in car accidents. In Balentine v Chester Water Authority, the Court considered whether the involuntary movement of a vehicle constitutes an operation of a motor vehicle for purposes of the vehicle liability exception to governmental immunity under 42 Pa.C.S. § 8542(b)(1). A lawsuit was brought by Victoria Balentine, the widow of Edwin Omar Medina-Flores (“Medina-Flores”), against Chester Water Authority (“CWA”), Charles Mathues (“Mathues”), Wyatt Roland, and Michael Roland. Medina-Flores was a contractor for Metra Industries, which was hired by CWA to rehabilitate a section of its water distribution system. The project encompassed cleaning and lining water mains, including one located on Kerlin Street in Chester, Pennsylvania. On August 15, 2012, Medina-Flores was working inside of a ditch located near the 1200 block of Kerlin Street. An inspector for CWA, Mathues, parked his CWA vehicle approximately ten to fifteen feet away from the ditch with a portion of the vehicle protruding into the road. At the time, the CWA vehicle’s engine was still running as Mathues stood outside of it. Soon thereafter, another vehicle struck the CWA vehicle, causing it to hit Medina-Flores and pin him inside of the ditch. Initially, the trial court granted CWA’s motion for summary judgment after determining that the motor vehicle exception to governmental immunity set forth in the Political Subdivision Tort Claims Act did not apply. Rather, the motor vehicle exception to governmental immunity would apply only if such a vehicle was considered “in operation.” As such, a person had to be in the act of driving or moving the vehicle in order for liability to attach. On appeal, a divided Commonwealth Court affirmed the trial court and stated that precedential case law which addressed whether involuntary movement of a vehicle constituted operation for purposes of the governmental immunity exception did not exist. As such, this was an issue of first impression. Thereafter, the Supreme Court of Pennsylvania granted discretionary review to consider whether the Commonwealth Court erred in affirming the appeal. In so doing, the Court focused on the fundamental question regarding the relationship between “motion” and “operation.” The language in the statute states that the vehicle liability exception to governmental immunity refers only to “operation” and not to “motion.” However, numerous Pennsylvania cases have muddied the definition to require that a vehicle also be in motion. The Supreme Court of Pennsylvania determined that “operation” did not mean to simply move forward or backwards but also included the decision-making process that is attendant to moving the vehicle. The Court noted that if the legislature intended that recovery was only permissible when the vehicle was in motion, the legislature would not have utilized a word that implies process within the statute. As such, the requirement of motion was never an element of the statute. Ultimately, the Court held that the vehicle liability exception to governmental immunity applied in this case. The Court stated that “[w]here a government vehicle obstructs a roadway, in whole or in part, we can assume, absent evidence to the contrary, that a government agent operated the vehicle to arrive at that position.” According to the Court, this redefinition of “operation” provides a reasonable standard that comports with the intent of the legislature and does not add the unnecessary requirement of motion. As a result, the order of the Commonwealth Court was reversed and remanded. Thanks to Zhanna Dubinsky for her contribution to this post. Please email Vito A. Pinto with any questions. Previous Next Contact

News School Is Not Its Student's Keeper (NY) September 5, 2013 < Back Share to: When a high school student was attacked by another student on an athletic field owned by a school district, a claim followed under the theory that the district failed to provide adequate security and negligently left gates open to the field. The assault allegedly occurred, at approximately 9:30 p.m., after a group of youths,who had been drinking alcohol, congregated on the field without permission. Although the Supreme Court, Suffolk County denied the school's summary judgment motion, the Appellate Division held that the West Islip Union Free School District made a prima facie showing of its entitlement to judgment as a matter of law. In Weisbecker v. West Islip Union Free School District, the court reasoned that the School District owed no special duty to the plaintiff. It held that the mere provision of security does not give rise to a special duty of protection. In this case, the School District established that it did not make direct assurances regarding security to the plaintiff and that he did not rely on the provision of security in deciding to congregate with others on the field. Further, the West Islip UFSD demonstrated that the failure to lock the gates accessing the field was not a proximate cause of the plaintiff's injuries, since the assault was not a foreseeable act. It is well settled that a plaintiff must prove that the public entity's negligent acts must be the proximate cause of the injury sustained as the result of a foreseeable act by a third party. This was not established by the plaintiff. Since neither theory advanced a triable issue of fact, the Appellate Division reversed the lower court and held the district was entitled to summary judgment. Special thanks to Johan Obregon for his contribution. For more information, contact Denise Fontana Ricci at dricci@wcmlaw.com . Previous Next Contact

