Opinion
12500/01.
February 3, 2004.
Upon the foregoing papers, the motion of defendant Executive Valet Services, Inc. for summary judgment dismissing so much of plaintiff's complaint as seeks damages for the loss of her automobile and the loss of certain personal property allegedly left therein, and dismissing the cross claims pleaded against it, is granted in part, and denied, in part, as hereinafter provided; plaintiff's cross motion for summary judgment as against defendants Executive Valet Services, Inc., Allstate Insurance Company and Thomas Kowalski on the issue of liability is granted, in part, and denied, in part, as hereinafter provided; the complaint as against defendant Thomas Kowalski is severed and dismissed.
Christopher Dai, Esq., for plaintiff.
Executive Valet: Charles J. Siegel, Esq., for defendant.
O'Donnell McLaughlin, Esqs., for defendant Allstate.
This is an action for monetary damages allegedly arising out of the theft of plaintiff's 1994 Mercedes on December 31, 1998, from the parking lot of a nightclub known as CYLO, owned by defendant FX Enterprises I, Ltd. and located on Arthur Kill Road in Staten Island, New York. In addition to the cost of her Mercedes, plaintiff seeks, inter alia, monetary damages for the loss of certain items of personal property (i.e., a cell phone, Macintosh laptop computer, perfume gift set and three shirts) that were allegedly present in the vehicle at the time of the theft.
On the night of the occurrence, defendant Executive Valet Services, Inc. ("Executive Valet") was providing valet services to the patrons of CYLO.Plaintiff claims that she valeted her automobile with one of Executive Valet's attendants prior to entering the nightclub and was issued a receipt. The valet attendant parked her vehicle and retained the keys. When plaintiff attempted to retrieve her Mercedes, the valet attendant informed her that her vehicle had been given to a person who claimed to be her friend.
Plaintiff immediately reported the theft to the police and to her automobile insurer, defendant Allstate Insurance Co. ("Allstate"), which assigned her a claim number for the loss. In an envelope postmarked January 2, 1999, plaintiff received an undated letter from Allstate entitled "Policy Change Notice" and "Amended Auto Policy Declarations" advising her of the temporary suspension of her collision and comprehensive coverage effective as of December 6, 1998, and the resulting decrease in her premium. Plaintiff 's claim for the loss of her vehicle was subsequently denied for lack of comprehensive coverage. Allstate purportedly suspended plaintiff's collision and comprehensive coverage due to her failure to submit her vehicle for a photo inspection.
Plaintiff claims that she was never advised in writing or otherwise of the mandatory photo inspection requirement or that her failure to comply would result in a suspension of her comprehensive coverage. Defendant Thomas Kowalski, the broker who obtained the subject Allstate policy for plaintiff and issued a temporary insurance card for the vehicle effective November 30, 1998, maintains that he verbally informed plaintiff of the photo inspection requirement and that he included certain documents related to the photo inspection (i.e., a "Vehicle Inspection Authorization" document and list of official inspection sites) in a packet of forms that he had given to another individual in his office to deliver to plaintiff when she came in to place the deposit on the policy. This individual, who was an employee of another agent in Kowalski's office, was deposed and has no recollection of meeting plaintiff or giving any documents to her.
Defendant Executive Valet maintains that plaintiff's vehicle was released to an unidentified individual by one of its employees, who also remains unidentified. According to the deposition testimony of this defendant's president, he was told by the valet captain that one of the attendants gave the Mercedes to the "owner's friend" who "wanted the car to***get [the owner and her companion] away from the scene, because they were *** causing a disturbance". Executive Valet has norecords or reports of this incident.
In moving for summary judgment dismissing so much of plaintiff's complaint as alleges the loss of her automobile and seeks to recover its cost, defendant Executive Valet maintains that since the vehicle was recovered, plaintiff has sustained no loss and no triable issue as to damages exists. The Court disagrees and finds, to the contrary, that even though the vehicle was recovered in November of 2002, questions of fact clearly exist as to its present condition and market value as compared to that at the time of its theft. In this regard, the auto appraiser's unauthenticated photographs and unsworn report that "[t]here is no physical damage to this car anywhere" are legally insufficient to support summary judgment, and are contradicted on this record by the Affirmation in Opposition of plaintiff's attorney (dated August 12, 2002) relative to his physical inspection of the vehicle in March of 2003.
