Global Liberty Ins. Co. v Ubini

[*1] Global Liberty Ins. Co. v Ubini 2008 NY Slip Op 50399(U) [18 Misc 3d 1141(A)] Decided on January 31, 2008 Supreme Court, Nassau County Woodard, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on January 31, 2008
Supreme Court, Nassau County

Global Liberty Insurance Co., Plaintiff,

against

Francis Ubini and Antonia Landeros, Defendants.



009325/06



Appearances of Counsel:

Robert Fischl, Esq.

Scott B. Schwartz, Esq.

Michele M. Woodard, J.

Plaintiff Global Liberty Insurance Co., is the automobile insurance carrier for Defendant Francis Ubini. Defendant Antonia Landeros is a plaintiff in a separate action brought against Mr. Ubini due to an automobile accident which occurred on January 14, 2006. In that accident Ms. Landeros was struck by Mr. Ubini's vehicle as she was walking. Global has disclaimed coverage for the incident. The sole issue at the hearing before this Court is whether the disclaimer for alleged lack of cooperation with the carrier's investigation by Mr. Ubini, is valid.

STATEMENT OF FACTS

In March 2005, Global issued a commercial automobile insurance policy (the "Policy") to Mr. Ubini, a livery cab driver. The coverage period of the Policy was from March 1, 2005 to March 1, 2006. The Policy, at Section IV, contains a set of "Business Auto Conditions," which states, in pertinent part:

2.Duties in the Event of Accident, Claim Suit or Loss."

b. *** You and any other involved "insured" must:

(2) Immediately send us copies of any request, demand, order, notice, summons or legal paper received concerning the claim or "suit."

(3)Cooperate with us in the investigation or settlement of the claim or defense against the "suit."

During the hearing, Mr. Ubini acknowledged that he received a copy of the Policy at his home address shortly after the Policy was issued. Instead of reviewing its terms and conditions, including the cooperation clause noted above, Mr. Ubini admitted that he took the Policy and placed it in a drawer, without ever looking at it again. He further admitted that this was his first auto policy with Global, and that the Policy was sent directly to him by Global, not by his insurance broker, John J. Cacchioli Agency, Inc. Mr. Ubini's testimony indicates that he paid his first premium to John J. Cacchioli Agency and believed that the plaintiff had instructed him in the past to direct policy inquiries to John J. Cacchioli Agency.

On the date of the accident, January 14, 2006, Mr. Ubini was traveling with a fare-paying [*2]passenger in the Town of Hempstead. At approximately 7:00 a.m., Mr. Ubini's vehicle struck Defendant Antonia Landeros' vehicle. Mr. Ubini testified that, upon impact, Ms. Landeros was knocked to the ground. After exiting the vehicle, Mr. Ubini observed Ms. Landeros sitting on a curb and he heard her complain of ankle pain. He further testified that Ms. Landeros was taken away from the scene by ambulance. Aside from his rear-seat passenger, Mr. Ubini took notice of two other witnesses who were in the immediate area at the time of the accident. Mr. Ubini, who admittedly was carrying a trip sheet with him, did not record the names of any witnesses, including his fare-paying passenger. Mr. Ubini testified that he discarded his trip sheet which did not contain the passengers' name or destination.

During cross-examination, Mr. Ubini, who holds advanced business degrees, acknowledged that his broker, John J. Cacchioli Agency, Inc. is a separate entity from Global. He further acknowledged that the Cacchioli Agency does not conduct business in the same office as Global. Yet, Mr. Ubini made a conscious decision to report the accident only to his broker. He did so by supplying a copy of a police report and by giving the information required to complete an MV-104 form, dated within six (6) days after the accident. Mr. Ubini admits that, he did not, at any time following the accident, engage in direct communications with Global, save a bitter exchange of words with Global's investigator, and angry messages that he left on a claims adjuster's voice mail.

The testimony of Global's claims adjuster, Dwight Geddes, reflects that, in the ordinary course of Global's business, they prepare an acknowledgment of claim form and a questionnaire, and send it to the insured's home address immediately following receipt of a claim. Here, Mr. Geddes admits that he received notice of the claim on January 18, 2006, and that it was Global's business practice to send out the aforesaid documents to an insured immediately after receiving the claim. He was unable to produce any evidence that the claim form and questionnaire were actually sent to Mr. Ubini. Mr. Ubini claims that he did not receive this claim form or the questionnaire.

