In today's Rogak No-Fault Blog:

The Appellate Division, First Department, changes the statute of limitations for PIP suits against self-insurers to three years. 

http://www.newyorknofaultadvisor.com/blog.php

Larry Rogak

The No-Fault Authority

In today's Rogak No-Fault Blog:

Suppose an insurer requests a specific document from the provider on a specific form.  The form is provided, but it is an outdated form; nonetheless, that very outdated version is exactly what the insurer asked for.   Can the insurer still maintain the position that the provider has not made out its prima facie case?

Hmmm.... find out!  http://www.newyorknofaultadvisor.com/blog.php

Larry Rogak

The No Fault Authority

In today's Rogak No-Fault Blog:

An arbitrator examines an insurer's reasons for demanding an EUO.

http://www.newyorknofaultadvisor.com/blog.php

Larry Rogak

The No-Fault Authority

LAWYER'S MALPRACTICE POLICY COVERS EMPLOYEE'S LUST FOR CLIENT

Order and judgment [of the] Supreme Court, New York County (Doris Ling-Cohan, J.), entered December 3, 2009, which denied defendant's motion for summary judgment dismissing the complaint and granted plaintiffs' cross motion for summary judgment declaring that defendant had a duty to defend and indemnify plaintiff in an underlying action, unanimously affirmed, without costs.

The court properly determined that the allegations in the underlying complaint that plaintiffs' law firm negligently hired and supervised an attorney who purportedly made sexual advances to a client, fall within the type of errors and omissions coverage provided by defendant's professional liability insurance policy (see Watkins Glen Cent. School Dist. v National Union Fire Ins. Co. of Pittsburgh, Pa., 286 AD2d 48 [2001]).

While the allegations may not fall under the policy definition of "Personal Injury," the court properly determined that they fall within the policy's definition of "Wrongful Act."

Comment:  It would have been interesting to get some details about the alleged incident, but the coverage message seems clear enough.

Larry Rogak

In today's Rogak No-Fault Blog:

1. A new twist on the Fair Price doctrine -- and a win for the insurer;

2. A new twist on what a provider needs to prove to establish a prima facie case.

Read up! http://www.newyorknofaultadvisor.com/blog.php

Larry Rogak

The No-Fault Authority

In today's Rogak No-Fault Blog:

What happens if a plaintiff serves a summons on an insurance company by mail, and the insurer fails to return the acknowledgement of service?

Find out!  http://www.newyorknofaultadvisor.com/blog.php

Larry Rogak

The No-Fault Authority

DEFAULT DENIED IN PIP/UM SUBRO SUIT FOR FAILURE TO PLEAD ESSENTIAL FACTS

This court decision involves a fact pattern that is not often litigated: it is a PIP and UM subro suit against a non-covered person -- that status applying because the defendant was driving without auto insurance.  After Utica Mutual paid both PIP and UM benefits to its insured, it brought this subro suit against the uninsured driver.  When the defendant failed to answer the Complaint, Utica moved for a default judgment.  The District Court first analyzes whether it has jurisdiction to hear the suit because the total amount sought is over $15,000.  Then the Court denies the default judgment on the grounds that Utica failed to plead essential elements of both a PIP subro and UM subro claim; in the case of PIP, that its insured did not bring its own tort action within 2 years; and in the case of UM, that the insured sustained a "serious injury." -- LNR

When a Court is presented with a default judgment application, it is tempting to simply grant it and move on to other pressing matters. However, the rule of law, as I understand it, demands more. The Court's duty is not "ministerial." See, e.g. McGee v. Dunn, 75 AD3d 624 (2d Dept. 2010). If subject matter jurisdiction is lacking, the Court should "refuse to proceed further and [should] dismiss the action." See Fry v. Village of Tarrytown, 89 NY2d 714, 718 (1997), quoting Robinson v. Oceanic Steam Nav. Co., 112 NY 315, 324 (1899). No matter how meritorious a claim may be, the Court in such a case would have no power to grant judgment upon it. Likewise, a Court may grant a default judgment by law only if the moving party's pleadings and proof establish one or more "viable" causes of action. See McGee v. Dunn, supra.

The instant case puts these principles to a test. On multiple points, the plaintiff's motion, while unopposed, presents facts and circumstances that raise a series of challenging issues. Although the end result of the Court's analysis is to sustain jurisdiction, that conclusion requires extended discussion. And in the end, deficiencies in plaintiff's pleading and proof result in the denial of the motion, without prejudice to renewal. These issues are discussed, below, in turn.

Plaintiff, Utica Mutual Insurance Company, moves for a default judgment against defendant, Michael Andre Lynton, based upon Mr. Lynton's failure to answer the complaint following service of process pursuant to CPLR 308(2). The complaint proceeds on the premise that plaintiff "is subrogated to all rights of RAMONA ESTEVEZ as against the Defendant arising out of the claimed occurrence." The subject "occurrence" was a motor vehicle accident between a vehicle operated by Ms. Estevez and a second vehicle owned and operated by Mr. Lynton. According to plaintiff's papers, it made basic no-fault payments "to or on behalf of" Ms. Estevez, totalling $15,197.22. It also paid Ms. Estevez $6,000.00 in settlement of her claim for supplementary uninsured motorist benefits.

Monetary claims brought in this Court are ordinarily limited to cases "where the amount sought to be recovered. . . does not exceed $15,000.00." UDCA §202. However, "[w]here several causes of action are asserted in the complaint, and each of them would be within the jurisdiction of the court if sued upon separately, the court shall have jurisdiction of the action." UDCA § 211.

Although the latter statute has long been a part of the law governing proceedings in this Court, its constitutionality remains open to question. In Mandel v. Kent, 70 AD2d 903 (2d Dept 1979), the Appellate Division held that the County Court's jurisdictional limit applied "to the entire complaint rather than each cause of action." It did so based on its reading of Article 6, §11 of the NYS Constitution, which provides that the County Court's jurisdiction "shall extend not to causes of action' but only to actions' where the amount sought to be recovered is beneath a certain amount." See Westbury Wholesale Produce Co. v. Main Maid Inn, LLC, 186 Misc 2d 911, 914 (Dist Ct NassauCo. 2000)(discussing Mandel).

In Westbury Wholesale Produce Co. v. Main Maid Inn, LLC, supra, Nassau District Court Judge Kenneth Gartner carefully considered whether to apply Mandel's logic to cases brought under the Uniform District Court Act. In a comprehensive, well-reasoned opinion, he concluded that the Appellate Division, Second Department, "would not extend the Mandel holding to District Court — an extension which would require the Appellate Division to of necessity declare [UDCA §211] ... unconstitutional as in contravention of ... the New York State Constitution." 186 Misc 2d at 916.

Since Judge Gartner's decision was handed down more than a decade ago, not a single published decision has cited Mandel. Nor have any court decisions questioned the ruling made by Judge Gartner in Westbury Wholesale Produce Co., respecting the continued applicability of UDCA 211 to District Court proceedings. Accordingly, the Court concludes that Mandel does not nullify UDCA §211, and therefore turns to the question of whether plaintiff's complaint properly pleads and presents "several causes of action," each of which are within the Court's jurisdictional limits. UDCA §211.

The complaint, in this case, separately asserts two causes of action. The first cause of action seeks judgment holding defendant liable for $15,000.00, based upon plaintiff's payment of basic no fault benefits. The second cause of action seeks judgment holding defendant liable for an additional $6,000.00, based upon its settlement of Ms. Estevez's supplementary uninsured motorist claim for pain and suffering.

Although plaintiff's papers admit that plaintiff voluntarily reduced its claim for repayment of basic no-fault benefits to $15,000.00 "to comply with the jurisdiction of this Court," that reduction begs the question of whether the Court has jurisdiction to consider claims totaling $21,000.00 in the aggregate. Notwithstanding defendant's default in answering the complaint, this Court is empowered to consider plaintiff's motion only if the claims fall within the ambit of UDCA §211, and on that point, plaintiff's motion raises a second difficult and complex threshold issue.

At first blush, the assertion of separate "causes of action" in the complaint brings the case squarely within the literal language of UDCA §211. Each "cause of action" seeks damages of $15,000.00 or less ($15,000.00 under the first cause of action and $6,000.00 under the second cause of action).

However, decisions of other Courts make plain that a lower court's jurisdictional limits cannot be circumvented by the simple expedient of splitting a claim into separately stated "causes of action." The Civil Court's decision in Kemper v. Transamerica Ins. Co., 61 Misc 2d 7 (Civ Ct NY Co. 1969), is illustrative.

In the Kemper case, plaintiff's complaint asserted four "causes of action" against an insurer, arising from a fire loss. Four categories of damages were sought, each under a different policy provision. Each "cause of action," on its face, sought damages within the jurisdictional limits of the Civil Court. Nevertheless, the total damages sought by plaintiff, arising from "a single fire," exceeded the Court's monetary limit.

The Civil Court (Stecher, J.) concluded, on these facts, that the complaint asserted only a single "cause of action." In holding that it lacked jurisdiction as a result, the Court acknowledged that the issue was "not a matter free from difficulty." As explained in the decision, the words "cause of action" could have different meanings in different contexts. Quoting from a Court of Appeals' decision involving a statutory pleading rule (requiring that "each cause of action must be separate and numbered"), Payne v. NYS & WRR Co., 201 NY 436, 440 (1911), the Civil Court adopted the following definition for the purpose of assessing its jurisdiction: "If the facts alleged show one primary right of the plaintiff, and one wrong done by the defendant which involves that right, the plaintiff has stated but a single cause of action." 61 Misc 2d at 8, quoting Payne, supra, 201 NY at 440.

Applying this definition, the Civil Court concluded that the complaint raised only one cause of action:

In the case under consideration the primary right is to be paid under the contract for the loss allegedly sustained in a single fire; and the defendant's wrong is the failure to make that payment. There can be little doubt that various obligations of payment assumed under a single written contract accruing at the same time constitute but a single cause of action (Wolf v. Wolf, 22 AD2d 678, 253 NYS2d 509; 5 Williston on Contracts revised edition, s 1291). It is thus apparent that the plaintiff's claim ... although stated in what appeared to be four separate causes of action are in fact one cause of action which exceeds the jurisdictional limitation of this court. 

The instant case involves similar, but not identical, factual circumstances. Plaintiff's claims, although separately stated in two causes of action, each involve "one wrong done by the defendant," namely, negligent operation of a motor vehicle by defendant, causing a collision that injured plaintiff's insured. As a result, plaintiff's insured applied for, and received, insurance benefits under the supplementary uninsured motorist and basic no-fault portions of her insurance policy. Under the provisions of that policy, plaintiff obtained subrogation rights which it now asserts in this action.

Just like in Kemper, it appears that plaintiff's claim, although set forth in two separate "causes of action," may be viewed as stating "but one case of action which exceeds the jurisdictional limit" for claims made in this Court. Kemper, supra. If so viewed, the Court would lack the power to grant the requested relief.

Notably, in Kemper, the Civil Court was able to transfer the action directly to the Supreme Court, pursuant to Art. VI, §19(f) of the NYS Constitution. However, this Court lacks similar authority. Compare NYS Const. Art. V1, §19(I). As a consequence, if the claims in this case are found to exceed the Court's jurisdictional limits, the Court would have no choice but to dismiss the proceeding. See Fry v. Village of Tarrytown, supra, quoting Robinson v. Oceanic Steam Nav. Co., supra.

