Monthly Archives: April 2014

Neighbor’s Falling Tree Creates Liability For Swim Club (PA)

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Property owners have always known that they are responsible for the maintenance of trees on their own property. However, is it possible to be liable for an injury caused by a tree that falls from a neighboring property?

In Dunlap v. Ridley Park Swim Club, the plaintiff was awarded $1.1 million for injuries sustained in the parking lot of the Ridley Park Swim Club when a tree from a neighboring property fell on her.  The plaintiff argued that the Swim Club had a duty to business invitees to inspect its property.  Given a dangerous overhanging tree, she contended that the club had a duty to warn of the condition and/or to eliminate parking in that area.

The neighboring property owner agreed to arbitration, at which the plaintiff was awarded $350,000. The swim club took the matter to trial. The jury found that the swim club’s negligence was a cause of the plaintiff’s injuries and awarded $750,000.

The plaintiff recognized that the swim club could not cut the offending tree down, but she convinced the jury that the club was nonetheless remiss in its duty to provide invitees with a safe environment.  It is a good reminder that, with respect to business invitees, premises liability not only covers a duty to maintain the property but also to warn of any dangerous conditions even if posed by a neighbor’s overhanging trees.

Thanks to Eric Clendening for his contribution.

For more information, contact Denise Fontana Ricci at .

 

Cat Food Raining Down on Shopper Is Not Proof of Negligence (NY)

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In premises liability actions, the plaintiff must prove that a commercial business either created a hazardous condition or, alternatively, had notice of the condition in sufficient time to address it.  This element can be satisfied either by proof of actual or constructive notice, i.e. the condition was present for sufficient amount of time that the business should reasonably have discovered and corrected it. To meet this burden, plaintiffs sometimes turn to experts.   However, even experts can have some difficulty establishing a factual basis for notice – if they overreach New York courts may find their opinions speculative and unsupportive.

McNee v. ShopRite.  Therein, the plaintiff alleged that she was injured when cases of canned cat food stacked in the aisle of the defendant’s supermarket fell on her.  The defendant demonstrated that when it stacked the canned cat food, it was not a dangerous condition.  Moreover, it denied actual or constructive notice of a hazardous condition at any time prior to the incident.  The plaintiff retained an architect to dispute the defendant’s defenses.  However, the court found that the architect’s opinions were speculative and conclusory.  As such, the second judicial department affirmed summary judgment in the store’s favor.

The moral of the story is that an expert’s opinion is only as good as the facts upon which it is based.

Thanks to Johan Obregon for his contribution.

For more information, contact Denise Fontana Ricci at .

 

Simple Mistake of Judgment Is Not Bad Faith Failure to Offer Policy Limit Settlement (NY)

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In New York, an insurer may be held liable for the breach of its duty of “good faith” in defending and settling claims over which it exercises exclusive control on behalf of its insured. In order to establish a prima facie case of bad faith, the plaintiff must establish that the insurer’s conduct constituted a “gross disregard” of the insured’s interests–that is, a deliberate or reckless failure to place on equal footing the interests of its insured with its own interests when considering a settlement offer.

In General Motors Acceptance Corp. v. New York Central Mut. Fire Ins. Co., the insured and its excess insurer commenced a bad faith action against the insured’s primary insurance carrier. The plaintiffs asserted that the defendant’s conduct, in failing to settle the case within the policy limit, was in “gross disregard of plaintiffs’ interests.”

In the underlying action, the plaintiff suffered a brain injury, causing a loss of smell, as well as other symptoms. The medical records also showed that the plaintiff suffered from pre-existing injuries. In its motion for summary judgment, the defendant asserted that its failure to make a settlement offer of the policy limit was not a breach of its duty of good faith because this was simply a mistake in judgment, and at the worst, negligence.

Although summary judgment was denied by the lower court, the First Department reversed, holding that the assessment of the insured’s exposure and the failure to make a settlement offer of the policy limit was no more than a mistake in judgment, which is insufficient to demonstrate bad faith.

Thanks to Gabe Darwick for his contribution.

For more information contact Denise Fontana Ricci at

 

Court of Common Pleas Calls a Foul on Secondary Liability Claims Over Collapsing Soccer Dome (PA)

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The Court of Common Pleas of Pennsylvania dismissed contribution and indemnity cross-claims against a co-defendant, focusing on the lack of a basis for secondary liability claims against the co-defendant.

