Summary
In Caimares, the First Department determined that an RRG is not an insurance company subject to New York's version of the Uniform Insurers Liquidation Act (the "UILA").
Summary of this case from In re HarrisOpinion
9530 Index 20620/17E
06-04-2019
Cynthia I. CAIMARES, Plaintiff-Respondent, v. Aimee ERICKSON, et al., Defendants-Appellants, David M. Jakubowicz, M.D., et al., Defendants.
Vogrin & Frimet, LLP, New York (Francine L. Semaya of counsel), for appellants. Sullivan Papain Block McGrath & Cannavo P.C., New York (Brian J. Shoot of counsel), for respondent.
Vogrin & Frimet, LLP, New York (Francine L. Semaya of counsel), for appellants.
Sullivan Papain Block McGrath & Cannavo P.C., New York (Brian J. Shoot of counsel), for respondent.
Acosta, P.J., Richter, Kapnick, Kahn, Kern, JJ.
Plaintiff, diagnosed with advanced-stage breast cancer, commenced this action to recover for injuries sustained due to defendants' alleged failure to inform her of the results of an October 28, 2014 mammography or refer her for follow-up evaluation. Pursuant to an order of the South Carolina Court of Common Pleas, dated September 21, 2017, and a Clarification Order of the same court, dated February 8, 2018 (Stay Orders), issued in connection with the liquidation of Oceanus Insurance Company, a Risk Retention Group, this action was administratively stayed, because defendant Aimee Erickson, FNP, is insured by Oceanus.
In accord with our recent decision in Givens v. Kingsbridge Hgts. Care Ctr., Inc., 171 A.D.3d 569, 570, 98 N.Y.S.3d 176 [1st Dept., 2019], we hold that lifting the stay in this case does not violate the Uniform Insurers Liquidation Act (UILA) ( Insurance Law §§ 7408 – 7415 ), because Oceanus is a risk retention group (RRG) and exempt from state laws such as the UILA.
The Full Faith and Credit Clause of the U.S. Constitution ( U.S. Const, art IV, § 1 ) does not dictate a different result. That clause does not require a state to apply a foreign state's law in violation of its own legitimate public policy ( Givens, 171 A.D.3d at 569, 98 N.Y.S.3d 176, citing Crair v. Brookdale Hosp. Med. Ctr., Cornell Univ., 94 N.Y.2d 524, 528, 707 N.Y.S.2d 375, 728 N.E.2d 974 [2000] ). Most of defendants-appellants' public policy arguments rely upon New York's adoption of the UILA, but, as indicated, UILA is not relevant here. Moreover, defendants' emphasis on New York's interest in preserving liquidation proceedings from outside interference is misplaced; the liquidation proceedings at issue here were commenced out of state and concern a non-domiciliary RRG (cf. Matter of Knickerbocker Agency [Holz], 4 N.Y.2d 245, 173 N.Y.S.2d 602, 149 N.E.2d 885 [1958] ; Lac D'Amiante du Quebec, Ltee v. American Home Assur Co., 864 F.2d 1033 [3d Cir.1988] ).
Defendants cite no case that supports their assertion that the public policy goal of centralizing proceedings against insolvent insurers takes precedence over this State's policy goals of compensating tort victims. Plaintiff's position to the contrary is particularly persuasive, given the unavailability of indemnity funds to compensate her for harms attributable to defendant Erickson (see Insurance Law § 5906 ). To the extent defendants herald the creation of RRGs by federal law as a solution to a former insurance crisis, the record before us does not demonstrate that plaintiff received a benefit from any aspect of the solution. While Erickson would have knowingly assumed the risk of being insured by Oceanus (see 15 USC [Liability Risk Retention Act] § 3902 [a][1] ), there is no basis on which to find that plaintiff similarly knowingly assumed that risk, or even was aware of the risk, or that she reaped any benefit from having assumed it, such as, for example, lower medical bills.
The record does not support defendants' argument that the court discriminated against RRGs, in violation of the Liability Risk Retention Act. The court ruled against defendants on the basis of case law and statutory authority, not personal animus. It did not condition Oceanus's continued operation in New York upon conduct otherwise prohibited by statute (see National Warranty Ins. Co. v. Greenfield, 24 F. Supp. 2d 1096 [D. Or. 1998], affd 214 F.3d 1073 [9th Cir.2000], cert denied 531 U.S. 1104, 121 S.Ct. 844, 148 L.Ed.2d 723 [2001] ). It merely held that a pending action by a severely ailing plaintiff could proceed.
We have considered defendants' remaining arguments and find them unavailing.