As for the further branch of defendant Executive Valet's motion which is for summary judgment dismissing plaintiff's claim for the loss of certain personal property allegedly left in the vehicle at the time of the theft, there is no evidence before the Court that the presence of plaintiff's personal items was disclosed to defendant's employees, or that they had any knowledge of the items that had been left in the vehicle.
It has been held in like circumstances that defendant's acceptance of plaintiff's automobile for parking did not, in and of itself, create a bailment with regard to any personal property left in the automobile in the absence of notice of the same ( see, Liggett v. Glen Oaks Club, Inc., Misc, 28 NYS2d 84 [App Term 1st Dept. 1941], aff'd, 263 AD 702 [1st Dept. 1941]; Swarth v. Barney's Clothes, Inc., 40 Misc 2d 423, 424 [App Term 1st Dept. 1963]; General Motors Acceptance Corp. v. Grafinger, 61 Misc 2d 670 [Civ. Ct. NY Co. 1969]). Accordingly, Executive Valet owed no duty to protect any undisclosed personal items left in plaintiff's vehicle and, therefore, it cannot be held liable, as bailee, for their loss. Under these circumstances, this defendant is entitled to summary judgment dismissing so much of the complaint as seeks damages for the loss of any personal property left in the automobile.
In cross-moving for summary judgment on the issue of liability against Executive Valet, plaintiff maintains that her vehicle was stolen while in the possession, control and custody of this defendant, and that liability on its part is therefore "obvious and incontrovertible".
It is well established that in an action against a bailee, "[proof of] the demand . . . and [a] refusal to deliver . . . are treated . . . as prima facie evidence of negligence; but if . . . it appears that the goods have been lost by theft, the evidence must show that the loss arose from the negligence of the [defendant]" ( Claflin v. Meyer, 75 NY 260, 264).
In the instant matter, it is the Court's opinion that plaintiff has met her burden of establishing negligence or lack of reasonable care on the part of this defendant from the undisputed evidence that plaintiff's Mercedes had been placed in Executive Valet's possession, and that its employees had thereafter released the vehicle to an unidentified individual who did not return and the vehicle remained missing until November of 2002 ( see, Allstate Ins. Co. v. Quik Park Garage Grenadier Parking Co., 299 AD2d 163 [1st Dept. 2002]). In view of these facts, it was incumbent upon Executive Valet to come forward with proof in admissible form to explain the loss or raise a triable issue of fact with respect thereto ( see, Claflin v Meyer, supra at 264), and in this regard, the explanation proffered by Executive Valet was legally insufficient ( see, Damast v. New Concepts in Jewelry Ltd., 86 AD2d 886 [2nd Dept.], app discontinued, 56 NY2d 807), being predicated in its entirety upon the deposition testimony of its president, which was, in turn, based solely upon an alleged conversation between himself and the valet captain, whose allegations concerning the incident were based upon information related to him by another employee whose identity remains unknown. Accordingly, plaintiff is entitled to partial summary judgment on the issue of liability regarding the loss of the vehicle as against Executive Valet.
In cross-moving for summary judgment as against Allstate on the issue of liability, plaintiff maintains that this defendant (1) failed to give her proper notice of the photo inspection requirement, (2) failed to provide her with a list of inspection sites and (3) failed to send her a timely written notice of the amended policy declarations. Plaintiff further maintains that Allstate's notice of policy change was statutorily defective in failing to set forth the specific reasons for the alteration in the policy, and that the ensuing denial of coverage for the loss of her vehicle must therefore be deemed a nullity.
