General Notice of Frequent Occurrence Not Sufficient to Show Actual Notice of Current Transitory Spill (PA)

In Karten v. Shop Rite the plaintiff claimed that she slipped and fell on some debris that was dark, slippery and smelled of rotten banana on the main walkway of the parking lot as she was leaving a Shop Rite grocery store.  The plaintiff sustained injuries to her knee, ankle and lower back, and filed suit for negligent maintenance of the premises.  Defendants moved for summary judgment, arguing that the store had no actual or constructive notice of the spill.

In opposition to the motion, the plaintiff argued that the substance that caused her to fall constituted a dangerous condition of lasting duration.  Plaintiff further argued that Shop Rite had actual notice of a dangerous condition because it had received general complaints regarding debris near the parking lot garbage cans.  However, the Court found that general notice of a frequent occurrence was not sufficient to show actual notice of a current transitory spill.  The Court, in concluding that the substance amounted to a transitory spill, found no evidence of actual notice to the store of the banana’s presence, and concluded that a jury would have to resort to improper speculation.

In the alternative, plaintiff complained that Shop Rite failed to produce information regarding a store employee and the surveillance film of the incidence.  However, the Court found that the plaintiff manufactured these issues solely for the purpose of opposing summary judgment, as they were never pursued by the plaintiff within the discovery period.  Further, the Court found that the allegations in plaintiff’s opposition to summary judgment contradicted her prior pleadings and deposition testimony.

In granting summary judgment, the Court found that Pennsylvania law did not support the presumption that damaged debris served as sufficient circumstantial proof for the duration of a transitory spill, and concluded that the plaintiff failed to meet her burden of establishing constructive notice.  Therefore, summary judgment was granted in favor of Shop Rite.

Thanks to Alexandra Perry for her contribution to this post.

WCM Is Pleased to Announce That Vivian Turetsky Has Been Promoted to Counsel

With effect as of January 1, 2019, WCM is pleased to announce that Vivian Turetsky has been promoted to the rank of counsel. Vivian focuses her practice on insurance coverage litigation on behalf of general liability, fine art, and jeweler’s block insurers in both state and federal courts in New York and New Jersey. Vivian joined WCM after practicing commercial litigation at both large and boutique litigation firms.

A Matter Of Factual Causation (PA)

In Mariana Koziar v. Neal T. Rayner and Andrea Rayner, the Pennsylvania Superior Court ruled that a plaintiff needed to establish factual causation, even when the defendant was found negligent and the plaintiff produced uncontroverted evidence of injury.

The plaintiff in this case, a house cleaner, slipped and fell as she exited a client’s garage door.  She severely injured her left ankle, requiring surgery, and subsequently sued the client/homeowners, alleging that the “lip” of the garage door was negligently constructed, and the driveway pavement was negligently maintained.  During trial, the jury heard differing accounts of how the accident occurred from the plaintiff herself.  At the trial’s conclusion, the jury returned a verdict in favor of the homeowners, finding that while they were negligent, their negligence was not the factual cause of the plaintiff’s injuries.

After the jury was discharged, the plaintiff filed a motion for a new trial, arguing the verdict was against the weight of the evidence.  The trial court granted the motion, and the homeowners appealed.  On appeal the plaintiff argued that when a jury finds a defendant negligent and concedes the existence of an injury, the jury is not permitted to find that the defendant’s negligence was not a substantial factor in bringing about the plaintiff’s injury.  The Superior Court rejected this argument, noting that Pennsylvania defines factual causation in the but for sense, and reversed the trial court’s order for a new trial.  The court concluded that while the jury could have found that the homeowners were negligent in any of the descriptions of the accident, it ultimately determined that the plaintiff had been negligent, herself.  The fact that there was uncontroverted evidence of an injury did not relieve the plaintiff of the burden to show factual causation.

Thus, this case illustrates the continued need of the plaintiff to carry his or her burden in order to prevail in an action.

Thanks to Robert Turchick for his contribution to this post.  Please email"> Colleen E.  Hayes with any questions.

