New York State Court of Claims

New York State Court of Claims

Holmes v. STATE OF NEW YORK, #2001-018-085, Claim No. 103495, Motion Nos. M-62944, CM-63008


Case Information

Claimant short name:
Footnote (claimant name) :

Footnote (defendant name) :

Third-party claimant(s):

Third-party defendant(s):

Claim number(s):
Motion number(s):
Cross-motion number(s):
Claimant's attorney:
Defendant's attorney:
Attorney General of the State of New York
By: JOEL L. MARMELSTEIN, ESQUIREAssistant Attorney General
Third-party defendant's attorney:

Signature date:
May 18, 2001

Official citation:

Appellate results:

See also (multicaptioned case)


Defendant brings a motion to dismiss the claim brought by Progressive Northeastern

Insurance Company (hereinafter Progressive). Claimant, Progressive, brings a cross-motion

seeking the dismissal of Defendant's motion, or in the alternative, permission to file a late claim,

or permission to intervene in the claim filed December 8, 2000 pursuant to CPLR 1012 and/or

1013. The Court has considered the following documents in determining these motions:

Notice of Motion ...................................................................................1

Affirmation of Joel L. Marmelstein, Assistant Attorney General in

Support, with all exhibits attached thereto ................................2

Notice of Cross-Motion..........................................................................3

Affirmation of Paul F. Iaconis, Esquire, in Opposition to Defendant's

Motion and in Support of Cross-Motion, with Exhibits A and

B attached thereto........................................................................4

Affirmation of Joel L. Marmelstein, Assistant Attorney General in

Opposition, with Exhibit A attached thereto...............................5 The claim seeks damages for the negligence of the State of New York as a result of the actions of the State Police in responding to a call regarding water running across New York State Route 365 in the Town of Vernon, near the intersection of Barrington Road, between 5:00 and 6:00 a.m., on December 13, 1998. Apparently a pipe had broken posing a danger to the traveling public. Allegedly the State Police placed two flares at the scene, notified the Oneida City Fire Department and then departed the location. Claimant, Amanda Holmes, (hereinafter Holmes) came upon the scene after the flares had burned out. Lacking any warning, Holmes' vehicle hydroplaned into a telephone pole and rolled over causing her to be injured. The claim also seeks reimbursement for the sum the insurer, Progressive, paid out to Holmes for the damage to her vehicle.

A notice of intention to file a claim was served upon the Attorney General on March 12, 1999. The notice of intention listed only Amanda Holmes as a party, Progressive was not named. The notice of intention described the injuries sustained by Holmes and the damage to her 1996 GMC Sport Utility Vehicle.

Defendant brings this motion to dismiss alleging that Progressive paid Holmes, pursuant to a collision insurance policy, the sum of $14,351.33 on December 28, 1998, representing the cost of the damage to her vehicle minus the $500 deductible. As a result of that payment, Claimant, subrogated her rights to seek reimbursement for the cost of the damages to her vehicle to Progressive. Since Holmes no longer had any right to seek reimbursement for her vehicle damage, except for the $500 deductible, she could not preserve Progressive's right to file a claim. Since Progressive failed to serve a notice of intention and/or serve and file a claim within 90 days of the date of accrual, its claim filed jointly with Holmes is untimely and must be dismissed.

The failure to serve a notice of intention or to file and serve a claim within 90 days of the date of accrual in accordance with Court of Claims Act Sections 10 and 11 is a fatal jurisdictional defect, requiring dismissal. (Byrne v State of New York, 104 AD2d 782 lv denied 64 NY2d 607) Yet, in opposition to the motion, Progressive's counsel asserts that since the insurer was subrogated and derives its rights from the insured, it "stands in [her] shoes" and can benefit from the actions of Holmes in serving a timely notice of intention. (Iaconis Affirmation ¶¶7 and 8)

Subrogation is an equitable doctrine designed to permit an insurer to seek reimbursement for the amount it has paid out according to contract from the individual or entity whose actions or inactions actually caused the damage. (See, Kaf-Kaf, Inc. v Rodless Decorations, Inc., 90 NY2d 654; Winkelmann v Excelsior Ins. Co., 85 NY2d 577) At the time that the insurer covers the loss, its subrogation right accrues. (Winkelmann v Excelsior Ins. Co., supra at 582) At that point, the insurer possesses the "derivative and limited rights of the insured and may proceed directly against the negligent third party to recoup the amount paid." (Winkelmann v Excelsior Ins. Co., supra at 582) "By subrogation a person acquires all the rights, securities, and remedies which were available to the person for whom he or she is substituted." (23 NY Jur 2d, Contribution, Indemnity & Subrogation, §128, p. 264) Subrogation, however is not a transfer of a cause of action. The cause of action still belongs to the insured, but having paid a part of the claim pursuant to the insurance contract, the insurer is entitled to pro tanto, stand in the place of the insured. (Liberty Mut. Fire Ins. Co. v Perricone, 54 AD2d 975)

In this case, Progressive paid out the loss on December 28, 1998, approximately two and a half months before Holmes served the notice of intention in her name alone. Progressive could have served a notice of intention or filed and served a claim in its own name seeking reimbursement for the amount it paid out, but it did not have to in order to preserve its rights to sue the State for reimbursement.

Even where the insured has been reimbursed in full for all damages, the CPLR 1004 specifically permits an action to be brought by the insured, although not the real party in interest. CPLR 1004 provides in pertinent part that, "...[an] insured person who has executed to his insurer either a loan or subrogation receipt, trust agreement or other similar agreement...may sue or be sued without joining with him the person for or against whose interest the action is brought." The purpose of the statute is to prevent the prejudicial effect of the jury learning that the loss was actually covered by insurance. (CNA Ins. Co. v Cacioppo Elec. Contractors, Inc., 206 AD2d 399; Point Tennis Co. v Irvin Industries, Corp., 63 AD2d 967) Although the reasoning behind the statute is not applicable to a claim in this Court, it remains that the insured may commence and maintain the action, despite having executed a subrogation agreement in favor of the insurer. There is simply no requirement, by statute or case law, that the insurer must bring the action in its own name, or be substituted as the named party once it has reimbursed the insured in full. (Cf., CNA Ins. Co. v Cacioppo Elec. Contractors, Inc., supra at 400; Agway Ins. Co. v Williamson, 162 AD2d 968; Point Tennis Co. v Irvin Industries, Corp., supra) Since the action could have been commenced in the name of the insured, the benefit of the insured serving a notice of intention can extend to the insurer as well. The insured set forth specifically in the notice of intention that she incurred damages to her vehicle, thereby placing the defendant on notice that a portion of the damages that would be sought were for the property damage. The purpose of the service and filing requirements of §10 of the Court of Claims Act is to provide notice of the claim intended to be filed, and an opportunity for the State to investigate to determine its potential liability under the circumstances. (Cannon v State of New York , 163 Misc 2d 623) Clearly, the State was placed on notice that a claim seeking reimbursement for the cost of damage to Holmes' vehicle was intended to be forthcoming.

Accordingly, Defendant's motion is DENIED, and Claimant's cross-motion is also DENIED as moot.

May 18, 2001
Syracuse, New York

Judge of the Court of Claims