Toll or Suspension? New York Court of Claims Judge Says Toll.

Did New York Governor Cuomo's Executive Order 202.8 et seq. create a toll or suspension of prescribed procedural limitations periods? 

On February 21, 2021, this New York Court of Claims judge, after chiding the New York Attorney General's Office for having "inexplicably failed to advise the court of Executive Order 202.8 and then, once raised by [the pro se] claimant, neglected to address it's impact here," said toll: 

Executive Order 202.8, as noted, provides for a toll, as do Executive Order 202.67 and Executive Order 202.72, the last two executive orders addressed to time limits for the commencement, filing or service of a legal action. Thus, it is clear that a toll, and not a suspension, was intended and the question becomes whether the statute authorizes a toll. The primary consideration in the construction of a statute is to ascertain and give effect to the intention of the legislature (McKinney's Cons Laws of NY, Book 1, Statutes § 92). The legislative intent is to be ascertained from the words and language used and the statutory language is generally construed according to its natural and most obvious sense without resorting to an artificial or forced construction. (McKinney's Cons Laws of NY, Book 1, Statutes § 94). Focusing on the phrase "suspend any statute" in Executive Law § 29-a(1), the statue demonstrates a far reaching application. Considering that the legislature extended the authority for the governor to suspend to "any statute", that power should not be read in the narrow context of statutes involving time limitations where a `suspension' represents a term of art. Moreover, a statute must be construed as a whole reading the various sections together to determine legislative intent (Matter of Plastic Surgery Group, P.C. v Comptroller of the State of NY, 34 NY3d 507, 516 [2019]; Loehr v New York State Unified Court System, 150 AD3d 716 [2d Dept 2017]). In that regard, consideration must be given to the language in Executive Law § 29-a(2) which provides that "[s]uspensions pursuant to subdivision one of this section shall be subject to the following standards and limits" and in paragraph "d" of subdivision two, which provides that the implementing executive order "... may provide for the alteration or modification of the requirements of such statute, local law, ordinance, order, rule or regulation suspended, and may include other terms and conditions". The language in subdivision two, paragraph "d" makes clear that something other than a straightforward suspension of a statute is authorized. The governor is also permitted to modify the terms and conditions of a statue. Here, Executive Order 202.8, and its successors, can reasonably be characterized as implementing a temporary alteration of the timely filing and service provisions in Court of Claims Act § 10, a modification. As such, the tolls were authorized and the claim is not untimely. 

~~Foy v. State of New York, 2021 NY Slip Op 21037 (NY Ct. Clms. 2021)

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So When Can I Close My File? Calculating New York's COVID-19 Toll

 A claim handling client asked me today on what date the statute of limitations for a third-party personal injury claim that would have expired on July 11, 2020 if New York's COVID-19 toll (if it was a toll and not a suspension--see my previous posts on this blog) had not been put in place now expires?  

The answer can be found on Slide 33 of my November 3, 2020 presentation:

So the answer is?  February 25, 2021.  

• The number of days from March 20, 2020 to and including July 11, 2020 is 114.
• 114 days after November 3, 2020 is February 25, 2021.  

Easy peasy.  Something else you can be thankful for tomorrow. 

Stay safe and well, everyone, and have a happy (if socially distant) Thanksgiving.

P.S.  I used two websites/services to make these calculations:

• timeanddate.com's Days Calculator; and
• Google.

$481.30 Awarded on a $62,830.97 No-Fault Claim -- Coronary Bypass Surgery and Related Hospital Services Found Unrelated to the MVA

NO-FAULT – CAUSATION – CORONARY BYPASS SURGERY – AAA ARBITRATION DECISION

Matter of United Health Services Hospital  aao JK and Preferred Mutual Ins. Co.
(AAA Case No. 17-18-1089-4199, issued 11/23/2020)

78-year old man passes out driving and crashes.  At the hospital, he is found to have suffered a myocardial infarction and severe coronary artery disease.  Eight days, one coronary bypass surgery and $62,830.97 later, he goes home.  A few weeks later, the hospital bills the man's no-fault insurer, Preferred Mutual, for the cost of the heart surgery and related services.  Preferred Mutual obtains a cardiologist's peer review opinion and denies payment.  Approximately four years and 100% in interest later, the hospital demands AAA arbitration of the denial. 

After a hearing, AAA Arbitrator Fred Lutzen concluded:

After reviewing the entire peer review and the submitted records, I find the peer provides a satisfactory medical rationale and relies on the facts present, so that Respondent has met its burden and proven, prima facie, that the hospital services and surgery related to his heart condition were unrelated to the motor vehicle accident. 

The arbitrator did award the hospital a total of $481.30 for the ER charge and a CT scan.  

Ryan Mura of this office ably defended Preferred Mutual's denial position in this arbitration.  Nice job, Ryan.   

The Key to Winning COVID-19 Business Interruption Lawsuits?

I was interviewed last Friday and quoted this morning in Jim Sams' article for the Claims Journal, entitled "The Key to Winning COVID Business-Interruption Claims: Say the Virus is Present".

Sandwiched between two policyholder attorneys, I made some points and said some words on the subject of the developing and refined strategies of policyholder attorneys to keep their clients' COVID-19 business interruption lawsuits from being dismissed on pre-answer dispositive motions.  

I said when I posted that article to LinkedIn that I'm still trying to get my head around policyholder attorney Chip Merlin's "absurd" argument. 

Absurd for policyholder attorneys to allege presence of the virus, or for insurer's to require that policyholders prove it? Listen for yourself and please tell me if you understand Chip's argument.

Then be sure to read my comment to the Claims Journal article.  

What do you think?  Is alleging presence of the virus on property "the key"?  I know of some federal judges who don't think so. 

COVID-19 Business Interruption Analytics -- Metrics for Six Dozen Litigation Rulings (To Date)

 It was in mid-April that I got the call.  I was being drafted to a team of attorneys from over a dozen jurisdictions to defend one of my insurer clients in what was expected to be an incoming tsunami of COVID-19 business interruption lawsuits.  For a seasoned insurance coverage attorney like me, this was my most recent call-up to The Bigs.  The Show.  The reason I spent all those formative coverage attorney years parsing sentences and hunting for the elusive Oxford comma.   

Now seven months and three, fully briefed, pre-answer motions to dismiss (actually four--moved twice in one case) later, I could tell you everything you never wanted to know about the meaning of DPLOODT (direct physical loss of or damage to) property, "loss" and "damage", "of" and "to", and whether a virus is alive or dead or neither and why it might matter to a policyholder's business interruption claim.

But not in this post.  Instead, I'll skip to and share with you the "scorecard" of sorts I've developed for cataloging and tracking the 72 COVID-19 business interruption ("BI" to the cool, commercial property kids) court rulings to date:

Now, if you had been following me all along on LinkedIn, you would already have these metrics.  I've lost count how many times since April I've used the #businessinterrution and #covidBIlitigation hashtags on my LinkedIn posts (but you can count them if you want, in no particular and discernable order, by clicking here).  