Eastern District of Pennsylvania Grants Casualty Insurer’s Motion for Summary Judgment, Finding No Duty to Indemnify (PA)

In Myers v. GEICO Casualty Insurance Co.., the Eastern District of Pennsylvania Court granted Summary Judgment in favor of a casualty insurance company, holding that it acted properly because the driver of the vehicle was not an insured under its policy.  In brief, Chapman and Bond had attended an event together and after entering the event venue, Chapman asked for the keys to Bond’s vehicle because she needed to retrieve something. Upon arriving to the vehicle, Chapman noticed a parking spot closer to the event venue and proceeded to move Bond’s car to the closer spot without obtaining permission from Bond. While moving the vehicle, Chapman was involved in a collision with Myers. Jasmine Tucker, Bond’s girlfriend, was the named insured on the GEICO Policy, while Bond was listed as an additional driver. Chapman was not named under the Policy in any capacity. Myers sued Chapman, Tucker and Bond alleging negligence. GEICO did not defend Chapman, determining that she was not covered under the Policy because she operated the vehicle without permission.

In determining whether Chapman was an insured under the policy, the Court looked to the terms of the Policy. The Policy stated the insurer would “pay damages which an insured becomes legally obligated to pay” because of injury or damages from the use or ownership of an “owned auto.” Under the policy, an “insured” included “any . . . person using the auto with your permission.” The omnibus clause of an automobile insurance policy designated an insured as “any person using the insured vehicle with the permission of the owner, the permission necessary to elevate the user to the status of an additional insured may be express or implied.”  The court determined that implied permission could be established through a relationship or conduct surrounding the incident that demonstrated both parties acquiesced.  In finding that Chapman was not an insured under the policy, the Court considered the lack of express consent and the fact that Chapman had never driven Bond’s car previously. The Court rejected Chapman’s argument that Bond’s conduct of giving Chapman the keys amounted to consent.

This opinion demonstrates that it is possible for individuals not named on an automobile insurance policy to be deemed “insured” if there is consent to operate the vehicle, whether express or implied. However, in order to establish implied consent, the court will look to all the factors surrounding the incident to determine the presence of mutual acquiescence.

Thanks to Rachel Thompson for her contribution to this post.  Please email ">Colleen E.  Hayes with any questions.

Reassertion of Importance: Extending Time to Answer (NY)

In Lev Aminov, M.D., as Assignee of April Cuffy v. Allstate Ins. Co., the 2nd Department, Appellate Term held that a defendant’s attempt at vacating a default judgement and compelling plaintiff to accept its answer fell short.

This action was commenced on September 16, 2014 by service of the Summons and Complaint on an Allstate employee. A default judgement was entered on October 31, 2014, due to Allstate’s failure to appear or answer. Almost exactly one year later, Allstate moved pursuant to CPLR 5015(a)(1) and (4) to vacate the default judgement and compel plaintiff to accept defendant’s answer.

The court indicated that the law was clear on this issue. Allstate needed to “demonstrate both a reasonable excuse for the default and the existence of a potentially meritorious defense to the action.” Allstate offered an affidavit from a claims adjuster, but not from the individual who was served with the Summons and Complaint. The court also pointed out that it took Allstate eleven (11) months to move to vacate the default judgment. Taking these factors into consideration, the court concluded that Allstate did not provide a reasonable excuse for the default. Therefore, Allstate’s motion seeking to vacate the default judgement and compel plaintiff to accept its answer was denied.

Thus, this case illustrates the importance of timely filings, as well as the factual support likely needed to prevail in having a default judgment vacated.

Thanks to Marc Schauer for his contribution to this post.  Please email ">Colleen E.  Hayes with any questions.

An Insured’s Misrepresentations In Warranty Resulted In Disclaimer (NY)

In Patriarch Partners, LLC v. Axis Insurance Company, the Second Circuit declined to alter its prior decision involving the interpretation of a policy warranty and its impact on coverage.  In so doing, the court implicitly incorporated the terms of the insured’s warranty, into the policy, to find there was no coverage for a multimillion dollar government investigation.

