News Legal Malpractice Claims Barred Business Enterprise/Pursuits Exclusions January 17, 2013 < Back Share to: Professional liability policies are designed to cover errors and omissions committed by professional while providing or failing to provide services on behalf of their firms. Sounds simple enough. Problems arise when attorneys -or other professionals – act in different capacities, sometimes providing legal advice while at others offering business judgments or acting as “deal makers” for fledgling businesses. In Abrams, Fensterman, et al. v. Underwriters At Lloyd’s, London, a partner and his law firm found themselves in a real pickle over some business transactions that went bad. The underlying complaint alleged that the partner committed legal malpractice and engaged in fraudulent conduct when he induced the underlying plaintiffs to invest in a business formed to underwrite and sell insurance products. According to the disgruntled investors, when their seed money went missing, the law firm defendants falsely claimed that it was stolen by members of a royal family in the United Arab Emirates. Given the allegations of legal malpractice, the law firm defendants sought a defense and indemnification from their malpractice insurer. After some initial fact gathering, the insurer denied coverage citing two key policy exclusions commonly called the “business pursuits” and “business enterprise” exclusions. Closely aligned, these exclusions bar coverage for any claims arising out of or in connection with (1) a business “controlled, operated or managed by any insured” or (2) an insured’s activities as “a trustee, partner, officer, director or employee of a business " other than his law firm. Given the attorneys' alleged involvement in the formation, capitalization and management of the business venture, the court upheld the insurer's denial of coverage. Abrams, Fensterman reinforces that most professional liability policies seek to avoid assuming additional risk where an attorney “so intermingles his business relationships with his law practice” that the line between the two is blurred. When timely invoked, the courts will uphold those exclusions. If you have any questions or comments about this post, please email Paul at pclark@wcmlaw.com Disclaimer: This post is not intended to express any opinion on the merits of the allegations in the underlying lawsuit, which may or may not have any merit.   Previous Next Contact

News Add Mud To The List Of Dangers Covered Under Labor Law 240(1) (NY) December 4, 2020 < Back Share to: The First Department has previously held that Labor Law 240(1), which provides strict liability protecting plaintiffs against gravity-related risks, applies if a worker standing on a platform on the surface of a body of water falls into that body of water. See, Pipia v. Turner Constr. Co., 114 A.D.3d 424 (1st Dep’t 2014), lv dismissed 24 N.Y.3d 1216 (N.Y. 2015). In a recent case where the plaintiff was injured stepping onto an area of ground that had previously been excavated and then backfilled with soil, the First Department extended the Pipia line of reasoning and held that the plaintiff’s accident was also covered by Labor Law 240(1). In Sunun v Klein, an early stage of the subject construction project involved excavating an area of ground to create a trench which was then backfilled with soil. No barriers or signage were implemented to cordon off this filled trench after it was backfilled. Plaintiff was working on a later date and stepped on that area of ground, and he unexpectedly sunk such that his leg was in the ground up to his mid-thigh. It was undisputed in discovery that there were no safety devices provided to protect plaintiff or any other workers from the gravity-related risks of descending into the trench if they were to walk on it, and plaintiff’s expert testified that the trench had been filled with soil that was insufficiently dense which created a risk of such accidents. Discussing the previous Pipia decision, the First Department held that the elevation differential between the ground level and the lower level to which the plaintiff’s foot and leg sank was analogous to the risks presented when a worker stands on a floating platform on a body of water without safety devices to prevent him from falling into the water. As such, the First Department reversed the motion court and granted plaintiff’s motion for partial summary judgment on the Labor Law 240(1) claim. Thanks to Shira Straus for her contribution to this post. Please email Georgia Coats with any questions. Previous Next Contact

