News Second Circuit Set to Hear Covid Business Interruption Claim May 21, 2020 < Back Share to: On Friday, May 18, Social Life Magazine filed a brief notice of interlocutory appeal of a district court judge’s oral decision denying its application for a preliminary injunction compelling its insurer, Sentinel Insurance Company Limited, to cover its lost revenues stemming from the Covid-19 pandemic. As a result, the Second Circuit is set to weigh in on what will likely be the first of many pandemic-related business interruption claims brought by small businesses throughout New York that will reach the appellate court. The factual background and related coverage arguments are at this point familiar, even if they are novel. Social Life, self-described as the "premier luxury publication for the Hamptons," sued Sentinel in the Southern District of New York after Sentinel denied coverage for Social Life’s business interruption claim caused by the pandemic and ensuing shutdowns. Sentinel asserted that the virus does not constitute “property damage,” a requirement for coverage in the first instance. In response, Social Life argued that the virus’s very presence on physical property and the potential for harm constituted the required damage. Notably, the Sentinel policy at issue did not contain a specific virus exclusion common in many policies. Nonetheless, on Thursday, May 14, District Judge Valerie Caproni denied Social Life’s application for a preliminary injunction. During oral argument, Judge Caproni stated that the most on-point case in New York appeared to be a First Department Decision styled Roundabout Theatre Co. v. Continental Cas. Co., where the Appellate Division held that the insured was not entitled to business interruption coverage because there was no “direct physical loss” to the property as a result of a city street closure order due to a construction accident. 302 A.D.2d 1 (1st Dep’t 2002). Distinguishing out-of-state cases, Judge Caproni stated that while she “[felt] bad for every small business” impacted by the pandemic, there needs to be “some damage to the property to prohibit you from going” for coverage to take effect. This case gives the Second Circuit the opportunity to weigh in on the specific issue of whether the Covid-19 virus constitutes “physical damage” for purposes of business interruption claims. As this decision has potential for widespread impact, we will be monitoring it closely. Thanks to Douglas Giombarrese for his contribution to this post. Please email Georgia Coats with any questions. Previous Next Contact

News LIABLE, UNTIL PROVEN INNOCENT: How Landlords Must Be Clear About the Transferring of Possession and Control When Leasing Property September 27, 2024 < Back Share to: Generally, in an action to recover damages for personal injuries, landowners owe a duty of general care for maintaining their property in a reasonably safe condition – a duty not easily relieved. The bounds of such a duty are focused on a landowner’s ability to exercise or exert control over a particular property, e.g. a duty is placed on the landowner or the entity able to exercise or exert control because “the person in possession and control of property is best able to identify and prevent any harms to others.” But what happens when a landowner leased or provides exclusive control over a particular property to another? Does that duty survive and extend through such a lease or is the landowner relieved of it? In Williams-McKay v. Parkgate Communications, Inc. , the Appellate Division, Second Department, answered and affirmed those exact questions. In Williams-McKay , the Karolyn Williams-McKay, a school bus driver for a transportation entity named Veterans Transportation had completed her morning bus route shift and returned the bus to the designated bus yard. After parking and exiting, the Plaintiff began taking several steps whereby she stepped in a pothole and was caused to fall, thereby suffering personal injuries. At the time of this incident, the landowner of the bus yard was the Defendant, Parkgate Communications, Inc. However, pursuant an oral agreement, Parkgate had actually leased the bus yard to Veterans Transportation. The Plaintiff eventually filed suit, and Defendant Parkgate moved for summary judgment. The lower Supreme Court denied Parkgate’s summary judgment, and they appealed. In reviewing the case, the Second Department noted that, while landowners who exercise control over a property are generally held to a duty to maintain said property in a reasonable safe condition, landowners who have transferred possession and control of a property are generally not liable for dangerous conditions on them , e.g. an ‘out-of-possession landlord’. With this understanding in mind, the Court ultimately found that Parkgate had failed to sufficiently establish that they were an ‘out-of-possession landlord’ at the time of the accident, as it was unclear whether possession and control of the bus yard had been sufficient transferred to Veterans Transportation. Additionally, the Court found that Parkgate failed to eliminate the possibility of whether they knew or should have known about the subject pothole prior to the accident. Therefore, Parkgate’s duty for maintaining the bus yard in a reasonably safe condition remained, despite them having leased it out to Veterans Transportation (an important point for any landlord is to ensure being able to prove that possession and control of a property are sufficiently transferred when leasing a property out to another). Thanks to William Hoffman for his contribution to this post. McKay v. Parkgate Communications, Inc. .pdf Download PDF • 142KB Previous Next Contact