Ironically, if the action were to be dismissed, and then refiled in the Supreme Court, that Court could then transfer the case back to the District Court, as allowed by NYS Constitution Art. V, §. 19, and CPLR §325(d). In that event, this Court would be empowered, under CPLR §325(d), to determine the claims without regard to otherwise applicable monetary limits.

Should plaintiff have its claims bounced back and forth, like this, to obtain determination of its claims against defendant? I think not. Although the jurisdictional limits of UDCA 202 must be respected, the language of UDCA is broad enough to encompass the subject claims.

As recognized in Kemper, the phrase "cause of action" can have different meanings in different contexts. No hard and fast definition has been applied by our state's courts. Although allegations emanating from "a single occurrence or transaction" often have been deemed to be part of one cause of action, "distinct causes of action" just as certainly may arise from a single transaction or occurrence. See 1 NY Jur2d Actions § 40. Indeed, it appears well settled that "where a single wrongful act causes injury to both the person and property of another, the party wronged has, and can separately sue upon, distinct causes of action." 1 NY Jur2d Actions §57; see also 103 NY Jur2d Torts §3 ("A single tortious act which causes damages to a person and to property gives rise to separate causes of action"). "Similarly, a single wrongful act affecting different interests. . . may give rise to a separate cause of action in favor of the owner of each such interest." 1 NY Jur2d Actions §57.

Not surprisingly, "conflicting decisions in different jurisdictions" have sometimes confounded our state's courts in determining whether one or more causes of action are being advanced. See Reilly v. Sicilian Asphalt Paving Co., 170 NY 40, 43-45 (1902). But more recent decisions draw a clear distinction between an injured person's cause of action for pain and suffering, on the one hand, and an insurer's related cause of action for recoupment of payments for extended economic loss. See Record v. Royal Globe Ins. Co., 83 AD2d 154 (2d Dept 1981). The issue in Record v. Royal Globe was whether an insured's release of a claim for personal injuries impaired the insurer's subrogation rights. While the decision did not address issues of jurisdiction, the Court's analysis hinged upon its recognition that a subrogated claim for "economic loss" (i.e. payments for lost earnings and medical expenses) was very different from a "non-economic" claim for pain and suffering. Since these claims were considered to be separate and distinct, the Court concluded that the release by Royal Globe's insured of her non-economic claims for pain and suffering had not impaired the insurer's subrogation rights respecting economic loss.

Viewing the claims in this case in a similar manner, it is apparent that the complaint does, indeed, state separate and distinct causes of action. Although both claims are asserted by the same party, under provisions of the same insurance policy, the first cause of action, for basic no-fault benefits, involves "economic losses" (e.g. medical expenses), whereas the second cause of action, for supplementary uninsured motorist benefits, involves payments for the insured's pain and suffering.

Accordingly, the Court concludes, on balance, that it has jurisdiction over plaintiff's claims. Since the complaint can be read as properly asserting two causes of action, each of which is within this Court's jurisdiction, see UDCA §211, it will proceed to determine the merits of plaintiff's default judgment application.

Plaintiff's motion includes proof of service of the summons and complaint upon defendant, proof of his default, and proof of the facts constituting plaintiff's claims. See CPLR §3215(f). Nevertheless, before a judgment by default can be granted, the Court must be provided with sufficient facts to establish that the plaintiff possesses legally viable causes of action. See, e.g. McGee v. Dunn, supra; Beaton v. Transit Facility Corp., 14 AD3d 637 (2d Dept 2005).

With respect to the first cause of action, the complaint, as amplified by plaintiff's moving affidavits, includes sufficient allegations that defendant was not a "covered person" under no-fault, since he lacked insurance for his vehicle on the date of the accident. Such allegations are "an essential element of an insurer's right to recoup first-party benefits" in a subrogation action. See County-Wide Ins. Co. v. 3-M Production Sales, 96 AD2d 569 (2d Dept 1983).

However, an equally essential element of the cause of action is an allegation that plaintiff's insured failed to commence a lawsuit, of her own, seeking damages for personal injuries arising from the accident. See County-Wide Ins. Co. v. 3-M Production Sales, supra; see also Ins. L. §5104(b). If such an action has been brought, the insurer's remedies, by law, would be limited to its lien rights against any recovery obtained by verdict or settlement of that action. Ins. L. §5104(b).

On the other hand, if the insured failed to commence such an action within two years after accrual of her claim, then, and only then, would the insurer have "a cause of action for the amount of first party benefits paid or payable against any person who may be liable to the covered person [i.e. its insured] for [her] personal injuries." Ins. L. §5104(b). Although the facts of this case involve the filing of a lawsuit by the insurer more than two years from the date of the accident, plaintiff's papers are silent as to whether its insured did or did not file her own lawsuit against Mr. Lynton.

In the absence of allegations addressing the issue, the Court will not assume, from such silence, that plaintiff's first cause of action was properly brought under Ins. L . §5104(b). Consequently, plaintiff's request for judgment by default on the first cause of action is denied, without prejudice to resubmission upon additional proof respecting whether its insured did or did not commence her own personal injury action which might overlap with plaintiff's claim for first party no-fault benefits in this subrogation lawsuit.

Plaintiff's allegations and proof respecting its second cause of action suffer from a different defect. The latter claim seeks recovery of supplementary uninsured motorist benefits that plaintiff paid to its insured in settlement of her claim for pain and suffering. Although the "serious injury" requirements of Ins. L. 5104(a) do not expressly preclude claims for pain and suffering by a covered person against a non-covered person, this case does not present such a direct claim for pain and suffering. Rather, it involves a claim by an insurer arising from its payment of supplementary uninsured motorist benefits to Ms. Estevez for a "non-economic loss," pursuant to Ins. L. §3420(f)(2) and the Insurance Superintendent's regulations (11 NYCRR §60-2.3[f]). Under applicable caselaw holdings, Ms. Estevez could not have properly obtained payment of uninsured motorist benefits for her pain and suffering without proof of serious injury. See Raffellini v. State Farm Mut. Ins. Co., 9 NY3d 196 (2007); see also Meegan v. Progressive Ins. Co., 43 AD3d 182, 184-186 (4th Dept. 2007).

Should plaintiff be able to sue the defendant to recoup supplementary uninsured motorist payments without proof that its insured, in fact, sustained a serious injury? In the absence of case law holding otherwise, the Court is not prepared to presuppose such a result. While it can be argued that the insurer is simply standing in the insured's shoes, the law as written expressly gives the insurer only a limited right to pursue a subrogation claim against a non-covered person, as authorized by Ins. L. §5104(b), for basic first party no-fault benefits, and to the extent an insurer acquires additional subrogation rights by paying supplementary uninsured motorist benefits pursuant to Ins. L. §3404(f), such payments are properly made only in cases involving serious injuries. Consequently, an insurer suing a non-covered person upon such a subrogated claim for supplementary uninsured motorist benefits should properly be required to plead and prove the serious injury in order to obtain a judgment against the defendant on the latter cause of action.

In the instant case, notwithstanding the complaint's conclusory statement that plaintiff's insured "was caused to sustain personal injuries," the complaint includes no factual allegations which might satisfy the requirements of Ins. Law §5102(d), defining the sort of "serious injuries" which could form the basis for meeting the statutory definition. Moreover, the medical records submitted with plaintiff's motion do not suffice under the circumstances, since no effort is made to use the records to demonstrate how the injuries and treatments brought the case within the statutory definition of a serious injury. Absent proof, by party affidavit, see CPLR §3215(f), that the personal injury claim at issue was "serious" enough to satisfy the no-fault law's threshold, the Court cannot conclude that the plaintiff has the right, by law, to recover its payment to its insured under the subrogation theory asserted.

Accordingly, where, as here, an insurer neither properly pleads, nor proves by party affidavit, that its insured suffered a true "serious injury" that justified payment of supplementary uninsured motorist benefits for pain and suffering, it is not entitled, upon a default, to obtain a judgment on the claim merely because the complaint includes a conclusory sentence alleging that plaintiff's insured suffered undefined injuries in the accident. Here, too, that failure of proof requires denial of the motion without prejudice.

For the foregoing reasons, the Court concludes that it has jurisdiction to determine claims by plaintiff that exceed $15,000 in the aggregate. However, due to deficiencies in plaintiff's pleading and proof, the Court must deny plaintiff's motion, without prejudice to renewal.

In today's Rogak No-Fault Blog:

Is manipulation under anesthesia outside the scope of a chiropractor's license?  Find out!

http://www.newyorknofaultadvisor.com/blog.php

Larry Rogak

The NoFault Authority

RETROACTIVE CANCELLATION OF POLICY OK AS TO INSURED AND ANYONE ELSE A PARTY TO MISREPRESENTATION DUE TO LACK OF INSURABLE INTEREST

Defendant Allstate Insurance Company moved for summary judgment under CLPR 3212. Plaintiffs Luis Rodriguez and Rafael Jiminez subsequently moved to preclude defendant from testifying at trial and to strike its complaint, or in the alternative, for an order scheduling depositions with preclusionary language.

Plaintiff Rodriguez was the holder of an automobile insurance policy with defendant. Plaintiff Jiminez was the titled owner of the vehicle, a 2001 Mitsubishi. On May 21, 2004, the vehicle was stolen, but was recovered nine days later on May 30, 2004 in damaged condition. Defendant denied plaintiff Rodriguez' claim on grounds of material misrepresentations made in the insurance application regarding vehicle ownership; in turn, plaintiffs filed the action herein, alleging six causes of action. Three were dismissed by a [prior order] granting defendant's motion for summary judgment. In the remaining causes of action, plaintiffs allege breach of contract, misrepresentation of defendant's employees (who are also defendants in this case), and professional malpractice.

In the instant motion for summary judgment, defendant contends that policy holder Rodriguez had no insurable interest, and that Jiminez, the vehicle's titled owner, had no contractual relationship with it. Taking first the argument that defendant and Jiminez had no contractual relationship, it is undisputed in this matter that the insured was Rodriguez, not Jiminez. Case law is consistent that in absence of privity, a cause of action may not be maintained for breach of contract (Plaisir v Royal Home Sales, ___AD3d___,___, 2011 NY Slip Op. 01255 [2d Dept 2011]; CDJ Builders Corp v Hudson Group Construction, 67 AD3d 720 [2009]; Grinnell v Ultimate Realty, LLC, 38 AD3d 600 [2007]; M. Paladino, Inc. v Lucchese & Son Contracting Corp., 247 AD2d 515 [1998]), misrepresentation (Levi v Utica First Insurance Company, 12 AD3d 256 [2004]), or professional malpractice (Bullmore v Ernst & Young Cayman Islands, 45 AD3d 461 [2007]; Tycon Tower I Investment Limited Partnership v Burgee, 234 AD2d 748 [1996]).

