Alleged Direction of Work Trumps Summary Judgment

In Powell v. HIS Constrs., Inc., et al., 2010 NY Slip Op 06068, the First Department reversed an order granting defendant GTL Construction’s motion for summary judgment. Plaintiff Joseph Powell allegedly sustained injuries when he fell on an unpaved section of sidewalk that was missing a concrete slab. The sidewalk was at the site of a recent construction project, for which plaintiffs maintained that GTL was the sidewalk installation contractor. Although GTL countered that it had no involvement with the project, performed only interior work, and owed no duty of care to the plaintiff, documentary and testimonial evidence indicated otherwise. The evidence established that GTL may have removed the sidewalk and/or provided directions to another sidewalk installation entity. In analyzing the matter under Espinal v. Melville Snow Contrs., the First Department reversed the lower court, holding that there was a question of fact as to GTL’s involvement in the project and its potential liability in failing to insure that the complete sidewalk was installed.

Special thanks to Lora Gleicher for her contributions to this post. If you have any questions, please contact Bob Cosgrove at .

http://www.courts.state.ny.us/reporter/3dseries/2010/2010_06068.htm

Roof Top Cell Phone Tower Does Not Interfere With Use and Enjoyment

In cities where backyards are sparse, perhaps “Not on my roof deck,” should replace “Not in my back yard.” Residents of The Salem House, a condominium located on New York City’s Upper East Side, were denied an injunction seeking to prevent cellular phone company T-Mobile from installing communications facilities atop the building’s roof deck.

Once the condo board informed the residents that they would be leasing a portion of the roof to T-Mobile for installation of a cell phone tower, the residents brought suit against the condo board and T-Mobile contending that the radio emissions would be dangerous to their health and safety and that T-Mobile was effectively admitting as much by placing FCC-required warning signs that addressed the potential dangers of the emissions. The residents also argued that the tower would interfere with their use and enjoyment of the roof deck, citing a declaration that had been issued to the residents regarding proper activities in the common areas.

Unfortunately for the residents, the court agreed with T-Mobile who argued that there was no evidence of the proven dangers of such radio emissions and that the FCC warning signs were not an admission because they were required by law. The court further held that federal law pre-empted the local court’s involvement in the matter stating that the proper remedy for the residents was to directly petition the FCC. The court also added that the unsigned and undated declaration had no authoritative value and that the condo board’s own bylaws, that gave the board the power to “curtail or relocate any portion of the common elements devote to store, recreation or service purposes,” would have superseded the declaration anyway.

It looks as if the Salem House residents will be stuck with an unwelcome addition to the New York City Skyline.

http://www.nydailynews.com/ny_local/2010/07/18/2010-07-18_towering_flap_over_east_side_condo_roof.html

Thanks to Alex Niederman for his contribution to this post.

A Reasonable Disclaimer Doesn’t Ensure Non-Payment of Fees in NJ.

In the case of Baughman v. US Liability Insurance, US Liability disclaimed coverage to its insured. The claim arose out of mercury exposure and the questions presented included whether: (a) exposure to [/i]indoor mercury contamination was “traditional environmental pollution”, or (b) whether medical monitoring constituted “damages” and whether exposure to harmful substances comprises “bodily injury.” The Court ruled in favor of the insured and insured’s counsel sought to recover its fees in both the underlying case and the declaratory judgment action. The federal court granted both applications. In granting the fees in the declaratory judgment action, the federal court used its discretion under New Jersey Court Rule 4:42-9(a)(6) and held that although the disclaimer was reasonable, because it was declared wrong by the court, the carrier was on the hook for the entire bill. To make matters worse, because insured’s counsel took the case on a contingency basis, the carrier was forced for pay a 35% lodestar enhancement.

If you have any questions about this decision, please contact Bob Cosgrove at .

http://pdf.wcmlaw.com/pdf/Mercury.pdf

No Accelerator Defect in Toyotas?

In response to literally thousands of complaints regarding sudden acceleration in Toyotas in recent years, including at least 75 fatal crashes, the National Highway Traffic Safety Administration has been conducting studies to determine the defect causing the sudden acceleration in Toyotas. Since last year, Toyota has recalled over 8 millions vehicles due to this alleged accelerator defect. In addition, Toyota received a fine from the NHTSA earlier this year for failing to inform the NHTSA about the issue concerning the accelerators in a timely manner.