News WCM Associate Publishes Article Discussing Intersection Between “All Risk” Coverage and Art in Freeman’s News Bulletin. April 26, 2019 < Back Share to: WCM Associate, Lauren Berenbaum, published an article entitled Frigon "All Risk" Insurance: Does It Really Provide Coverage For All Risks? in Freeman's Monthly Business Bulletin. As the title indicates, the article discusses whether “all risk” policies only provide coverage for real physical loss or damage. In addition, the article explores the connection between “all risk” policies and the legal challenges faced by collectors when selling art through a third-party. For more information about this post, please contact Bob Cosgrove. Previous Next Contact

News Qualified, Not Absolute, Privilege Applies when there is No Opportunity to Rebut Defamatory Statements (NY) July 18, 2018 < Back Share to: On June 27, 2018, the Court of Appeals issued a decision in Stega v New York Downtown Hospital, which held that whether an absolute privilege applies to a communication made in the course of a quasi-judicial proceeding depends on the status of the subject of the communication. In Stega, New York Downtown Hospital terminated the employment of plaintiff, a medical scientist, and removed her as chairperson of the hospital’s Institutional Review Board (IRB). Dr. Steven Friedman’s (the Acting Chief Medical Officer for Downtown Hospital) statements to the FDA during an investigation of Downtown Hospital’s IRBs about plaintiff, which discussed the reasons for the removal of plaintiff from her positions, were published in an Establishment Inspection Report (EIR) released by the FDA. Plaintiff commenced a defamation action against Downtown Hospital, Friedman, and others, asserting that her professional reputation was damaged by the publication of defamatory statements about her made by Friedman to the FDA inspectors. Defendants filed a motion to dismiss. Supreme Court allowed plaintiff’s defamation claim against Downtown Hospital and Friedman to survive, concluding that the statements were not shielded by an absolute privilege because the FDA’s investigation had none of the indicia of a quasi-judicial proceeding. The Appellate Division reversed, concluding that the complained-of statements were made in a quasi-judicial context in which an absolute privilege protected them. The Court of Appeals reversed again, holding that Friedman’s statements, as published in the EIR, were not protected by absolute privilege. Rather, the Court of Appeals held that qualified privilege, rather than absolute privilege, applies when the subject of the alleged defamation has no opportunity to rebut the allegedly defamatory statements. As such, plaintiff's action was remanded to the trial court, with the understanding that qualified privilege applies to the defamatory statements. Plaintiff must still prove damages, but the claim has survived motion practice -- for now. Thanks to Meg Adamczak for her contribution to this post. Please email Vincent Terrasi with any questions. Previous Next Contact