I know you're wondering how I keep all these stats or metrics, right?  Easy (not really).  Thank Microsoft and the sortability (not a real word) of the excellent Excel spreadsheet.  Et voilà:

The image above clicks to its PDF source, but for the real spreadsheet geeks who know what insights custom sorting can reveal, I offer you the sortable Excel spreadsheet, itself.  All case rulings are clickable through to PDF documents residing in my Dropbox folder.  If you want updated versions of the rulings metrics and spreadsheet, follow me on LinkedIn and watch for my weekly postings.  

Please feel free to share the rulings metrics, sortable spreadsheet and Dropbox folder link with whomever might find them interesting and useful.  

And stay safe and well, everyone.  

Tolled or Suspended? Watch What Happens Now That Whatever It Was Is Over.

 

If you were unable to join us on November 3rd for a scintillating discussion (at least as scintillating as any discussion of the New York Civil Practice Law and Rules can be) about the expiration of New York's so-called COVID-19 toll (or was it a suspension?), turn the nearest light up to at least 6000K, grab another caffeinated drink, and click the image above for a recorded replay of my presentation.  Running time is 55 minutes and 49 seconds of heart-pounding action.  Mature audiences only.  

If you prefer to read along with or in lieu of listening, my slide deck in PDF format is [click] here.

Toll or Nothing -- Free Webinar on November 3, 2020 to Review & Discuss NY's "COVID-19 Toll"

Join us on Tuesday, November 3, 2020 at 2:00 PM ET for a free webinar to review and discuss NY's "COVD-19 Toll", set to expire on November 3, 2020.

Topics will include:

• toll vs. suspension: what's the difference?
• Executive Orders 202, 202.8, 202.14, 202.28, 202.38, 202.48, 202.55, 202.55.1, 202.60, and 202.67.  
• scope of the toll or suspension -- what things other than SOLs does this apply to?
• toll or suspension -- which is it?
• if a toll -- what happens: four scenarios
• if a suspension -- what happens: four scenarios
• applicability to time limits prescribed by:
• regulations?
• contracts?

We're going to run this webinar  on Microsoft Teams.  If you'd like to attend, click the link below.  You will not need to install any apps or software if you don't want to; you can attend the webinar via your computer's Internet browser of choice.  Join us and watch and listen in.  I'll have a Q&A at the end of the program.  See you then.  

Join Microsoft Teams Meeting

*** COVID-19 BI LITIGATION RULINGS BY THE NUMBERS *** (through Oct. 29, 2020)

I have seen a "scorecard that, together with the cases that I and others on LinkedIn have reported, tallies the COVID-19 business interruption rulings to date as 35-13 in favor of insurers. 

>>  The FEDERAL/STATE COURT SPLT split is 33-15. 

>> The FEDERAL COURT SCORE is 29-4 for insurers. 3 of the 4 rulings favoring policyholders are from the same judge. 

>> The STATE COURT SCORE is 9-6 in favor of policyholders. 2 of the 6 rulings favoring insurers are from the same judge. 

>> Of the 13 TOTAL DECISIONS FAVORING POLICYHOLDERS, only 4 are from federal court and 9 are from state court. 3 of the 4 federal court ruling favoring policyholders are from the same judge. 

>> 28 DIFFERENT FEDERAL JUDGES have ruled on motions -- 26 in favor of insurers and 2 in favor of policyholders. 

>> 14 DIFFERENT STATE COURT JUDGES have ruled on motions – 5 in favor of insurers and 9 in favor of policyholders. 

>> The AVERAGE LENGTH of the STATE COURT rulings FAVORING POLICYHOLDERS is 1.88 pages. 

>> The AVERAGE LENGTH of ALL FEDERAL COURT rulings is 11.37 pages.

What's it all about, Alfie?

Toll or Suspension -- What's Due on November 4th?

I am beginning to question my office's present position on whether New York Executive Order § 202.8 and its subsequent extensions operates as a toll or suspension of prescribed limitations periods. 

Many think, as did I originally, that 202.8 et seq. created a toll. If it’s a toll, I’ve said that 229 days must be added to the expiration date. If it’s a suspension, any procedural limitations period that expired or will expire from March 20th through November 3rd will become November 4th, making a LOT of things due that day. Governor Cuomo started off in EO 202.8 calling it a toll, but EO 202.67, as you will recall, states that “for any civil case, such suspension is only effective until November 3, 2020, and after such date any such time limit will no longer be tolled[.]” Great. That’s clears it up. 

Fellow NY blogger Eric Turkewitz thinks it’s a toll. So do these attorneys. 

Second Department Appellate Division Justice Thomas F. Whelan, however, thinks it’s a suspension. 

I’m now leaning towards suspension, in part because the statute that gives the governor emergency powers and the statute Cuomo cited in all orders in the Executive Order 202 series – Executive Law § 29-a – is entitled “Suspension of other laws” and starts: 

1. Subject to the state constitution, the federal constitution and federal statutes and regulations, the governor may by executive order temporarily suspend specific provisions of any statute, local law, ordinance, or orders, rules or regulations, or parts thereof, of any agency during a state disaster emergency, if compliance with such provisions would prevent, hinder, or delay action necessary to cope with the disaster. 

2. Suspensions pursuant to subdivision one of this section shall be subject to the following standards and limits: 

a. no suspension shall be made for a period in excess of thirty days, provided, however, that upon reconsideration of all of the relevant facts and circumstances, the governor may extend the suspension for additional periods not to exceed thirty days each[.] 

Whatever it is, it’s ending on November 3, 2020.  I'm going to meet with the attorneys in my office and do some more reading and studying.  Join me afterwards in a Microsoft Teams meeting on Tuesday, November 3rd, at 2:00 PM ET to hear my office's updated opinion on this question and discuss and cast your vote.  Not in that election. This one.

Join the Microsoft Teams Meeting

What Is New York's No-Fault Scheme Ill-Equipped to Handle? (The right answer is not "claims".)

NO-FAULT – RICO AFFIRMATIVE ACTION – PRELIMINARY INJUNCTION STAYING COLLATERAL ARBITRATIONS & LITIGATION – MOTION TO DISMISS

GEICO v. Mikhail Strut, MD, RES Physical Medicine & Rehabilitation Services, PC, and Cheryle Hart, MD
(WDNY, 4/10/2020)

Those of you dealing with Mikhail Strut, MD (f/k/a Mikhail Strutsovskiy) and his medical practice,  RES Physical Medicine & Rehabilitation Services, PC, may want to read this decision (click the case name) and follow this case.  