Plaintiff, Turkey Run Properties, LP initiated a lawsuit following the collapse of a soccer dome on property the company owns. Turkey Run leased the dome from Soccer Dome, LLC and used the agent Gleason Agency, Inc. to purchase insurance from Seneca Specialty Insurance Company to cover the dome. After the dome collapsed, Turkey Run filed a claim with Seneca, who subsequently denied to cover Turkey Claims after investigating the incident. Turkey Run then initiated suit against Seneca, claiming that Seneca breached their contract by failing to pay the claim, against Gleason for negligence in completing the insurance application, and against Soccer Dome for negligent maintenance of the dome itself. Upon answering Turkey Run’s complaint, all three defendants filed cross-claims against all the other defendants. While almost all of the claims settled, Gleason’s contribution and indemnity cross-claims against Soccer Dome remained unsettled. Seeking to have Gleason’s cross-claims dismissed, Soccer Dome filed a Motion for Discontinuance.

The Court of Common Pleas treated Soccer Dome’s motion as a Motion for Summary Judgment, and ultimately dismissed the contribution and indemnity cross-claims due to the lack of a legal relationship between the two parties and Gleason’s erroneous allegations of Soccer Dome’s secondary liability.

Gleason argued that it was in no way responsible for the accident as Soccer Dome was “actually responsible for the collapse.” Gleason further maintained that at most, it was secondarily liable, as it did not contribute to causing the dome to collapse as Soccer Dome did. But, the court dismissed Gleason’s argument as an incorrect understanding of primary and secondary liability, describing it as based on “some sort of ‘which negligence was worse’ analysis.”

Moreover, the court explained that Gleason’s focus on the cause of the collapse ignored the fact that the allegations against Gleason were grounded in the delayed insurance payment that Turkey Run linked to Gleason’s negligence in obtaining the policy. Turkey Run argued that such negligence on Gleason’s part resulted in additional mildew and mold damages while the parties argued over coverage. In light of the negligence allegations against Gleason, there was thus no basis to shift blame to Soccer Dome.

The court referred to the Pennsylvania Supreme Court’s explanation that “[t]he difference between primary and secondary liability is not based on a difference in degrees of negligence” as evidence of Gleason’s misunderstanding of secondary liability.

Thanks to Nicole Pedi for her contribution to this post. If you have any questions, please email Paul at .

Safety First: Pennsylvania Schools May Be Responsible for Students’ Criminal Acts

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Recently, the Pennsylvania Superior Court held that a private college cannot escape civil liability for injuries caused by the criminal acts of its students where the institution voluntary assumed a “program of safety” that the community came to rely upon.

Specifically, in the case of Murray v. Albright College, student Patrick Murray was assaulted in the doorway of his dorm room after an authorized search of his floor mates’ dorm room revealed a loaded handgun, approximately one pound of marijuana, and surveillance equipment. Shortly after the search, which was conducted by Albright public safety officers, Murray began to receive threats from unknown individuals who suggested that he had “snitched” on his fellow students. The threats quickly turned to action when two unauthorized males were granted access to Patrick’s dorm by his floor mates, and brutally beat Murray.

In the lawsuit that followed against Albright, Murray and his parents contended that the college was liable for the criminal acts of its students to the extent that it failed to warn or prevent his attack. The trial court, however, disagreed with the Murrays’ contentions, and granted summary judgment to Albright on the basis that it could not reasonably foresee the criminal acts of its students.

On appeal, however, the Superior Court compared Murray’s residence on Albright’s campus to that of the relationship between landlord and tenant. Specifically, the Superior Court explained that, under Pennsylvania law, a landlord is not required to protect a tenant from criminal activity unless the landlord provides a “program of safety.” According to the Court, once a “program of safety” is deemed to exist, a landlord has voluntary assumed the duty to protect its tenant and is therefore exposed to liability for the criminal acts of third parties. Applied in the context of Murray’s attack, the Superior Court concluded that Albright’s student handbook required the college to report criminal violations such as the possession of marijuana to local authorities for prosecution. Given that Albright failed to adhere to this policy and did not involve the local authorities, the Court ultimately reversed, citing that a genuine issue of material fact existed as to whether the college’s omissions may have allowed the attacks to occur.

All told, the opinion in Murray speaks to the liability of landlords, generally, and educators, specifically, in respect of the criminal acts of third parties. As a result, both groups should remain mindful that, at least in Pennsylvania, the provision of additional safety measures may serve to increase, rather than detract from, a party’s ultimate exposure. As the saying goes, “no good deed goes unpunished.”

