STANLEY JONAS, ET AL. v. NATIONAL LIFE INS. CO., ET AL., No. 651733/2013, 2017 NY Slip Op 01438 Appellate Division, First Department (February 23, 2017)

The Appellate Division, First Department, ruled in favor of the Firm’s client, an insurance broker, and affirmed dismissal of the breach of fiduciary duty, breach of contract, and fraud claims made by the Plaintiffs for failure to state a claim. The Plaintiffs filed suit in New York Supreme Court, New York County, alleging that the broker made oral misrepresentations about the nature and extent of coverage provided by the disability insurance policy they purchased from Certain Underwriters at Lloyd’s of London through an excess lines broker. The trial court initially dismissed all but the breach of fiduciary duty claim against the broker for failure to state a claim, then after a motion to reargue it issued a second order dismissing that claim as untimely under the statute of limitations. Plaintiffs appealed and argued, inter alia, that the trial court had incorrectly dismissed their breach of fiduciary duty and contract claims against the broker because he referred them to the excess lines broker and assisted in filling out the disability insurance application. The Appellate Division, First Department rejected the Plaintiffs’ arguments and held that the broker had discharged his common law duty to the Plaintiffs when he advised them that he was unable to procure the disability coverage Plaintiffs had requested and referred them to an excess lines broker that could. The Appellate Division, First Department therefore modified the trial court’s first decision to dismiss the Plaintiffs’ breach of fiduciary duty claim for failure to state a claim, and otherwise affirmed dismissal of all other claims against the broker.

For inquiries about this case, please contact partner Barry R. Temkin or associate Kate E. DiGeronimo.