News PTSD May Be Considered a Bodily Injury Under Insurance Policy (PA) December 19, 2019 < Back Share to: The Superior Court of Pennsylvania recently reversed an order granting summary judgment to an insurer after the insurer claimed that the plaintiff failed to produce evidence essential to her cause of action. In Carol Evans v. Travelers Insurance Company, the insurance company moved for summary judgment claiming that the plaintiff failed to show that her Post-Traumatic Stress Disorder (“PTSD”) resulted from bodily harm she sustained in a motor vehicle accident. The underlying incident involved a car accident in which Carol Evans (“Evans”) was driving in the left passing lane when a tractor-trailer merged into her direction and collided with her vehicle. The accident caused a crack in Evans’ windshield, broke the passenger side mirror off her vehicle, smashed her passenger side windows, caused broken glass to enter inside of the vehicle, and pushed her vehicle to the left toward the concrete barrier. Evans was able to regain control of her car and pull over to the right side of the road. As a result of the accident, Evans did not initially seek medical care. Instead, Evans relied on generic pain medications at first. Later, the pain in her head and neck escalated and she began to experience dizziness in the week following the accident. Several months after the accident, Evans began treating with a psychiatrist for PTSD. Initially, Evans’ insurer, Travelers Insurance Company (“Travelers”) paid for her PTSD treatment but later denied coverage for future treatment. Travels determined that Evans’ PTSD did not constitute “bodily injury” as defined by the endorsement because it was not caused by a physical injury. As a result, Evans filed a breach of contract lawsuit against Travelers in the Court of Common Pleas in Wayne County. In response, Travelers filed a Motion for Summary Judgment claiming that Evans was not entitled to receive coverage for her PTSD treatment. The trial court found that Evans failed to provide evidence that her mental injuries resulted from her physical injuries, which was essential to her cause of action. As a result, Evans appealed to the Superior Court. First, Evans concluded that the trail court erred in determining that her PTSD was not covered under the Travelers’ policy. Specifically, she argued that PTSD, sustained with concomitant physical injuries, constitutes “bodily injury” under the policy. In response, Travelers’ relied on Superior Court case law denying coverage in an instance in which the plaintiff solely experienced PTSD but was not actually involved in a physical accident. The Court distinguished that case from the instant matter as Evans suffered both physical and emotional injuries as a result of her accident. As such, the Court concluded that Evans was entitled to benefits under her policy if the physical harm she sustained in the accident resulted in an illness. The Court determined that Evans produced evidence to support her claim that her PTSD resulted from her physical injuries and caused her continuous pain, affected her emotion and physical well-being, and required extensive medical testing, treatment, and rehabilitation. Furthermore, the Court found that Evans’ PTSD could have been caused in part by her physical injuries which are closely related and seemingly intertwined. As a result, the Court found there was a genuine issue of material fact to deem summary judgment inappropriate. Evans also argued that the trial court’s interpretation of the policy conflicts with the Motor Vehicle Financial Responsibility Law (“MVFRL”) and violates public policy. Specifically, Evans concluded that she was denied coverage even though she paid additional premiums for Added Party Benefits. She argued that she paid these additional premiums to receive “Increased Medical Expenses,” at a limit of $100,000.00. The Court was not persuaded with Evans’ position regarding the Added Party Benefits. Rather, the Court found it inconsequential that Evans chose to pay for the Added Party Benefits, as it did not relieve Evans of the requirement that she show that she sustained “bodily injury” in her motor vehicle accident. The Court was unpersuaded that Evans’ payment of additional premiums allowed her access to coverage for psychiatric treatment that was otherwise unavailable. Thanks to Zhanna Dubinsky for her contribution to this post. Please contact Vincent F. Terrasi with any comments. Previous Next Contact

News Court Upholds Abandoned Vehicle Court (PA) October 21, 2021 < Back Share to: In Nothstein v. Cochran, the Court of Common Pleas ruled in favor of the defendant tow truck company after following the proper procedure to obtain title for the Plaintiff’s abandoned vehicles. Plaintiffs in this case left their vehicles in a parking lot owned by a third party. The defendant towed the plaintiffs’ cars from the lot and stored the vehicles in their own impound lot. Defendants had now believed the vehicles were abandoned. According to PA law in order to reclaim an abandoned vehicle, the owner of the vehicle must pay the “costs for towing and storage from the date the salvor submitted the abandoned vehicle report to the department, plus a fee of $50 of which $25 shall be transmitted to the department by the salvor.” 75 Pa.C.S.A. § 7306. At this point if the 30 day period lapses then the controlling holder can dispose of the abandoned vehicle. Defendants followed the proper procedure under the statute and notified Penn DOT. Defendants had no separate obligation to the plaintiffs. While Plaintiffs complained they did not get notice from Penn DOT, the court held they did not adequately address that issue by bringing in PennDOT into the action and only found that the defendant towing company was not held to the same rigorous reporting standard, but did follow procedure. Simple takeaway is to follow the letter of the law or you will have lost your case. Thanks to Kevin Riley for his contribution to this post. Should you have any questions, please do not hesitate to contact Tom Bracken. Previous Next Contact

