James E. Freligh II, Appellant,v.Government Employees Insurance Company, Respondent.BriefN.Y.December 7, 2017BASCH & KEEGAN UPEli B. BaschMaureen A. Keegan Derek J. SpadaJohn A. DeGasperis PERSONAL INJURY ATTORNEYS 307 Clinton Avenue j P.O. Box 4235 | Kingston, New York 12402 Tel. (845} 338-8884 • www.BaschKeegan.com • Fax: (845) 338-2268 September 8, 2017 State of New York Court of Appeals 20 Eagle Street Albany, New York 12207 Re: Freligh v. Government Employees Insurance Company APL-2017-00151 Dear Justices of the Court: This letter is submitted on behalf of the Appellant, James E. Freligh, III, seeking a reversal of the Memorandum and Order of the Appellate Division, Third Department, which reversed the Supreme Court’s decision and dismissed this action. This appeal has been brought based upon two justices in the Appellate Division dissenting from the majority opinion. We respectfully request that the Appellate Division’s decision be reversed because there are questions of fact regarding credibility, as well as issues of fact regarding whether Mr. Freligh’s future lost earnings could be reasonably projected. FACTS In December of 2012, Mr. Freligh had been unemployed for several months and was seeking employment. (R. at 411). Mr. Freligh has experience in automotive work and applied for a job at VW Parts, Inc., which is located in Fleischmanns, New York. (R. at 411). The company was owned by William Hrazanek. (R. at 411). On December 15, 2012, Mr. Freligh was offered a job by Mr. Hrazanek at VW Parts with a salary of $2,000 per week plus benefits. (R. at 411). l Significantly, Mr, Hrazanek wrote the terms of employment on Mr, Freligh’s job application. (R. at 46). Mr. Hrazanek wrote that Mr. Freligh was “seeking position that is open for parts specialist and warehouse manager. He meets all requirements and will start 1/1/13.” (R. at 46). Mr. Hrazanek wrote that Mr. Freligh’s start time was 8:00 a.m. and his salary was $2,000.00 per week. (R. at 46). This document was signed by Mr. Hrazanek on 12/15/12. (R. at 46). Mr. Freligh was elated by the job offer and accepted it prior to the collision. (R. at 411). Unfortunately, eight days after accepting the job offer and nine days prior to his start date, Mr. Freligh was severely injured in an automobile collision that occurred on December 23, 2012. (R. at 411). As such, he was rendered disabled and unable to work at VW Parts. (R. at 412). In December of 2012, VW Parts, Inc., was one of the largest dealers of Volkswagen and Audi parts in the countiy. (R. at 411). The company had tens of thousands of parts labeled and warehoused, as well as about 1,500 to 2,000 intact cars waiting to have parts stripped, labeled and warehoused. (R. at 411). Mr. Freligh worked at automotive parts dealerships for approximately 26 years. (R. at 411). He began working when at the age of 17 at Shokan Coach Works, which at the time was the largest dealer of used Audi parts in the world. (R. at 411). Mr. Hrazanek’s business was similar to Shokan Coach Works, except that he sold both Volkswagen parts and Audi parts. (R. at 411-12). Due to Mr. Freligh’s extensive experience with Audi and Volkswagen parts, his job at VW Parts was going to consist of dismantling and warehousing of parts. (R. at 412). He has knowledge about which parts fit which vehicles and which parts are interchangeable between different vehicles. (R. at 412). This was valuable to a business such as VW Parts because Mr. Freligh’s knowledge and experience would facilitate the sale of vehicle parts. (R. at 412). Respondent Government Employees Insurance Company (“GEICO”) emphasized that VW Parts was ultimately an unsuccessful business and was eventually sold. (R. at 412). However, Mr. Freligh believes that if he had been hired to work at this company, his expertise in Audi and Volkswagen parts would have helped the business to remain profitable. (R. at 412). Furthermore, while the date is not 2 www.BaschKeegan.com precisely clear, VW Parts was not sold until sometime in 2014, which was long after Mr. Freligh’s scheduled date to begin work. (R. at 412). In any event, Mr. Freligh was prevented from beginning work at VW Parts due to his injuries from the collision. (R. at 412). Moreover, Mr. Freligh was prevented from seeking alternative work due to his injuries. (R. at 412). If Mr. Freligh began working at VW Parts and the company became insolvent, he would have sought and obtained other employment. (R. at 412). However, due to his injuries from the collision, he was prevented from returning to work in any capacity. (R. at 412). Furthermore, Mr. Hrazanek did not sell VW Parts, Inc., until 2014. (R. at 412). The company continued to sell