News Strict Interpretation of Exclusion Flushes Disclaimer Down the Drain (NY) September 27, 2019 < Back Share to: Insurers are by now well aware of the New York rule placing the burden on the insurance company to demonstrate the allegations of the complaint fall squarely within an exclusion, and that such exclusions are given “strict and narrow interpretations.” In their recent decision in Cohen v. Tri-State Consumer Ins. Co., the Second Department demonstrated just how narrow these interpretations can be. In Cohen, the plaintiffs’ home was damaged after a clogged toilet overflowed, and they sued the defendant insurance company under a homeowners’ insurance policy. The insurers disclaimed coverage relying upon an exclusion for losses caused by “water which backs up through sewers or drains.” Although the plain language of this exclusion appears at least arguably applicable to the claimed loss, New York Courts took a different view. In fact, the Nassau County Supreme Court granted the plaintiffs summary judgment, finding there was no question of fact as to whether the policy exclusion applied. The Second Department affirmed, ruling that plaintiff had demonstrated coverage in the first instance, and held that the exclusion relied upon by the insurer, strictly construed, clearly did not apply to the claimed loss. The case is a sobering reminder of the potential pitfalls of relying on a single exclusion, particularly without strong precedent in support, as the basis for denying a claim, and insurers and coverage defendants would be wise to keep it in mind in performing their coverage analysis. Thanks to Nicholas Schaefer for his contribution to this post. Please email Vito A. Pinto with any questions. Previous Next Contact

News SJ Granted In Face Of Conclusory Defendant Affidavit On Labor Law Claim (NY) December 9, 2022 < Back Share to: This week the First Department, Appellate Division, in Castillo v. TRM Contracting 626 LLC, et al., 2022-00671, affirmed a worker’s partial motion for summary judgment on Labor Law § 240(1) liability. While attempting to cover a window with plastic before starting to paint, plaintiff proved that he fell from an unsecured, 6-to-8-foot-tall A-frame ladder that was in poor condition and leaning against a wall in a closed position because of obstructions at the work site, namely, large boxes preventing him from fully opening the ladder. This established a violation under Labor Law § 240(1) because the workplace conditions prevented a worker from placing the ladder in an open, secure position, causing the worker injury because the ladder shifted, slipped, or collapsed. The Court faulted defendants for their failure to raise an issue of fact through an affidavit from defendant’s principal, holding that that affidavit was conclusory and did not cite any facts describing the location of plaintiff’s accident, did not show that the principal was aware of where plaintiff had been working, and did explain how plaintiff could have opened the ladder and properly secured it in the work area. Moreover, the competing affidavit did not deny plaintiff’s testimony that he was not allowed to move the boxes. The Court also rejected defendants’ argument that plaintiff’s partial motion was premature because defendants did not prove that the foreman, whose deposition defendants wanted to take but had never noticed, would provide relevant testimony as he was not present to supervise plaintiff the day of the accident. Thanks to Abed Bhuyan for his contribution to this post. Please contact Heather Aquino with any questions. Previous Next Contact

News Third Circuit Affirms Doctor’s Sexual Misconduct Is Not Within the Scope of His Employment, and Thus Not Covered Under Professional Liability Policy September 9, 2020 < Back Share to: The Third Circuit affirmed a New Jersey District Court’s ruling that there is no coverage for a doctor’s claim for coverage in an underlying sexual misconduct and medical malpractice lawsuit, affirming the well-established principle that an employee’s conduct outside the scope of employment prevents them from being an insured under the employer’s policy. Dr. Jonathan Fellus was employed as a neurologist at Kessler Institute Rehabilitation Center (“Kessler”). Kessler’s professional liability policy with Columbia Casualty included coverage for Kessler’s “employees,” but applied “only for acts within the scope of their employment” at Kessler. In 2008, Lorette Schroth (“Schroth”) sought treatment from Dr. Fellus for a head injury and the two began a sexual relationship which lasted approximately a year. In 2010, Schroth sued Dr. Fellus in New Jersey state court, alleging sexual misconduct, intentional infliction of emotional distress, negligent infliction of emotional distress, and medical malpractice. After a trial and appeal, Schroth obtained a verdict totaling $1.5 million in compensatory damages, $1 million in punitive damages, and close to $500,000 in interest. Dr. Fellus sought coverage from Columbia. The District Court dismissed Dr. Fellus’s claim, finding that there was no coverage because coverage was limited to “acts within the scope of their employment” with Kessler, and the sexual relationship with Schroth plainly did not constitute such conduct. On appeal, the Third Circuit affirmed, bluntly holding that “[i]nterpreting the policy to allow for coverage would defy both governing law and common sense” and finding that Dr. Fellus’s actions were not of the kind he was employed to perform. Finally, the Court flatly rejected Dr. Fellus’s argument that the conduct was within the scope of his employment because, “but for” his employment, their relationship would have been permissible. The Court noted that “[u]nder his rationale, any interaction between doctor and patient, not matter how abusive or predatory, would be deemed within the scope of employment and covered by Columbia’s policy.” The Decision thus articulates the limits of a Professional Liability Policy, and represents a straightforward and common sense application of the relevant law. Thanks to Douglas Giombarrese for his contribution to this post. Please email Georgia Coats with any questions. Previous Next Contact

