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Leavitt, Kerson & Duane v. American Guarantee and Liability Ins. Co.

Other Lower Courts

December 10, 2007

Leavitt, Kerson Duane, et al., Plaintiffs,
v.
American Guarantee and Liability Insurance Company, et al., Defendants.

Editorial Note:

This case is not published in a printed volume and its disposition appears in a table in the reporter.

COUNSEL

Plaintiff's Attorney: Jonathan Silver, Esq.

Defendant's Attorney for Maria Urena: Schwartz Ponterio PLLC.

Defendant's Attorney for American Guarantee: Steinberg Cavaliere, LLP, Kevin F. Cavaliere, Esq.

OPINION

Patricia P. Satterfield, J.

In this action for declaratory judgment plaintiffs Leavitt, Kerson Duane, Koppell; Leavitt, Kerson Duane LLP; Koppell, Leavitt, Kerson, Leffler Duane, LLP (collectively "plaintiff law firm"); Paul E. Kerson, John F. Duane, and Marc C. Leavitt, seek an order granting partial summary judgment and declaring that defendant American Guarantee and Liability Insurance Company (American Guarantee) has a duty to defend and indemnify plaintiffs in the underlying legal malpractice action entitled, Urena v. Leavitt, Kerson Duane, and to reimburse them for attorney's fees, costs and disbursements incurred to date and to be incurred in the future in the underlying action. American Guarantee cross-moves for an order granting summary judgment and declaring that it has no duty to defend and indemnify the plaintiffs in the underlying action, dismissing the complaint, and awarding it costs and disbursements incurred in the defense of this action.

Maria Urena, a defendant herein, and plaintiff in the underlying action, underwent surgery at Kings County Hospital in Brooklyn to remove a mass in her ovaries on July 23, 1994. Ms. Urena continued to experience pain, and alleges that she repeatedly sought medical attention. In November 2004, she had another operation at Kings County Hospital, in order to remove a sponge that had been left in her body. Ms. Urena was last examined at Kings County Hospital on November 24, 2003. Ms. Urena originally retained Jesus J. Pena to represent her, but was dissatisfied with him, and on April 30, 2004, she received a letter from Mr. Pena stating that he would no longer pursue her case.

Ms. Urena retained plaintiff law firm on May 6, 2004 to represent her in a medical malpractice claim against the New York City Health and Hospitals Corporation (the "HHC") and its physicians at Kings County Hospital. On October 6, 2004, plaintiffs sent a summons and complaint to Ms. Urena at her Florida address, for her signature. Plaintiff law firm thereafter purchased an index number on November 13, 2004 and commenced an against solely against the HHC, which served an answer in December 2004.

In a letter dated December 7, 2004, the Corporation Counsel's Early Settlement Unit requested that plaintiff law firm, Ms. Urena's counsel, produce all medical and hospital records, and other enumerated documents, including "any other item(s) pertinent to an early resolution of your case." John F. Duane, a plaintiff herein, and a defendant in the underlying action, responded some ten months later by sending the Corporation Counsel's Medical Malpractice Unit a letter dated September 7, 2005, along with a copy of the verified bill of particulars and response to the combined discovery demand. On November 2, 2005, plaintiff law firm, on behalf of Ms. Urena, served a motion for leave to serve a late notice of claim; for leave to serve a supplemental summons and complaint; and to compel the HHC to provide Ms. Urena with the names of the physicians who performed the surgery in 1994. Said motion was filed with the court on November 7, 2005. The HHC cross-moved to dismiss the complaint based upon the failure to serve a notice of claim. These motions were fully submitted on February 14, 2006, and on April 12, 2006, the Hon. David Elliot granted the cross-motion to dismiss the complaint on the grounds that a timely notice of claim was not filed, a condition precedent to suit, and Ms. Urena failed to timely move for leave to file a late notice of claim. The court determined that the applicable statute of limitations expired on November 24, 2004, and that as the motion for leave to file a late notice of claim was not made until November 2, 2005, which was well beyond the period of limitations, the court lacked jurisdiction to extend the time in which to file a late notice of claim. The court also stated that as the statute of limitations had expired, Ms. Urena was not entitled to commence a separate action against the individual doctors who were employees of the HHC. Finally, the court found that Ms. Urena's request to toll the statute of limitations was without merit. The Appellate Division in an order dated December 6, 2006, affirmed Judge Elliot's order, and further determined that Ms. Urena's contention that the HHC should have been equitably estopped from asserting the statute of limitations as a bar to her application for leave to serve a late notice of claim was without merit ( Urena v. New York City Health and Hospitals Corp., 35 A.D.3d 446 [2006]).

On February 28, 2007, Ms. Urena commenced an action for legal malpractice in the United States District Court, Southern District of New York, entitled Maria Urena v Leavitt, Kerson Duane, Koppell, Leavitt, Kerson Duane LLP, Koppell, Leavitt, Kerson, Leffler Duane, LLP, Paul E. Kerson, John F. Duane, Marc C. Leavitt and Jesus J. Pena.

Defendant American Guarantee issued a Lawyers Professional Liability Insurance Policy to Leavitt, Kerson Duane, with a policy period of January 12, 2007 to January 12, 2008. On March 15, 2007, Mr. Kerson, on behalf of himself and the insured law firm, informed American Guarantee of Ms. Urena's federal court action. American Guarantee, in a letter dated April 19, 2007, stated that it would not provide a defense or indemnify the insureds in Ms. Urena's federal court action, on the grounds that the insureds failed to provide notice of a potential claim, pursuant to the terms of the policy. American Guarantee specifically stated that:

"your attention is drawn to the section of the Policy entitled "CONDITIONS ", which states in pertinent part as follows: B. NOTICE ...


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