Curtain Falls on Coverage for Met Mishap

Strauss contracted to strip and repaint a rooftop steel carriage track at the Metropolitan Opera.  Strauss’s CGL policy contained a clause adding, as an additional insured, any person or organization that had a written agreement with Strauss to be added as an additional insureds on Strauss’s policy.

An exhibit to the form contract between Strauss and the Met said:

b.Owners and contractors protective liability insurance with a combined single limit of $5,000,000.00. Liability should add the Metropolitan Opera Association as an additional insured and should include contractual liability and completed operations coverage.

c.Comprehensive General Liability. Combined coverage for property and bodily injury with a minimum single limit of $5,000,000.00 (Limits may be met with an ‘Umbrella Policy’).

Strauss did not obtain an OCP policy.

A worker fell off a ladder on September 16, 2008. The worker eventually sued the Met under the Labor Law; the Met ultimately impleaded Strauss.  The Court of Appeals held that Strauss was not covered for the claim due to late notice of the occurrence.[i]

The Court of Appeals found that the contract required Strauss to make the Met an additional insured on an OCP policy. Since the contract did not express that requirement for the GCL policy, the Met was not an additional insured.

Judge Read dissented, reasoning that while the “additional insured” requirement may have been “awkwardly phrased and infelicitously placed,” its reference to “completed operations coverage” was an obvious reference to the typical CGL policy.

Strauss Painting, Inc., v Mt. Hawley Ins. Co. (NY Nov. 24, 2014).

[i]  Since the amendment of Insurance Law § 3420(a)(5), effective for policies issued on or after January 17, 2009, would now require the insurer to demonstrate prejudice arising from the late notice, we will not analyze that aspect of the opinion.

AZ APP: Doc Cannot be Prosecuted for Lax Compliance with Medical Pot Regs

As part of its implementation of Arizona’s voter-passed medical marijuana law, the Department of Health Services requires the certifying doctor to represent that he/she  has reviewed the last 12 months’ medical records from the patient’s other treating physicians.

The county drug task force sent a confidential informant into the doctor’s office to request certification for medical marijuana. The doctor took a history and performed an examination. The “patient” indicated that she did not have a complete set of records from her other doctors with her. The doctor accepted her agreement to get the records together for the next visit, and provided the certification.

The powers that be decided to prosecute the doctor for falsely certifying that he had reviewed the missing records.

The Court of Appeals, Div. 1, held that the doctor is saved by ARS § 36-2811(c), which provides that a physician “shall not be subject to  . . . prosecution . . .based solely on providing written certifications . . .”

State v. Gear (AZ App. Div. 1, Nov. 20, 2014).






NY Applies Single Limit to Lead Exposure Claims by Successive Tenants in Successive Policy Years

Allstate issued a policy to the landlord  which renewed each September.  The liability limit per occurrence was $500K.  The policy had a “noncumulation clause” stating that all bodily injury resulting from exposure to the same general condition would be treated as a single loss.

Tenant #1 moved out in September of 1993, and tenant # 2 moved in.   In July 1993, DOH notified the landlord that one of the children of  tenant # 1 had high lead levels, and the landlord performed some repairs.  A child of tenant #2 was then found to have high levels as well.

Separate suits were brought on behalf of the two families. Tenant #1 settled for $350,000.  Allstate told the family of tenant #2 that there was only $150,000 left in coverage.

NY’s high court, with one judge dissenting, said that Allstate was right.  It said that despite the abatement work, the lead that afflicted the children of tenant #2 was the same lead that was present when tenant # 1 was in the unit. Thus, it was exposure to the same general condition  and only one policy limit from one year applied.

One judge dissented, noting that a reasonable businessman would not have understood the policy to limit the coverage in this fashion, and would not have renewed with the same company at the same rate if the application of the noncumulation clause was clear.

Nesmith v Allstate Ins. Co. (NY Nov. 25, 2014).


No Jurisdiction for AZ Court of Appeals under Rule 54(c) where some claims were sent to arbitration and remaining claims were dismissed.

The Superior Court granted a motion to compel arbitration of two claims and dismissed the remaining claims. The judgment recited that “no further matters remain pending”. The judgment did not contain a Rule 54(b) statement or finding that there was no just reason for delay.   The Court of Appeals, Division 1, held that it had no jurisdiction because the Superior Court did not, in fact, resolve all the claims. It could not even hold the appeal open while the parties got the judgment amended to include a Rule 54(b) statement.

Madrid v. Avalon (Az. App., Div. 1., Nov. 18, 2014).

ABC, Hospital and Doc defeat medical confidentiality and emotional distress claims arising from “NY Med” broadcast.

Several months after the patient died in the ER from injuries sustained in a motor vehicle accident, his wife and children recognized that he was the subject of a segment on ABC’s “NY Med” show.  The segment was narrated by the chief resident. The decedent’s voice could be heard briefly during the segment, and the chief resident was shown entering the room to advise the family of the patient’s death.  The family’s reaction was not heard on the segment. No identifying information about the patient or the family was aired, and no details of the accident were given.

The family sued. The Supreme Court (trial level in NY) denied ABC’s motion to dismiss the intentional infliction of emotional distress claim and denied the hospital’s and doctor’s motion to dismiss that claim as well as a claim for violation of physician-patient confidentiality.

To avoid confusion for my Arizona readers, note that in NY,  trial level denial of summary judgment is appealable as of right.