In opposition, plaintiffs do not specifically address the issue of a lack of privity between Jiminez and the defendants; the opposition papers focus primarily on the "insurable interest" issue, and on case law disallowing an insurance company's ab initio cancellation of a policy (Teeter v Allstate, 9 NY2d 655 [1961]). Opposing papers only address Jiminez' relationship with the defendant by stating that "[p]laintiff Rafael Jiminez was informed by an insurance broker processing Allstate Insurance policies that he would save money if he could insure the car under someone with a better driving history" and by stating that he and Mr. Rodriguez were "...unsophisticated immigrants with little knowledge of the English language [who] were simply following the advice of Mr. Jiminez' insurance broker."

Such statements fall far short of rebutting the argument that Jiminez lacked privity with the defendant in this matter. Further, the issue of whether a person has an insurable interest generally arises where that person is the contracted policyholder; that issue differs markedly from whether an individual has privity with the insurance company. Additionally, the question of whether an insurance company can issue an ab initio cancellation of a policy can only arise between the insurance company and the policyholder. Jiminez was not the policyholder in this case, and plaintiffs have failed to show otherwise. Plaintiffs have failed to produce evidentiary proof in admissible form sufficient to establish the existence of material issues of fact requiring a trial on this issue (Alvarez v Prospect Hospital, 68 NY2d 320 [1986]; Winegrad v New York University Medical Center, 64 NY2d 851 [1985]; Zuckerman v City of New York, 49 NY2d 557 [1980]). Accordingly, the Court herein finds that Jiminez has no privity with the defendant, and therefore, no cause of action against the defendant(s) on any of the aforestated grounds. Defendant's motion for summary judgment as regards Jiminez must be granted.

On the issue of whether Rodriguez had an insurable interest, defendant relies upon Rodriguez' unsigned deposition transcript to contend that certain statements support his lack of financial interest in the vehicle, and that his role was only to secure insurance for his cousin, Jiminez. However, "...the unsigned deposition transcript of the plaintiff...submitted in support of [defendant's] motion, did not constitute admissible evidence in light of the [defendant's] failure to demonstrate that the transcript was forwarded to the plaintiff for...review pursuant to CPLR §3116(a)" (Marmer v IF USA Express, Inc., 73 AD3d 868 [2d Dept 2010]). Consequently, the Court finds that defendant has failed to offer admissible evidence to support its contention that Rodriguez lacked a insurable interest in the vehicle. The proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of any material issues of fact. Failure to make such a prima facie showing requires a denial of the motion, regardless of the sufficiency of the opposing papers (Alvarez, 68 NY2d 320 at 324; Winegrad, 64 NY2d 851 at 853; Zuckerman, 49 NY2d 557 at 563). The Court must deny the branch of defendant's motion for summary judgment against Rodriguez.

Although not required to do so to reach a decision on the motion for summary judgment, the Court will address the plaintiff's contention in its papers that defendant has no legal right to issue an ab initio cancellation of an insurance policy. Case law is clear that an insurance company's termination of an insurance policy must be guided by Vehicle and Traffic Law (VTL) §313. Subsection (1)(a) provides in part: "[n]o contract of insurance for which a certificate of insurance has been filed with the commissioner shall be terminated by cancellation by the insurer until at least twenty days after mailing to the named insured...a notice of termination..." Further, case law has held that "[r]egardless of whether plaintiff had an insurable interest...or whether he obtained the policy by misrepresentation, defendant could not rescind the policy ab initio and it could not terminate the policy prospectively without satisfying the procedural requirements of Vehicle and Traffic Law §313" (Mooney v Nationwide Mutual Insurance Company, 172 AD2d 144 [3d Dept 1991]).

However, in Insurance Company of North America v Kaplun (274 AD2d 293 [2d Dept 2000]), while the Court underscored precedential and statutory authority prohibiting an insurer's retroactive cancellation of a policy, it also clarified that VTL §313's provisions were designed to protect "innocent third parties" who sustained injuries, and not those who were parties to misrepresentations made in procuring the policy. In that case, the Court found that the insurance company could deny benefits to the insured on grounds that he was a participant in the misrepresentation in obtaining the policy.

In the case at bar, there were no injured third parties; instead plaintiff seeks to recover for damage to the insured vehicle which occurred while it was stolen. Though defendant failed to meet its summary judgment burden regarding Rodriguez, if it is able to establish at trial that Rodriguez was a participant to misrepresentations made to procure the policy in question, as in Kaplun, "...denying plaintiff the right to recover would not impinge in any way upon the protection the policy affords innocent victims, would not subvert the statutory proscription against retroactive cancellation and would comport with elemental fairness" (Kaplun, 274 AD2d 293 at 299, citing Mooney v Nationwide Mutual Insurance Company, 172 AD2d 144 at 149).

The Court now addresses plaintiff's motion to preclude defendant from testifying at trial and to strike its complaint, or in the alternative, to have a date certain for depositions ordered with preclusionary language. In its opposition, defendant offers a chronology to explain the events that have arisen to prevent it from appearing for depositions, and contends that its failure to appear has not been either "willful or contumacious" (Joseph v Roller Castle, Ltd., 100 AD2d 839 [1985]). This Court has twice before ordered that depositions occur: in a May 18, 2006 order by the Honorable Joseph J. Esposito, and in a December 2, 2008 order by the Honorable Diccia T. Pineda-Kirwan. Since neither order included preclusionary language, the Court will neither preclude defendant from testifying at trial nor strike its answer at this time. However, the Court orders herein that depositions are to take place within 60 days of this Court order, i.e., by May 13, 2011, and that the failure of the defendant to comply with this order shall result in its preclusion from testifying at trial.

The defendant's motion for summary judgment is granted with respect to plaintiff Rafael Jiminez, but is denied with respect to plaintiff Luis Rodriguez. The plaintiff's motion to preclude defendant's testimony at trial and strike defendant's answer or, in the alternative, to order a date for depositions with preclusionary language is granted to the extent that depositions are ordered herein to occur within 60 days of this order. The failure of the defendant to comply will result in its preclusion from testifying at trial.

Comment:  Although this suit involved physical (auto) damage, the principle applies directly to PIP as well, but in a novel way: a denial of first party benefits is being upheld due to lack of insurable interest in the vehicle by the policyholder.  This kind of misrepresentation happens all the time: "Joe" has a terrible driving record and auto insurance would cost him a fortune, so he asks "John" (who has a good driving record) to take out a policy in his name on "Joe's" car.  I have handled a lot of these "insurable interest" cases; they often involve questions of whether the policyholder had anything to lose (in some cases he does; he may have contributed half the price of the car, etc).   But this should turn a whole new light on the question of insurable interest in PIP claims.

Larry Rogak

QUESTION!
A Person has property stored at a friends house in their garage, all of their
property was stolen, none of the friends property was stolen. would the friends
Home Owners Policy come into play?

Thank you

Terry Van Whitney
Florida Private Investigator #C2400207
po box 195382
Winter Springs, Florida 32708
321-696-9211

In today's Rogak No-Fault Blog:

We win two EMG/NCV arbitrations despite rebuttal testimony from the provider.

http://www.newyorknofaultadvisor.com/blog.php

Larry Rogak

The No-Fault Authority

I would think so as a Homeowners policy usually covers the contents of the home.
They usually don't specify that the contents must be the homeowners 'stuff'.

--- In TheRogakReport@yahoogroups.com, "terry_whitney2000"
<terry_whitney2000@...> wrote:
>
> QUESTION!
> A Person has property stored at a friends house in their garage, all of their
property was stolen, none of the friends property was stolen. would the friends
Home Owners Policy come into play?
>
> Thank you
>
> Terry Van Whitney
> Florida Private Investigator #C2400207
> po box 195382
> Winter Springs, Florida 32708
> 321-696-9211
>

In today's Rogak No-Fault Blog:

What does an auto insurer have to do to win a "staged accident" case?

Find out!  http://www.newyorknofaultadvisor.com/blog.php

Larry Rogak

The No Fault Authority

VETERINARIAN NOT LIABLE FOR DOG'S CHANGE OF PERSONALITY AFTER BOARDING

This unusual case was an appeal from a judgment of the Civil Court of the City of New York, Queens County (Diccia T. Pineda-Kirwan, J.) which awarded plaintiff $900.  The Appellate Term reversed.

"Plaintiff commenced this small claims action to recover damages which allegedly resulted from his boarding his eight-month-old Rottweiller at defendant's facility. At the nonjury trial, plaintiff testified that he had boarded his dog, Chopper, at defendant's facility while he had gone on a week-long vacation. When he picked up Chopper, whom he personally had trained, the dog was 'filthy' and acted strangely, and his leash and collar were missing. In addition, plaintiff's oak table, which had been inside Chopper's cage, was damaged."

"After plaintiff brought him home, Chopper was uncontrollable for several months, despite the prior training, and ultimately, seven months later, had to be euthanized. Plaintiff testified that he thought that defendant had kept Chopper in a cage in 'solitary confinement' and had not exercised or walked him. Defendant's witness testified that Chopper was a young 'active' dog and that Chopper was biting on the oak table in his cage because he was a puppy and needed something to chew on. The witness also testified that it was defendant's practice to walk its boarded dogs two to three times per day. The Civil Court awarded plaintiff the principal sum of $900, and defendant appeals."

"Upon a review of the record, we find that substantial justice was not done between the parties according to the rules and principles of substantive law (CCA 1804, 1807; see Ross v Friedman, 269 AD2d 584 [2000]; Williams v Roper, 269 AD2d 125, 126 [2000])."

"Where a bailment is for the mutual benefit of both parties, the bailee is required to exercise reasonable care and diligence in keeping and safeguarding the bailor's property, and the bailee is answerable for loss or injury resulting from his or her ordinary negligence (see 9 NY Jur 2d, Bailments and Chattel Leases § 60). If a bailee fails to return a bailor's property or returns the property in a damaged condition, there is a presumption of liability for negligence, and the burden then shifts to the bailee to explain the circumstances of the loss (see 9 NY Jur 2d, Bailments and Chattel Leases § 117). The defense witness adequately explained the reason for the damage to the oak table, and plaintiff failed to show any lack of reasonable care on defendant's part as would subject it to liability for this damage."

"With respect to Chopper, plaintiff failed to establish a prima facie case of liability on the part of defendant since, aside from his speculative testimony, he failed to proffer any additional evidence to support his contention that Chopper had suffered injuries as a result of defendant's negligence during the period of time that Chopper had been boarded at defendant's facility."

"Plaintiff's remaining contentions are without merit. Accordingly, the judgment is reversed and the action is dismissed."

Comment:  What could happen to a dog during a week's boarding that would so drastically change his personality?  Who puts an oak table in a dog's crate?  Even keeping a dog in "solitary confinement" for a week shouldn't make him permanently crazed.  Something happened to this dog, but the mere fact that he changed (allegedly) after the boarding, doesn't make the vet liable.

Larry Rogak

WE WIN SUMMARY JUDGMENT IN COVERAGE SUIT: INSURED'S BEACH CABANA IS NOT AN INSURED LOCATION UNDER HOMEOWNER'S POLICY

In this declaratory judgment action, defendant Security Mutual Insurance Company ("Security Mutual") moves, pursuant to CPLR § 3212, for summary judgment dismissing the complaint.