In 2011, Patriarch Partners, LLC, a private equity investment firm, obtained an excess directors and officers policy through Axis Insurance Company which provided $5 million in excess insurance.  Patriarch had $20 million in primary coverage.  Axis was concerned about potential new liabilities, thus, it required Patriarch to execute a warranty statement that would eliminate liability in the event Patriarch had prior knowledge of a claim.  Patriarch presented a warranty signed by its sole officer stating it was not aware of any “facts or circumstances that would reasonably be expected to result in a Claim.”  Unbeknownst to Axis (but not to Patriarch), the Securities and Exchange Commission had been investigating Patriarch as early as 2009.  In 2012, after the Axis policy took effect, the SEC served a subpoena on Patriarch.  Patriarch subsequently sought coverage for the costs related to the SEC’s investigation.

In the ensuing coverage action, the Second Circuit relied on the terms of the warranty and found that no coverage existed because Patriarch had been aware of facts and circumstances that could reasonably be expected to result in a claim.  The Second Circuit rejected Patriarch’s argument that it would have to have specific knowledge that the “claim” would reach the $20 million threshold, thus, triggering the Axis excess policy, in order for Axis to disclaim coverage on this basis. The court further rejected Patriarch’s argument that the relevant facts and circumstances had to be subjectively known by Patriarch’s founder, who signed the document, citing general principals of agency.  Interestingly, the court’s holding relied mostly on the warranty itself, even though the warranty was not directly incorporated into Axis’s policy.

Ultimately, this opinion highlights the importance of full disclosure in an insurance application or warranty in order for coverage to attach.

Thanks to Doug Giombarresse for his contribution to this post.  Please email ">Colleen E.  Hayes with any questions.

Second Circuit Rejects Ambiguity Argument Regarding Policy’s Action Over Exclusion (NY)

An additional insured attempted to argue the “separation of insureds” clause rendered the Action Over Exclusion, an iteration of an employer’s liability exclusion, inapplicable, as it was not the employer of the claimant.  The Second Circuit disagreed based on the plain language of the exclusion.

In Endurance American Specialty Insurance Co. v. Century Surety Co., Hayden Building Maintenance Corp. was the general contractor on a construction project at which the plaintiff, who was an employee of Pinnacle Constr. and Renovation Corp., was injured.  Hayden sought coverage as an additional insured under the CGL insurance policy issued to Pinnacle by Century Surety Co.  Century denied coverage based on the policy’s Action Over Exclusion, which provided that there was no coverage for “bodily injury” to an “employee” of the named insured arising out of and in the course of employment by the named insured, or performing duties related to the conduct of the named insured’s business.  Hayden challenged the disclaimer, arguing the exclusion did not apply because Hayden did not employ the plaintiff and the policy’s terms must be applied separately to each insured seeking coverage as per the policy’s Separation of Insureds provision.

Although the district court agreed with Hayden, the Second Circuit reversed and held the Action Over Exclusion unambiguously barred coverage.  In particular, the appellate court held the exclusion barred coverage for bodily injury claims brought by an employee of “the named insured,” as opposed to “the insured.”  The Court further observed the Action Over Exclusion specifically replaced the Employer’s Liability Exclusion, which used the term “the insured.”  The Second Circuit ultimately reversed “because to do otherwise would render the unambiguous language…a nullity.”

Insurance policies are arguably the most hyper-scrutinized class of contracts.  As a result, in evaluating coverage, it is critical to evaluate even the most minute distinction in policy terms.  Here, an endorsement altered an exclusion by redefining the pertinent class of insured by changing “the insured” to “the named insured.”

Thanks to Christopher Soverow for his contribution to this post.  Please contact ">Colleen E.  Hayes with any questions.

Improper Service: No Harm, No Foul (PA)

A Pennsylvania Court determined that a plaintiff’s good faith attempts to effectuate service tolled the statute of limitations.

In Mandarano v Plink, the Pennsylvania Court of Common Pleas in Lackawanna County heard an interesting case regarding a failure to comply with the Pennsylvania service statute.  In Mandarano, the Plaintiff commenced a premises-liability action one day before the statute of limitations expired by serving the President of the Defendant company via a detective agency.  Under Pa.R.C.P. 400(a), original service in Pennsylvania is only to be effectuated by a Sheriff.  As a result, the Defendant filed preliminary objections seeking that the complaint be dismissed for failure to comply with Pa.R.C.P. 400(a).  The Defendant argued the statute of limitations is tolled only if the plaintiff makes a good faith effort to effectuate service of process on the opposing party, which he argued did not occur. Plaintiff countered, stating that Pa.R.C.P. 126 enables a court to “disregard any error or defect of procedure which does not affect the substantial rights of the parties.”

