In American Building Supply Corp. v. Petrocelli (2012) the Court of Appeals addressed the issue of whether an insured could maintain an action for negligence and breach of contract against an insurance broker for failure to procure adequate insurance coverage where the insured received the policy without complaint. The plaintiff was a business which hired a new insurance broker in October 2004. In its discussions with the defendant broker the plaintiff specifically requested general liability coverage for its employees in case of injury. The defendant provided plaintiff with an insurance policy which excluded the specifically requested coverage for employees. Plaintiff did not read the insurance policy upon receipt nor did the defendant broker.

In October 2005 one of the plaintiff's employees was injured on the job and coverage was denied based upon the policy exclusion. Plaintiff commenced a negligence and breach of contract action against the broker and alleged a failure to procure adequate insurance. Defendant moved for summary judgment which the Supreme Court denied. The Appellate Division reversed and held that the plaintiff's failure to "read and understand the policy ... precludes recovery in this action". The Court of Appeals reversed and held that a failure to read the policy should not bar the plaintiff from pursuing its action. Such a failure to read the policy may give rise to a defense of comparative negligence but should not bar altogether an action against a broker.

The plaintiff in Savage v. Anderson's Frozen Custard (4th Dept., November 16, 2012) was injured after a chair slid out from beneath her causing her to fall to the floor. Plaintiff alleged negligence and failure to warn of a defect. Defendant moved for summary judgment and met its initial burden with respect to the negligence and failure to warn claims by submitting evidence that the accident was not attributable to a defect in the chair or the store floor. The defendants established that the chair in question and many others like it had recently been purchased shortly before the accident. The restaurant was visited by approximately 6,000 to 7,000 patrons since the purchase of those chairs without incident. The Fourth Department reversed the lower court's denial of the defendant's motion and held that the plaintiff failed to raise a triable issue of fact. In its decision the Court noted that the plaintiff's expert's affidavit was insufficient after it was shown he never visited the scene of the accident or performed tests on the floor.

In Hoover v. New Holland North America Inc. (4th Dept., November 16, 2012) the plaintiff was assisting her father in digging a hole using a tractor driven post hole digger. While the digger was in operation the plaintiff's coat became caught in the driveline which resulted in the plaintiff's arm being severed above the elbow. The evidence established that the owner of the digger had removed a plastic shield that covered the driveline prior to the accident. The defendant manufacturer made a motion for summary judgment and argued that it could not be held liable for injuries resulting from "a substantial alteration or modification of the product" which renders the product defective or unsafe. The Fourth Department denied defendant's motion after plaintiff raised an issue of fact. Specifically plaintiff showed that a protruding bolt attached to the driveline was an entanglement hazard and that there were design alternatives that would have reduced or eliminated the hazard in the digger. Based on this evidence the Fourth Department held that the plaintiff presented sufficient evidence that the digger was defectively designed and that the removal of the shield did not constitute a substantial modification.

The plaintiff in Hayes v. Texas Roadhouse Holdings (4th Dept., November 16, 2012) commenced action after she tripped and fell over a curb separating a sidewalk and a landscaped area at the defendant's restaurant. In support of its motion for summary judgment the defendant argued that the subject curb was in a reasonably safe condition at the time of the fall and submitted evidence that the curb complied with applicable building codes and zoning ordinances. The Fourth Department denied the defendant's motion and held that evidence of a defendant's compliance with industry standards does not establish as a matter of law that such defendant is not negligent.

On December 17, 2012 Governor Cuomo signed the Uniform Notice of Claim Act. This becomes effective 180 days after being signed into law. The bill would amend the General Municipal Law and other statutes to permit claimants to serve a notice of claim on any public corporation by delivery of the notice to the New York Secretary of State. The Secretary of State would then forward a copy of the notice to the appropriate public entities.

Under the current General Municipal Law public entities have 90 days from the date of service of the notice of claim in which to request a hearing and question the claimant regarding the nature of the claim. Under the new proposed bill public entities will lose a minimum of ten days out of that 90 day period due to the Secretary of State's involvement. Municipalities must be vigilant with these new time constraints when deciding whether to go forward with a General Municipal Law §50-h hearing.

Prepared by Kevin E. Loftus