Over 100 plaintiffs have already filed both personal injury and wrongful death suits against Toyota, presumably alleging defective design. The only problem with this NHTSA testing thus far (at least in the eyes of plaintiffs, to be sure) is that the testing has yet to uncover a defect. The preliminary results seem to indicate that driver error, rather than an electronic defect, is the most likely cause of this rash of accidents involving Toyotas. These preliminary findings do not constitute good news for plaintiffs and claimants, but the testing seems far from finished at this point. Seeing that Congress has already commented publicly about Toyota’s poor handling of this situation, the NHTSA would be well advised to double and triple check its findings before concluding its investigation.

Special thanks to Brian Gibbons for his contributions to this post. If you have any questions, please contact Bob Cosgrove at .

http://online.wsj.com/article/SB10001424052748703834604575364871534435744.html?mod=WSJ_business_whatsNews

Fasten Your Seatbelts – Turbulent Air Ahead for Airlines.

Airlines seem to be a magnet for bad news these days. Ever increasing fuel costs, bankruptcies on the rise, and now, according to the 3rd Circuit, the need to comply with state tort law wherever an airline lands its planes. In Elaasaad v. Independence Air Inc. and Delta Airlines Inc., the United States Court of Appeals for the Third Circuit has just determined that federal law does not prempt state law when it comes to the disembarkation of passengers. Once that plane has come to a full stop, seatbelts can be unbuckled but the airlines better understand state tort law.

The simple rule is that where there is both a federal law and state law on point, federal law prempts state law. However, the skies are not always blue and clear, and there is more than one gray cloud that the courts have encountered in making preemption determinations. Elaasaad is an example of the federal courts having to examine the current statutes and case law interpreting the statutes, and still further clarify when the federal statute applies. Here, the court decided that once the plane has come to a complete stop, none of the federal statutes are applicable and thus state tort law will apply.

So what are the implications? Airlines will have to comply with the tort laws of each individual state where they land their planes. When passengers are injured while leaving an aircraft, the law of the destination will determine the standard of care the airline must apply. This will make handling claims increasingly difficult as airlines will not be able to apply a uniform standard to claims, but instead will have to rely on the locus of each injury.

Special thanks to Alison Weintraub for her contributions to this post. If you have any questions, please contact Bob Cosgrove at .

http://scholar.google.com/scholar_case?case=8032119810883847026&hl=en&as_sdt=2&as_vis=1&oi=scholarr

The Favor Bank.

In his classic work on greed in the 1980’s, Bonfire of the Vanities, Tom Wolfe summed-up the New York code of ethics: “What goes around comes around.” A deposit in the “favor bank,” Wolfe suggested, is like money; it may be withdrawn when needed. But what about requests for extensions of time to answer complaints — are they deposits in the favor bank? The answer depends on where you are.

In New York, New Jersey and Pennsylvania, requests for modest extensions are routine. Generally speaking, such requests are not viewed as favors; they are deemed (to change metaphors) par for the course. In other parts of the country, however, defense lawyers are reluctant to ask for extensions, reasoning that a favor granted necessarily results in a favor that must be returned.

Unless the extension is conditioned upon waiving a right (such as moving against the complaint or contesting personal jurisdiction), 15-30 day extensions are granted and accepted as a matter of routine. In fact, a refusal to grant a reasonable request, if the issue later arises in court, is viewed as a breach of “civility,” a sin in the New York, New Jersey and Pennsylvania. Also, under the local procedural codes of some federal and state courts, brief extensions must be granted as a matter of right. The moral of this note: Know the ethics and local procedural code of your jurisdiction.

If you have any questions about this post, please contact Dennis Wade at .

Deja Vu All Over Again — Melamine in Chinese Product.

The great NY Yankees catcher Yogi Berra coined the phrase “It’s déjà vu all over again” to describe his teammates Mickey Mantle and Roger Maris (again) hitting back to back home runs. Observers of the Chinese market must feel the same way when it comes to melamine in Chinese product. Recent press suggests that Chinese infant formula is (again) contaminated with melamine at levels of more than 500 ppm. At these levels, medical/scientific literature confirms that sickness (specifically kidney problems) in infants can result. At present, no-one is certain as to whether there any confirmed cases of sickness, nor is it clear just how widespread the contamination might be. China remains a major supplier of infant formula for markets around the world.