In analyzing the situation, the Court first relayed the standard for evaluating untimely service.  To warrant the dismissal of an action based upon the untimely service of original process, the record must reflect that either (1) plaintiff demonstrated an intent to stall the judicial machinery by delaying the proper service of process, or (2) the defendant was prejudiced by plaintiff’s failure to comply with the procedural rules governing service.  The type of prejudice required to warrant a dismissal based upon improper service of process involves a “substantial diminution of the defendant’s ability to present factual information in the event of trial which has been brought about by plaintiff’s delay” in the proper service of original process. The Court found no evidence of any prejudice nor that the plaintiff intentionally acted in a manner that was designed to stall the judicial process.  Moreover, since the Defendant’s officer was furnished with timely notice of the filing of this suit, the Court found that the purpose of the statute of limitations was satisfied.

This case poses an interesting situation, where the specific requirements of a statute were not met, but where the Plaintiff’s action complied with the spirit and purpose of the statute.  Most states contain statutes and regulations allowing Courts to disregard any defect of procedure that does not prejudice another party.  The Defendant could not provide any evidence that he was prejudiced, and the Plaintiff was allowed to proceed in his lawsuit.  There was no-harm, and, thus, the Court found no-foul.

Thanks to Malik Pickett for his contribution to this post. Please email ">Colleen  E. Hayes with any questions.

This and That by Dennis Wade

The Holidays are a time to have fun and to look for inspiration for the coming year.  Both may be found in the law.  Here are some of my favorites–some fun, some inspirational.

“Truth isn’t truth.”

Rudolf Giuliani explaining why answering Special Prosecutor Mueller’s questions might pose a risk for the President.

“I like beer.  I still like beer.”

Then Supreme Court Nominee Brett Kavanaugh answering questions about his high school days at Georgetown Prep.

“North Philly, Officer Sean Devlin, Narcotics Strike Force, was working the morning shift.  Undercover surveillance.  The neighborhood?  Tough as a three dollar steak…”

Chief Justice Roberts, sounding like Dashiell Hammet, in dissent from a denial of certiorari in a probable cause case.

“So often in life, things that you regard as an impediment turns out to be great good fortune.”

Judge Ruth Bader Ginsberg

“Independence means you decide according to the law and the facts.”

Justice Stephen Breyer

“Eighteen-hole golf courses, 10-foot-high basketball hoops, 90 foot baselines, 100-yard football fields—all are arbitrary and none is essential…Many, indeed, consider walking to be the central feature of the game of golf-hence Mark Twain’s classic criticism of the sport: ‘a good walk spoiled.’”

The late Justice Scalia’s preface in dissent as to why the Supreme Court should not have touched the “cart” controversy in PGA Tour, Inc. v. Casey Martin.

“I do know one thing about me:  I don’t measure myself by others expectations or let others define my worth.”

Justice Sonia Sotomayer

“The young man knows the rules, but the old man knows the exceptions.”

Justice Oliver Wendell Holmes

And that’s it for This and That:



Wade Clark Mulcahy LLP Victorious in Binding Arbitration

Partner, Vincent Terrasi recently secured a win at a binding arbitration in the case of Scuorzo v. Safdar, et. al.  Scuorzo was a pedestrian struck by a black livery car in Manhattan in 2010.  The black livery car claimed that it was caused to hit the pedestrian due to the negligent operation of an ambulance that entered an intersection against a red signal. The ambulance driver activated an air horn in the direction of the livery car, startling the livery driver, which resulted in evasive actions that led to the accident.  WCM represented a black car dispatch company and the sole legal theory against the base was that they were vicariously liable for the acts of the driver on a theory of respondeat superior.

After 7 days of jury selection, the defendants settled with plaintiff and resolved the liability dispute amongst the defendants over the course of a two-day binding arbitration.  While fault for the accident was apportioned between the two drivers, WCM proved that the base was not an employer for the purposes of vicarious liability, resulting in a complete win for WCM’s client.