In this decision and order, WDNY Judge Sinatra adopted Magistrate Judge Scott's recommendations to:

• DENY defendants' motion to dismiss GEICO's complaint, which alleges causes of action based on RICO, fraud and unjust enrichment; and

• GRANT GEICO's motion for a preliminary injunction and a stay of all collateral no-fault suits and arbitrations, upon GEICO posting $500,000 security. 

In rejecting Dr. Stut's argument that GEICO was trying "improperly to circumvent New York's no-fault scheme" by litigating Strut's claims in federal court, Judge Sinatra remarked:  "Well, isn't that the pot calling the kettle black?  But the law is clear that Plaintiffs may maintain RICO and fraud claims in federal court, notwithstanding New York's no-fault scheme, because the no-fault scheme is ill-equipped to handle claims involving systemic fraud." 

Okay, Judge Sinatra didn't write the pot/kettle thing.  But he did deny Dr. Strut's motion to dismiss and grant GEICO's preliminary injunction application.  If you're a New York no-fault insurer and are facing growing numbers of suits and arbs while you race to complete a global DJ action to confirm your non-coverage position, consider moving for preliminary injunctive relief.  

Yes, that Mikhail Strut.

What Should a Lawyer Sound Like? (Hint: Never use four words when three will do.)

No, this is not the set up to another lawyer joke.  And I'm not asking for a friend.  

On my LinkedIn account I recently shared Inc. Magazine's October 1, 2020 article entitled, "Ruth Bader Ginsburg Taught a Law Clerk the Secret to Strong Writing".  Here's the article:

I said in my LinkedIn post that I strongly endorse the less is more method. The if-it-takes-more-than-one-breath test. 

My transformative moments along the path of becoming a better writer who happened to be working in the legal industry came in 1981 from attorney L. David Zube, then director of Broome County Neighborhood Legal Services, and then again in 1986 from Justice James Boomer of the Appellate Division, Fourth Department. 

David Zube taught me to eschew legalese and write plainly, using an crude but memorable excretory metaphor that included a generic jurist to make his point. Still in college but with designs on law school, I thought I ought to sound like a lawyer, if I were writing for a lawyer.  Where I was wrong, it turned out, was in my thinking of what a lawyer ought to sound like.  I've never forgotten that lesson (or its associated visual imagery).  

Justice Boomer taught me and the other newbie confidential law assistants during his this-is-how-you-should-write-your-reports welcome-to-the-court session to write with a purpose and the reader in mind.  Admittedly, in writing those reports to affirm, reverse or modify, I never adhered to Justice Ginsberg's first tip of good writing: Set up constraints.  Thankfully, we had an incredibly proficient typist, Patty.  I was composing memos of law when cutting and pasting literally meant cutting and pasting (or at least scotch taping).

I just finished revising a reply memorandum of law for a federal court action my office is defending.  The court's local rules limit reply memoranda to 10 pages.  Limits force the writer to be selective and succinct: selective of which points or arguments bear mentioning in limited space, and succinct in clearly communicating those points in as few words as necessary.  

Before I became a lawyer--the exact moment of which is still hotly debated--I thought being a lawyer required sounding like a lawyer. The reason for that likely sourced to the thick and heavy "hornbooks" we "1Ls" were forced to lug around. Thankfully, legal writing, like the law, has evolved. One of my law school classmates, now a judge, recently wrote this: 

There is indeed a consistent thread throughout the law that distinguishes bare allegations from allegations proven by credible evidence, better known as "facts." Allegations, in general, are much easier to make than to prove. Misconduct allegations, in particular, are sometimes the product of an accuser feeling embarrassed or feeling insulted or feeling intimidated by the accused, as opposed to any actual wrongdoing by the accused. Allegations are also at times the product of less than laudable motives, such as secondary gain. Perhaps the most frightful aspect of allegations is their power to destroy. This seems particularly acute today, when so many receive their information from social media, where a keyboard is often wielded as a cudgel. It is a sad reality that in the modern world, all that is required to malign is an agenda, an audience and an accusation. 

Nice, huh?  Well said, Frank.

Subject, predicate, object.  Active voice. The KISS principle for sentence composition.  Simple words (for the most part).  Write for the reader, not yourself.  

P.S.  From the Appellate Division's website re Justice Boomer:

James H. Boomer, was born on August 13, 1922. He served during World War II as a Naval Aviator from 1942 to 1946. Justice Boomer graduated from the Syracuse University College of Law, summa cum laude, in 1948 and was admitted to practice that year. He served as this Court's first research assistant from January 1948-July 1949. He became the Corporation Counsel for the City of Rochester in 1949 and served in that capacity until 1961. Thereafter, he practiced law in Rochester until 1970 when he was elected to the Supreme Court in November 1970. He was designated to the Appellate Division, Fourth Department by Governor Hugh Carey in 1982. During his term he served as a Trustee to the Appellate Division Law Library and served as the Chair of the Indigent Criminal Appeals Management Counsel for the Seventh Judicial District. He also served briefly as a temporary judge of the Court of Appeals. Justice Boomer was an avid hiker and mountain climber, scaling Mount Kilamanjaro at the age of 70. He died during a hiking expedition on November 14, 1993.

No wonder the court had him do the this-is-how-you-should-write-your-reports training to each new class of law assistants.  He was awesome AND awe-inspiring.

This Is Your Last Tolling! -- Executive Order No. 202.67 Extends COVID-19 Tolling of Procedural Time Limits Through November 4, 2020

For the sixth time since New York's COVID-19 toll of "any specific time limit for the commencement, filing, or service of any legal action, notice, motion, or other process or proceeding, as prescribed by the procedural laws of the state, including but not limited to *** the civil practice law and rules, *** or by any other statute, local law, ordinance, order, rule, or regulation, or part thereof" went into effect, Governor Cuomo's office has further extended that toll for another 30 days. 

Executive Order 202.67, dated October 4, 2020, "do[es] hereby continue the suspensions, modifications, and directives, not superseded by a subsequent directive, made by Executive Orders 202 up to and including 202.21, and 202.27, 202.28, 202.29, 202.30, 202.38, 202.39, 202.40, 202.48, 202.49, 202.50, as extended, and Executive Order 202.55 and 202.55.1, as extended, and Executive Order 202.60 for another thirty days through November 3, 2020[.]"

"Through" means including.  

EO 202.67 does, however, signal that this may be the last extension of the COVID-19 toll, adding:

The suspension in Executive Order 202.8, as modified and extended in subsequent Executive Orders, that tolled any specific time limit for the commencement, filing, or service of any legal action, notice, motion, or other process or proceeding as prescribed by the procedural laws of the state, including but not limited to the criminal procedure law, the family court act, the civil practice law and rules, the court of claims act, the surrogate’s court procedure act, and the uniform court acts, or by any statute, local law, ordinance, order, rule, or regulation, or part thereof, is hereby continued, as modified by prior executive orders, provided however, for any civil case, such suspension is only effective until November 3, 2020, and after such date any such time limit will no longer be tolled[.]

