New York CM Report of Recent Decisions (2009v1)
2009 Volume 1
A summary of significant recent developments in the law focusing on substantive issues of litigation and featuring analysis and commentary on special points of interest.
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Articles in this report
In Moran v. Erk, 11 N.Y.3d 452 (2008), the Court of Appeals of New York observed that "attorney approval contingency" clauses enable either side's attorney to void executed contracts for any reason, or for no reason at all. The "attorney approval contingency clause" provides that attorneys will have the final word on the validity of a contract, even once an expectation of performance may already have been created. Id.
In Nova Casualty Company v. Central Mutual Insurance Company, 59 A.D.3d 777 (3d Dep't 2009), commercial general liability ("CGL") carrier Nova Casualty Company ("Nova") brought a declaratory judgment action against its insured, contractor Ryan Bennett (the "contractor" or "Bennett"), seeking a declaration that Nova was not required to indemnify or defend Bennett in a suit filed by homeowners James and Joan Catlett (the "Catletts" or homeowners) and their Insurer, Central Mutual Insurance Company ("Central Mutual"), arising from a fire caused by the contractor's work.
The Court of Appeals of New York in Fasso v. Doerr 12 NY 3d 80, 903 N.E 2d 1167(2009) has issued a decision stating that a subrogation claim may not be discontinued by the injured plaintiff and the tortfeasor defendant without the consent of the subrogee.
Insured's Conduct Determines the Reasonableness of Insured's Belief of Non-Liability
The First Department recently decided two cases involving an insured's obligation to timely notify its insurer of an underling occurrence, and insured's reasonable belief of non-liability to excuse its unreasonable delay. Normally, in determining such issues, the court relies heavily on the facts and circumstances of the underlying occurrence.
New Jersey Court Upholds a Waiver of Subrogation Provision
Skulskie owned a residential condominium. Pursuant to New Jersey law, the by-laws provided that the Directors will acquire various types of insurance coverage. The by-laws also provided that all insurance policies will contain a provision whereby the insurer waives its rights to subrogation against Unit Owners, the Association, etc. All unit owners had the right, but were not required, to obtain personal property and/or liability insurance, and all such policies were required to have a waiver of subrogation provision.
Notice of a Pre-Existing Condition and Late Notice Preclude Coverage Under and Environmental Policy
The Appellate Division, First Department recently ruled that an insured is not entitled to coverage for creditor reimbursement under an environmental damages insurance policy where pollution conditions were known before the inception of the policy and notice to the insurer was late. Wells Fargo Bank N.A. v. Zurich American Insurance Co., N.Y. Sup., App. Div., 1st Dept.; 2009 N.Y. App. Div. LEXIS 1390.
Statutory Protection Afforded Even To Negligent Worker Under Labor Law
Following the general pattern of the other Appellate Divisions' interpretation of New York's Labor Law Section 240, the Appellate Division, Second Department recently held that a plaintiff's partial negligence, which may have contributed to plaintiff's accident, is not a bar to the statutory protections afforded by Labor Law Section 240, and that summary judgment will still be appropriate under those circumstances.