The Appellate Division, First Department, reversed. The court held that the actions of the defendants in showing a pixilated image of the decedent was not so extreme and outrageous as to support the intentional infliction of emotional distress claim.  The breach of confidentiality claim failed because no confidential information was actually disclosed.

Chanko v. American Broadcasting Companies Inc. (1st Dept., Nov. 18, 2014).

The trial court decision can be accessed by visiting NY Web Civil Supreme. Index search under 152552/2013 in New York County.  When the next screen appears, click on the index number. When the next screen appears (Web Civil Supreme – Case Detail), scroll to the bottom and choose  “Show efiled Documents.” The decision is document no. 82.

Ex Mental Patient not Entitled to Public Defender for Restoration of Gun Rights

The patient was represented by the public defender in a proceeding to compel court ordered treatment for mental illness. As a consequence of the ensuing findings, the patient was prohibited from possessing firearms unless her right to do so was restored by a subsequent proceeding. To regain her gun rights, the patient had to prove, by clear and convincing evidence, that she was unlikely to pose a threat to public safety and that possession of a firearm by her was not contrary to the public interest. The proof had to include psychological or psychiatric evidence.

After the patient completed her treatment, the Superior Court appointed the public defender to represent the patient on the gun restoration proceeding. The county, which pays for the public defender, sought special action relief.

The Court of Appeals, Division 2, held that the patient was not entitled to counsel at public expense on the gun restoration petition. The court found that the applicable statutes did not specifically require it and that due process analysis, while applicable, did not compel appointment of counsel. The decision will make interesting reading for students of mental health law, patients’ rights, and gun rights.  Pinal Cnty. Bd. Of Supervisors v. Georgini (9/18/2014).

No Default Where Wrongful Death Plaintiff Lacks Capacity

The NY tort defense bar is familiar with the “proposed administrator” scenario. On the eve of the expiration of the statute of limitations, a person not properly appointed as personal representative of the decedent files a summons in a wrongful death action. Dismissal for lack of capacity is not on the merits, so the plaintiffs get six additional months to get it together and properly commence a new action. The initial filing is not a complete nullity.

Today the Appellate Division, Second Department, held that the filing by an unauthorized person was null enough to save the defendants from default. The court noted that the purported plaintiff lacked authority on the day the summons was filed.  He subsequently obtained letters.  Although the letters were revoked in favor of another family member, the plaintiff continued prosecution and moved for a default judgment. The court held that regardless of whether the defendants timely appeared or answered, the motion for a default judgment was properly denied. Jordan v Metropolitan Jewish Hospice (2d Dept. Nov 12, 2014).

Prompt Motion Required to Preserve Objection to Preliminary Conference Order

Orders resulting from conferences are not appealable paper if they are not the result of a motion on notice.  So if you don’t like a preliminary conference order, you need to make a motion, on notice, seeking relief from it.

The Supreme Court, Nassau County (Hon. Winslow), conducted a PC in September of 2013 and ordered the defendant to produce disputed documents for an in camera inspection. In February of 2014, the court ruled that the documents were discoverable and plaintiff’s counsel got them.  In May of 2014, after taking plaintiff’s deposition, the defendant made its motion.

Too late says the Supreme Court, holding that defendant’s objection to disclosure under statutes protecting hospital quality assurance was waived.  The court went on to say that even if the objection was timely, the defendant’s submission was insufficient to demonstrate that the privilege applied.  Gaska v. Nassau Health Care Corp. (Sup. Ct. Nassau Co.,  Nov. 5, 2014, Index No 1497/2013) available for subscribers at NYLJ.


Arizonans Buying Medical Pot Need to Save Cab Fare

Arizona law makes it illegal to drive with intoxicating metabolites of  listed drugs, including marijuana, in the blood.

On October 21st, two of three judges on a panel of the Court of Appeals, Division 1,  rejected the contention that under the voter-passed medical marijuana statute, a user could not be prosecuted unless actually impaired.

On November 4th, a unanimous panel of the same court endorsed that conclusion, and further held that the defendant drivers, one registered for medical marijuana in Oregon and the other in Arizona, could not present their medical marijuana registration cards as evidence to support an affirmative defense.   The court noted that although physicians may have certified them as eligible for medical marijuana, under federal law, physicians cannot prescribe it. Thus, a statute exempting drugs prescribed by a physician from the reach of the criminal statute did not apply.

So unless the Arizona Supreme Court reviews this, patients may wish to set aside a couple of weeks’ cab fare before heading for the dispensary.



OCR Issues Privacy Bulletin in Wake of Ebola Hysteria

Just in time for the declaration that there are no known active cases of Ebola in the U.S., OCR issued  a bulletin to ensure understanding of how the Privacy Rule works in emergency situations.

The helpful guidance includes the assurance that information can be shared to avoid “imminent danger,” but only to the extent consistent with state statutes, regulations and case law.

Privacy Officers will also be glad to know that, if the President declares an emergency or disaster and the Secretary of HHS declares a public health emergency, the Secretary may waive sanctions or penalties against hospitals that fail to distribute privacy notices to the hundreds or thousands of victims that come streaming into the ED for help.

Those readers who are not covered entities or business associates, and thus not required to comply with the HIPAA Privacy Rule, will be relieved to find out that they may voluntarily comply if they want to.

On a serious note, since so many of the enforcement provisions key off state law, even in the event of a catastrophe, it is essential for institutions to build state requirements into their policies and procedures.