If Governor Cuomo means what he says and New York's COVID-19 toll is not continued past November 3, 2020, the magic number will be 229 -- 229 days added to the expiration date of the procedural time limit at issue, such as a statute of limitations or a contractual suit limitation.  I'll post more about that calculation on November 2nd.  

Those who want to know more about this toll by executive order may read my previous posts about it here and here and here.

When You Is an It

AUTO – UM COVERAGE – "INSURED" – STAY OF UM ARBITRATION

State Farm Mut. Auto. Ins. Co. v. Sanchez
(Sup. Ct., NY Co., 8/3/2020)

State Farm issued an auto policy to "Profit General Contractor & Contracting, LLC", a limited liability company having one member (owner),  Alexandro Sanchez.  While riding his bicycle, Mr. Sanchez was hit by an uninsured vehicle, sustaining injuries.  He made a claim under his LLC's auto policy with State Farm for UM coverage, which State Farm denied on the basis that Sanchez did not qualify as an "insured" under the LLC's policy, which was defined as:

(1) you, as the named insured and, while residents of the same household, your spouse and the relatives of either you or your spouse; 

(2) any person while acting in the scope of that person's duties for you, except with respect to the use and operation by such person of a motor vehicle not covered under this policy, where such person is: 

(i) your employee and you are a fire department; 

(ii) your member and you are a company, as defined in General Municipal Law section 100; 

(iii) your employee and you are an ambulance service, as defined in Public Health Law section 3001; or

(iv) your member and you are a voluntary ambulance service as defined in Public Health Law section 3001; 

(3) any other person while occupying: 

(i) a motor vehicle insured for SUM under this policy; or 

(ii) any other motor vehicle being operated by you or your spouse ; and 

(4) any person, with respect to damages such person is entitled to recover, because of bodily injury to which this coverage applies sustained by an insured under paragraph (1), (2), or (3) above.

Sanchez demanded arbitration of his UM claim and State Farm commenced this special proceeding to stay that arbitration.  

In ruling in favor of Sanchez and dismissing State Farm's petition, the court, after noting that "the burden rests on the party seeking the stay to establish the existence of evidentiary facts, sufficient to conclude that there is a genuine preliminary issue", held that because the policy was issued to an LLC and afforded coverage options for the named insured's "spouse"  and a discount for the named insured having taking an accident prevention course, the policy afforded UM coverage to him: 

Factually, the facts of the instant matter have even more in common with with those of Morette. In Morette, Anthony Morette, the sole owner of policyholder A.T. Morette Electric LLC, allegedly was struck by an unidentified motor vehicle while he was jogging. Ultimately, Mr. Morette's wife and daughter sought a declaratory judgment that the insurer, Merchants Mutual Insurance Company, was liable for SUM coverage (Morette, supra, 35 Misc. 3d at 201-202). The court denied the insurers' motion for summary judgment, rejecting Merchants' argument that because the LLC was the named insured, SUM coverage was unavailable. In reaching such conclusion, the court relied on a few key provisions, including the option to pay a premium for spousal liability coverage (id. at 206). It further noted that the exclusions page did not exclude the member of the LLC from injuries that were relevant to the facts at hand. Here, too, the option to purchase spousal liability coverage existed, and coverage for a bike accident was not excluded. In addition, the exclusions page indicates that petitioner had the discretion to provide coverage to the surviving spouse if the insured was deceased (NYSCEF Doc. No. 5, at 000029). Further, as respondent points out, petitioner provided a discount to the LLC because respondent took an accident prevention course, and this also weighs in favor of treating him as individually covered under the policy.

LLCs don't have spouses and can't take an accident prevention course, but they can be treated as a carbon-based life form for purposes of UM (and SUM) coverage under an automobile insurance policy.

Another (x5) 30 Days in the Toll -- Executive Order No. 202.60 Continues COVID-19 Tolling of Procedural Time Limits Through October 4, 2020

At least the Governor's office didn't wait until tomorrow morning at 6:11 AM this time.   

For the fifth time since New York's COVID-19 toll of "any specific time limit for the commencement, filing, or service of any legal action, notice, motion, or other process or proceeding, as prescribed by the procedural laws of the state, including but not limited to *** the civil practice law and rules, *** or by any other statute, local law, ordinance, order, rule, or regulation, or part thereof" went into effect, Governor Cuomo's office has further extended that toll for another 30 days. 

Executive Order 202.60, posted this afternoon, "do[es] hereby continue the suspensions, modifications, and directives, not superseded by a subsequent directive, made by Executive Orders 202 up to and including 202.21, and 202.27, 202.28, 202.29, 202.30, 202.38, 202.39, 202.40, 202.48, 202.49, 202.50, as extended, and Executive Order 202.55 and 202.55.1 for another thirty days through October 4, 2020[.]"

If New York's COVID-19 toll is not continued again past October 4, 2020, the number will be 199 -- 199 days added to the expiration date of the procedural time limit at issue, such as a statute of limitations or a contractual suit limitation. 

Another 30 days in the toll.

If you haven't been keeping track, my prior posts on this toll by executive order are here and here.

Now go enjoy your long Labor Day weekend, lawyers.

The Jenner Complaint

It's been dubbed "the Jenner complaint" and, last I knew, has been filed in Illinois and New York state courts. It's an evolved or mutated variant of predecessor COVID-19 BI policyholder complaints, embedding a table of contents, photos, floor plans and seating charts in its hundreds of pages in support of these policyholders' core argument that impairment or loss of function or functionality equals direct physical loss or damage.

Interested persons can follow the New York state court action's docket by clicking here.

#businessinterruptioninsurance #COVID19businessinterruptionlitigation

DC Court Grants Summary Judgment to Commercial Property Insurer on COVID-19 Business Interruption Claim

* * * SPECIAL ALERT * * *

This afternoon the Superior Court of the District of Columbia granted summary judgment to Erie Insurance Exchange, dismissing plaintiffs' complaint for COVID-19-related business income/ interruption losses.

The court concluded: 

With both dictionary definitions and the weight of case law supporting Defendant’s interpretation of the term "direct physical loss," Plaintiffs’ additional arguments are unconvincing. First, Plaintiffs argue that because the insurance contract has specific exclusions for "loss of use" under some coverage lines but not for Income Protection coverage, the Court should infer that the Income Protection coverage covers losses such as Plaintiffs’. Plaintiffs' Motion at 13-14. But as already discussed, even if “loss of use” was covered, Plaintiffs would still have to show that the loss of use was a "direct physical loss” similar to those in the cases discussed supra at 5-7. And for the reasons explained in this order, there was no “direct physical loss” to Plaintiffs.  Second, Plaintiffs argue that, unlike some similar insurance policies, their policies do not include a specific exclusion for pandemic-related losses. Id. at 19-20. But again, even in the absence of such an exclusion, Plaintiffs would still be required to show a 'direct physical loss.' Because they cannot do so, the Court grants summary judgment to Defendant.

