After nine successful years, Bowitch & Coffey is closing its doors. Starting August 1, 2021, Gary Bowitch and Dan Coffey will be practicing law in their own law firms and will continue to provide clients with the same high quality legal services in their areas of expertise. Their new contact information is:
Gary S. Bowitch
Attorney at Law
13 Willow Street
Castleton, NY 12033
Phone: 518-527-2232
Email: gbowitch@bowitchlaw.com
Bowitch Law New Website
Daniel Coffey
Coffey Law PLLC
17 Elk Street
Albany, NY 12207
Phone: 518-813-9500
Email: Dan@coffeylawny.com
Coffey Law New Website
Recovering from the General Contractor for Negligence of a Subcontractor
The rule in New York is that “Generally, a party who retains an independent contractor, as distinguished from a mere employee or servant, is not liable for the independent contractor’s negligent acts.” [1] However, fortunately for the subrogation practitioner in New York, there are many exceptions to this general rule, as we will see in a moment.
Insured Not Entitled to Sue for “Loss of Resale Value” of Repaired Auto
At the end of a subrogation trial, the judge instructs the jury that the subrogating carrier is entitled to the lesser of: (a) the cost to repair, or (b) the loss in market value of property damaged in a loss. [1] The value of property at the time of a loss is known as its “actual cash value” or ACV. The ACV is typically calculated by estimating the cost to replace the item, then subtracting depreciation. Many times the insured is paid an extra amount (replacement cost, or “RC”) if they actually rebuild their house or replace contents. However, RC payments are typically not recoverable in subrogation. Whereas ACV payments restore the insured to the condition he/she was in just prior to the loss, RC payments actually put the insured in a better condition than they had been in. For example, suppose a fire destroys my eight-year old television. At the time of the fire, my TV was only worth $100. Because my policy has RC coverage, I buy a nice, new flat-screen TV valued at $800. My life is actually better because I have a brand new TV, not an eight-year old one. If my carrier pursues subrogation, the carrier can only seek to recover the $100 ACV value of the TV, not the $800 replacement cost.
Court Rules on Venue in a Subrogation Action
The word “venue” refers to the location (county) in which a lawsuit will be heard and in which the trial will occur (if it proceeds all the way to trial). The plaintiff (i.e., the one filing the lawsuit) initially chooses the venue when he/she files a “Summons and Complaint” with the court clerk at one of New York’s 62 counties. The venue chosen must be “proper” and the defendant (i.e., the one responding to the lawsuit) can object if she/he feels the plaintiff did not file the lawsuit in the correct county – or if the county chosen is not convenient to the witnesses. Generally, the venue is based on the “residency” of the plaintiff or the defendant. If the plaintiff is a corporation – such as a subrogating insurance company – and the defendant “resides” in a county different than the plaintiff, the issue of which venue if most appropriate gets a bit more complicated, as demonstrated by a New York City judge earlier this month.
More Articles...
- NYS Legislature Passes Legislation Limiting Health Insurer Subrogation
- Carrier Permitted to Consolidate its APIP Subrogation Action With its Insured's Personal Injury Action
- Expert File Material May Have To Be Disclosed if Note Properly Protected
- New York Cannot Extinguish Medicare Provider’s Subrogation Lien
- Subrogating Under a “Bailment” Theory