News Cosgrove Speaks at Annual PDI Conference. September 24, 2009 < Back Share to: The Pennsylvania Defense Institute invited WCM partner Robert J. Cosgrove to lecture at its September 24, 2009 annual conference in Bedford Springs, PA. Bob spoke on the topic of "Preserving Subrogation Rights in the First Party Insurance Context." A copy of the handout materials is attached. If you would like more information about the program or the materials, please feel free to contact Bob. http://pdf.wcmlaw.com/pdf/PDI.pdf http://www.padefense.org/ Previous Next Contact

News New York's Highest Court Affirms WCM's Victory Regarding Tenders in Public Sidewalk Cases December 4, 2025 < Back Share to: The New York Court of Appeals left intact our client’s AI coverage win in the First Department, which we reported on here: https://www.wcmlaw.com/news/first-department-rules-that-circumstances-do-matter-in-evaluating-ai-tenders-in-public-sidewalk-cases . In denying appellant’s motion for leave to appeal, New York’s high court confirms that circumstances do matter in AI tender disputes. In February 2025, the Appellate Division, First Department affirmed summary judgment for our client, which insured a ground-level commercial tenant. After a pedestrian tripped and fell over a bulkhead around the corner from the insured’s tenancy, the building owner pressed for coverage citing the additional insured provision of the tenant’s insurance policy. We pushed back because the particular circumstances of our case did not trigger AI coverage. New York courts agreed. A great win for our client. The defense started at the tender stage and concludes with New York’s high court refusing to take the appeal. Please see below for our original post regarding the important Appellate Division decision. Please contact Dennis Wade or Abed Bhuyan for more information about this decision or WCM's insurance coverage practice. Previous Next Dennis M. Wade Dennis M. Wade Partner +1 212 267 1900 dwade@wcmlaw.com Contact

News WCM Counsel Jim Scott Elected President of Pennsylvania Defense Institute July 16, 2021 < Back Share to: James W. Scott, Jr., Counsel in the Philadelphia office of Wade Clark Mulcahy LLP, was elected President of the Pennsylvania Defense Institute at its Annual Conference at the Omni Bedford Springs Resort in Bedford, PA. PDI is the statewide organization of civil defense counsel and insurance professionals. Jim is a past President of the Philadelphia Association of Defense Counsel. As such, he is the only attorney to be elected president of both organizations. Jim is a graduate of Duke University and Temple University School of Law. His practice focuses on the defense of construction defect, premises liability, and product liability claims. Please email Jim if you have any questions about his practice or about PDI in general. Previous Next Contact

News No Joy In Mudville: Plaintiff's Case Strikes Out (NY) March 26, 2021 < Back Share to: In Chiaramonte v. Town of Smithtown, plaintiff was playing in a charity softball tournament sponsored by the defendants when she slipped on a muddy surface of one of the fields running from second to third base, allegedly injuring herself. The plaintiff subsequently commenced the instant action to recover damages for personal injuries against the defendants, alleging that they were negligent in the maintenance of the subject field. The defendants moved for summary judgment dismissing the complaint on the ground, among others, that the plaintiff assumed the risk of her injuries. The Supreme Court granted the motion, and the plaintiff appeals. The Appellate Division, Second Department, upheld the lower Court ruling under the doctrine of primary assumption of risk. Risks inherent in a sporting activity are those which are known, apparent, natural, or reasonably foreseeable consequences of the participation. Participants are not deemed to have assumed the risks of reckless or intentional conduct, or concealed or unreasonably increased risks. Here, the plaintiff admitted to observing that the field on which she was injured was “pretty muddy” prior to her accident, and testified at her deposition that she knew that it had rained the day before the accident. The plaintiff, a seasoned softball player and coach, further testified at her deposition that she had played softball previously in the rain and was fully aware that she could be injured at any time playing softball. The evidence submitted in support of the motion demonstrated that the plaintiff knew of the muddy conditions on the subject field and voluntarily chose to play anyway, and that she was readily aware of the risks inherent in the game of softball. Thus, she assumed the risk of slipping on mud on this field at the time of the subject accident. Thanks to Paul Vitale for his contribution to this post. Please email Georgia Coats with any questions. Previous Next Contact