The case is Rose's 1, LLC et al. v. Erie Insurance Exchange and you can read the court's decision and order by clicking here. 

Another 30 Days in the Toll -- Executive Order No. 202.55 Continues COVID-19 Tolling of Procedural Time Limits Through September 4, 2020

I went to bed last night and woke up before 6:00 this morning hitting F5 on my browser and thinking that today would be the day.  The day New York's COVID-19 toll of procedural time limits "for the commencement, filing, or service of any legal action, notice, motion, or other process or proceeding, as prescribed by the procedural laws of the state, including but not limited to *** the civil practice law and rules, *** or by any other statute, local law, ordinance, order, rule, or regulation, or part thereof" would be over.  The day the title of this morning's blog post would start with "Plus 139".  

Someone at the Governor's office, however, was up early this morning, too, and at 6:11 AM posted Executive Order 202.55, which "continue[s] the directives, not superseded by a subsequent directive, made by Executive Order 202 and each successor Executive Order up to and including Executive Order 202.21, and Executive Order ... 202.28, ... 202.38, ... [and] 202.48 ... for another thirty days through September 4, 2020[.]"

If you missed my July 6, 2020 post on what Executive Orders 202.8, 202.14., 202.28 and 202.38 provided, click here.  If the COVID-19 toll is not continued again past September 4, 2020, the addend will be 169 --  169 days added to the expiration of the procedural time limit at issue, such as a statute of limitations or a contractual suit limitation.

Another 30 days in the toll.

When the Insured's Shoes Are Bigger Than the Tortfeasor's Shoes

AUTO – SUM COVERAGE – TRIGGER

Gross v. Travelers Ins.
(4th Dept., 7/24/2020)

Gross had an auto policy with Travelers that was written to afford BI and SUM coverage of $300,000 per person and $300,000 per accident.  He and his wife were injured when their vehicle was rear-ended by a vehicle operated by a nonparty tortfeasor, who was insured by The Hartford under a policy affording BI coverage with limits of $100,000 per person and $300,000 per accident.

In other words, the comparative BI coverage limits were:

                                Insured                                         Tortfeasor
Per person               $300,000                                      $100,000
Per accident            $300,000                                       $300,000

Gross settled his underlying personal injury claim for the tortfeasor's $100,000 per person policy limit, and his wife settled her claim for $16,000. Gross submitted a SUM claim to Travelers, which denied it on the ground that plaintiff's SUM coverage was not triggered because the tortfeasor's $300,000 in per accident BI coverage was not less than Gross's $300,000 in per accident BI coverage. Supreme Court agreed, and granted Travelers' motion to dismiss the complaint pursuant to CPLR 3211(a)(1) on that ground.  Gross appealed and the Fourth Department REVERSED, holding:

"Insurance Law § 3420(f)(2) was enacted to allow an insured to obtain the same level of protection for himself [or herself] and his [or her] passengers which he [or she] purchased to protect himself [or herself] against liability to others'" (Matter of Prudential Prop. & Cas. Co. v Szeli, 83 NY2d 681, 686 [1994], quoting Mem of St Exec Dept, 1977 McKinney's Session Laws of NY at 2446). It is well settled that, "[u]nder Insurance Law § 3420(f)(2), an insured's [SUM] coverage is triggered when the limit of the insured's bodily injury liability coverage is greater than the same coverage in the tortfeasor's policy" (id. at 684). More particularly, when determining whether SUM coverage is triggered, "[t]he necessary analytical step . . . is to place the insured in the shoes of the tortfeasor and ask whether the insured would have greater bodily injury coverage under the circumstances than the tortfeasor actually has" (id. at 687), which "requires a comparison of each policy's bodily injury liability coverage as it in fact operates under the policy terms applicable to that particular coverage" (id. at 688).  

Here, a comparison of the two policies at issue, in light of the circumstances of this case, demonstrates that plaintiff would be afforded greater coverage under his policy than under the tortfeasor's policy. The tortfeasor's policy would have provided plaintiff with only $100,000 of coverage for bodily injury, whereas plaintiff's policy would have provided him with up to $300,000 of coverage for bodily injury. Although plaintiff's SUM benefits would be reduced by the amount paid to his wife under the policy's $300,000 per accident maximum, he is still afforded more coverage under his policy than under the tortfeasor's policy because the bodily injury limit for an accident in which two people are injured would be $200,000 under the tortfeasor's policy, which is less than the coverage afforded by plaintiff's policy. Consequently, the SUM provision of plaintiff's policy was triggered (see Insurance Law § 3420[f][2][A]; Matter of Government Empls. Ins. Co. v Lee, 120 AD3d 497, 498-499 [2d Dept 2014]; Jones v Peerless Ins. Co., 281 AD2d 888, 889 [4th Dept 2001]).

Okay, you SUM savants.  What's the dispositive difference between the comparative coverage limits in this case and the comparative coverage limits in the seminal, controlling case of Prudential Prop. and Cas. Co. v. Szeli?  Hint: it has to do with swapping the headings in the above table.

New York County Supreme Court Grants Insurer's CPLR 3211(A)(1) Motion to Dismiss Plaintiff's Complaint Based on Insured's Failure to Submit Timely Proof of Loss

PROPERTY – BURST WATER PIPE-CAUSED WATER LOSS – PROOF OF LOSS REQUEST – MOTION TO DISMISS

Stein v. National General Ins. Co.
(Sup. Ct., NY Co., 6/9/2020)

Just when you thought you understood the "documentary evidence" basis of a CPLR 3211(a) pre-answer motion to dismiss, this decision issues.

In February 2018, Stein's Manhattan apartment sustained water damage from a burst water pipe.  National General investigated the loss and on April 15, 2019, paid Stein $30,519.82 for his loss. Unhappy with the amount of the loss payment, Stein hired a public adjuster, who inspected the loss and estimated the claim at $404,977.78.  National General declined to enter into an appraisal and, on July 9, 2019, sent a demand to Stein for a signed sworn proof of loss to be provided within 60 days.

On October 24, 2019, National General wrote to Stein, denying coverage for his claim based on various grounds, including Stein's failure to submit a signed sworn proof of loss within 60 days. Stein brought this action on February 18, 2020, alleging breach of contract and breach of the covenant of good faith and fair dealing.

