New York Civil Law

New York Civil Law Back In September

Partially due to the summer, work obligations, and the need to revamp this Weblog, New York Civil Law is taking a break until September 1, 2005.  Have a good rest of the summer and I'll see you back with more great New York cases.

Appellate Division, First Department Issues Strong Decision Concerning Radiators in Apartments Where Children Are Known to Live

In Rivera v. Nelson Realty, LLC, the Appellate Division, First Department held as matter of law that the owners and managers of an apartment building had not breached their nondelegable to duty under Multiple Dwelling Law sec. 78(1) to maintain the premises in a reasonably safe condition.  A three-year old who lived in the premises with his parents had straddled a radiator without a cover, sustaining serious burns to his legs.  The Majority rejected the plaintiffs' allegations that the radiator should have been covered so as to prevent young children from touching it, essentially finding that there was no actionable negligence.  Justice Saxe offered his dissenting opinion, observing that the Majority ignored a premises owner's legal duties.  His dissenting opinion is an interesting read.

Recent Legislative Report of New York Bills on Labor Law and Insurance

For all those interested in pending bills in the New York Assembly and Senate, the Council of Insurance Brokers of Greater New York issued its latest legislative report.  The following is a portion of the report as it appeared on CIB's Website with added hyperlinks.

VICARIOUS LIABILITY

Once again the legislation to end New York’s vicarious liability law, holding car dealers and makers liable for damages when leased vehicles are in accidents, did not pass, as it is opposed by the powerful Trial Lawyers Association.  While S.1410 (Johnson) was reported to the Senate calendar on 3/17/05, it was never considered in the Upper House for an actual vote.

In the Assembly, the political theater was even more interesting, as the bill was bottled up in committee. A.2620 (Canestrari) was scheduled for consideration on the Assembly Transportation Committee agenda on 6/7/05.  The Committee Chair, Assemblymember David Gantt (D-Monroe) predicted that the 24 member committee was evenly split on the measure.  In an attempt to break the logjam, Assembly Minority Leader Charles Nesbitt (D-Orleans), substituted a proponent of the bill, Assemblymember James Tedisco (R-Schenectady) for ranking minority member Assemblymember Patrick Manning (R-Dutchess).  Speaker Sheldon Silver countered this move by promoting co-sponsor and proponent of the bill, Assemblymember Robert Sweeney (D-Suffolk) to the Assembly Rules Committee, leaving a vacancy on the Transportation Committee, thus ensuring that a “Yes” vote on the bill in committee would fail by one vote.

Proponents of the bill predict that if the bill was allowed to come to a vote in either House of the Legislature, it would pass by wide margins.

SAFE WORKPLACE

CIB urged that the Legislature address the problems associated with general and specialty contractor’s absolute liability under NY Labor Law Sections 240, 241 & 241-a, detailing how current law adversely affects the general liability insurance marketplace.  It is difficult to find affordable coverage for general contractors and nearly impossible for roofers and riggers.

While all parties were sympathetic to the plight of contractors, and to their brokers & agents who cannot place coverage for them, there was the acknowledgment that this is a major political problem that cannot be resolved until all of the stakeholders, including organized labor, trial lawyers, contractors, brokers & agents, carriers, etc., sit down with the Legislature and the Governor’s office to negotiate a workable settlement.  In view of this political reality, none of the bills relating to reform of the so-called “scaffolding laws,” S.3823 (Volker) / A.2946-A (Morelle) and S.3255 (Volker) / A.1181 (Morelle), were even considered.

STATE INSURANCE FUND (SIF)

CIB made the argument that SIF is an unregulated entity that is out of control.  Originally created to be the workers’ comp residual fund or insurer of last resort, SIF now enjoys a 40+ % share of the workers’ comp market in New York and continues to aggressively seek more business with unlicensed representatives.  SIF has an unfair competitive advantage over the voluntary market, since it pays no taxes, offers no commissions to brokers or agents, etc.  Moreover, SIF abuses consumers by requiring 30-days advance notification of cancellation of coverage and short rates rather than pro-rates insured’s premiums upon cancellation.

There was considerable interest by Legislators and NYSID representatives to study the SIF problem further, and to possibly work with CIB on corrective legislation.

   AUTO FRAUD

While a number of bills were introduced to address auto insurance fraud, including cracking down on organized insurance fraud rings, none were the subject of agreement between the Senate and Assembly.   A.8357-A (Grannis), the omnibus no-fault insurance fraud prevention act, made it to the floor of the Assembly, but was laid aside on the calendar.  It has no Senate companion bill.  While the bill has many salutary provisions to combat auto fraud, it also contains a number of problematic sections, such as triggering the unfair claims settlement practices law by virtue of a single act, rather than first establishing a general pattern of such practices.

A.2218 (Lafayette), which would make it unlawful to procure an individual to obtain services meant to defraud an insurance carrier, was never even considered in the Assembly Insurance Committee.  Moreover, there was no Senate companion bill.