News Beer Pong Decision Bounces the Wrong Way for Bar Owners (NY) August 25, 2011 < Back Share to: Beer pong is one of the many activities that college students participate in when they tell their parents that they are studying. But take the game away from college, and disaster can ensue, as seen in Venito v. Salverson, et. al. Plaintiff Thomas Venito and defendant Mark Salverson were playing beer pong at KJ’s Ale House on Staten Island, and the two had an argument about the rules of the game. The bartender twice tried unsuccessfully to intervene. The argument then escalated into fight, which the bartender also could not stop, so he called 911. Salverson was arrested, convicted of misdemeanor assault, and served 60 days in jail. Plaintiff suffered facial and ankle fractures and sued Salverson and the bar. The bar moved for summary judgment, claiming the responsibility for plaintiff’s injuries fell solely on defendant Salverson. The judge denied the motion, holding that a jury might find that staffing the bar with only one bartender was insufficient security over Memorial Day weekend. The court also pointed out that the bartenders multiple efforts to stop the dispute were ineffective, and a jury might find that he should have called 911 before things escalated. It therefore held there was an issue of fact as to the claims of negligent security, hiring, and training. Interestingly, the court also found that plaintiff presented a prima facie case for liability under the Dram Shop. Plaintiff needed, in essence, to establish that the bar served alcohol to a knowingly intoxicated person. The court pointed out that, under any set of rules, the common objective of beer pong is the “copious consumption of alcoholic beverages.” The game encouraged excessive drinking at the bar, and the bar provided the alcohol to the participants. The court said that Salverson’s “aggression” was a common sense way for the bartender to observe visible evidence of intoxication. It remains to be seen whether this decision stands up on appeal. But I think one lesson learned is to agree on the rules before you play bar games. If you would like more information about this post, please write to mbono@wcmlaw.com Previous Next Contact

News Plaintiff’s Premises Liability Case Gets Iced (PA) December 18, 2020 < Back Share to: In Derito v. Walmart Stores East, L.P. (District Court of the Western District of Pennsylvania), plaintiffs Charles and Kimberly DeRito (collectively “DeRito”) were unable to overcome defendant Walmart’s summary judgment motion in this slip and fall action. According to DeRito, Walmart’s front door was stuck open for approximately 31 seconds due to a malfunction while it was actively snowing. Snow and ice was allegedly blowing into the store when Mr. DeRito slipped and fell due to an accumulation of “powdery” snow and ice inside the store. Walmart had salted the pathway leading to its entrance and had weather mats laid out at the entry of the store. Walmart filed a motion for summary judgment arguing that its employees did not have notice of an allegedly dangerous condition. The Court granted the motion dismissing DeRito’s claims. In Pennsylvania, landowners owe business invitees the highest duty of care. However, the simple fact that a plaintiff was allegedly injured on a defendant’s premises does not automatically prove negligence. While Mr. DeRito testified powdery snow had been blowing into the store because the door was stuck open, Walmart employees testified they saw no accumulation of snow, ice or water at the entrance when they went to inspect the malfunctioning door. While accepting DeRito’s allegations that the malfunctioning door and alleged powdery snow/ice may be hazardous conditions, DeRito failed to prove that Walmart had actual notice of them. Also, DeRito did not demonstrate Walmart had actual knowledge of snow accumulation or the malfunctioning door, nor did DeRito offer any evidence that the malfunctioning door was a recurring problem. Thus, he could not prove “actual notice” to Walmart. Concerning “constructive notice,” Pennsylvania courts recognize the the length of time an allegedly hazardous condition remains in place is indicative of a property owner’s constructive notice. Here, the malfunctioning door was only open for thirty-one seconds before Mr. DeRito fell. Thus, Walmart employees would not have had sufficient time to discover the condition prior to his alleged slip and fall and DeRito provided no evidence to support a claim there was snow inside the store entrance prior to his arrival. Thus, DeRito’s claim slipped and fell short of the legal requirements for negligence. Given our recent winter storm and forecast for more, this is a reminder that a slip and fall on snow or ice does not automatically confer liability on a property owner. Plaintiff still has the burden to prove the property owner violated the standard of care owed to an invitee. Thanks to Gabrielle Outlaw for his contribution to this post. If you have any questions or comments, please contact Thomas Bracken. Previous Next Contact