Defendant E. Patricia Dolan ("Dolan"), via Security Mutual's agent, non-party P. Turim Insurance Agency ("P. Turim"), obtained a homeowner's insurance policy from Security Mutual. Security Mutual's policy, HO 0496138 (the "Policy"), which was in effect from April 13, 2005 to April 13, 2008 (see Affirmation of Renee A. Breitner, Esq. in Support of Motion [Breitner Affirm.], Exhibit "C", the Policy). The Policy provides that it covers premises located at 197 Kildare Road, Garden City, New York 11530 (the "Garden City Residence") (see id., Declarations Page).

In the summer of 2005, Dolan was renting a beach cabana number C23 (the "Cabana") from the Sun and Surf Beach Club (the "Beach Club"), located at 2191 Bay Boulevard, Atlantic Beach, New York. On September 10, 2005, upon Dolan's invitation, plaintiff Susan Raner ("Raner" or "plaintiff") was at the Cabana, where she fell and suffered bodily injuries (the "Accident").

Denial of Coverage

The parties dispute when Dolan first notified Security Mutual about the Accident and Raner's claims. Security Mutual claims that it was first notified only in December 2005, when it received a fax from P. Turim, whereas Dolan claims that she called Security Mutual shortly after the Accident and was instructed to contact her insurance agent, which she allegedly did eight to ten days after the Accident.

After it received the fax from P. Turim, Security Mutual sent a reservation of rights letter, dated December 13, 2005, to Dolan. It then assigned non-party Great Wave Investigation Co. ("Great Wave") to investigate the issues of coverage and liability. In February 2006, following its investigation, Great Wave submitted a report to Security Mutual. By letter dated February 14, 2006, Security Mutual disclaimed coverage for the Accident on the grounds of the Policy exclusions for liability resulting from premises other than the insured premises, as well as Dolan's failure to give Security Mutual timely notice of the Accident.

Personal Injury Action

In December 2007, Raner commenced a lawsuit against Dolan in the Supreme Court, Nassau County, titled Susan Raner v E. Patricia Dolan (Index No. 21909/2007), alleging that Dolan's negligence caused her injury (the "Personal Injury Action") (see Breitner Affirm., Exhibit "C"). By order dated June 26, 2008, and entered July 11, 2008, the court in the Personal Injury Action granted Raner's motion for partial summary judgment on default on the issue of liability. On March 4, 2009, following an inquest on the issue of damages, a judgment was entered in favor of Raner and against Dolan in the amount of $359,313.24 (the "Amount of Judgment").

This Action

In this action, Raner alleges that Security Mutual (1) insured Dolan "for liability concerning the occupancy of the" Cabana (Complaint, ¶ 7); (2) improperly and untimely disclaimed coverage (id., ¶¶ 8, 14-15); and (3) failed to defend and indemnify Dolan (id., ¶ 14). Raner seeks a judgment (1) declaring that Security Mutual had a duty to defend and indemnify Dolan in the Personal Injury Action and (2) awarding the Amount of Judgment in favor of Raner, plus interest. Defendant E. Patricia Dolan ("Dolan") has not interposed an answer.

Security Mutual now moves for summary judgment dismissing the complaint.

To obtain summary judgment, the movant must tender evidentiary proof that would establish the movant's cause of action or defense sufficiently to warrant judgment in his or her favor as a matter of law (Zuckerman v City of New York, 49 NY2d 557, 562 [1980]). "[T]o defeat a motion for summary judgment the opposing party must show facts sufficient to require a trial of any issue of fact'" (id., quoting CPLR 3212 [b]).

The first issue for the court's consideration is whether the premises where the Accident occurred is covered by the Policy. In determining this issue, the court looks to general principles governing the interpretation of insurance policies. "The interpretation of [an insurance] policy's terms is a question of law for the court" (Seaport Park Condominium v Greater NY Mut. Ins. Co., 39 AD3d 51, 54 [1st Dept 2007]). "An insurance contract is to be interpreted by the same general rules that govern the construction of any written contract and enforced in accordance with the intent of the parties as expressed in the language employed in the policy . . . The touchstone for interpreting insurance contracts, as with other contracts, is the reasonable expectation of the parties [citations omitted] (Throgs Neck Bagels v GA Ins. Co. of NY, 241 AD2d 66, 69 [1st Dept 1998]. "As with the interpretation of any contract, the unambiguous terms of an insurance policy must be accorded their plain and ordinary meaning" (Seaport Park Condominium, 39 AD3d at 54).

"Where the contract at issue is an insurance policy, any exclusion from coverage must be stated unambiguously, and any ambiguity must be resolved against the insurer as drafter of the policy's language" (Matter of Reliance Ins. Co., 55 AD3d 43, 46 [1st Dept 2008], affd 12 NY3d 725 [2009]). "To negate coverage by virtue of an exclusion, an insurer must establish that the exclusion is stated in clear and unmistakable language, is subject to no other reasonable interpretation, and applies in the particular case" (Continental Cas. Co. v Rapid-American Corp., 80 NY2d 640, 652 [1993]).

Here, coverage under the Policy is divided into six categories: "Residence," "Related Private Structures on the Premises," "Personal Property," "Additional Living Expense and Loss of Rent," "Personal Liability," and "Medical Payments to Others" (see Policy, Declarations Page).

As to the category of "Personal Liability," with policy limits of $300,000 per each occurrence, the Policy, in relevant part, provides: "[w]e pay, up to our limit of liability, all sums for which any insured is legally liable because of bodily injury or property damage caused by an occurrence to which this coverage applies" (emphasis in the original)(Policy, at L-1).

As to the category of "Medical Payments to Others," with policy limits of $1,000, the Policy, in relevant part, provides: "[w]e pay the necessary medical expenses incurred or medically determined within three years from the date of an accident causing bodily injury to which this coverage applies" (id.).

The Policy defines "occurrence"as "an accident, including continuous or repeated exposure to substantially similar conditions" (id. at 2, § 10) and "bodily injury" as "bodily harm, sickness or disease to a person including required care, loss of services and death resulting therefrom" (id. at 1, § 2).

Under the "Personal Liability" and "Medical Payments to Others" categories, the Policy excludes coverage if, among other things, liability "result[ed] from premises owned, rented or controlled by an insured other than the insured premises ..."(emphasis in the original) (Policy, at L-3, § 1 [g]).

The Policy defines "insured premises," in relevant part, as follows: "[i]f you own the one to four family house described in the Declarations, the insured premises means that house, related private structures and grounds at that location" (Policy, at 1, § 7 [a] [1]). The Declarations Page provides that the Garden City Residence is the house covered by the Policy (see Policy, Declarations Page).

Security Mutual contends that the Cabana is not "the insured premises" within the meaning of the Policy and that, therefore, the Policy does not provide coverage for the Accident.

In opposition, Raner points out that the Cabana is "the insured premises" under the following clause in the Policy: "[f]or Personal Liability and Medical Payments to Others coverages, only, insured premises also include the following: ... that part of any premises occasionally rented to an insured for other than business purposes (Policy, at 1-2, § 7 [b] [8]).

The issue then becomes whether "premises occasionally rented to an insured", language which is contained in the Policy, is an ambiguous term. "[T]he test to determine whether an insurance contract is ambiguous focuses on the reasonable expectations of the average insured upon reading the policy and employing common speech [citations omitted]" (Matter of Mostow v State Farm Ins. Cos., 88 NY2d 321, 326-327 [1996]). "The test for ambiguity is whether the language in the insurance contract is susceptible of two reasonable interpretations'" (MDW Enters. v CNA Ins. Co., 4 AD3d 338, 340-341 [2d Dept 2004], quoting State of New York v Home Indem. Co., 66 NY2d 669, 671 [1985]).

The court finds that the term "premises occasionally rented to an insured" is not ambiguous, and its plain and ordinary meaning refers to episodic, non-systematic rentals (see Seaport Park Condominium, 39 AD3d at 54). It is undisputed that Dolan has been renting the same Cabana every summer for over 20 years (see Breitner Affirm., Exhibit "K", Dolan's Written Statement to Great Wave; Exhibit "F", Dolan Dep. Tr., at 33). She has decorated it and stored items in it during the winter (see Dolan's Written Statement to Great Wave). This type of systematic rental spanning decades cannot be characterized as "occasional" (cf. Villanueva v Preferred Mutual Ins. Co., 48 AD3d 1015, 1017 [3d Dept 2008] [the term "occasional rental for residential purposes," used in a homeowner's policy for a summer house, was deemed to be ambiguous, where a one-time rental of the home for five months was at issue]). Dolan could not reasonably expect that her Cabana, which she had been renting every summer for over 20 years from the Beach Club, was an occasional rental covered by the Policy. Accordingly, the Cabana is not "the insured premises" within the meaning of the Policy and the unambiguous exclusion of coverage, where liability results from premises other than the insured premises, applies (Policy, at L-3, § 1 [g]) (see Continental Cas. Co., 80 NY2d at 652). The court concludes, therefore, that Security Mutual was not obligated to defend or indemnify Dolan in the Personal Injury Action.

In light of this determination, the issue of whether Security Mutual timely disclaimed coverage is rendered academic.

For the foregoing reasons, it is hereby

ORDERED that the motion of defendant Security Mutual Insurance Company for summary judgment is granted and the complaint is dismissed without costs and disbursements; and it is further

ADJUDGED and DECLARED that the defendant Security Mutual Insurance Company did not have a duty to defend or indemnify defendant E. Patricia Dolan in the underlying action titled Susan Raner v E. Patricia Dolan (Index No. 21909/07, Supreme Court, Nassau County), and it is not obligated to pay the judgment entered in that action on March 4, 2009.

This constitutes the decision, order and judgment of the court.

DATED:_February 14, 2011____________________

E N T E R,

______________________________

O. PETER SHERWOOD

J.S.C.

In today's Rogak No-Fault Blog:

Can an auto policy be voided retroactively as to all claimants -- both PIP and liability?  Before you answer, read today's decision from the Appellate Division.

Car gets stuck in the snow in the driveway of insured rental property.  Tenant
goes out to help and falls as she is pushing the car to get it out of snow.  Are
medical bills covered by that car owners no-fault coverage?  Is this injury
considered to stem from of use, operation or maintenance of a motor vehicle?




Response:  In my opinion, yes.  This is a use-or-operation injury. -- Larry
Rogak

Carpenter v Isme , 2011 NY Slip Op 30640(U) (Sup Ct, Queens County) (Docket Number: 11638/08) (Judge: Howard G. Lane)

Edited by Lawrence N. Rogak 

This action arises out of an automobile accident that occurred on December 15, 2005. Defendants have submitted proof in admissible form in support of the motion for summary judgment, for all categories of serious injury. The defendants submitted inter alia, affirmed reports from three independent examining and/or evaluating physicians (an orthopedist, a neurologist, and a radiologist) and plaintiff's own verified bill of particulars.

Under the "no-fault" law, in order to maintain an action for personal injury, a plaintiff must establish that a "serious injury" has been sustained (Licari v. Elliot, 57 NY2d 230 [1982]). The proponent of a motion for summary judgment must tender sufficient evidence to show the absence of any material issue of fact and the right to judgment as a matter of law (Alvarez v. Prospect Hospital, 68 NY2d 320 [1986]; Winegrad v. New York Univ. Medical Center, 64 NY2d 851 [1985]).