A.3682 (Lafayette), which would require mandatory arbitration as the initial remedy for dispute resolution, again was never considered by the Assembly Insurance Committee.  And, again, there is no Senate companion bill.

A.1956 (Lafayette), which would allow for the cancellation of commercial auto policies that were procured with intent to commit fraud, was never brought by the Assembly Insurance Committee.  There is no Senate companion bill.

WORKERS’ COMPENSATION

CIB has stressed that New York continues to be a high cost/low weekly benefit state and that reforms to the underlying system must ultimately be made to mitigate rates.

A.8764 (Rules by John), the omnibus workers’ compensation benefits improvement act, would, amongst other things, increase average weekly benefits up to an indexed 2/3 of the average weekly wage.  It would also allow collective bargaining agents to choose a different workers’ comp. carrier than the one selected by the employer.  The bill never left the Assembly Labor Committee.  There was no Senate companion legislation.

The workers’ comp. issue continues to be a major bone of contention between organized labor and business groups.  Likewise, the paid family leave act, A.1301 (Nolan), which passed the Assembly, but S.1501 (Morahan), its Senate companion, did not.

CIB is supportive of a workers’ comp. related bill, A.1305 (Nolan) / S.3798 (Leibell), which would phase in an increase of the maximum weekly non-occupational disability benefit from $170 to $340 per week.  Unfortunately, the bill was bottled up in the Assembly Ways & Means and Senate Labor Committees.

Thank you to CIB.

Appellate Division, Third Department Determines Business-Purposes Exclusion Ambiguous

The Appellate Division, Third Department recently addressed the business-purposes exclusion of a homeowner's insurance policy in Pepper v. Allstate Ins. Co.   The plaintiff, a self-employed trucker, accidentally started a fire near his detached garage while attempting to repair an oil leak on his freightliner truck that he used to haul logs.   The Court determined that the business exclusion had at least two reasonable interpretations and was therefore ambiguous.  Notably, the Court reasoned that one interpretation was that the plaintiff's activity of repairing the truck was not directly connected to the acquisition of economic gain, even though fixing the truck allowed the plaintiff to acquire economic gain by hauling logs.   

Insurance Department Issues Two Recent Opinions On Insurance and Rental Cars

The New York State Insurance Department issued two informal decisions in June 2005 addressing insurance and rental automobiles.  The first decision answers in the negative the following inquiry: May an insurer make payment out of the collision portion of an insured’s policy and take a deductible?  The second decision answers in the affirmative the following question: May a rental vehicle company hold the person to whom a vehicle was rented in 2002 liable for the entire loss of the vehicle (where the vehicle is stolen) or is his or her responsibility limited to $100?

New York Court of Appeals Reverses Appellate Division in Labor Law Case

In October 2004, New York Civil Law discussed an odd Labor Law decision concerning the City of New York's liability under Labor Law sec. 240(1) concerning a worker injured while working on the Cross Bronx Expressway (see prior post here).  The New York Court of Appeals yesterday handed down a decision in this case -- Albanense v. City of New York.  The Court held that the City was not subject to liability under sec. 240(1), observing that the City's role was largely confined to its regulatory responsibilities arising out of its work permits.

Thank you Nelson Timken for alerting me to the case and providing a summary of the case in the comments section here.

Former New York Court of Appeals Judge Dies

Tragically,  I learned today that Judge Vito Titone recently passed away (see Newsday article here).  Judge Titone served on the New York Court of Appeals from 1985 to 1998.  Besides his his great contributions to New York jurisprudence, Judge Titone had the distinction of being the only Judge thus far from Staten Island to sit on the Court of Appeals.

The Parties' Briefs in Important Court of Appeals Labor Law Decision - Walls v. Turner Construction

The New York Court of Appeals recently held in Walls v. Turner Construction that a construction manager can constitute an "agent" under Labor Law sec. 240(1) where the manager had the ability to control the activity which brought about the injury (see prior post).  In arriving at this conclusion, the Court looked at facts demonstrating that the construction manager was under a contractual obligation to monitor the subcontractor's work and to protect its employees.  Since the facts of this appeal are so important, I felt it necessary to go behind the actual decision and see what the parties argued.  I have provided copies of the parties' briefs to the Court of Appeals below.  I will provide selected documents in the Record on Appeal in a subsequent post.

Plaintiff's Appellate Brief Pt. I (Download SCAN_35300896_000.pdf); Pt. II (Download SCAN_35300897_000.pdf); Pt. III (Download SCAN_35300898_000.pdf); Defendant's Appellate/Respondent's Brief Pt. I (Download SCAN_35300900_000.pdf); Pt. II (Download SCAN_35300899_000.pdf); and Plaintiff's Reply Brief (Download SCAN_35300901_000.pdf).

Newly Discovered Website on New York Insurance Coverage Issues

New York insurance coverage attorney Thomas Bower offers this recent overview of recent insurance coverage decisions.  His summaries are an excellent source for insurance coverage news and analysis.