In lieu of answering the complaint, National General moved on March 6, 2020 to dismiss Stein's complaint based on CPLR 3211(a)(1) (documentary evidence) and 3211(a)(7) (failure to state cause of action).  In support of its motion, National General submitted its attorney's affirmation with exhibits and a memorandum of law.  The exhibits attached to its attorney's affirmation were:

• a copy of the complaint;
• a copy of the relevant insurance policy;
• a copy of National General’s "Disclaimer of Coverage"; 
• copies of emails exchanged between National General and Stein’s public adjuster, Scott Modlin; 
• copies of emails exchanged between Stein and Modlin; 
• copies of emails sent by Modlin to National General and its representatives; 
• a copy of National General’s May 28, 2019 "Request for Information and Examination under Oath (“EUO”) demand"; 
• a copy of relevant sections of Stein’s testimony at his September 10, 2019 EUO; 
• a copy of National General’s June 24, 2019 letter requesting information and demanding an EUO; 
• a copy of National General’s July 15, 2019 letter requesting information and demanding an EUO; 
• a copy of a July 26, 2019 letter from Stein’s previous attorney; and
• a copy of National General’s July 9, 2019 letter demanding a signed, Sworn Statement in Proof of Loss, as well as the July 10, 2019 delivery receipt from Federal Express.

Stein opposed National General's motion to dismiss on two bases: (1) that National General's motion pursuant to CPLR 3211(a)(1) relied upon Stein's deposition testimony and, therefore, was not properly founded upon "documentary evidence"; and (2) National General should not be permitted to disclaim coverage as it only sent its proof of loss demand to Stein and not to his public adjuster.

In rejecting these arguments and GRANTING the motion, Supreme Court held:

These submissions conclusively resolve all factual issues as a matter of law and conclusively disposes of the plaintiff's claims for breach of contract and breach of the duty of good faith and fair dealing inasmuch as it is well settled that a plaintiff's "failure to file proof of loss within 60 days after receipt of defendant's notice is an absolute defense to an action on the policy, absent waiver of the requirement by the insurer or conduct on its part estopping its assertion of the defense." Hunter v Seneca Ins. Co., 114 AD3d 556, 557 (2014) citing Igbara Realty Corp. v New York Prop. Ins. Underwriting Assn., 63 NY2d 201, 209-210 (1984).  

In opposition, the plaintiff argues (i) that the defendant's motion pursuant to CPLR 3211(a)(1) relies upon the plaintiff's deposition testimony, and therefore is not properly founded upon documentary evidence, and (ii) the defendant should not be permitted to disclaim coverage as it only sent the demand to the plaintiff, not his insurance adjuster. The plaintiff's contentions are without merit. Contrary to the plaintiff's first contention, the defendant's submission of its demand of proof, with service, and the subsequent disclaimer of coverage are sufficient to establish the plaintiff's failure to respond within the 60-day time limit. See Hunter v Seneca Ins. Co., supra. Moreover, on a motion to dismiss pursuant to CPLR 3211(a)(1), documentary evidence may be supplemented by affidavits or deposition testimony that are not disputed. See Rosenbaum, Rosenfeld & Sonnenblick, LLP v Excalibur Grp. NA, LLC, 146 AD3d 489 (1 Dept. 2017). As the plaintiff does not dispute, in his deposition testimony or his opposition papers, that he did not timely respond to the defendant's demand, the court may properly rely on such evidence. See id. 

Furthermore, to the extent that the plaintiff contends that the defendant's failure to serve its demand on his adjuster constitutes a defense to this motion, such an argument is contrary to the plain language of New York Insurance Law § 3407, which only requires service of the demand be made upon the insured. Therefore, the plaintiff fails to rebut the documentary evidence submitted by the defendant, and dismissal pursuant to CPLR 3211(a)(1) is granted. 

As the action is dismissed pursuant to CPLR 3211(a)(1), the court does not reach the portion of the defendant's motion seeking to dismiss the complaint pursuant to CPLR 3211(a)(7).

Can this decision be reconciled with the Bonavita v. GEICO decision that I blogged about last week?  Is it because Stein did not dispute that he failed to submit a timely proof of loss?  Tell me what you think in the comments below.

As of the date of this post, no notice of appeal has been filed.  

The Unopposed Loss -- Court Denies Declaratory Judgment to No-Fault Insurer Based Solely on Default of Non-Answering Defendants

NO-FAULT – HIT-AND-RUN – AFFIRMATIVE ACTION – DEFAULT JUDGMENT – DECLARATORY JUDGMENT – INJUNCTIVE RELIEF

Ameriprise Ins. Co. v. Kim
(2nd Dept., 7/29/2020)

We've run into this before.

Your insurer client brings a global affirmative action against all carbon-based life-form claimants and their health care(less) assignee-providers spawned from a single, reported motor vehicle accident, seeking declaratory and injunctive relief.  All of the defendants are served, but most if not all them don't answer or move against the complaint.  Your client makes a motion for a default judgment against the non-answering defendants, who don't appear and oppose the motion.  Your client proves up good service of the summons and complaint, the non-answering defendants' default, and the facts constituting your client's claim.

Mark it down as a win, right?  Wrong.

In AFFIRMING Supreme Court's denial of Ameriprise's default judgment motion, the Second Department reminded:

"A plaintiff seeking leave to enter a default judgment must file proof of proper service of the summons and the complaint, the defendant's default, and the facts constituting the claim" (Global Liberty Ins. Co. v Surgery Ctr. of Oradell, LLC, 153 AD3d 606, 606; see CPLR 3215[f]). "[A] default judgment in a declaratory judgment action will not be granted on the default and pleadings alone for it is necessary that [the plaintiff] establish a right to a declaration'" against the defendants (JBBNY, LLC v Dedvukaj, 171 AD3d 898, 902, quoting Dole Food Co., Inc. v Lincoln Gen. Ins. Co., 66 AD3d 1493, 1494; see Merchants Ins. Co. of N.H. v Long Is. Pet Cemetery, 206 AD2d 827, 828).

Here, while the plaintiff submitted proof of proper service of the summons and the complaint, the non-answering defendants' default, and the facts constituting the plaintiff's claim, the plaintiff's submissions in support of the motion failed to establish its right to the declarations sought (see JBBNY, LLC v Dedvukaj, 171 AD3d at 903). As such, we agree with the Supreme Court's determination denying that branch of the plaintiff's motion which was for leave to enter a default judgment against the non-answering defendants.

Take-Away Point #1:  Establishing one's entitlement on motion to declaratory relief requires more than what is minimally required to obtain a default judgment.  Insurers must "establish their right" to the declaration, with a quantum of evidence equivalent to what is needed to avoid a directed verdict at trial.

Take-Away Point #2:  Although not apparent from this short memorandum decision, even if the movant establishes its right to a declaration, the decision whether to grant a declaratory judgment rests within the sound discretion of the court (CPLR 3001) and is "dependent upon facts and circumstances rendering it useful and necessary."  Denial of a default judgment is proper if the declaratory relief sought clearly affects the rights of other parties not alleged to be in default.  See Merchants Ins. Co. of N.H. v Long Is. Pet Cemetery, 206 AD2d 827, 828).