News NY's Second Department: Insurance Brokers Are Still Not Held to Professional Standard of Care. April 8, 2010 < Back Share to: As a general matter of NY law, an insurance broker has a duty to either obtain the coverage that a customer specifically requested within a reasonable time or inform the customer of its inability to do so. This standard of care is often challenged by disgruntled insureds after a loss when, after a carrier successfully disclaims coverage, the insured is left without a recovery. In such cases, the insured often asserts a claim against its broker and alleges that the broker failed to properly advise as to the type of coverage most appropriate for the risk. NY's Second Department has just rejected such an attack. In Core-Mark International v. Swett & Crawford, the plaintiff alleged that its insurance brokers procured a scheduled loss property insurance policy rather than the general limits blanket policy that was needed and specifically requested. As a result, when the inevitable loss occurred, Core-Mark was not fully compensated for its damages by the policy. Core-Mark asserted negligence and breach of fiduciary duty causes of action against Swett & Crawford. The Court found that while a negligence action could be asserted, Swett & Crawford did not breach any fiduciary duty in procuring the improper insurance policy. The Court reasoned that under the particular facts before it, because (a) Swett & Crawford had not received compensation for any consulting services and (b) no course of conduct between Core-Mark and Swett existed which would put an objectively reasonable broker on notice that its advice was being sought and relied upon, a professional/fiduciary duty did not exist. The Court thus dismissed the breach of fiduciary duty claim. However, given the Court's reasoning -- which required proof of only (a) or (b), it is easy to imagine a fact pattern where the result could have been far different and a new duty of care precedent could have been established. Brokers beware! Special thanks to Chris O'Leary for his contributions to this post. If you have any questions, please contact Bob Cosgrove at rcosgrove@wcmlaw.com . http://www.nycourts.gov/reporter/3dseries/2010/2010_02735.htm Previous Next Contact

News PA Superior Court Applies Fair Share Act to Strict Liability Action January 5, 2018 < Back Share to: The Pennsylvania Fair Share Act, enacted in 2011, regulates the apportionment of jury verdict awards for liable parties. The Fair Share Act mandates that all defendants are responsible for the share of liability apportioned to them, with the exception that a defendant could be liable for the entire award if found more than 60% liable. In plain English, any defendant with 60% or less allocated liability in a case involving the Fair Share Act is only responsible for its own culpability and cannot be made to satisfy the entire judgement if a portion of the judgment is, for whatever reason, not collectable. The Fair Share Act unquestionably includes negligence verdict awards but the Pennsylvania Supreme Court and Pennsylvania Appellate Courts , until recently, had yet to weigh in regarding the applicability of the Fair Share Act for strict liability cases sounding in tort actions. In Roverano v. John Crane Inc, the Superior Court of Pennsylvania dealt with the Fair Share Act within the context of a strict liability asbestos action where plaintiff claimed he sustained lung cancer as a result of exposure to asbestos. The trial court had decided that the jury could not apportion liability because the case involved strict liability for asbestos exposure. The Superior Court held that the applicable statute alluded to strict liability for tort cases and only excluded four categories of strict liability actions, implicitly including the balance of strict liability cases sounding in tort. Further, the Court held that strict liability allocation amongst joint tortfeasors was required by the Fair Share Act to be identical to the allocation method for negligent joint tortfeasors. The Court held that was mandated per the legislative intent underlying the enactment of the Fair Share Act. Additionally, the Court held that the clause in the applicable statute “including actions for strict liability” is revealing. Finally, the Court found legislative history instructive as older versions of the bill included “causal negligence” but were replaced in the enacted statute with “liability”, thus allowing an inference of greater inclusion of possible actions. The Superior Court’s decision means that a “fact-finder [should allocate] liability among joint tortfeasors in all types of cases, including strict liability cases”. The Court specifically declined to weigh in how exactly to allocate liability, but that the liability allocation should not be done on a per capita basis, Revealingly, the Superior Court did note that the jury should consider evidence of any previous settlements with released defendants as part of its liability determination. Thanks to Matt Care for his contribution to this post and please write to Mike Bono for more information. Previous Next Contact