In the present action, the burden rests on defendants to establish, by the submission of evidentiary proof in admissible form, that plaintiff has not suffered a "serious injury." (Lowe v. Bennett, 122 AD2d 728 [1st Dept 1986], affd, 69 NY2d 701, 512 NYS2d 364 [1986]). When a defendant's motion is sufficient to raise the issue of whether a "serious injury" has been sustained, the burden shifts and it is then incumbent upon the plaintiff to produce prima facie evidence in admissible form to support the claim of serious injury (Licari v. Elliot, supra; Lopez v. Senatore, 65 NY2d 1017 [1985]).

In support of a claim that plaintiff has not sustained a serious injury, a defendant may rely either on the sworn statements of the defendant's examining physician or the unsworn reports of plaintiff's examining physician (Pagano v. Kingsbury, 182 AD2d 268 [2d Dept 1992]). Once the burden shifts, it is incumbent upon plaintiff, in opposition to defendant's motion, to submit proof of serious injury in "admissible form". Unsworn reports of plaintiff's examining doctor or chiropractor will not be sufficient to defeat a motion for summary judgment (Grasso v. Angerami, 79 NY2d 813 [1991]). Thus, a medical affirmation or affidavit which is based on a physician's personal examination and observations of plaintiff, is an acceptable method to provide a doctor's opinion regarding the existence and extent of a plaintiff's serious injury (O'Sullivan v. Atrium Bus Co., 246 AD2d 418 [1st Dept 1998]). Unsworn MRI reports are not competent evidence unless both sides rely on those reports (Gonzalez v. Vasquez, 301 AD2d 438 [1st Dept 2003]; Ayzen v. Melendez, 749 NYS2d 445 [2d Dept 2002]).

However, in order to be sufficient to establish a prima facie case of serious physical injury the affirmation or affidavit must contain medical findings, which are based on the physician's own examination, tests and observations and review of the record rather than manifesting only the plaintiff's subjective complaints. It must be noted that a chiropractor is not one of the persons authorized by the CPLR to provide a statement by affirmation, and thus, for a chiropractor, only an affidavit containing the requisite findings will suffice (see, CPLR 2106; Pichardo v. Blum, 267 AD2d 441 [2d Dept 1999]; Feintuch v. Grella, 209 AD2d 377 [2d Dept 2003]).

In any event, the findings, which must be submitted in a competent statement under oath (or affirmation, when permitted) must demonstrate that plaintiff sustained at least one of the categories of "serious injury" as enumerated in Insurance Law §5102(d) (Marquez v. New York City Transit Authority, 259 AD2d 261 [1st Dept 1999]; Tompkins v. Budnick, 236 AD2d 708 [3d Dept 1997]; Parker v. DeFontaine, 231 AD2d 412 [1st Dept 1996]; DiLeo v. Blumberg, 250 AD2d 364 [1st Dept 1998]).

For example, in Parker, supra, it was held that a medical affidavit, which demonstrated that the plaintiff's threshold motion limitations were objectively measured and observed by the physician, was sufficient to establish that plaintiff has suffered a "serious injury" within the meaning of that term as set forth in Article 51 of the Insurance Law. In other words, "[a] physician's observation as to actual limitations qualifies as objective evidence since it is based on the physician's own examinations."

Furthermore, in the absence of objective medical evidence in admissible form of serious injury, plaintiff's self-serving affidavit is insufficient to raise a triable issue of fact (Fisher v. Williams, 289 AD2d 288 [2d Dept 2001]). 

The affirmed report of defendants' independent examining orthopedist, Robert Israel, M.D., indicates that an examination conducted on September 23, 2009 revealed an impression of: resolved sprain of the cervical spine, resolved sprain of the lumbar spine, resolved sprain of the right hip, and resolved sprain of the bilateral knees. He opines that the plaintiff has no disability as a result of the accident of record.

The affirmed report of defendants' evaluating radiologist, Alan B. Greenfield, M.D. indicates that an MRI of the Lumbar Spine dated March 31, 2007 revealed a diagnosis of "[d]egenerative disc disease with degenerative disc bulging as well as degenerative bony osteophyte ridging and degenerative facet arthropathy at L5-S1. The constellations of these findings are clearly longstanding and degenerative in origin and cannot be attributed to an accident of 12/15/05 with any reasonable degree of medical certainty." He concludes that "[t]here are no findings on this examination, which can be attributed to an accident occurring more than one year prior to the imaging date of this examination."

The affirmed report of defendants' evaluating radiologist, Alan B. Greenfield, M.D. indicates that an MRI of the Left Shoulder revealed a diagnosis of: "[d]ownsloping of the AC joint represents an anatomic variant, however, it is also associated with mild degenerative arthropathy along the undersurface of the AC joint, both of which may contribute to bony impingement. These findings are clearly longstanding and are unrelated to trauma including the accident of 12/15/05". He concludes that there are no findings which can be attributed to an accident of December 15, 2005.

Additionally, defendants established a prima facie case for the category of "90/180 days." The plaintiff's verified bill of particulars indicates: that plaintiff was confined to bed for approximately one (1) week and confined to home for approximately one (1) week. Such evidence shows that the plaintiff was not curtailed from nearly all activities for the bare minimum of 90/180, required by the statute.

The aforementioned evidence amply satisfied defendants' initial burden of demonstrating that plaintiff did not sustain a "serious injury." Thus, the burden then shifted to plaintiff to raise a triable issue of fact that a serious injury was sustained within the meaning of the Insurance Law (see, Gaddy v. Eyler, 79 NY2d 955 [1992]). Failure to raise a triable issue of fact requires the granting of summary judgment and dismissal of the complaint (see, Licari v. Elliott, supra).

In opposition to the motion, plaintiff submitted: an attorney's affirmation, a sworn narrative report of plaintiff's internal medicine physician, Munta Majeed, M.D., certified medical records of Muntaz Majeed, M.D., a notarized narrative report of plaintiff's chiropractor, Michael W. Tafreshi, an affirmed narrative report of plaintiff's neuroradiologist, Mark J. Lodespoto, M.D., and an affirmed report of plaintiff's neurologist, Abraham M. Glassman, M.D.

Plaintiff has failed to establish a causal connection between the accident and the injuries. The causal connection must ordinarily be established by competent medical proof (see, Kociocek v. Chen, 283 AD2d 554 [2d Dept 2001]; Pommels v. Perez, 4 NY3d 566 [2005]).

Plaintiff testified at her deposition that she was involved in four accidents prior to the subject accident wherein she sustained injury to her neck, back, shoulders and knees. None of plaintiff's medical experts address the significance of the four prior accidents, and thus, their opinions as to causality are rendered speculative. As none of plaintiff's examining doctors were aware of all of plaintiff's prior accidents and none of them reviewed her medical records from these prior accidents, the plaintiff's medical submissions are insufficient to raise a triable issue of fact as to whether plaintiff has a causally-related "serious injury" to her neck, back, shoulders or legs (see, Vidor v. Davila, 37 AD3d 826 [2d Dept 2007; Varveris v. Franco, 71 AD3d 1128 [2d Dept 2010]).

Additionally, although defendants' independent examining radiologist opines in his affirmed reports that his examination of plaintiff revealed longstanding degeneration in the lumbar spine and left shoulder, plaintiff's experts failed to indicate their awareness that plaintiff was suffering from such condition and failed to address the effect of these findings on plaintiff's claimed accident injuries (Francis v. Christopher, 302 AD2d 425 [2d Dept 2003]; Monette v. Keller, 281 AD2d 523 [2d Dept 2001]; Ifrach v. Neiman, 306 AD2d 380 [2d Dept 2003]).

Hence, plaintiff failed to rebut defendants' claim sufficiently to raise a trial issue of fact (see, Pommels v. Perez, 4 NY3d 566, 2005 WL 975859 [2005]).

When construing the statutory definition of a 90/180-day claim,the words "substantially all" should be construed to mean that the person has been prevented from performing her usual activities to a great extent, rather than some slight curtailment (see, Gaddy v. Eyler, 79 NY2d 955; Licari v. Elliott, 57 NY2d 230 [1982]; Berk v. Lopez, 278 AD2d 156 [1st Dept 2000], lv denied 96 NY2d 708 [2001]). Plaintiff fails to include experts' reports or affirmations which render an opinion on the effect the injuries claimed may have had on the plaintiff for the 180-day period immediately following the accident. As such, plaintiff's submissions were insufficient to establish a triable issue of fact as to whether plaintiff suffered from a medically determined injury that curtailed her from performing her usual activities for the statutory period (Licari v. Elliott, 57 NY2d 230, 236 [1982]). Accordingly, plaintiff's claim that her injuries prevented her from performing substantially all of the material acts constituting her customary daily activities during at least 90 of the first 180 days following the accident is insufficient to raise a triable issue of fact (see, Graham v. Shuttle Bay, 281 AD2d 372 [1st Dept 2001]; Hernandez v. Cerda, 271 AD2d 569 [2d Dept 2000]; Ocasio v. Henry, 276 AD2d 611 [2d Dept 2000]).

Therefore, plaintiff's submissions are insufficient to raise a triable issue of fact (see, Zuckerman v. City of New York, 49 NY2d 557 [1980]).

One of the perennial problems in New York PIP is trying to figure out whether a person is eligible for it.  There are different rules for New York residents vs. out of state residents, named insureds and household members vs. uninsured persons, bus passengers, pedestrians, in-state accidents and out-of-state accidents. 

The regulations are complex and poorly worded, and have to be considered in the light of the Insurance Law and other laws.

I have worked out all the answers and compiled them as a chart, with annotations.  When it's ready, I will make the announcement -- and then the debates can begin.

Larry Rogak

NEW YORK HAS JURISDICTION OVER INTERNET-BASED COPYRIGHT INFRINGEMENT SO LONG AS COPYRIGHT HOLDER IS IN NEW YORK

In a decision with important implications for copyright infringement suits that are covered by CGL and other policies (as well as those where insurance is not involved), the Court of Appeals has held that when a copyright holder resides in New York, the New York courts will take jurisdiction over an infringement suit where the defendant is alleged to have violated the copyright on the Internet, regardless of where the defendant resides or where the infringement took place. -- LNR

The United States Court of Appeals for the Second Circuit has asked us a question regarding the scope of long-arm jurisdiction under CPLR 302 (a) (3) (ii) in the context of a federal copyright infringement action.

Plaintiff Penguin Group (USA) is a large trade book publisher with its principal place of business in New York City. Defendant American Buddha is an Oregon not-for-profit corporation whose principal place of business is in Arizona. It operates two Web sites — the American Buddha Online Library and the Ralph Nader Library ^[FN1] — that are hosted on servers located in Oregon and Arizona.

Penguin commenced this copyright infringement action against American Buddha in the United States District Court for the Southern District of New York, alleging that American Buddha infringed on Penguin's copyrights to four books: "Oil!" by Upton Sinclair; "It Can't Happen Here" by Sinclair Lewis; "The Golden Ass" by Apuleius, as translated by E.J. Kenney; and "On the Nature of the Universe" by Lucretius, as translated by R.E. Latham. The complaint alleges that American Buddha published complete copies of these works on its two Web sites, making them available free of charge to its 50,000 members and anyone with an Internet connection. The electronic copying and uploading of the works was apparently undertaken in Oregon or Arizona.