News Say Cheese! Photo Taken with Mobster not Actionable (NY) August 27, 2009 < Back Share to: Plaintiff attended the trial of the notorious mafia boss, John Gotti, and after court broke for the day, plaintiff decided to help Gotti maneuver through the throng of photographers and into Gotti’s car. A freelance photographer then took a picture of plaintiff holding Gotti’s arm. The photo was ultimately used in an advertisement for the television program, Inside the Mafia, and the ad appeared in posters throughout New York City. Plaintiff filed suit in Alfano v. NGHT, et al, alleging that the unauthorized use of his image violated his privacy. The Court held, however, that the New York statute prohibiting the “commercial appropriation” of a living person’s image did not apply because of the “newsworthy” nature of the trial that was being photographed. The Court also held the advertisement was an “incidental use” of the image to illustrate the newsworthy content of the television program. The plaintiff’s other claims were also rejected and the court dismissed the complaint. Previous Next Contact

News US Supreme Court Issues Major Asbestos Decision. March 8, 2012 < Back Share to: In the case of Kurns v. Railroad Friction, the US Supreme Court was faced with the preemptive scope of the Locomotive Inspection Act (LIA). In a 6-3 decision, the Supreme Court affirmed the Third Circuit and effectively overruled the PA Supreme Court decision in Norfolk & Western v PA Public Utility Commission, 413 A.2d 1037 (pa. 1980). In Norfolk, the PA Supreme Court held that PUC regulations affecting locomotives in interstate operation were not preempted under the BIA and the Supreme Court Napier opinion and thus state law tort claims could proceed. The US Supreme Court disagreed and held that the the federal regulations preempted state law tort claims. Does this (finally) mean a decrease in asbestos litigation? Stay tuned to find out. Special thanks to Clayton Thomas for his contributions to this post. For more information, please contact Bob Cosgrove at rcosgrove@wcmlaw.com .     Previous Next Contact

News What’s In A Name? The Wrong One Can End a Plaintiff's Case (PA) June 30, 2020 < Back Share to: In Fick v. Barbon, plaintiff Terrence Fick (“Fick”) appealed the Superior Court’s decision to grant summary judgment in favor of defendant Barry Barbon (“Barbon”) following a car accident. At issue here is Pennsylvania Rule of Civil Procedure (Pa,R.C.P.) 1033—which explains correcting the name of a defendant after litigation has commenced—and the application of an amendment to the rule. Fick alleges that on July 5, 2016, he was rear-ended by a vehicle owned by Barbon. At the time of the incident, Barbon’s grandson, Dean Reist (“Reist”), was driving. When Fick filed suit in July 2018, he only named Barbon as defendant and the statute of limitations expired soon after. In August 2018, Fick filed a motion for leave to file an amended complaint to name Reist as defendant in the matter. Fick alleged that Barbon and his insurance company concealed Reist’s identity. After his first motion was denied, Fick filed a second motion for leave to file an amended complaint stating that Pa.R.C.P. 1033(b) applied in this case. This motion was also denied, but the Court granted Barbon’s motion for summary judgment. Fick’s appeal followed. Fick made three arguments in his appeal. First, he argued that the trial court erred and abused its discretion by denying his second motion for leave to amend despite his compliance with Pa.R.C.P. 1033. Second, he argued that the trial court erred and abused its discretion by denying his first motion since Barbon failed to disclose Reist’s identity before the statute of limitation ran. Lastly, he argued the trial court erred and abused its discretion by granting Barbon’s motion for summary judgment when a genuine issue of material fact would have existed had his motions been granted. Needless to say, the Superior Court did not agree. Rule 1033(b) states an amendment correcting the name of a party who had claims asserted against it in the original pleading will relate back to the commencement of the matter if the party was given notice proper notice and such amendment will not prejudice the party’s defense of its case. The party also knew or should have known that it would have been named in the original pleading but for the mistake as to its identity. The Court argues Fick did not seek to amend the name of a party, but wanted to add Reist to the action after the statute of limitations had run. Such addition has been historically prohibited. Fick testified during his deposition that Reist provided his name and contact information following the car accident. Therefore, Reist’s identity was disclosed to Fick and his first and second arguments are baseless. Finally, the Court stated that the summary judgment in Barbon’s favor was appropriate because Fick sued the passenger in a case alleging negligent operation of a vehicle. Therefore, the summary judgment ruling was appropriate and affirmed. Thanks to Gabrielle Outlaw for her contribution to this post. For comments or questions please contact Vincent Terrasi. Previous Next Contact

