The late notice defense, absent a showing of prejudice, will soon disappear in January of 2009 thanks to a new law enacted by the NY Legislature.

But it’s not gone yet.

The Court of Appeals recently held that an insured failed to comply with the policy condition requiring notice “as soon as practicable” where nine months passed between service of the suit and notification to the insurance carrier.

The insured argued that it was also unaware of the lawsuit and thus unable to provide notice, but the Court held that the insured’s lack of knowledge was based on the insured’s own failure to update the address maintained by the Secretary of State for notification of service.

The Court stated it was “unquestionably practicable” for the insured to keep its address current with the Secretary of State, and therefore it failed to comply with the policy provision. Thus, there was no coverage for the loss.

Briggs v. Hanover

In NJ, a carrier needs to show appreciable prejudice to disclaim coverage on late notice grounds. The standard is tough to meet and therefore few carriers press the issue. State National Insurance Company is about to prove the exception.

State National insures the County of Camden. The County was sued by a Mr. Anderson. Mr. Anderson, an 18 year old male, was driving in Camden County when his car went onto the roadway shoulder where there was a significant drop-off between the asphalt and the adjacent dirt and gravel. In the resulting collision, Anderson suffered significant injuries – so significant that a jury awarded him $15 million in past and future pain and suffering, disability and loss of enjoyment of life and $1.29 million in past medical costs.

The problem (from State’s perspective) was that Camden didn’t let State know about the
lawsuit until a year and a half into the litigation – after discovery had ended. The delay was a problem from State’s perspective because Camden had failed to retain any relevant expert witnesses – a failure that State alleges led directly to the verdict.

What happens next? Stay tuned to find out.

In yet another ruling on the wage claim of an illegal immigrant who used a fake social security card to get hired, a New York appellate court has ruled in favor of the claimant. In Coque v. Wildflower Estates Developers, the plaintiff wrongly submitted a fake social security card to gain employment, but his wrong was offset by the employer’s wrong in failing to follow the law and verifying his bona fides. The plaintiff was injured at work in a gravity-related accident, which triggered liability under Labor Law section 240. The Second Department court ruled that “an employer should not be rewarded for its failure to comply with federal immigration law by being relieved of liability for its failure to provide a safe workplace.” Moreover, said the court, where an employer is complicit in the hiring of an illegal alien, allowing that employer to avoid paying a wage claim would only encourage further illegal hiring by the employer.

The attorney for Darren Roy Mack has gone before the Nevada Supreme Court to ask that a divorce agreement be set aside because it had not been finalized by the time his wife, Carla’s , death. Mack is attempting to void the agreement so no payments need to be made to Carla’s estate. The argument is especially creative since Mack became the subject of an international manhunt in June 2006 after being charged with his wife’s murder. He is now serving time for the first degree murder of his wife and with the sniper shooting of Family Court Judge Chuck Weller , who was overseeing the couple’s acrimonious divorce. The Supreme Court is now considering the argument’s merits.

http://www.rgj.com/article/20081104/NEWS18/81104051

In Litwack v. Plaza Realty, the plaintiff, a tenant in the defendant’s apartment building, brought suit to recover for injuries allegedly sustained due to toxic mold in her apartment. When the plaintiff began to feel sick, her doctors recommended that she have her apartment environmentally tested and the presence of mold was confirmed. Months before the mold was discovered, the plaintiff had complained about a brown, wet spot in the middle of her dining room wall. A week later, the building’s handyman opened the sheetrock and discovered a potential tiny crack in a steam pipe. When the steam was turned on months later, the crack was confirmed and a plumber was called in to repair the pipe. The plaintiff had also complained that her air conditioners dripped during the summer months. In response, building staff would change her filters from time to time. Based on these two incidents, the plaintiff claimed that the defendants were on notice of the mold. The Court of Appeals disagreed and held that the defendants did not have sufficient notice of the potential for mold growth.

Litwack v. Plaza Realty Investors, 208 WL 4700971 (N.Y.), 2008 N.Y. Slip Op. 08158

In Cohen v. Memorial Sloan-Kettering, the Court of Appeals has rendered a decision that once again demonstrates that not every fall from a ladder triggers liability under Labor Law §240.

Cohen was a construction worker who brought suit against the property owner based on injuries he sustained while installing pipe racks in the ceiling at Sloan-Kettering. Cohen fell when he attempted to climb down the ladder and could not clear the first step because there were pipes protruding from a nearby, unfinished wall. The lower court denied the plaintiff’s motion for summary judgment under the scaffold law, but the Appellate Division reversed ruling that the ladder was not an adequate safety device under the statute. In reversing the Appellate Division, the Court of Appeals held that the plaintiff’s injuries were the result of usual and ordinary dangers at a construction site rather than an elevation-related hazard. The Court further held that no liability exists under the scaffold law where the injury results from a separate hazard wholly unrelated to the risk that brought about the need for the safety device.

Cohen v. Memorial Sloan-Kettering, 2008 WL 4700793 (N.Y.), 2008 N.Y. Slip Op. 08161

New York’s Labor Law section 200 is a statutory restatement of an owner’s common law duty to provide workers with a safe place to work. In Ortega v. Puccia, an appellate court explains that there are two avenues to liability (and thus two avenues of defense) when it comes to a section 200 claim. One category of case is where the worker is injured as a result of “dangerous or defective premises conditions” at the site. A second category of case is where the injury occurs as a result of “the manner in which the work is performed.”

In the Ortega case, the owner hired a contractor to do sheetrock work at his home. The contractor employed the plaintiff and provided the plaintiff with a scaffold. The plaintiff fell from the scaffold because the wheels did not lock and the scaffold moved. The court granted summary judgment to the owner because “the accident did not involve any dangerous or defective condition on the defendants’ premises. The accident instead involved the manner in which the plaintiff performed the work, which was not supervised by the [owner], and which was performed on equipment provided by the plaintiff’s employer, not by the [owner].”

As a practical matter, owners who might wiggle out of a section 200 claim are usually still stuck with liability under the broader sweep of Labor Law sections 240 and/or 241. In this case, however, the owner escaped section 240 and 241 liability based upon the exclusion in those statutes applicable to owners of one- and two-family homes who do not direct or control the work. Thus, in this case, the section 200 claim became the plaintiff’s last hope and the court’s analysis is helpful to defendants in mapping out a successful defense to such claims.