The seminal question presented on this branch of the cross motion is whether triable issues of fact exist regarding Allstate's compliance with the standards for the suspension of coverage pursuant to which it seeks to avoid liability for the loss sustained prior to the inspection of plaintiff's vehicle ( see 11 NYCRR 67.6). Pertinent in this regard is that both Insurance Law § 3411 and the regulations promulgated thereunder ( 11 NYCRR part 67) prohibit the issuance of an automobile insurance policy providing coverage for physical damage to an automobile unless the insurer has conducted an inspection of the vehicle ( 11 NYCRR 67.2[a]). The regulations applicable to such inspections provide, inter alia, as follows:
[U]nless the inspection and the inspection report form are completed immediately upon the request for coverage, an insurer shall either immediately confirm physical damage coverage and remind the insured of the inspection requirement on a prescribed confirmation letter or immediately obtain the prescribed acknowledgment signed by the insured (applicant). Insurers must use the prescribed CONFIRMATION OF PHYSICAL DAMAGE COVERAGE-NOTICE OF MANDATORY PHOTO INSPECTION REQUIREMENT letter (NYS APD form B), with a copy thereof to the producer of record, or the prescribed ACKNOWLEDGMENT OF REQUIREMENT
FOR PHOTO INSPECTION (NYS APD form D), contained in section 67.11 of this Part. A copy of this notice (form B) addressed to the insured, and Certificate of Mailing thereof, or the completed acknowledgment (form D) shall be retained by the insurer in the insured's policy record. The insurer shall, at the time coverage is effected, furnish the insured with an inspection site where the inspection can be conducted during the five-calendar-day period.
The location of an inspection site or sites and the consequences of the insured's failure to obtain a timely inspection shall be furnished immediately to the insured either in person or by telephone. Documentation of such verbal notice, including the name of the person giving the notice and the identity of the site(s) provided must be contained in the insured's policy record. (11NYCRR 67.4[c][1])
In consonance with these regulations, the courts have held that there is a "strict obligation" upon an insurer that an inspection be made ( see, Mella v. State Farm Insurance Co., 270 AD2d 318 [2nd Dept. 2000]; Valachovic v. Lumbermen's Mutual Casualty Co., 105 Misc 2d 577, 580 [Sup. Ct. Broome Co. 1980], aff'd 84 AD2d 879 [3rd Dept. 1981]), and that it is not the duty of the insured to inquire or take action about an inspection until the insurer makes him aware of the need to inspect and provides a list of authorized inspection sites ( see, Tiner v. Executive Insurance Co., 124 Misc 2d 527 [Rockland Co. Ct. 1984], aff'd, 129 Misc 2d 1089 [App Term 9th and 10th Jud Dist. 1985]).
In the instant matter, although there is conflicting deposition testimony from plaintiff and her broker, defendant Kowalski, as to whether he verbally informed her of the necessity for a photo inspection and/or the consequences for failing to have her vehicle inspected, even assuming, arguendo, that oral notice of some kind was given by defendant's agent, no evidence has been proffered to establish that Allstate fulfilled its "strict obligation" of adherence to the other requirements of 11 NYCRR 67.4(c))(1). Under these circumstances, no triable issue of fact has been raised and plaintiff is entitled to the entry of partial summary judgment against Allstate notwithstanding her failure to comply with the photo inspection requirement ( 11 NYCRR 67.6[c]; see, Mella v. State Farm Insurance Co., supra; Siddiqui v. Nationwide Mutual Insurance Co., 255 AD2d 30, 33 [3rd Dept. 1999]; Govan v. Motor Insurance Corp./CIM Insurance, 167 Misc 2d 733, 736 [App Term 2nd Dept. 1996]).
Here, in opposition to plaintiff's summary judgment motion, Allstate relies solely upon (1) an undated "Policy Change Notice" which, according to Allstate's attorney, was sent to plaintiff along with a notification of suspension of collision and/or comprehensive coverage in an envelope postmarked subsequent to the date of loss, and (2) a "Notice of Suspension of Physical Damage Coverage" dated December 30, 1998 purporting to suspend said coverage retroactively as of December 6, 1998. Allstate further contends, but without citation of authority, that "the physical damage coverage never took effect" since plaintiff failed to "initiate the coverage" by complying with the mandatory photo inspection.