News Applicability of Assault and Battery Exclusion Dependent Upon Policy Definitions October 7, 2016 < Back Share to: In qbe-ins-corp-v-walters, the Pennsylvania Superior Court addressed the applicability of an insurance policy’s assault and battery exclusion. In QBE Ins. Corp., the insured owned a café. On September 9, 2011, an altercation occurred in the café’s parking lot that resulted in a patron being shot. The patron sued the café in a complaint that sounded in negligence. Specifically, the patron contended the café failed to properly train and supervise its employees. The insurer filed a declaratory judgment action seeking a declaration of no coverage on the basis of the policy’s assault and battery exclusion. The insured argued that since the patron’s underlying complaint averred that the insured acted negligently in the hiring, training, and supervision of its employees, as well its failure to warn the patron of a dangerous condition, the assault and battery exclusion did not bar coverage. However, the exclusion broadly defined assault or battery as, among other things, the negligent employment, investigation, supervision, training, and retention of a person for whom any insured is or was ever legally responsible . Thus, the court concluded that since the exclusion included negligent employment, investigation, supervision, and/or training of a person for whom it was legally responsible as part of its definition of assault and battery – the alleged negligent conduct of the insured and/or of its employees fell squarely within the policy’s definition of assault and battery. Consequently, the exclusion acted as a complete bar to coverage. This case demonstrates the importance of carefully looking to an insurance policy’s defined terms, as the applicability of a policy provision or exclusion may turn on a close reading of these definitions.   Thanks to Collen Haynes for her contribution to this post.       Previous Next Contact

News Insured's Notice of Claim after Default Judgment Held Prejudicial as a Matter of Law (NY) May 30, 2019 < Back Share to: New York was a relative latecomer to the club of states requiring liability insurers to be "prejudiced" in order to disclaim coverage in bodily injury matters. For that reason, New York case law provides less guidance on what constitutes prejudice in the context of late notice than many other states. One recent decision, however, provides an example of an insurer that was prejudiced as a matter of law. In Villavicencio v. Erie Ins. Co.., a tenant had sued the owner of his apartment building for property damage after the building had caught fire. After the owner failed to answer the complaint, the court entered default judgment in favor of the plaintiff. Six days after the entry of default judgment, approximately nine months after suit was filed, and over three years after the fire, the property owner notified its insurer of the incident. Six days later, the insurer disclaimed coverage because of late notice. With an unsatisfied judgment in hand, the tenant filed a direct action against the insurer to collect on the judgment. The tenant argued that the disclaimer was invalid because the insurer was not prejudiced by late notice. But the court disagreed, and granted the insurer’s motion for summary judgment. In doing so, the court relied on the plain language of New York Insurance Law, §3420(c)(2)(b), which provides that “an irrebuttable presumption of prejudice shall apply if, prior to notice, the insured’s liability has been determined by a court of competent jurisdiction or by binding arbitration; or if the insured has resolved the claim or suit by settlement or other compromise.” In reaching its decision, however, the court noted that the default judgment in the underlying action had not been vacated. Villavicencio will provide some comfort to insurers relying on a late notice defense, even if it left open the issue of whether a vacated default judgment would also vacate the prejudice. Thanks to Mike Gauvin for his contribution to this post. Please email Brian Gibbons with any questions.     Previous Next Contact

News No Notice, No Negligence (NY) July 17, 2018 < Back Share to: In Bombino-Munroe v Church of St. Bernard, the Appellate Division, Second Department reviewed a Supreme Court decision concerning notice in a slip and fall on ice case where the plaintiff alleged the defendant was negligent. The plaintiff slipped and fell near the rear entrance of her child’s preschool. Specifically, the plaintiff testified that she used the front entrance to enter the building and dropped off her son at his class. She was attempting to leave the premises through the rear entrance when the slipped on ice. A lawsuit was filed in Westchester County Supreme Court. The preschool director testified that she entered the building through the rear entrance about 90 minutes prior to the incident, and she did not see any ice on the ground. The injured plaintiff testified that she did not see the ice before she fell. The defendant preschool moved for summary judgment, arguing that the lawsuit should be dismissed because the preschool did not have the requisite notice of the icy condition to be held liable in this accident. The Supreme Court denied this motion, finding that there was a triable issue of fact as to whether the defendant had constructive notice of the alleged ice condition. On appeal, the Appellate Division, Second Department, discussed the law as to notice. The law is that “a property owner will be held liable for a slip-and-fall accident involving snow and ice on its property only when it created the dangerous condition which caused the accident or had actual or constructive notice of its existence. In this case, the plaintiff did allege the defendant created the icy condition; so the only way the preschool could be liable is if it had notice. After reviewing the evidence, the Appellate Division concluded that the Supreme Court erred in its decision and should have dismissed the lawsuit because the preschool did not have actual or constructive notice that there was an icy condition. In addition, the Appellate Division reaffirmed the principle that general awareness that snow or ice may be present during winter months is legally insufficient to constitute notice of the particular condition that caused the injured plaintiff's fall. Thanks to George Parpas for his contribution to this post. Please email Vincent Terrasi with any questions. Previous Next Contact