By mid-February 2007, Mr. Geddes instructed his investigator, a retired New York City police officer, John Stewart, to visit Mr. Ubini's home to obtain information regarding the accident. According to Mr. Stewart's testimony, on February 28, 2006, he traveled to Mr. Ubini's home address, identified his vehicle and then knocked on Mr. Ubini's front door. Mr. Stewart testified that at first, he advised Mr. Ubini that he wished to speak with him about the accident and Mr. Ubini refused. Mr. Ubini did not know who Mr. Stewart represented. He advised Mr. Stewart that he needed to be brief. Instead of arranging for a more advantageous meeting Mr. Stewart called Mr. Ubini "stupid" and told him that he was going to be sued. The meeting between the two quickly escalated into an argument, and then turned into physical confrontation. Mr. Stewart testified that Mr. Ubini flailed his arms at him, barely missing his head by inches. He further testified that after backpedaling down Mr. Ubini's exterior steps, Mr. Stewart, in self-defense, drew his gun, and aimed it at Mr. Ubini. Mr. Ubini had no weapon and never hit Mr. Stewart.

Mr. Ubini's testimony contradicts Mr. Stewarts version of the incident. On direct examination, he stated that Mr. Stewart, without any physical provocation, put a gun into his ribs and said, "I will shoot you and you will spend your life in a nursing home." Mr. Ubini's Affidavit, previously submitted to this Court, stated that the gun was pressed against his head. Despite the different versions, the Court credits Mr. Ubini's testimony that he did not threaten [*3]Mr. Stewart and that Mr. Stewart's actions were unprovoked.

Mr. Ubini, following the altercation, contacted John J. Cacchioli Agency and learned that Mr. Stewart had been sent by the plaintiff's claims office. He then called that office and left an explicit message on Dwight Geddes' voice mail. He referenced the gun incident by stating that Global had sent someone to assassinate him. The call included his admitted profane comment that Mr. Geddes should "go No.## himself." Taken alone, this shows that Mr. Ubini was upset and outraged by Mr. Stewart's conduct. Notably, Mr. Geddes made no effort to ameliorate the situation even though he admitted that he was aware, based upon Mr. Stewart's written report, that his own investigator had pulled a gun on a customer during an interview intended to gain that customer's cooperation.

Instead, shortly after receiving a report of the altercation, Mr. Geddes sent a Reservation of Right ("ROR") letter to Mr. Ubini. The letter dated March 1, 2006, sent by certified mail, return receipt requested, stated that Mr. Ubini was in breach of his duty to cooperate and that Global had not received notice of the accident despite its attempts, by mail and in person, to obtain information. The letter further states, "it is extremely important that you contact us upon receipt of this letter to provide us with the details regarding this accident." There was no mention of the altercation or the gun. Without reference to this serious incident, a reasonable person, upon receipt of this letter, might be so insensed as to not contact the insurer. Mr. Geddes' testimony is that he received a second threatening call shortly after the ROR letter was sent to Mr. Ubini. It is undisputed that neither Mr. Geddes nor anyone from the Plaintiffs office made any attempt to assuage the apparently distraught feelings of Mr. Ubini brought on by the gun incident, no matter who the Plaintiff believed was at fault. Mr. Ubini did not make any attempt, in person, by mail or by telephone, to give information directly to Global following his receipt of this letter. However, Mr. Ubini submitted into evidence a letter dated May 9, 2006 sent to Global from his attorney presumably regarding the altercation. Although the letter did not provide information about the accident, such contact provided the plaintiff with another avenue to obtain the cooperation desired. In light of the unusual circumstances surrounding the Plaintiff's investigation, it would have been reasonable to contact Mr. Ubini's representative and attempt to gain Mr. Ubini's cooperation through him.

Instead, on May 15, 2006, approximately 2 ½ months after the ROR letter was sent, and received by Mr. Ubini, Global issued its disclaimer letter. The letter, which was received by Mr. Ubini, sets forth that the disclaimer is due to the "non-compliance, inactivity and evasiveness" that Mr. Ubini demonstrated with regard to Global's attempts to investigate the accident. Contrary to the Plaintiff's position, Mr. Ubini did provide information which was geared to provide the Plaintiff with the information it sought based on Mr. Ubini's prior experience .

Plaintiff, correctly points out that Mr. Ubini's broker, the Cacchioli Agency is not an agent of the Plaintiff. Nonetheless, Mr. Geddes did not deny that the information given by Mr. Ubini to the Cacchioli Agency was in fact received by the Plaintiff. On cross-examination Mr. Geddes admitted that he had received Mr. Ubini's signed accident report from the John J. Cacchioli Agency. Mr. Ubini's communications to his broker, considering his experience with Mr. Stewart, belie Plaintiff's argument that Mr. Ubini engaged in willful non cooperation. Although Mr. Ubini made another disturbing telephone call to Global on May 17, 2006, Global again made no attempt to address the altercation or insure Mr. Ubini that such conduct was not condoned or, at least, not ignored by Global. This conduct is yet another example of how the [*4]Plaintiff failed to address Mr. Ubini's concerns or Mr. Stewart's erratic behavior which involved an employee pulling a gun on a customer. His conduct certainly created an unusual situation as testified to by Mr. Stewart, himself, who stated he had not drawn a gun on a customer before or after he did so on Mr. Ubini.In Thrasher v. U. S. Liability Insurance Co. , 19 NY2d 159 (1967) the Court of Appeals laid out a three pronged test for determining the propriety of an insurance company's disclaimer. The Court in Thrasher, infra at pp.168-169 stated:

The burden of proving lack of co-operation of the insured is placed upon the insurer (Insurance Law, § 167, subd. 5). Since the defense of lack of co-operation penalizes the plaintiff for the action of the insured over whom he has no control, and since the defense frustrates the policy of this State that innocent victims of motor vehicle accidents be recompensed for the injuries inflicted upon them (Wallace v. Universal Ins. Co.,18 AD2d 121, affd. 13 NY2d 978; Kehoe v. Motorists Mut. Ins. Co., 20 AD2d 308, 310; Vehicle and Traffic Law, § 310, subd [2]). The courts have consistently held that theburden of proving the lack of co-operation is a heavy one indeed. Thus, the insurer mustdemonstrate that it acted diligently in seeking to bring about the insured's co-operation (Amatucci v. Maryland Cas. Co., 25 AD2d 583; Rosen v. United States Fid. & Guar. Co., 23 AD2d 335 [overruled on other grounds by Matter of Vanguard Ins. Co. (Polchlopek), 18 NY2d 376]; National Grange Mut. Ins. Co. v. Lococo, 20 AD2d 785, affd. 16 NY2d 585; Kehoe v. Motorists Mut. Ins. Co., supra); that the efforts employed by the insurer were reasonably calculated to obtain the insurer's co-operation (National Grange Mut. Ins. Co. v. Lococo, supra; Wallace v. Universal Ins. Co., supra); and that the attitude of the insured, after his co-operation was sought, was one of "willful and avowed obstruction" (Coleman v New Amsterdam Cas. Co., 247 NY 271, 276; American Sur. Co. v. Diamond, 1 NY2d 594). In our opinion, the insurer failed to act diligently in seeking Kelley's co-operation and failed to employ reasonable efforts in locating Kelley.

It should be abundantly clear that the actions of Global Liberty do not meet

these standards. While at first blush, it would appear reasonable for the insurance company to ask an investigator to obtain further information from the insured, it is readily apparent that the procedures employed by Investigator Stewart from the moment that he received the file from Dwight Geddes, were not of the kind designed to secure the cooperation of anyone. At no time did he attempt to reach out to Mr. Ubini to arrange an interview. When he arrived unannounced at the residence and attempted to get a statement then and there, without first advising the insured that he was from the insurance company, he acted out in an erratic, unusual, and shocking fashion , instead of trying to arrange a mutually convenient time for a discussion. There is little place in the business world or anywhere else in a civilized society for the type of conduct engaged in by Investigator Stewart. Indeed, his conduct had the potential to be viewed as a criminal attack by the insured. Investigator Stewart knew that and for that reason when Mr. Ubini called for police assistance on February 28th Stewart first identified himself to the members of the Nassau County Police Department as a retired officer.

Faced with the altercation, particularly one involving the drawing of a gun by the Plaintiff's representative, the Plaintiff's failure to address the incident with Mr. Ubini, demonstrates that Plaintiff did not act diligently in seeking to bring about the insured's [*5]cooperation. Notwithstanding Mr. Ubini's admittedly explicit telephone messages, some effort should have been made to address such a volatile situation before issuing a disclaimer. Without doing so, the Plaintiff's efforts in these special circumstances were not reasonably calculated to obtain the insured's cooperation as required in Thrasher v. U.S. Liability Insurance Co., 19 NY2d 159 (1967).

The cases cited by the Plaintiff are factually distinguishable from this case and do not warrant a different conclusion. None of those cases involves situations in which the insurer's representative pulled a gun on or became embroiled in a physical confrontation with the insured.

The evidence offered at the hearing on this matter and the test imposed by the Court of Appeals establish that Global Liberty's disclaimer was improper and unfounded.The facts establish that the course of conduct engaged in by the representatives of Global Liberty was not designed to induce the cooperation of the insured; it was counter-productive in nature. Notwithstanding such atrocious conduct on the part of the representatives of Global Liberty, the facts also establish that Francis Ubini has cooperated to the best of his ability under all of the circumstances.

Based on the foregoing, the Plaintiff did not act diligently in seeking to bring about Mr. Ubini's cooperation. The Plaintiff's efforts were not reasonably calculated to bring about his cooperation. Hence, the Defendant Ubini did not willfully fail to cooperate with the Plaintiff. The Motion to declare that the Plaintiff has no obligation to defend or indemnify the Defendant Ubini is denied.

Therefore, the Court FINDS, ADJUDGES and DECLARES that Plaintiff Global Liberty's disclaimer was not proper and that it must defend and indemnify Francis Ubini in the separate underlying action brought by Antonia Landeros.

Dated: January 31, 2008

Mineola, NY

______________________________

MICHELE M. WOODARD

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