Mute the Barking, Playing, Sirening, Shuffling, Pinging, Drinking and Breathing Sounds, Please

ORDER TO SHOW CAUSE – TELECONFERENCE IN LIEU OF IN-PERSON HEARING GUIDELINES

Travelers Cas. & Sur. Co. of Amer. v. Omni Contracting Co., Inc.
(SDNY, 7/25/2020)

The COVID-19 pandemic has disrupted most aspects of court practice, including in-person appearances and hearings.  It has also caused United States District Court Judge Nelson Román, when converting an in-person show cause hearing to a teleconference, to remind counsel to follow the court's "guidelines" for teleconference participation:

1. Use a landline whenever possible. 
2. Use handset rather than speakerphone. 
3.  Identify yourself each time you speak. 
4. Be mindful that, unlike in a courtroom setting, interrupting can render both speakers unintelligible. 
5. Mute when not speaking to eliminate background noise, i.e., dog barking, kids playing, sirens, papers shuffling, emails pinging, drinking, breathing. It all comes through. This will also prevent interruptions. 
6. Avoid voice-activated systems that don't allow the speaker to know when someone else is trying to speak and they cut off the beginning of words. 
7. Spell proper names. 
8. Have judge confirm reporter is on the line. 
9. If someone hears beeps or musical chimes, that means someone has either come in or left the conference. Please be aware that the judge may need to clarify that the reporter has not lost the line. (This has happened before, and the reporter had to dial back in and tell the judge the last thing that the court reporter transcribed.)

For those wondering, Judge Román is two days older than me (so he surely speaks from experience about the audio reliability of landlines) and is someone who doesn't like dog-loving, paper-shuffling, heavy breathing, well-hydrated attorneys who have kids, live near first responders, prefer paper to plastic, and email a lot.  

Just kidding.  'Cept about being two days older than me.  

And who spells any more (other than Siri)?  

I'm out.  [Chime]

No, You May Not Be Excused... Court Denies Insurer's 3211(a)(1)-Based Pre-Answer Motion to Dismiss Declaratory Judgment Action

PERSONAL AUTO – TEMPORARY SUBSTITUTE AUTO – NON-OWNED AUTO – DECLARATORY JUDGMENT ACTION – MOTION TO DISMISS

Bonavita v. Government Employees Ins. Co.
(2nd Dept., 7/22/2020)

Before the Roman Catholic Mass was said in English in Mahwah, New Jersey, my brothers and sisters and I had to ask "May I be excused?" (may, not can) before leaving our assigned seats (assigned theoretically to preserve order in a family of then seven, rivaling siblings) at the dinner table to head back outside to play or into the living room to watch our allotted one hour of television.  The qualifying condition for an affirmative answer from one of our parents was a dinner plate cleared of the meat, starch AND vegetable food groups that made a daily appearance at our dinner table (ask me sometime about the inventive methods my mother came up with to get my brothers and me to finish our green vegetables, especially cellulose-armored asparagus).  There was no leaving our dinner table without finishing your dinner.  Period.  I learned to intensely dislike certain foods, while developing strategies for clearing my plate without eating its unappetizing contents (our family's German Shepherd was one such strategy until she was banned from the dining room during dinner), before I was ten.

Insurers facing declaratory judgment and breach of contract actions sometimes ask to be excused from a lawsuit without getting to the meat and potatoes (and even asparagus) of the action, moving to dismiss the complaints lodged against them before interposing an answer.  In New York state court actions, New York Civil Practice Law and Rules (CPLR) Rule 3211 provides the bases for doing so:

1. a defense is founded upon documentary evidence;  or 
2. the court has not jurisdiction of the subject matter of the cause of action;  or 
3. the party asserting the cause of action has not legal capacity to sue;  or 
4. there is another action pending between the same parties for the same cause of action in a court of any state or the United States;  the court need not dismiss upon this ground but may make such order as justice requires;  or 
5. the cause of action may not be maintained because of arbitration and award, collateral estoppel, discharge in bankruptcy, infancy or other disability of the moving party, payment, release, res judicata, statute of limitations, or statute of frauds;  or 
6. with respect to a counterclaim, it may not properly be interposed in the action;  or 
7. the pleading fails to state a cause of action;  or 
8. the court has not jurisdiction of the person of the defendant;  or 
9. the court has not jurisdiction in an action where service was made under section 314 or 315 ;  or 
10. the court should not proceed in the absence of a person who should be a party; or 
11. the party is immune from liability pursuant to section seven hundred twenty-a of the not-for-profit corporation law .  

Plaintiff Bonavita was driving a vehicle owned by plaintiff Molinari when the vehicle was involved in a multivehicle accident.  As a result of the accident, the plaintiffs were named as defendants in a pesonal injury action (the underlying action).  Plaintiffs subsequently commenced this action against GEICO, seeking a judgment declaring that, pursuant to an insurance policy issued to Bonavita's mother, GEICO is obligated to defend and indemnify plaintiffs in the underlying action. The plaintiffs alleged that Bonavita's use of Molinari's vehicle qualified for "temporary substitute auto" or "non-owned auto" coverage under the policy.

In lieu of answering, GEICO moved pursuant to CPLR 3211(a)(1) and (7) to dismiss the complaint, contending that the plaintiffs were not entitled to coverage under the policy because, among other things, the vehicle being driven by Bonavita on the date of the accident was neither a "temporary substitute auto" nor a "non-owned auto" as defined in the policy. In support of its motion, GEICO submitted, among other things, an affidavit of its claims examiner, an affidavit of its attorney, a letter sent to GEICO from the plaintiffs' counsel, a letter from GEICO disclaiming coverage, a copy of the GEICO policy, and policy "declaration sheets" issued by GEICO during the relevant period. Plaintiffs opposed the motion and submitted, among other things, an affidavit of Bonavita, who averred that he is the son of GEICO's policyholder and resided at her home at the time of the accident.  Supreme Court denied the motion, and GEICO appealed.

In AFFIRMING the denial of GEICO's motion to dismiss, the Second Department reiterated what kind of evidence constitutes "documentary evidence" under subdivision 1 of CPLR 3211(a):

A motion to dismiss a complaint pursuant to CPLR 3211(a)(1) on the ground that a defense is founded on documentary evidence may be appropriately granted only where the documentary evidence utterly refutes the plaintiff's factual allegations, conclusively establishing a defense as a matter of law (see Goshen v Mutual Life Ins. Co. of N.Y., 98 NY2d 314, 326; Leon v Martinez, 84 NY2d 83, 88; Rodolico v Rubin & Licatesi, P.C., 114 AD3d 923, 924). "[T]o be considered documentary,' evidence must be unambiguous and of undisputed authenticity" (Fontanetta v John Doe 1, 73 AD3d 78, 86; see Cives Corp. v George A. Fuller Co., Inc., 97 AD3d 713, 714). "[J]udicial records, as well as documents reflecting out-of-court transactions such as mortgages, deeds, contracts, and any other papers, the contents of which are essentially undeniable, would qualify as documentary evidence in the proper case" (Fontanetta v John Doe 1, 73 AD3d at 84-85 [internal quotation marks omitted]; see Cives Corp. v George A. Fuller Co., Inc., 97 AD3d at 714). Affidavits, deposition testimony, and letters are not considered documentary evidence within the intendment of CPLR 3211(a)(1) (see Rodolico v Rubin & Licatesi, P.C., 114 AD3d at 925; Cives Corp. v George A. Fuller Co., Inc., 97 AD3d at 714).  

