I. PLAINTIFFS INVOLVED IN ACCIDENTS WITH TORTFEASORS WITH INSOLVENT INSURERS NOT ENTITLED TO AUM@ COVERAGE
In the matter of Eagle Insurance Company vs. Hamilton, 4 A.D.3rd 355, 773 N.Y.S.2d 68 (2nd Dept., 2004), the Court addressed the issue of how a petitioner=s source of recovery is affected by insolvent insurance companies. In 1998, the petitioner Hamilton was injured in a motor vehicle accident. At the time, the petitioner was insured by Eagle. The petitioner=s policy contained the New York State Mandatory Uninsured Motorist=s Coverage (UM), which provides coverage in instances when a tortfeasor=s vehicle is uninsured. The petitioner did not possess, however, the optional ASupplemental Uninsured Motorist@ or ASUM@ coverage.
In Eagle the tortfeasor=s insurer Reliance National Indemnity Company, had recently declared insolvency. Its New York assets were in a state of receivership. As a result, the petitioner pursued recovery from the Public Motor Vehicle Liability Security Fund, established by New York State. In response to the petitioner=s request for benefits the Fund corresponded AAt this time, the PMV Fund is unable to provide either a defense to, or indemnification of this claim insofar as the PMV Fund is financially strained.@
The petitioner then sought arbitration against Eagle for UM benefits. Eagle argued that the tortfeasor=s vehicle was not uninsured at the time of the accident but rather was insured by Reliance. Eagle further argued that the petitioner=s UM coverage is only triggered when a tortfeasor=s insurer denies or disclaims coverage. The petitioner responded that Reliance=s insolvency was the equivalent of the tortfeasor being uninsured.
The Court agreed with Eagle and ruled that the petitioner was not entitled to UM benefits. Technically Reliance never denied or disclaimed coverage in this accident, it just went out of business. The petitioner could have pursued recovery through Eagle if he had purchased SUM coverage. SUM coverage specifically allows recovery when dealing with an insolvent insurer. As a result of the petitioner only having the mandatory UM coverage and not SUM, he was not entitled to recover from his insurance company and was faced with the bleak prospect of pursuing recovery through the state fund.
II. PROPERTY OWNER=S FAILURE TO SHOVEL SIDEWALK COULD BE A BASIS FOR LIABILITY EVEN IF INJURY OCCURS OFF PROPERTY
A recent decision of the Fourth Department upheld a lower Court=s ruling that a failure to shovel one=s sidewalk may be a basis for liability when a municipal ordinance requires it. In Di Natale vs. State Farm, 2004 N.Y. Slip. Op. 02079, the plaintiffs were forced to walk on Niagara Falls Boulevard, a busy highway, as a result of the defendants= failure to clear their respective sidewalks. Multiple plaintiffs were injured and one plaintiff lost her life as a result of being struck by a vehicle while on the Boulevard. The defendants moved for summary judgment arguing that no duty existed towards the plaintiffs since the accident occurred away from the defendants= premises.
The Fourth Department disagreed. In its decision, the Court pointed to a local ordinance of the town where this accident occurred which assigned liability to property owners who fail to keep their sidewalks clear. The defendants= apparent violation of the ordinance, which required Aany owner or occupant of any premises fronting or abutting on any street or highway to maintain any sidewalk abutting the premises by keeping it free and clear from snow and ice@, was enough to raise triable issues of fact as to whether the defendants breached a duty owed towards the plaintiffs and whether that breach was a proximate cause of the injuries and fatality.