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GONZALSKI v. PRUDENTIAL INSURANCE COMPANY OF AMERICA

March 22, 2004.

ROBERT C. GONZALSKI, Plaintiff,
v.
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA and LESTER D. PRICE,[fn1] Defendants



The opinion of the court was delivered by: FREDERICK SCULLIN, Chief Judge, District Page 2

*fn1 Defendant Lester D. Price has been deceased for more than twenty years. Thus, Rule 25 of the Federal Rules of Civil Procedure does not apply, and, therefore, the Court dismisses Plaintiff's claims against Defendant Price for lack of jurisdiction. See Fed.R.Civ.P. 25(a).

MEMORANDUM-DECISION AND ORDER

  I. INTRODUCTION

  Plaintiff Robert Gonzalski commenced this action against Defendants Prudential Insurance Company of America (hereinafter "Prudential" or "the Company") and Lester Price on June 5, 2002, alleging state law claims of fraud, breach of contract and negligence.*fn2

  II. BACKGROUND*fn3

  Plaintiff held three life insurance policies with Defendant Prudential, which were purchased on March 15, 1959 ("1959 policy"), September 11, 1963 ("1963 policy") and February 16, 1967 ("1967 policy"), respectively.

  On May 27, 1979, and after an unsuccessful attempt to borrow money on his life insurance policies, Plaintiff wrote to Defendant Prudential stating his dissatisfaction with the Company and that he was unable to borrow money from his policies. Defendant Prudential responded in a July 3, 1979 letter, stating that two of Plaintiff's policies had already lapsed for nonpayment of premiums but that they could be reinstated.

  Plaintiff did not again contact Defendant Prudential regarding the matter, however, until July 15, 1996, when he wrote a letter in which he stated that he cancelled his three existing Page 3 policies after Defendant's agent convinced him to purchase a new policy for $50,000.00 at an annual premium of $292.00. In addition, Plaintiff stated that he later found out that the premium price for the $ 50,000.00 policy was actually $1,099.00 per year and that no new $ 50,000.00 policy was ever put into place for him. Defendant Prudential responded to the concerns outlined in Plaintiff's July 15, 1996 letter on August 20, 1996, and sent Plaintiff a proposal whereby it agreed either to issue Plaintiff a new $50,000.00 life insurance policy for $292.00 a year or to issue Plaintiff a $30,000.00 life insurance policy with no payment of premiums in settlement of Plaintiff's complaints. Plaintiff did not inform Defendant Prudential that its offer was unacceptable, however, until August 13, 1997, approximately one year later.*fn4 On June 23, 1998, Plaintiff contacted Defendant Prudential, requesting copies of the $30,000.00 and $50,000.00 policies referenced in the August 20, 1996 proposal. Defendant Prudential stated, in a letter dated July 1, 1998, that, since Plaintiff had not accepted its proposal, despite numerous opportunities and extensions to do so, the offer was withdrawn and the file closed. Plaintiff then commenced the instant lawsuit on June 5, 2002, approximately four years later.

  Presently before the Court is Defendant Prudential's motion for summary judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure. Page 4

  III. DISCUSSION*fn5

  Defendant asserts that Plaintiff's claims for breach of contract, fraud and negligence are time-barred under their respective statute-of-limitations periods.*fn6 Plaintiff, on the other hand, Page 5 argues that, since there was continual communication between the parties and reliance on the part of Plaintiff, the statute-of-limitations periods are tolled and, therefore, his claims are not time-barred.

 A. Plaintiff's Breach of Contract Claim

  Plaintiff purports to allege a breach of contract claim against Defendant, claiming that Defendant's agent's actions amounted to a breach of contract. Specifically, Plaintiff alleges that Defendant's agent induced him to replace his three existing life insurance policies with a new $50,000.00 policy for an annual premium of $292.00.*fn7 Moreover, Plaintiff contends that Defendant altered the premium for the $50,000.00 policy to $1,099.00 and that no new $50,000.00 policy was ever put into place at the agreed-upon premium price of $292.00.

  Thus, based upon these allegations, the Court finds that Plaintiff's claim is more properly designated as a breach of contract in the inducement claim. In order to establish a cause of action for inducing a breach of contract, there must be (1) a valid contract between the plaintiff and the other contracting party; (2) the defendant's knowledge of that contract; (3) the defendant's intentional and improper procurement of the breach of that contact; and (4) damages. See Forty Exchange Co. v. Cohen, 125 Misc.2d 475, 481-82 (Civil Ct. N.Y. County 1984) (citations omitted). Since a breach of contract in the inducement cause of action is ...


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