August, 2003

I. REMOVING AIR UNITS FROM A BUILDING QUALIFIES AS “ALTERING” UNDER SECTION 240(1) OF THE LABOR LAW.

The Court of Appeals has recently held in Panek v. County of Albany, 99 N.Y.2d 452, 758 N.Y.S.2d 267 (2003) that removing air units from a building slated for demolition, while not in and of itself a “demolition” under §240(1) of the Labor Law, does qualify as “altering” a building and covers workers for injuries arising out of such activity. In Panek, the plaintiff was on a ladder removing two large air units from the old traffic control tower at Albany Airport when he fell and was injured. The tower had been slated for demolition, but the demolition project had not yet begun. For this reason, the Court held that the plaintiff’s activity did not qualify under the demolition category in the Labor Law. Nonetheless, the Court found that such activity qualified as the process of “altering” a building and since it occurred while the plaintiff was working on a ladder, it qualified as an elevation related risk and successfully invoked §240(1). In their decision, the Court stated that the plaintiff’s work constituted modification of the building and whether the building was scheduled for demolition or slated for continued use does not change the nature of the work project at the time of the accident.

II.AN INSURANCE AGENT DOES NOT HAVE A CONTINUING DUTY TO ADVISE OR DIRECT A CLIENT TO OBTAIN ADDITIONAL COVERAGE ABSENT SUCH SPECIFIC REQUEST.

The Fourth Department has recently held that a general request for insurance does not impose upon the insurance agent a duty to recommend coverage for every possible scenario nor does it require the agent to advise, guide or direct a client to obtain certain insurance coverage. Frost v. Mayville Tremaine, Inc., 299 A.D. 2d 839, 750 N.Y.S.2d 398 (4^th Dept., 2002). In Frost, the plaintiff, a business owner, sued his insurance agent alleging that he had relied upon the defendant’s representations that the insurance policy purchased by the plaintiff would cover losses for damage to property under control of the plaintiff regardless of the property ownership. In this case, the plaintiff sold a mobile home and delivered title to and possession of the home after the buyers obtained financing. Subsequently, after the transfer of title and possession, plaintiff’s contractors improperly connected the utilities to the mobile home causing substantial water damage.

The plaintiff attempted to make a claim under his insurance policy for the damage caused to the home only to learn that because the plaintiff did not have “Garage Keepers’ Coverage”, the plaintiff’s insurance company would not provide coverage for this damage. The reason given was that the plaintiff was no longer owner of the home. Through plaintiff’s deposition testimony, the agent established that the plaintiff did not request such coverage during a meeting with the insurance agent. The Fourth Department affirmed the trial court’s dismissal of the case noting that absent a specific request to advise or act, an insurance agent does not have a continuing duty to guide or direct the client to obtain additional coverage. The agent’s duty is defined simply by the nature of the request of the customer. Since the plaintiff in this case, made a general request for insurance, the agent cannot be liable for not providing the specific coverage that the insured eventually needed.

Anthony J. Cervi