Thanks to Adam Gomez for his contribution to this post. If you have any questions, please email Paul at .

If You Don’t Want to Reveal the Records, You Have to Withdraw the Claim (NY)

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The courts are always cautious when it comes to the disclosure of a party’s mental health records. A good example is the recent case of Alford v. City of New York, where plaintiff suffered injuries after he fell seven feet down an elevator shaft in a building owned by the New York City Housing Authority. Plaintiff claimed physical injuries to his knee and back, as well as post-traumatic stress disorder and other mental and psychological injuries. Although claiming mental and psychological trauma, plaintiff initially refused to disclose medical records regarding his prior treatment for substance and alcohol abuse. Plaintiff moved the lower court for a protective order precluding disclosure of these records and precluding defendants from using any of these medical records already obtained at trial. Importantly, within the same motion, plaintiff also sought leave to withdraw his claims for PTSD and mental and psychological injuries. Defendants cross-moved to compel disclosure of the records.

The lower court held, and the First Department affirmed, that there is no dispute that plaintiff’s mental condition at the time of the accident was relevant in light of plaintiff’s original claim of psychological injury. However, once plaintiff asked to withdraw his claims for mental and psychological injuries, the records were no longer relevant so the court granted plaintiff’s motion. The First Deparment held that as soon as plaintiff’s mental condition was withdrawn from the case, plaintiff’s right to confidentiality of his mental health records trumped the interests of justice in disclosing them. In addition, the court held that plaintiff’s claim for loss of enjoyment of life did not warrant disclosure of these records as that claim relates only to his physical injuries.

A plaintiff will not be forced to open up his life entirely just because he commenced a suit. However, each claim a plaintiff chooses to bring must be proven and a defendant has a right to fully investigate and defend against each one. If the plaintiff does not want to expose himself entirely, he cannot benefit from such claims and they should be withdrawn, as was done in this case. We query how the trial court will deal with a claim that plaintiff can no longer work based solely on his physical injury if, in actuality, his psychological problems have contributed to his loss of employment.

Thanks to Anne Mulcahy for her contribution to this post. If you have an questions, please email Paul at.

Nonparty Discovery Easier to Obtain (NY)

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Procedural skirmishes can affect the outcome of litigation. For example, if a plaintiff can deprive a defendant of access to proof from a nonparty witness whether within or outside the state, the scales may tip ever so slightly in favor of the plaintiff in a closely contested lawsuit.

While not a  “sexy” issue, the New York Court of Appeals in Matter of John Kapon v. William I. Koch, resolved a conflict in the Appellate Division focusing on the standard and burdens when subpoenaing a nonparty for testimony under New York law. New York divides its Appellate Division into four departments based on geography. Two of the departments held that a litigant could not obtain nonparty discovery unless the requested discovery was relevant to the prosecution or defense of an action. In contrast, the two other departments held that the party issuing the subpoena must show that the disclosure could not be obtained from sources other than the nonparty, a far greater threshold to obtaining often critical discovery.

In Kapon, the Court of Appeals resolved the conflict within the Appellate Division and adopted the more liberal interpretation of nonparty discovery: “as long as the disclosure sought is relevant to the prosecution or defense of an action, it must be provided by the nonparty.” Further, the Court explained in detail the burdens imposed of each party. The party issuing the subpoena must only satisfy a “minimal burden” of stating the reason the disclosure is sought either on the face of the subpoena or the notice accompanying it. Once this showing is made, a more onerous burden is imposed on a party seeking to quash the subpoena who must show that the discovery sought is “utterly irrelevant” or that the “futility of the process to uncover anything legitimate is inevitable or obvious.”

Nonparty discovery should be much easier in New York litigation whether sought within or outside the Empire State. As long as the proponent of the subpoena can articulate the relevance of the information sought, the subpoena should be upheld and the information produced.

If you can any questions about this post, please email Paul at .

A [Clear] Picture Is Worth A Thousand Words (NY)

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The defendants in Deviva v. Bourbon Street Fine Foods & Spirit, et al., 2014 NY Slip Op 02255 (2d Dept. 2014) found this old adage to unfortunately still ring true. In Deviva, the plaintiff allegedly tripped, fell, and was hurt. One defendant moved for summary judgment, alleging the defect was trivial in nature. The Court granted this motion and, upon searching the record, also awarded summary judgment to the other defendants.