*  *  *  *  * 

Here, the affidavits and letters submitted by GEICO in support of its motion did not constitute documentary evidence within the intendment of CPLR 3211(a)(1) (see County of Westchester v Unity Mech. Corp., 165 AD3d at 885; Attias v Costiera, 120 AD3d 1281). Moreover, the GEICO insurance policy and declaration sheets failed to show that the plaintiffs were not, as they alleged in the complaint, entitled to coverage under the temporary substitute auto and/or non-owned auto provisions of the GEICO policy. Therefore, GEICO's submissions did not utterly refute the plaintiffs' allegations or conclusively establish a defense as a matter of law (see 25-01 Newkirk Ave., LLC v Everest Nat. Ins. Co., 127 AD3d 850; AGCS Marine Ins. Co. v Scottsdale Ins. Co., 102 AD3d 899).

An insurance policy is a contract, but the policy and policy declarations by themselves did not "utterly refute" the complaint's allegations and establish that plaintiffs were not entitled to coverage under the GEICO policy.  While I certainly understand an insurer's desire for the earliest possible exit from an insured's DJ or breach of contract action, this case is another example of how challenging it is for an insurer to get a lawsuit dismissed on a substantive coverage defense before answering the complaint.

NYSSIU Legal Update 2019-2020 Edition

 LEGAL UPDATE

I have been privileged since incorporating the New York State Chapter of Special Investigation Units (NYSSIU) in 1997 to serve as its Counsel.  Many times I have prepared and presented the NYSSIU Legal Update to members and guests at NYSSIU meetings.  Some of those updates even made it to NYSSIU's website.  

On May 6, 2020, my son Ryan Mura prepared and virtually presented the 2019-2020 edition of the NYSSIU Legal Update.  That edition digests eight no-fault, six property and two criminal law case decisions, as well as providing updates on New York legislative and regulatory developments affecting New York property and casualty insurers. 

You can read that Legal Update here.  Case decisions are hyperlinked within.  Questions can/should be directed to Ryan.

$7,332.02 a Day -- Bench-Trying a First-Party Property Coverage Dispute

Ever wonder how the non-jury trial of a first-party property coverage dispute plays out in court?  Wonder no more.

Christine Wagner's single family home in New Hartford, New York, sustained fire damage on May 1, 2016.  She and her homeowners insurer, New York Central Mutual Fire Insurance Company, agreed that the fire destroyed the home's garage, "bonus room" above the garage, and a breezeway connecting the home to the garage.  Wagner and NYCM disagreed over the extent to which the home sustained indirect damage.  The policy afforded replacement cost coverage.

Wagner's contractor and public adjuster submitted repair estimates of approximately $411,000 (including code upgrades) and $338,000 "plus code upgrades", respectively.  NYCM obtained and submitted a contractor's estimate and its claim handler's estimate of approximately $175,000 and $216,000, respectively.  NYCM ultimately paid Wagner the approximately $216,000 amount.

Wagner sued NYCM in May 2017, seeking "the approximate sum of $100,000.00 or the appproriate amount to be determined by the court."  In March 2018 Wagner's counsel filed her note of issue and statement of readiness for a non-jury trial.

The action was tried to Oneida County Supreme Court Patrick MacRae over the course of three days on November 13, 14 and 15, 2018.  On June 26, 2019, Justice MacRae issued his 21-page, detailed decision awarding Wagner a total of $21,996.06.  A month later, Wagner filed a judgment, with interest and costs, against NYCM for $28,413.10.  Ten days later, Wagner filed a notice of appeal.

Those who would take such a first-party property coverage dispute to trial -- especially a bench trial -- would do well to review Justice MacRae's detailed decision, who began and framed his decision with:

The central question is this: is plaintiff entitled to compensation above the $216,018.92 that has been paid by defendant?  

The first factor that bears on the determination of the appropriate amount of damages is whether plaintiff has met her burden of proof. The burden here is one of preponderance. So long as plaintiff's proof is sufficient to suggest that her evidence carries sufficient weight to tip the balance in her favor, she meets that burden and, at least in the first analysis, is entitled to a finding in her favor. It is only if plaintiff has met that initial burden that the burden would shift to the defendant to come forward with evidence that at least re-balances the scale. If the defendant does this, it has overcome plaintiff's evidence and is entitled to a finding in its favor. 

Plaintiff indicated at trial that the three (3) areas in which she was claiming entitlement to more than the defendant paid were: 1. Contents; 2. Code upgrades; and 3. An additional amount for the general cost of repair (Tr. 5-9).

On page 21, Justice MacRae concluded:

On the basis of the foregoing, plaintiff is awarded the following amounts above the $216.018.92 already paid by defendant.  For contents, $4.079.36; For the following code items: knob and tube wiring, $12,750.00; sheathing upgrade, $1,792.20; insulation upgrade, $1,699.50; and deck attachment, $1,675.00, for a total for code upgrades of $17,916.70; for a total award of $21,996.03.

On July 17, 2020, the Appellate Division, Fourth Department, unanimously AFFIRMED Justice MacRae's decision and the corresponding judgment without writing.  I surmise the Fourth Department concluded that Justice MacRae had written enough.

If there is a moral of this story, I suppose it could be that trying property coverage actions to a single judge rather than a petit jury might be the way to go for parties of the first and second part to insurance contracts, especially during a pandemic when jury trials are few and far between -- literally and figuratively.  I've tried several first-party property coverage action to a judge with good results for my insurer clients.  Especially when such a trial revolves around issues of scope and pricing/damages -- issues often compared in potential juror engagement and interest to watching paint dry -- entrusting the outcome to a sitting judge should, at least in theory, always be less risky (albeit usually less instant) than asking a jury to pay focused attention for three days, understand the technical (and dry) testimony on damages, and render a well-reasoned and accurate verdict.  Right?

LinkedIn Poll Results on Disclosing Adjuster and Engineer Reports

On July 8th I blogged about this question:

Is a New York Property Insurer Obligated to Disclose Copies of Its Adjuster and Expert Reports Prior to Litigation?

I also created a poll on this question on LinkedIn (connect with me here).  If you were interested in my blog post, you probably will be interested in the poll's results:

Answer              # Votes                   %   
YES.                        5                     14%
NO.                        16                     46%
IT DEPENDS.       14                     40%

Thank you to those who voted.  I appreciate your perspectives.