News Doesn’t Take Much to Get Decent Bucks for Aggravation (NY) August 13, 2021 < Back Share to: Oftentimes we see a plaintiff complaining that harm recently suffered caused exacerbation or aggravation of a prior existing, symptomatic or asymptomatic, condition. Questions relating to the impact of such claims on past and future pain and suffering are left to a jury to decide. Given the subjective nature of such damages, as accustomed, we look to precedent for guidance and enlightenment on what reasonable compensation is. From a Supreme Court, Suffolk County case, the exposure to insurers in such situations and the opinions of the defendants’ experts stand out. In Iacono v. Martinez, the plaintiff was driving westbound on the Long Island Expressway. Due to police activity, she was forced to stop in the right lane. While she was stopped, the defendant struck the rear panel of her car. With no damage to the defendant’s vehicle and only a partial imprint of the defendant’s license plate on the plaintiff’s vehicle, both parties agreed that the collision produced only a mild impact. At the scene of the accident, the plaintiff made no complaints of pain and did not seek any medical attention until thirteen days after the accident. The plaintiff claimed to have sustained a neck injury and that the instant accident aggravated a previously dormant condition necessitating cervical fusion surgery at the C5-6 level. The dormant condition related to cervical fusion at C6-7 level and disc herniation at the C5-6 level from a previous automobile accident. The plaintiff contended she had not treated with any doctors for cervical pain relating to the prior accident for twenty months preceding the accident at issue in this case. The subjective claims made by her included disruption to sleep, having to spend the majority of days in bed, and taking pain medication for life. With these, she sought recovery of damages for her past and future pain and suffering. The defendants’ own neurologist opined that, if what the plaintiff was saying was accurate, then the instant accident aggravated her prior dormant condition. Given this framework, the matter settled on the cusp of jury selection for $900,000 of a $1,100,000 policy. Essentially, a huge settlement for what one would argue was a relatively minor accident with a plaintiff who had pre-existing conditions. However, this settlement, and similar past verdicts, make future verdicts of this magnitude sustainable on appeal. Thanks to John Diffley for his contribution to this post. Please email Georgia Coats with any questions. Previous Next Contact

News Court Defers To An Arbitrator’s Credibility Determinations (NY) June 16, 2023 < Back Share to: New York courts have historically shown a deference to the arbitration process, particularly an arbitrator’s discretion and ability to make credibility determinations. Even in the labor arbitration setting, courts must generally accept an arbitrator’s credibility determinations. The Appellate Division, Second Department recently reached this result in Matter of O' Brien v. Yonkers City Sch. Dist. In that case, a tenured teacher was charged with conduct unbecoming a teacher after he inappropriately restrained a student. The charges proceeded to arbitration where the teacher was found culpable, even where evidence suggested that the teacher may have acted appropriately, and the arbitrator recommended termination. The teacher commenced a proceeding to vacate the arbitrator’s determination, pursuant to CPLR article 75. The Second Department observed that “where, as here, the obligation to arbitrate arises through a statutory mandate, the determination of the arbitrator is subject to 'closer judicial scrutiny' under CPLR 7511(b) than it would otherwise receive.” As such, “an award in a compulsory arbitration proceeding must have evidentiary support and cannot be arbitrary and capricious.” Applying this standard, the Court found that there was a rational basis and evidentiary support for the arbitrator’s findings, as the “Court must accept the arbitrator's credibility determinations, even where there is conflicting evidence and room for choice exists.” However, the Court rejected the penalty of termination since the teacher had worked for the school system for 19 years and had an unblemished record. The Court found that the penalty was “so disproportionate to the offense as to be shocking to one's sense of fairness” and remanded the case for the imposition of a lesser penalty. This case is an example of a New York court supporting an arbitrator’s credibility determinations in the face of contradictory evidence. The Court applied the “arbitrary and capricious” standard in accepting the arbitrator’s ruling, but ultimately found that the penalty was unfair under the circumstances. Thank you to Rebecca Pasternak for her contribution to this post. Please contact Andrew Gibbs with any questions. Previous Next Contact