Special thanks to Mendel Simon for his contributions to this post. If you have any questions, or would like more information about WCM’s product recall practice, please contact Bob Cosgrove at .

http://news.bbc.co.uk/2/hi/world/asia_pacific/10565838.stm

PA Supreme Court Affirms Prejudice Requirement for Late Notice Disclaimer.

In the case of Vanderhoff v. Harleysville Insurance, Harleysville disclaimed coverage to its insured on the basis of the insured’s failure to provide timely notice. After working its way through the system, the Supreme Court was confronted with the issue of what the insurer needed to prove to deny coverage. The Supreme Court held that a late notice disclaimer requires a carrier to demonstrate prejudice (even in the case of an uninsured motorist claim involving a phantom vehicle).

http://www.pacourts.us/OpPosting/Supreme/out/J-43-2008mo.pdf

http://www.pacourts.us/OpPosting/Supreme/out/J-43-2008do.pdf

If you would like more information about this post, please contact Bob Cosgrove at .

A Burden as Light as New-Fallen Snow

New York’s Second Department (covering Brooklyn, Queens, Long Island, and several counties north of the City) has issued a ruling “to discuss and clarify what a snow-removal contractor must show to establish its prima facie entitlement to summary judgment.”

The seminal case in this area of the law is Espinal v. Melville Snow Contractors, 98 NY2d 136, where New York’s highest court ruled that “a contractual obligation, standing alone, will generally not give rise to tort liability in favor of a third party.” In other words, the typical slip-and-fall plaintiff will generally not have a viable claim against the snow removal contractor. However, the court set out three exceptions to this general rule, to wit, (1) where the contractor negligently “launches a force or instrument of harm;” (2) where the plaintiff detrimentally relies on the contractor’s performance of its duties; and (3) where the contractor has entirely displaced the owner’s duty to maintain the property safely.

In Foster v. Herbert Slepoy Corp., (dediced June 22, 2010), the plaintiff slipped and fell on snow/ice in the driveway/parking lot of the building where she lived. She filed suit against the both the owner/manager and against the contractor, Kerry Clancy. The plaintiff admitted at her deposition that she did not know of Clancy’s role as the contractor nor even of Clancy’s existence before filing suit. Clancy moved for summary judgment.

The Foster court ruled that Clancy demonstrated his prima facie entitlement to summary judgment merely by coming forward with proof that the plaintiff was not a party to his contract and that he therefore owed no duty of care to the plaintiff. In other words, the contractor was not required to negate the possible applicability of the Espinal exceptions because there was nothing in the plaintiff’s complaint or bill of particulars that alleged that any of the exceptions applied. The court explained that the initial burden on the contractor in moving for summary judgment is “governed by the allegations of liability made by the plaintiff in the pleadings.” Here, once the contractor made his initial showing, the burden then shifted to the plaintiff to show that there was a question of fact as to the applicability of one of the three Espinal exceptions.

In short, the contractor contemplating summary judgment must look to the pleadings to see if an Espinal exception is addressed. If it is not, the initial burden of making out a prima facie entitlement to summary jdugment is as light as new-fallen snow.

NJ Sup.Ct. Finds Exclusion "arising out of" Ambiguous.

In Flomerfelt v. Cardiello, the plaintiff attended a party hosted by the defendant where she became unresponsive and was ultimately treated for kidney and liver failure. A hospital toxicology report identified alcohol, marijuana, opiates and cocaine in her system. No expert determined the levels of each substance in plaintiff’s system however, the hospital found the injuries “probably secondary to drug overdose.” The defendant’s expert suggested her injuries may have resulted from prior drug abuse.

The defendant sought coverage under his parents homeowners policy which was denied, with the carrier relying on an exclusion in the policy for claims “arising out of” the use, transfer or possession of controlled dangerous substances. The trial court found coverage, the Appellate Division reversed and the New Jersey Supreme Court reversed and remanded finding the insurer’s use of the phrase ” arising out of” with no further qualification, made the exclusion ambiguous, requiring an interpretation consistent with the insured’s reasonable expectation. In remanding, the Court noted that the coverage issue could not be resolved because the record failed to answer questions about the sequence of events leading to the plaintiff’s injuries and the cause or causes of her injuries.

http://www.judiciary.state.nj.us/opinions/supreme/A409FlomerfeltvCardiello.pdf

Please contact Robert Ball with any questions regarding this post at .