American Buddha's Web sites assure its users that its uploading of these works and the users' downloading of them do not constitute copyright infringement because they are protected under sections 107 and 108 of the Copyright Act (17 USC § 101 et seq.), which govern fair use and reproduction by libraries and archives. Penguin disputes that any exception to the Copyright Act applies to American Buddha's activities.

American Buddha moved to dismiss the complaint for lack of personal jurisdiction, arguing that its ties to New York were too insubstantial. In response, Penguin asserted that it had secured long-arm jurisdiction over American Buddha by virtue of CPLR 302 (a) (3) (ii), which provides jurisdiction over nondomiciliaries who commit tortious acts outside the state that result in injuries within New York. American Buddha countered that CPLR 302 (a) (3) (ii) was inapplicable because Penguin did not suffer an in-state injury.

The district court granted American Buddha's motion and dismissed the complaint, holding that Penguin was injured in Oregon or Arizona, where the copying and uploading of the books took place. The court determined that Penguin suffered only a "purely derivative economic injury" in New York based on its domicile here, which was insufficient to trigger CPLR 302 (a) (3) (ii). Although the court acknowledged that the Internet could be a complicating factor in analyzing personal jurisdiction, it concluded that the Internet played "no role in determining the situs of [Penguin's] alleged injury" since the claimed infringement occurred in Oregon or Arizona.

Recognizing a split of authority in the New York district courts regarding the application of CPLR 302 (a) (3) (ii) to copyright infringement cases against out-of-state defendants, the Second Circuit certified the following question to us:

"In copyright infringement cases, is the situs of injury for purposes of determining long-arm jurisdiction under N.Y. C.P.L.R. § 302 (a) (3) (ii) the location of the infringing action or the residence or location of the principal place of business of the copyright holder?" (609 F3d 30, 32 [2d Cir 2010]).

The Second Circuit invited this Court to "alter this question as it should deem appropriate" (id. at 42) and noted that, "in the context of certifying a question to the New York Court of Appeals[,] . . . the allegation of distribution over the Internet may be a factor in the Court's interpretation of the statute in question" (id. at 39).^[FN2]

Because the Internet plays a significant role in this case, we narrow and reformulate the certified question to read:

In copyright infringement cases involving the uploading of a copyrighted printed literary work onto the Internet, is the situs of injury for purposes of determining long-arm jurisdiction under N.Y. C.P.L.R. § 302 (a) (3) (ii) the location of the infringing action or the residence or location of the  principal place of business of the copyright holder?

In answer to this reformulated question and under the circumstances of this case, we conclude it is the location of the copyright holder.

CPLR 302 (a) (3) (ii) allows a court in New York to exercise personal jurisdiction over an out-of-state defendant when the nondomiciliary:

"3. commits a tortious act without the state causing injury to person or property within the state, except as to a cause of action for defamation of character arising from the act, if he
. . .
"(ii) expects or should reasonably expect the act to have consequences in the state and derives substantial revenue from interstate or international commerce."

Consequently, a plaintiff relying on this statute must show that (1) the defendant committed a tortious act outside New York; (2) the cause of action arose from that act; (3) the tortious act caused an injury to a person or property in New York; (4) the defendant expected or should reasonably have expected the act to have consequences in New York; and (5) the defendant derived substantial revenue from interstate or international commerce (see LaMarca v Pak-Mor Mfg. Co., 95 NY2d 210, 214 [2000]). If these five elements are met, a court must then assess whether a finding of personal jurisdiction satisfies federal due process (see id. at 216). The only issue before us concerns the third requirement — whether an out-of-state act of copyright infringement has caused injury in New York.

Penguin, supported by amici curiae American Association of Publishers and other national publishing organizations, argues that a New York-based copyright holder sustains an injury in New York for purposes of CPLR 302 (a) (3) (ii) when its copyright is infringed through the out-of-state uploading of its protected work onto the Internet. American Buddha and amicus curiae Public Citizen respond that this case is controlled by Fantis Foods v Standard Importing Co. (49 NY2d 317 [1980]), where we held that a derivative economic injury felt in New York based solely on the domicile of the plaintiff is insufficient to establish an in-state injury within the meaning of the statute. Both parties raise compelling arguments.

Our analysis begins with Fantis Foods, where we found personal jurisdiction to be lacking in the absence of a "direct injury" within New York. In that case, Standard, a New York wholesaler of feta cheese, asserted a claim for conversion against a Greek entity that had diverted a cheese shipment — meant to be shipped to Standard in Chicago — to a competitor while the shipment was in Greece or on the high seas. We concluded that personal jurisdiction over the Greek defendant did not lie under CPLR 302 (a) (3) (ii) because:

"In final analysis the only possible connection between the claimed conversion and any injury or foreseeable consequence in New York is the fact that Standard is incorporated and maintains offices there. It has, however, long been held that the residence or domicile of the injured party within a State is not a sufficient predicate for jurisdiction, which must be based upon a more direct injury within the State and a closer expectation of consequences within the State than the indirect financial loss resulting from the fact that the injured person resides or is domiciled there" (id. at 326).

In a different commercial tort context, in Sybron Corp. v Wetzel (46 NY2d 197 [1978]), we held that an injury had occurred in New York under CPLR 302 (a) (3) (ii). The defendant in Sybron, a nondomiciliary corporation, hired a former employee of Sybron — a competitor engaged in manufacturing in New York — allegedly to obtain Sybron's protected trade secrets. Recognizing that the locus of injury in commercial cases "is not as readily identifiable as it is in torts causing physical harm" (id. at 205), we determined that Sybron sustained a sufficiently direct injury in New York to support jurisdiction under CPLR 302 (a) (3) (ii) since its claim was based on more than just its in-state domicile. Rather, Sybron had alleged that it acquired the trade secrets at issue in New York and, further, that the defendant's unfair competition threatened to pilfer Sybron's significant New York customers.

Fantis Foods and Sybron both cited favorably to American Eutectic Welding Alloys Sales Co. v Dytron Alloys Corp. (439 F2d 428 [2d Cir 1971]). There, the plaintiffs, two related New York corporations, brought an action against an out-of-state competitor alleging that it induced their employees to work for the competitor and to use confidential information to lure away plaintiffs' customers in Kentucky and Pennsylvania. The Second Circuit identified three options for determining the situs of injury under CPLR 302 (a) (3) (ii) in a commercial tort case: "(1) any place where plaintiff does business; (2) the principal place of business of the plaintiff; and (3) the place where plaintiff lost business" (id. at 433, quoting Spectacular Promotions, Inc. v Radio Station WING, 272 F Supp 734, 737 [ED NY 1967] [Weinstein, J.]). The Court determined that the third choice "seem[ed] most apt," observing that "[t]he place where the plaintiff lost business would normally be a forum reasonably foreseeable by a tortfeasor" (id. [internal quotation marks and citation omitted]). Because plaintiffs alleged a loss of business only in Kentucky and Pennsylvania, the claim against the competitor was dismissed for lack of personal jurisdiction in New York. The Court rejected plaintiffs' reliance on their New York domicile, reasoning that any "derivative commercial injury" predicated on a loss of sales in other states was too remote to establish an in-state injury within the meaning of the statute (id.).

The injury in the case before us is more difficult to identify and quantify because the alleged infringement involves the Internet, which by its nature is intangible and ubiquitous. But the convergence of two factors persuades us that a New York copyright owner alleging infringement sustains an in-state injury pursuant to CPLR 302 (a) (3) (ii) when its printed literary work is uploaded without permission onto the Internet for public access. First, it is clear that the Internet itself plays an important role in the jurisdictional analysis in the specific context of this case. It is widely recognized that "the digital environment poses a unique threat to the rights of copyright owners" and that "digital technology enables pirates to reproduce and distribute perfect copies of works — at virtually no cost at all to the pirate" (House Commerce Comm Rep on the DMCA, HR Rep 551, 105th Cong, 2d Sess, at 25, reprinted in 10 Nimmer on Copyright, Appendix 53, at 37). Indeed, the rate of e-book piracy has risen in conjunction with the increasing popularity of electronic book devices (see Trivedi, Writing the Wrong: What the E-Book Industry Can Learn from Digital Music's Mistakes with DRM, 18 JL & Poly 925, 928 [2010]).

The crux of Penguin's copyright infringement claim is not merely the unlawful electronic copying or uploading of the four copyrighted books. Rather, it is the intended consequence of those activities — the instantaneous availability of those copyrighted works on American Buddha's Web sites for anyone, in New York or elsewhere, with an Internet connection to read and download the books free of charge ^[FN3]. Unlike American Eutectic, where the locus of injury was clearly circumscribed to two other states, the alleged injury in this case involves online infringement that is dispersed throughout the country and perhaps the world. In cases of this nature, identifying the situs of injury is not as simple as turning to "the place where plaintiff lost business" (American Eutectic, 439 F2d at 433) because there is no singular location that fits that description.

As a result, although it may make sense in traditional commercial tort cases to equate a plaintiff's injury with the place where its business is lost or threatened, it is illogical to extend that concept to online copyright infringement cases where the place of uploading is inconsequential and it is difficult, if not impossible, to correlate lost sales to a particular geographic area. In short, the out-of-state location of the infringing conduct carries less weight in the jurisdictional inquiry in circumstances alleging digital piracy and is therefore not dispositive.

The second critical factor that tips the balance in favor of identifying New York as the situs of injury derives from the unique bundle of rights granted to copyright owners. The Copyright Act gives owners of copyrighted literary works five "exclusive rights," which include the right of reproduction; the right to prepare derivative works; the right to distribute copies by sale, rental, lease or lending; the right to perform the work publicly; and the right to display the work publicly (see 17 USC § 106). Hence, a copyright holder possesses an overarching "right to exclude others from using his property" (eBay Inc. v MercExchange, L.L.C., 547 US 388, 392 [2006] [internal quotation marks and citation omitted]).

Based on the multifaceted nature of these rights, a New York copyright holder whose copyright is infringed suffers something more than the indirect financial loss we deemed inadequate in Fantis Foods. For instance, one of the harms arising from copyright infringement is the loss or diminishment of the incentive to publish or write (see Twentieth Century Music Corp. v Aiken, 422 US 151, 156 [1975]; see also Princeton Univ. Press v Michigan Document Servs., Inc., 99 F3d 1381, 1391 [6th Cir 1996], cert denied 520 US 1156 [1997] ["[P]ublishers obviously need economic incentives to publish scholarly works . . . If publishers cannot look forward to receiving permission fees, why should they continue publishing marginally profitable books at all? And how will artistic creativity be stimulated if the diminution of economic incentives for publishers to publish academic works means that fewer academic works will be published?"]). And, the harm to a plaintiff's property interest in copyright infringement cases "has often been characterized as irreparable in light of possible market confusion" (Salinger v Colting, 607 F3d 68, 81 [2d Cir 2010]).