News Absentee Landlord and Absentee Defendant (PA) August 25, 2016 < Back Share to: On July 27, 2016, a judge in the Philadelphia Court of Common Pleas recently found against a landlord in a premises liability case for $225,203. The case arises out of an incident that occurred on December 22, 2014 when the plaintiff, Janet McHugh, was trying to take her trash out to the alley through the building’s unfinished basement. When McHugh opened the basement door toward, it became caught on wires hanging from the basement’s ceiling. The wires caught on the drywall and a 30-lb electrical box, tearing both off the wall. The drywall fell on McHugh’s head and neck and the electrical box landed on her upper-body. McHugh alleged that the landlord, Philip Carter Jr., was making the repairs himself and had allowed the dangerous conditions to exist. To prove this, McHugh presented an engineering expert asserting numerous building code and safety regulation violations. These included no drywall ceiling in the basement, exposed framing and wiring, drywall not being properly affixed, hanging wires, and inadequate anchoring. The plaintiff complained of pain in her neck and weakness in her left arm and hand. A subsequent CT scan and MRI confirmed disc instability and she was diagnosed with a cervical strain and sprain. She underwent surgery on December 24, 2014 on some of her discs and then had physical therapy for two months thereafter. McHugh also presented a medical expert who stated that her injuries were related to the accident and that she suffered a permanent injury. The expert also stated that she will require lifelong epidural injections and that her discs are at risk of a breakdown. Carter did not answer the complaint and a default judgment was entered against him. The case proceeded to a bench trial on damages at which Carter represented himself pro se, presented no experts of his own, and simply maintained that McHugh sustained no injury in the incident. This case emphasizes the simple fact of how necessary it is to actually present a defense. When a defendant either does not have insurance or chooses not to cooperate with their defense, the end result can be a personal judgment, which can be nearly impossible to escape in the future. Thanks to Peter Cardwell for his contribution to this post. Please email Brian Gibbons with any questions. Previous Next Contact

News Philip Pizzuto Joins WCM as Partner in New York & New Jersey Offices April 4, 2022 < Back Share to: WCM is pleased to announce that Philip Pizzuto has joined us as a partner. Phil is a trial lawyer with nearly 25 years of experience representing insureds, corporations, municipalities and individuals in the New York metro area. He has tried numerous cases to verdict in the New York, New Jersey, and Federal courts in a variety of cases including employment, general liability, toxic torts, personal injury and municipal disputes. Phil also provides advice and guidance on disputes involving toxic tort, employment and ADA claims. Phil was recently a partner with a large general practice firm in New Jersey and New York before joining Wade Clark Mulcahy LLP, and previously worked at a large New York City firm where he concentrated on toxic tort and other liability matters. Phil is licensed to practice law before the New York, New Jersey and Pennsylvania Bars. He is a graduate of Temple University School of Law. Previous Next Contact

News Insurer of Common Insured Entitled to Contribution of Defense Costs From Other Carrier April 18, 2012 < Back Share to: Recently, the New Jersey Appellate Division addressed the question of whether an insurer can pursue another insurer of a common insured for defense cost contribution when that second insurer had already settled with the insured. Where the insurers both provided primary coverage for the loss, the carrier who paid the costs of the defense had an equitable right to contribution separate and apart from subrogation. This right is not extinguished even by a settlement with the insured. In Potomac Insurance Company v. Pennsylvania Manufacturers’ Association Insurance Company, the issue arose out of a claim for continuous damage from water infiltration into a public school over a period of eight years. The insured general contractor had insurance policies with several insurers over that time period. When it was sued by the Board of Education, Pennsylvania Manufacturers issued a denial letter. Potomac undertook the insured’s defense and ultimately brokered a settlement with the Board of Education. In the meantime, the defense counsel filed a declaratory judgment action against Pennsylvania Manufacturers on behalf of the insured. Pennsylvania Manufacturers and the insured settled for $150,000 that was applied to the overall settlement with the Board of Education. Potomac’s appointed defense counsel for the insured negotiated the settlement agreement with Pennsylvania Manufacturers. During the coverage litigation, that latter agreement became a critical issue. Significantly, Potomac was not a party to the agreement. Moreover, the agreement, which was initially drafted by Pennsylvania Manufacturers, included negotiated language that was subject to varying interpretations as to whether Potomac’s right to contribution for defense costs was extinguished. As a result, the court found that the ambiguous contract did not reflect a meeting of the minds. Moreover, since Potomac had a separate right to contribution, the agreement did not defeat its claim for contribution of defense costs for the underlying litigation. On one last issue, the Appellate Division reversed an award of attorney fees related to the insurer’s declaratory action. Since the plaintiff insurer failed to bring the coverage claim in its name within the declaratory judgment action filed on behalf of the insured, it violated the entire controversy doctrine. Had it pursued its claim in the same action, the subsequent litigation would have been avoided. The award of attorney’s fees to a successful litigant on a liability policy is an equitable remedy, which the court deemed unavailable where the insurer violated this doctrine and, thus, had unclean hands. For more information email Denise Ricci at dricci@wcmlaw.com . Previous Next Contact