News Mode-Of-Operation Doctrine Rejected For Accident Not Involving A Self-Service Setting (NJ) June 16, 2023 < Back Share to: In New Jersey premises liability cases, plaintiffs are generally required to prove that a dangerous condition existed, and that the owner had actual or constructive knowledge of the condition. There are certain exceptions to this burden of proof including the “mode-of-operation” doctrine which creates a rebuttable presumption of negligence where an owner’s mode of business operation creates a dangerous condition. The doctrine creates an inference of negligence which excuses a plaintiff from having to prove notice, shifting the burden to the defendant to show it exercised due care. In Miguez v. Shoprite of Kearny, the New Jersey Appellate Division addressed the doctrine in a case where the plaintiff was allegedly injured when she slipped and fell on a metal vent which had fallen off a self-service refrigerator in the deli aisle at a supermarket. Consequently, plaintiff initiated a lawsuit against the defendant to recover damages. Plaintiff’s engineering expert opined that the refrigerator had not been cleaned or serviced in years and store surveillance video showed the vent cover fell after an employee placed items inside. Defendant moved for summary judgement on the ground plaintiff had failed to establish actual or constructive notice of the condition. Plaintiff argued she did not have to do so because the mode-of-operation doctrine applied or that defendant created the condition that caused her fall. The trial court granted defendant’s motion, holding that plaintiff was required to prove actual and/or constructive notice and failed to do so. The Appellate Division affirmed in part and reversed in part, first holding that the trial court was correct in refusing to apply the mode-of-operation doctrine. In so holding, the Court recognized that the New Jersey Supreme Court has limited the doctrine to the self-service setting where customers are independently handling merchandise and equipment without the assistance of employees. The Appellate Division found that plaintiff failed to demonstrate the necessary nexus between a defendant's self-service operations and her fall. However, the Court also found that the award of summary judgment was inappropriate where the evidence provided by plaintiff established the existence of genuine issue of material fact as to whether defendant had actual or constructive notice of the dangerous condition, or whether defendant caused this condition through its own inaction. The takeaway from the Miguez decision is that plaintiffs should only attempt to assert the mode-of-operation doctrine as a way to shift their burden of proof in premises liability cases in limited situations involving a retailer’s self-service operations. The case also demonstrates that summary judgment as to the issue of notice may be a challenge where there is evidence creating issues of fact. Thank you to Jordan Davis for his contribution to this post. Please contact Andrew Gibbs with any questions. Previous Next Contact

News NJ Deemer Statute Offers No Protection To Out of State Defendant Driver December 22, 2009 < Back Share to: The evolution of transportation from the horse and buggy to the automobile did more than revolutionize our mode of travel. It fueled and accelerated bodily injury claims as the demolition derbies continue on our public streets and highways. State legislatures have attempted to deal with the crush of auto-related litigation by passing varioius "no fault" schemes designed to reduce the number of lawsuits for minor, soft tissue injuries in return for the prompt payments of the injured party's medical bills under PIP. New Jersey is no different. Its latest version of a tort limitation was modeled on the New York statute that required a "serious injury" as a condition to suit. Known informally as the "verbal threshold," the New Jersey statute bars suit for injuries sustained in an automobile accident unless the plaintiff falls into at least one of six categories of injury. Unlike New York's statute, the policyholder makes an election at the time he purchases an auto policy: in exchange for a higher premium, he is not subject to the verbal threshold. Most policyholders select the limitation to suit and pay a lower premium. What happens if an out of state driver gets in an auto accident in New Jersey? What if both drivers are from out of state? Is the plaintiff subject to New Jersey's verbal threshold in either situation? In Zalilowicz v. Kelsey, both plaintiff and defendant were out of state drivers from Pennslyvania. Under the New Jersey No Fault scheme, a plaintiff is subject to the tort limitation unless a specific selection is made when he purchases his policy. However, the Deemer statute provides that an out of state driver is presumed to have selected the tort limitation if his insurer is authorized to underwrite insurance in the state of New Jersey. Simple enough if the plaintiff has an accident with a New Jersey driver. What about if both the plaintiff and defendant are from out of state? The New Jersey Supreme Court held that the defendant does not get the benefit of the limitation-on-lawsuit where the defendant is from out of state and his insurer is not admitted in New Jersey. The Supreme Court reasoned that since such a nonresident driver is not eligible for PIP/No Fault benefits because his insurer is not admitted in New Jersey -- and not subject to the Deemer Statute-- then he does not get the benefit of the tort limitation. According to the court, if the defendant's insurer is not part of the No Fault scheme for PIP purposes, he's outside the statute for all purposes including the ability to use the tort threshold as a defense. Of interest, the Supreme Court almost invited the legislature to close this loophole and cited language that would achieve that goal. If you have any questions about this post, please email Paul at pclark@wcmlaw.com http://www.judiciary.state.nj.us/opinions/supreme/A8708ZabilowiczvKelsey.pdf Previous Next Contact