Moreover, the absence of any evidence of the actual downloading of Penguin's four works by users in New York is not fatal to a finding that the alleged injury occurred in New York ^[FN4]. In Sybron, we made clear that a tort committed outside the state that was likely to cause harm through the loss of business inside the state was sufficient to establish personal jurisdiction regardless of whether damages were likely recoverable or even ascertainable (see Sybron, 46 NY2d at 204; see also Sung Hwan Co., Ltd. v Rite Aid Corp., 7 NY3d 78, 85 [2006]). Courts often issue injunctive relief in copyright infringement cases to halt impermissible uses because "to prove the loss of sales due to infringement is . . . notoriously difficult" (Salinger, 607 F3d at 81 [internal quotation marks and citation omitted]). In any event, it is undisputed that American Buddha's Web sites are accessible by any New Yorker with an Internet connection and, as discussed, an injury allegedly inflicted by digital piracy is felt throughout the United States, which necessarily includes New York.

In sum, the role of the Internet in cases alleging the uploading of copyrighted books distinguishes them from traditional commercial tort cases where courts have generally linked the injury to the place where sales or customers are lost. The location of the infringement in online cases is of little import inasmuch as the primary aim of the infringer is to make the works available to anyone with access to an Internet connection, including computer users in New York. In addition, the injury to a New York copyright holder, while difficult to quantify, is not as remote as a purely indirect financial loss due to the broad spectrum of rights accorded by copyright law. The concurrence of these two elements — the function and nature of the Internet and the diverse ownership rights enjoyed by copyright holders situated in New York — leads us to view this case as closer to Syb ron than Fantis Foods. Thus, we conclude that the alleged injury in this case occurred in New York for purposes of CPLR 302 (a) (3) (ii).^[FN5]

Finally, contrary to American Buddha's assertion, our decision today does not open a Pandora's box allowing any nondomiciliary accused of digital copyright infringement to be haled into a New York court when the plaintiff is a New York copyright owner of a printed literary work. Rather, CPLR 302 (a) (3) (ii) incorporates built-in safeguards against such exposure by requiring a plaintiff to show that the nondomiciliary both "expects or should reasonably expect the act to have consequences in the state" and, importantly, "derives substantial revenue from interstate or international commerce." There must also be proof that the out-of-state defendant has the requisite "minimum contacts" with the forum state and that the prospect of defending a suit here comports with "traditional notions of fair play and substantial justice," as required by the Federal Due Process Clause (International Shoe Co. v Washington, 326 US 310, 316 [1945] [internal quotation marks and citation omitted]; see also World-Wide Volkswagen Corp. v Woodson, 444 US 286, 291-292 [1980]). These issues are beyond the scope of this certified question and their resolution awaits further briefing before the federal courts.

Accordingly, as reformulated, the certified question should be answered in accordance with this opinion.
* * * * * * * * * * * * * * * * *
Following certification of a question by the United States Court of Appeals for the Second Circuit and acceptance of the question by this Court pursuant to section 500.27 of the Rules of Practice of the New York State Court of Appeals, and after hearing argument by counsel for the parties and consideration of the briefs and the record submitted, certified question answered in accordance with the opinion herein. Opinion by Judge Graffeo.
Chief Judge Lippman and Judges Ciparick, Read, Smith, Pigott and Jones concur.
Decided March 24, 2011

Footnote 1: The Ralph Nader Library is not affiliated with Ralph Nader.

Footnote 2: The Second Circuit also stated that "[t]here is a possible question at the threshold that neither the district court nor the parties have addressed and which we do not here decide: whether a copyright — in and of itself an intangible thing — has a physical location for jurisdictional purposes and, if so, what that location is" (609 F3d at 36 n 4). The Second Circuit resolved to "accept for the purposes of this appeal the district court's implicit conclusion that copyrights have a location and that their location in this case is in New York State" (id.). We, too, accept this characterization in answering the certified question.

Footnote 3: Of course, we take no position on the merits of Penguin's claims.

Footnote 4: In its brief, Penguin asserts that its claim is solely against American Buddha and that it is "loath to sue its readers," particularly where they are assured by American Buddha's Web sites that downloading the works contained therein would not constitute copyright infringement.

Footnote 5: We do not find it necessary to address whether a New York copyright holder sustains an in-state injury pursuant to CPLR 302 (a) (3) (ii) in a copyright infringement case that does not allege digital piracy and, therefore, express no opinion on that question (compare McGraw-Hill Cos. v Ingenium Tech. Corp., 375 F Supp 2d 252, 256 [SD NY 2005] ["The torts of copyright and trademark infringement cause injury in the state where the allegedly infringed intellectual property is held"] with Freeplay Music, Inc. v Cox Radio, Inc., 2005 WL 1500896 [SD NY 2005] [holding that personal jurisdiction over a nondomiciliary in a copyright infringement case did not exist because the injury occurred where the alleged out-of-state infringement took place]).

Comment:  New Yorkers (and their insurers) who use the Internet to upload or download materials that may be subject to copyright need to be concerned about the reverse situation -- being hauled into courts all over the country by copyright holders who sue in their home states.  

Larry Rogak

In today's Rogak No-Fault Blog:

1. Does a bus passenger get PIP if she steps into a hole in the street after stepping out the rear door?  In her BI case, does she have to prove threshold?

2. If a judgment is entered in a PIP suit for more than the policy limits, can the insurer get the judgment reduced to the amount remaining on the policy?

Find out!  http://www.newyorknofaultadvisor.com/blog.php

Larry Rogak

In today's Rogak No-Fault Blog:

Is "LMK" retroactive?  The Appellate Term says....  well, read the report and find out!

After months of painstaking research and analysis of the New York PIP regulations and case law, I am rolling out something that has never existed before: a chart explaining who qualifies for PIP, and when.

The NEW YORK PIP ELIGIBILITY CHART breaks down potential claimants into 14 categories:

NY residents in NY vehicles

NY residents in out of state vehicles

NY residents in NY buses

NY residents in out of state buses

Out of state residents in NY vehicles

Out of state residents in out of state vehicles

Out of state residents in NY buses

Out of state residents in out of state buses

NY pedestrians hit by NY vehicles

NY pedestrians hit by out of state vehicles

Out of state pedestrians hit by NY vehicles

Out of state pedestrians hit by out of state vehicles

NY residents hit by motorcycles/ATVs

Out of state residents hit by motorcycles/ATVs

Furthermore, for each of the above 14 categories of claimants, I further divide them into two types: NY accidents and out of state accidents.

All together, there are 28 classifications of claimants treated by this chart, and for each one, my conclusions as to whether each type is or is not an EIP, with comments.  It contains as much information as could possibly be squeezed into one page.

This first-of-its kind EIP chart will enable attorneys and claims examiners to make quick and accurate determinations as to a claimant's eligibility, saving many hours of research and expense.

From the lawyer who brought you the first comprehensive book on New York PIP, now there is finally a guide to PIP eligibility.

The New York PIP Eligibility Chart is available in several forms: posters, mouse pads, calendars, stickers, note cards -- even on a coffee mug. 

Please visit the new on-line Rogak No-Fault Store  and choose the format of The New York PIP Eligibility Chart that suits your needs best.  Once you have this chart, you'll wonder how you ever got along without it.  Just like Rogak's New York No-Fault Law & Practice (and I've got a 2011 supplement in the works for that).

The No-Fault Authority 

INNOCENT VICTIM STRUCK INTENTIONALLY BY DRIVER IS ENTITLED TO UM BENEFITS FROM HIS OWN POLICY

At issue in this appeal is whether the insured decedent, the victim of an intentional crime, was injured as the result of an accident within the meaning of the uninsured motorist endorsement and certain other provisions of the insured's policy. Since the occurrence must be viewed from the insured's perspective, we conclude that it was indeed an accident and that the insured is entitled to benefits under the policy provisions at issue.

Decedent, Neil Conrad Spicehandler, was struck by a vehicle at 7th Avenue and 32nd Street in Manhattan on February 12, 2002. He sustained a compound fracture of his left lower leg, requiring surgery, and died from complications shortly after the operation. Decedent was one of many who were injured when the driver, Ronald Popadich, intentionally drove his vehicle into pedestrians. Popadich later pleaded guilty to second degree murder and admitted that he intended to cause Spicehandler's death.

Decedent was an insured under an automobile liability policy purchased by defendant Langan through plaintiff State Farm. As the administrator of decedent's estate, Langan made a claim seeking to recover benefits under the policy's uninsured/underinsured motorist (UM) endorsement, mandatory personal injury protection endorsement (PIP endorsement) and death, dismemberment and loss of sight endorsement (Coverage S)^[FN1].

The policy's UM endorsement provides that it "will pay all sums that the insured or the insured's legal representative shall be legally entitled to recover as damages from the owner or operator of an uninsured motor vehicle because of bodily injury sustained by the insured, caused by an accident arising out of such uninsured motor vehicle's ownership, maintenance or use" subject to relevant policy exclusions. The PIP endorsement and Coverage S likewise state that they will pay benefits for injuries sustained as the result of "an accident." These endorsements exclude coverage on several bases, but none specifically excludes coverage for an injury that results from intentional conduct. State Farm denied and disclaimed liability because it determined, as relevant here, that decedent's death was caused not by an accident, but by the intentional conduct of the operator of the vehicle.

State Farm commenced this declaratory judgment action seeking a declaration that it was not obligated to provide benefits in connection with decedent's death. Defendant answered and counterclaimed, requesting a declaration that State Farm was required to provide coverage under the policy. Plaintiff's motion and defendant's cross motion for summary judgment were denied because the parties had not, at that point, provided the court with information regarding the outcome of the criminal action against Popadich, which the court deemed "essential" to determining whether decedent's injuries were caused by an intentional act. The Appellate Division upheld the portion of the Supreme Court order that denied summary judgment on the issue of whether the incident was covered by the policy, finding that there was insufficient proof to determine whether decedent had been the victim of an intentional crime, but that, if he had, the incident would not be covered.

After Popadich was convicted of second degree murder, State Farm renewed its motion for summary judgment, again seeking a declaration that it was not required to provide benefits under the policy. Langan opposed the motion and cross-moved for summary judgment, urging that whether the incident was an accident within the meaning of the policy must be determined from the perspective of the insured. Supreme Court granted State Farm's motion and denied Langan's cross motion on the basis of Popadich's conviction.

On appeal, a majority of the Appellate Division modified to declare that State Farm was required to provide benefits under the Mandatory PIP and Coverage S endorsements and, as so modified, affirmed (55 AD3d 281 [2d Dept 2008]). The Court determined that State Farm was not required to provide UM benefits because the purpose of statutorily required uninsured motorist coverage is to provide an individual with the same level of coverage he or she would be entitled to if injured in an accident with an insured motorist covered by an applicable policy. Since a standard liability policy would not have covered Popadich for his intentional criminal conduct, the Court found that Langan's UM coverage was not applicable under the circumstances presented here. However, the Court determined that in other contexts it was appropriate to determine whether a particular event was an accident from the insured's point of view, that the incident was clearly unexpected from decedent's perspective and that, as a result, State Farm was required to provide coverage under the PIP and S Coverage endorsements.

Two Justices dissented in part and would have affirmed Supreme Court's order declaring that State Farm was not required to provide coverage. The dissent agreed that Langan was not entitled to UM benefits under current law based on Popadich's intentional conduct, but observed that there had been a recent national trend to allow for coverage in similar circumstances and that strong public policy considerations weighed in favor of coverage. The dissent would have denied PIP and S Coverage benefits based on the law of the case and, in any event, disagreed that the same term should be interpreted differently within the same policy. Both parties appeal pursuant to leave granted by the Appellate Division, which certified for our review the question of whether its order was properly made. We modify and answer the certified question in the negative.