In moving for summary judgment, parties may submit photographs which accurately depict the condition of the area of the accident site to establish whether a defect is trivial and therefore not actionable. The Court uses these photographs to help determine if the defect is trivial, typically focusing on the width, elevation, irregularity and appearance of the alleged defect. In taking testimony before trial, the defense should request the plaintiff to properly identify and mark these photographs as demonstrating the conditions of the site of the alleged accident.

In Deviva, the Second Department found the poor quality of the only photograph acknowledged by plaintiff to accurately depict the condition of the area to be insufficient evidence to establish as a matter of law that the alleged defect was trivial, so it reversed the trial court’s decision. The other photographs the moving defendant attached (from its investigator) were not acknowledged by the plaintiff to accurately depict the condition of the area, so they also were insufficient to establish as a matter of law that the alleged defect was trivial.

We learn from Deviva that moving for summary judgment on the defense of trivial defect based on photographic evidence takes three entities working in unison. The defendant’s  investigator (if utilized) must take clear photographs of the alleged trivial defect, the defense attorney must mark the photographs at plaintiff’s deposition, and the plaintiff must identify these photographs as fairly and accurately representing the condition of the defect. As masterful a writer as an attorney may be, “a [clear] picture is worth a thousand words” when moving for summary judgment based on a trivial defect.

Thanks to Bryan Lipsky for his contribution to this post. If you have any questions, please email Paul at .

Found Stolen Art? There’s An App For That.

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Italy’s heritage police recently announced the release of a smartphone app that will allow people to take a photograph of art works that they suspect are stolen and then send the photo directly to the heritage police.  The heritage police can then compare the photo to their archives, which include the largest data bank of stolen art in the world — about 5.7 million objects.  There will also be information on the app about artwork that the police are searching for, and to help people find the nearest heritage police station.

I can’t help but wonder if the heritage police are being overly optimistic, or if Italians actually use their smart phones for more than taking selfies or playing Candy Crush.  It will be interesting to see if this proves to be a valuable law enforcement tool, or winds up being taken down when it is overrun by pranksters and crackpots.

Please write to Mike Bono for more information.

Mishandled Settlement Negotiations Leads to Bad Faith Award to Excess Carrier (NY)

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Primary and excess carriers often find themselves at odds during settlement negotiations.  The primary owes the excess a duty to resolve the case within the primary limits, but the primary carrier also wants to strike the best possible deal and not simply tender its limits.  Once a case is settled, the dispute usually becomes moot, and typically only becomes a major problem if the case is tried and the claimant is awarded an excess judgment.

However, in the recent case of Quincy Mutual v. New York Central Mutual, the excess carrier sued the primary, alleging that the excess carrier was unreasonably required to contribute to a settlement because the primary carrier improperly handled settlement negotiations.

The specifics are discussed in great detail in the attached decision: Quincy Mutual.  Briefly, the mutual insured, Randolph Warden, was involved in a serious auto accident with claimant Peggy Horton.  Warden failed to yield the right of way at a stop sign.  He pleaded guilty to a traffic violation, and summary judgment was awarded against him.  Horton sustained significant injuries and required six surgeries, including disc fusion.

While the summary judgment award was on appeal, Horton’s attorney demanded the $500,000 primary policy limits and rejected the primary’s offer of $75,000.  He kept that offer open even after he later learned of the excess limits.  Months passed, and the award was affirmed.

When the parties appeared for a pre-trial conference, the demand now exceeded both policy limits, but the primary carrier stuck with its $75,000 offer.  Months and months passed and the plaintiff continued to have surgery and presented expert opinions regarding increased damages.  Despite the efforts of the excess carrier, the insured’s personal counsel, and the court, the primary carrier stuck with their offer of $75,000.  Finally, over three years after the summary judgment decision was affirmed on appeal, the primary carrier tendered its $500,000 limits.  The case settled for about $1.5 million, which included about $500,000 in accrued interest, when the excess carrier tendered its $1 million limit as well.

The excess carrier then sued the primary carrier, and a bench trial was held in federal court.  The court rejected the primary’s argument that the excess carrier could have dropped down and settled within the primary limit if it wanted to mitigate its damages. The magistrate seemed particularly peeved that a reinsurer paid most of the primary carrier’s contribution, and that very little of its own money was at stake during the negotiations.

As such, the magistrate found that the primary carrier, having no liability defense, should have settled the matter for its policy limits of $500,000, and awarded the excess carrier $1 million, finding that it should not have needed to contribute to the settlement.

Please write to Mike Bono for more information.