News Biggest Loser In Insurance Scam September 2, 2010 < Back Share to: David Fioravanti, who won $100,000 on the NBC reality show "The Biggest Loser", has been indicted in Boston for an insurance scam involving alleged jewelry losses. According to authorities Fioravanti took out an insurance policy covering $63,000 in jewelry 2002. The following year he reported that the jewelry was lost when his apartment was burglarized and he collected on a $63,000 insurance claim. Months later he purchased insurance on the same jewelry from a different company and reported it stolen. That company canceled the policy when it learned about the prior claim. Undaunted, Fioravanti later insured the same jewelry with yet another company that reported his activity to law enforcement officials. http://www.bostonherald.com/news/regional/general/view.bg?articleid=1122606 Previous Next Contact

News Authenticity Battles Continue to Haunt the Art World. July 26, 2010 < Back Share to: One of the more common disputes that art insurers end up embroiled in are disputes over authenticity. Consider for example, a loss in market value claim. If the object at issue is really an Old Master, the loss could be significant. However, if it is a later copy, the loss could be quite nominal. To assist with authenticity claims, restorers and experts vet a painting by analyzing (among other things) brushstrokes, composition, iconography and pigments. A subjective finding results. The latest craze attempts to turn subjective opinion into an objective science through the use of fingerprints. Peter Paul Biro is among the pioneers in this field. However, according to The New Yorker, all that glitters might not be gold. In this interesting article, Biro’s techniques are called into question -- http://www.newyorker.com/reporting/2010/07/12/100712fa_fact_grann?currentPage=all. Food for thought for all those who thought science could turn appraisals into a hard science. If you would like more information about this post, or WCM’s fine art practice, please contact Bob Cosgrove at rcosgrove@wcmlaw.com . Previous Next Contact

News Findings Of Plaintiff's Own Doctor Subvert His Serious Injury Claim February 15, 2008 < Back Share to: In Sharma v. Diaz, 2008 NY Slip Op 01130, AD Index 2007-05350, Kings Co. Index 27745/04, a case involving a motor vehicle accident, plaintiff claimed to have sustained neck and lower back injuries, including herniated and bulging discs with radiculopathy. The defendant moved for summary judgment asserting the plaintiff did not sustain a serious injury pursuant New York Insurance Law §5102(d). As part of his motion, the defendant relied upon the findings of plaintiff's treating physician, who examined the plaintiff within three months of the accident and found that plaintiff possessed full range of motion in the cervical and lumbar regions of his spine. Despite this, the trial court denied defendant's motion finding that the defendant failed to meet his prima facie burden that the plaintiff did not sustain a serious injury. In reversing the trial court and granting defendant's motion for summary judgment, the Appellate Division - Second Department found that the defendant had established his entitlement for summary judgment. Since the plaintiff failed to provide any medical evidence to counter defendant's motion, the appellate court deemed the aforemention findings of plaintiff's own treating physician fatal to his claim. Furthermore, the court held that the mere existence of disc herniations and bulges with radiculopathy, without objective evidence demonstrating the extent of physical limitation, insufficient to prove serious injury. http://www.nycourts.gov/reporter/3dseries/2008/2008_01130.htm Previous Next Contact