This appeal turns on whether decedent's injuries were caused by an accident within the meaning of the policy. Although the endorsements at issue do not define the term "accident," we have previously held that it is not to be "given a narrow, technical definition," but should be interpreted according to how it would be understood by the average person (Miller v Continental Ins. Co., 40 NY2d 675, 676 [1976]). We have determined that, for purposes of automobile insurance policies, the term "accident" means an event typically involving violence or the application of external force (see Michaels v City of Buffalo, 85 NY2d 754, 758 [1995]). In order to determine whether a particular event was "accidental, 'it is customary to look at the casualty from the point of view of the insured, to see whether or not . . . it was unexpected, unusual and unforeseen'" (Miller, 40 NY2d at 677 [citation omitted]). Although we have noted that the perspective of the injured victim should not be used to determine whether an accident has occurred, "'[b]ecause an injury is always fortuitous to a non-consenting victim'"
(Michaels, 85 NY2d at 759 [citation omitted]), here we have the situation where the victim is also the insured.

It is clear that, viewed from the insured's perspective, the occurrence was an unexpected or unintended event — and therefore an "accident" — even though Popadich admittedly intended to strike decedent with the vehicle. The language of the policy also suggests that this type of situation would be covered as it was an accident caused by the use of a motor vehicle that did not have an applicable insurance policy. Significantly, Insurance Department regulations require that an automobile owner's liability insurance policy contain a provision specifying "that assault and battery shall be deemed an accident unless committed by or at the direction of the insured" (11 NYCRR § 60-1.1 [f]). Although the provisions at issue here do not involve liability coverage, the regulation is relevant to the understanding of the extent of coverage provided by the endorsements.

The argument against requiring coverage, advanced by State Farm and relied upon by the Appellate Division, is based on the general principle that mandatory uninsured motorist benefits are meant to provide coverage that is coextensive with, and not greater than, that afforded by a standard liability policy. They rely on our statement that the purpose of mandatory UM benefits is "'to provide the insured with the same level of protection he or she would provide to others were the insured a tortfeasor in a bodily injury accident'" (Raffellini v State Farm Mut. Auto. Ins. Co., 9 NY3d 196, 204 [2007], quoting Matter of Prudential Prop. & Cas. Co. v Szeli, 83 NY2d 681, 687 [1994]).

In support of its position, State Farm relies on McCarthy v Motor Veh. Acc. Indem. Corp. (16 AD2d 35 [4th Dept 1962], affd 12 NY2d 922 [1963]), a case where the plaintiff-victim was injured when the insured motorist committed an intentional assault against her using his vehicle. After the insurer denied coverage because the occurrence was not an accident within the meaning of the policy, plaintiff sought to recover under the policy's MVAIC endorsement — a statutorily required endorsement intended to afford coverage to a person injured by an uninsured or unidentified motorist, equal to that available to one injured by a motorist covered by an applicable liability policy (see McCarthy, 16 AD2d at 38).

MVAIC is funded by assessments levied against all of the insurance companies licensed to conduct business in the state. McCarthy held that since an intentional assault committed by an insured motorist was not an accident subject to coverage under the standard liability policy, such an occurrence would likewise be excluded from coverage under the MVAIC endorsement. The Court also determined that allowing recovery under MVAIC would be inconsistent with the purpose for which the special fund had been established.

This case differs from McCarthy in two important respects. First, UM coverage, although required by statute, is part of the insured's own policy — a policy that the insured selected and for which he pays premiums. Benefits received through coverage under the UM endorsement do not come out of a State fund. Second, the insured is the victim in this case, not the tortfeasor, and the public policy against providing coverage for an insured's criminal acts is not implicated.

We hold that, consistent with the reasonable expectation of the insured under the policy and the stated purpose of the UM endorsement (to provide coverage against damage caused by uninsured motorists), the intentional assault of an innocent insured is an accident within the meaning of his or her own policy. The occurrence at issue was clearly an accident from the insured's point of view and Langan is entitled to benefits under the UM endorsement.

This result is also in keeping with the national trend toward allowing innocent insureds to recover uninsured motorist benefits under their own policies when they have been injured through the intentional conduct of another (see e.g. American Family Mut. Ins. Co. v Petersen, 679 NW2d 571 [Iowa 2004]; Shaw v City of Jersey City, 174 NJ 567, 811 A2d 404 [2002]; Wendell v State Farm Mut. Auto. Ins. Co., 293 Mont 140, 974 P2d 623 [1999]). Although the above decisions are not binding on this Court, we are persuaded that the view that has been adopted by these jurisdictions is the better one.

For many of the same reasons, Langan is entitled to coverage under the PIP endorsement and Coverage S. The average insured's understanding of the term "accident" is unlikely to vary from endorsement to endorsement within the same policy. The occurrence, from the insured's perspective, was certainly unexpected and unforeseen and should be considered an accident subject to coverage. Contrary to State Farm's argument, we perceive no danger that this result will frustrate efforts to fight fraud in the no-fault insurance system. Significantly, there is no allegation whatsoever of fraud in this case and it is patent that benefits should continue to be denied to those who intentionally cause their own injuries.

The argument that Langan is entitled to attorneys' fees was not addressed by the courts below and should be remitted to Supreme Court for its determination in the first instance.

Accordingly, the order of the Appellate Division should be modified, without costs, by granting defendant judgment declaring in accordance with this opinion and remitting to Supreme Court for further proceedings in accordance with this opinion, and, as so modified, affirmed. The certified question should be answered in the negative.


SMITH, J. (dissenting):

I would affirm the order of the Appellate Division.

As a general matter, it is true that whether a particular event is an "accident" should be viewed from the point of view of the insured. The insured here was Spicehandler, the event was an accident from his point of view, and his estate was therefore properly allowed to recover under the so-called PIP and Coverage S endorsements.

But uninsured/underinsured motorists (UM) coverage is different. Its purpose is to protect an insured who is injured by a tortfeasor without liability insurance — a purpose accomplished by putting the insured in the position that he would have been in if the tortfeasor had been insured. This requires a determination of whether the tortfeasor could have made a claim under a hypothetical policy of liability insurance — and the tortfeasor should thus be treated as the "insured" for purposes of analysis. Since Popadich drove his car into Spicehandler on purpose, the event was not an accident from Popadich's point of view; Popadich could not have obtained indemnification from a liability insurer; and Spicehandler's estate should not be permitted to recover under the UM endorsement.

This is essentially what we held when we affirmed the Appellate Division's decision in McCarthy v Motor Veh. Acc. Indem. Corp. (16 AD2d 35 [4th Dept 1962], aff'd 12 NY2d 922 [1963]). The majority tries to distinguish McCarthy on what it calls two grounds, which seem really to be one — that UM coverage is "part of the insured's own policy" and that "the insured is the victim in this case, not the tortfeasor". The distinction will not withstand analysis. The purpose of UM coverage is the same as the purpose of the MVAIC endorsement at issue in McCarthy: "to afford coverage," as the majority puts it, "to a person injured by an uninsured or unidentified motorist, equal to that available to one injured by a motorist covered by an applicable liability policy" (majority op at 7-8). The essential rationale for McCarthy is that the victim of an uninsured motorist should not be in a better position than the victim of an insured one. That rationale was sound in McCarthy, and is sound here. 

I see no justification for departing from McCarthy. A more serious argument might be made — though it is not made here — for a more significant change in the law: modifying, in cases involving automobile liability policies required by statute, the general rule that liability insurance cannot cover intentional torts. As McCarthy mentions, a standard automobile liability policy provides coverage only for accidents, and thus would not cover "an assault and battery committed by the insured" (16 AD2d at 41; see also, e.g., Matter of Travelers Indem. Co. v Richards-Campbell, 73 AD3d 1076 [2d Dept 2010]; Matter of Aetna Cas. & Sur. Co. v Perry, 220 AD2d 497 [2d Dept 1995]). This limitation seems to be derived from the long-established rule, based on public policy, that insurance may not indemnify a tortfeasor for intentional wrongdoing (Messersmith v American Fid. Co., 232 NY 161, 165 [1921]; Town of Massena v Healthcare Underwriters Mut. Ins. Co., 98 NY2d 435, 445 [2002]). Courts in some jurisdictions have made compulsory liability insurance an exception to this rule, reasoning that the purpose of liability insurance, to the extent that it is required by law, is to protect injured victims, not tortfeasors, and that victims should be protected no less against intentional than against negligent torts (e.g., Speros v Fricke, 98 P3d 28, 36-38 [Utah 2004]; Dotts v Taressa, 182 W Va 586, 390 SE 2d 568 [1990]; Wheeler v O'Connell, 297 Mass 549, 9 NE 2d 544 [1937]). Whether such an exception is justified, and if so whether it should be created by judges or by legislators, are questions that we should not address until we have a case that presents them.
* * * * * * * * * * * * * * * * *
Footnotes

Footnote 1: This action solely concerns claims made under Langan's own policy — not the policy of either the driver or the vehicle.

Comment:  I see this as a "feel-good" decision, in which the Court casts aside logic and indulges a legal fiction in order to achieve a result which, I admit, has a strong compassionate appeal.  After all, an innocent victim of an intentional automobile assault might be left without compensation for horrific injuries which were in no way his fault.  But -- and this is an important "but" -- it defies logic to say that an intentional assault with an automobile is an "accident" from the victim's point of view.  If a pedestrian were to be confronted by a mugger with a gun and shot during a robbery, would that be an "accident" from the victim's point of view?  No -- it would be an assault.   Why is an assault using an automobile as a weapon an "accident" and an assault using a baseball bat not an accident?   There is no difference, except for the fact that in the former, there is an insurance policy which can be tapped for benefits.

This decision will no doubt bring welcome relief to a small class of people: those with personal auto policies who are intentionally run down by another driver (thankfully, this doesn't happen often).   But this result, in my view, comes about only because this Court took it upon itself to re-write a contract in order to achieve a desired result.

Larry Rogak

There are a lot of things you can say about New York PIP, but one thing you can't say is that you did some PIP shopping.  Until now.

For better or worse, I have opened the world's first "New York PIP Store."  Our first product: my brand-new New York PIP Eligibility Chart.  For the first time ever, you can tell at a glance whether a claimant is an EIP or not.  Save thousands of dollars the very first time you use it by not paying benefits to a claimant who is not eligible -- or by mistakenly denying benefits to a claimant who is.

The New York PIP Eligiblity Chart is available on mouse pads, coffee mugs, posters, note cards -- even T-shirts (become the most "well-read" person in your office!).

We'll be introducing more useful, informative (and maybe even fun) PIP products in the future.  (You didn't think you'd ever see the words "PIP" and "fun" in the same sentence, did you?)  

THE ROGAK NO-FAULT STORE 

Larry Rogak

There is nothing in the Regulations authorizing or requiring an insurer to provide a claimant with a copy of his or her PIP file upon request, free or not. However, if the claimant were to send in a proper HIPAA authorization and pay a reasonable copying charge (limited by law to 75 cents per page), I don't see why an insurer would treat this request any differently than when another insurer (e.g. a BI claims department defending a suit) requests the file with a proper authorization. -- Larry Rogak