News Cheerleader Assumed Risk of Injury February 6, 2009 < Back Share to: The Fourth Department’s recent February 2009 decision in Williams v. Clinton Central School District, upholds New York’s long-standing assumption of risk doctrine. In this case, Williams, a high school senior, commenced suit against her school district for injuries sustained while performing a cheerleading stunt. She alleged that the school unreasonably increased the risk of injury by failing to provide a matted surface during practice. In upholding the dismissal of plaintiff’s complaint, the Fourth Department held that although the school district was under a duty to exercise reasonable care to protect student athletes, the risk of performing cheerleading stunts on a non-matted surface was open, obvious, and inherent in plaintiff’s participation in the activity. Thanks to Lora Gleicher for her contribution to this post. http://www.nycourts.gov/reporter/3dseries/2009/2009_00742.htm Previous Next Contact

News No Litigation Hold? No Records? Then Sanctions and Spoliation in NJ. October 3, 2011 < Back Share to: E-discovery -- a phrase certain to strike fear in the heart of any insurance company or claims professional! Yet, notwithstanding the fear factor, we have seen many clients and insurers (none of which, of course, were represented by us) ignore or pay scant attention to the litigation hold requirement. The company that does so, does so at its own peril as this recent district court opinion makes clear. The failure to properly impose a litigation hold and the resultant negligent destruction of records subjects the destroying party to sanctions and spoliation, i.e. an adverse inference charge. Strong medicine indeed. If you have any questions about this post, please contact Bob Cosgrove at rcosgrove@wcmlaw.com . Previous Next Contact

News A New York Lloyd's? July 8, 2008 < Back Share to: Details are sketchy and many issues must still be worked out, but the recreation of the New York Insurance Exchange is in the works. If all goes according to plan, the Exchange will re-open in the next 18 months. The question is -- will pubs and coffee houses follow? http://www.insurancejournal.com/news/national/2008/07/08/91689.htm?print=1 Previous Next Contact

News City Defendants Win Summary Judgment on Trivial Defect Defense (NY) September 10, 2020 < Back Share to: In Acevedo v. City of Yonkers, the infant plaintiff was allegedly injured when he was playing basketball in the street in front of his home, located in Yonkers, and tripped and fell over a water valve cap that was recessed into the street. The family brought suit against the City of Yonkers. The defendants moved for summary judgment dismissing contending that they did not receive prior written notice of the condition alleged as required by section 24–11 of the Charter of the City of Yonkers, and that the defect alleged was trivial and therefore not actionable as a matter of law. The Supreme Court granted that branch of the defendants' motion which was for summary judgment dismissing the complaint, finding that the defendants established that they had not received prior written notice of the defect alleged. The plaintiffs appeal. The Appellate Division Second Department found that the defendants should have been granted summary judgement; however, due to the fact the defect was trivial and not on notice. The Court held “In determining whether a defect is trivial, the court must examine all of the facts presented, including the ‘width, depth, elevation, irregularity and appearance of the defect along with the time, place and circumstance of the injury.’ “A defendant seeking dismissal of a complaint on the basis that the alleged defect is trivial must make a prima facie showing that the defect is, under the circumstances, physically insignificant and that the characteristics of the defect or the surrounding circumstances do not increase the risks it poses.” Here, the defendants established their prima facie entitlement to judgment as a matter of law by submitting, the area of loss did not possess the characteristics of a trap or nuisance, and therefore, was not actionable. The Appellate Court did not discuss the notice portion of defendants’ brief. The granting of summary judgment on the defense of trivial defect is rare as Courts find that triviality is a question of fact for the juror; however, the dimensions of the area where the infant plaintiff fell, along with photographs and the testimony of the plaintiffs all combined for the Appellate Court to rule that the defect was indeed trivial. Thanks to Paul Vitale for his contribution to this post. Please email Georgia Coats with any questions. Previous Next Contact