However, it is the opinion of this Court that Allstate's arguments are unavailing in the absence of any proof of mailing of the prescribed form confirming its suspension of physical damage coverage in accordance with 11 NYCRR 67.6(b) and Insurance Law § 3425(h). In any event, Allstate's purported notice of suspension must be deemed a nullity where, as here, there is no evidence that this defendant insurer has adhered to the requirements of 11 NYCRR part 67 relating to the proper notification of the mandatory photo inspection requirement ( see 11 NYCRR 67.6[c]; Insurance Law § 3411[m][2]; Mella v. State Farm Insurance Co., supra).
In cross-moving for summary judgment as against the insurance broker, Thomas Kowalski, plaintiff relies solely upon this defendant's alleged failure to (1) advise her of the required photo inspection and (2) provide her with a list of inspection sites. In this regard, it is axiomatic that although an insurance agent has a common-law duty to obtain the requested coverage, the agent generally does not have a continuing duty to advise, guide or direct a client based on a special relationship of trust and confidence ( see, Murphy v. Kuhn, 90 NY2d 266, 273; accord, Chase Scientific Research, Inc. v. NIA Group, Inc., 96 NY2d 20, 30). Furthermore, insofar as it appears, the statutory duty to inform an insured of the mandatory photo inspection requirement has been imposed solely upon the insurance carrier and not the agent (Insurance Law § 3411; 11 NYCRR part 67; Mella v. State Farm Insurance Co., supra; Tiner v. Executive Insurance Co., supra at 529).
Consistent with the foregoing, inasmuch as it is undisputed that the defendant broker obtained for plaintiff a policy effective November 30, 1998 with the desired comprehensive coverage, including loss due to theft, and that plaintiff was issued a temporary insurance card upon the payment of the required deposit, in the absence of any evidence that plaintiff had entered into a special relationship with the broker such that he assumed or acquired any duties toward her in addition to those fixed at common law ( see, Shenorock Shore Club, Inc. v. Rollin Agency, Inc., 270 AD2d 330, 331 [2nd Dept. 2000]; The Manes Organization, Inc. v. Meadowbrook-Richman, Inc., AD2d, 2003 WL 22967238 [1st Dept.]; Busker on the Roof Ltd. Partnership Co. v. Warrington, 283 AD2d 376, 377 [1st Dept. 2001]), the broker may not be held liable for Allstate's suspension of physical damage coverage for plaintiff's vehicle. Nor may this defendant be held liable under a malpractice theory, as insurance brokers and agents have not been deemed to be professionals ( see, Chase Scientific Research, Inc. v. NIA Group, Inc., supra at 30; Santiago v. 1370 Broadway Associates, L.P., 96 NY2d 765, 766; The Manes Organization, Inc. v. Meadowbrook-Richman, Inc., supra).
Accordingly, plaintiff's cross motion for summary judgment as against defendant Kowalski must be denied and the complaint as against him dismissed ( see CPLR 3212 [b]).
Therefore, it is
ORDERED, that the motion of defendant Executive Valet for summary judgment is granted to the extent of severing and dismissing so much of the complaint and any cross claims as are predicated upon the alleged loss of personal property left in plaintiff's vehicle at the time of the loss; and it is further
ORDERED, that the balance of defendant Executive Valet's motion is denied; and it is further
ORDERED, that so much of plaintiff's cross motion as is for summary judgment against defendant Thomas Kowalski on the issue of liability is denied; and it is further
ORDERED, that the complaint as against defendant Thomas Kowalski is hereby severed and dismissed; and it is further
ORDERED, that the further branch of plaintiff's cross motion which is for summary judgment against defendant Executive Valet on the issue of liability is granted as to the cause(s) of action predicated on the loss of the vehicle, and is otherwise denied; and it is further
ORDERED, that so much of plaintiff's cross motion as is for summary judgment against defendant Allstate on the issue of liability is granted in its entirety; and it is further
ORDERED, that the Clerk shall enter judgment accordingly.