parts up until it was sold in 2014. (R. at 412). As such, if he was not injured in the collision, Mr. Freligh it is reasonably calculable that he would have remained employed at VW Parts until at least 2014, which was more than one year after his anticipated start date of employment. (R. at 412). Additionally, the individual who purchased VW Parts may very well have retained Mr. Freligh as an employee at the business. (R. at 412). Notably, Mr. Freligh was acquainted with the purchaser of VW Parts prior to the December 23, 2012 collision due to his experience in automotive parts. (R. at 412). Respondent GEICO claimed that it does not have to pay or deny Mr. Freligh’s lost wages because it never received an NF-6 form from Mr. Hrazanek or anyone at VW Parts. (R. at 413). However, Mr. Hrazanek testified at a deposition that Appellant never requested an NF-6 form from him. (R. at 138-39; 413). Furthermore, Appellant also sent an investigator to meet with Mr. Hrazanek. (R. at 413). Appellant obtained whatever information it could possibly need from Mr. Hrazanek through questioning at his deposition and through documentary evidence that was submitted by VW Parts to Appellant, most of which was attached to Appellant’s motion. (R. at 413). In fact, Appellant conducted two depositions of Mr. Hrazanek. (R. at 91-153; 342-93). Finally, in the event that Mr. Freligh’s job with VW Parts did not work out, he would have sought and obtained other employment. (R. at 413). Respondent avers that Mr. Freligh’s lost wage claim is speculative. (R. at 413). However, Respondent’s allegations are premised upon speculation, meaning that 3 www.BaschKeegan.com Respondent is speculating that Mr. Freligh’s employment would not have worked out and that he would have never found alternative employment in the event that it did not work out. (R. at 413). Mr. Freligh’s injuries from the 12/23/12 collision continue to plague him. (R. at 413). He remains totally disabled and unable to return to work due to his injuries. (R. at 413). Deposition testimony of William Hrazanek: Mr. Hrazanek testified that he is the owner of VW Parts, which is also known as VWP, Inc. (R. at 100). VW Parts dismantled Volkswagens and Audis and then stored and sold the parts. (R. at 102-04). As a result of Hurricane Irene, some vehicles owned by VW Parts were destroyed and washed downstream. (R. at 112-14). However, the inventory at one location was fully intact and not affected by the flood. (R. at 113-14). Mr. Hrazanek knew Mr. Freligh for about 15 years prior to hiring him. (R. at 130). Mr. Hrazanek wanted to hire Mr. Freligh because he “needed to expand the business and get back on track after the flood and [Mr. Freligh] was the person that [Mr. Hrazanek] felt was able to do that.” (R. at 131). At his first deposition, Mr. Hrazanek was shown Mr. Freligh’s application for employment, which was filled out on December 15, 2012. (R. at 134). Mr. Freligh was supposed to start work on “the first of the year.” (R. at 134). Mr. Hrazanek wrote on the application that Mr. Freligh’s salary would be $2,000.00 per week. (R. at 135). Mr. Hrazanek then signed the application. (R. at 46). The salary of $2,000 per week was arrived at because Mr. Hrazanek had plans to open a repair shop. (R. at 135). Also, Mr. Freligh worked at numerous Audi dealers and attended many automotive schools. (R. at 135). Mr. Hrazanek was “basing [his company’s] future on James [Freligh] actually,” and the future of his company was compromised because Mr. Freligh was unable to work due to his injuries from the collision. (R. at 135). 4 www.BaschKeegan.com Appellant’s counsel showed Mr. Hrazanek an NF-6 form and asked if he was ever asked to complete this document. (R. at 138-39). Mr. Hrazanek did not believe that he was ever asked to complete that form. (R. at 138-39). Mr. Hrazanek was subsequently re-deposed. (R. at 342). At his second deposition, Mr. Hrazanek again confirmed that he hired Mr. Freligh to assist in opening a repair shop at his premises. (R. at 342). Significantly, Mr. Hrazanek explained the difference between VW Parts, Inc. and VWF, Inc., which were two companies that he owned. (R. at 380-81). VWP, Inc. was a holding company for the property where VW Parts, Inc. operated its business, (R. at 380-81). VWP, Inc., had nothing to do with operating the company. (R. at 380-81). When Mr. Hrazanek filed bankruptcy, he filed for VWP, Inc. (R. at 380-81). There is no indication that he filed bankruptcy for VW Parts, Inc., which was the business that hired Mr. Freligh shortly before the collision. (R. at 380-81). Thus, Mr. Freligh’s employer did not file for bankruptcy. Nonetheless, companies that file for bankruptcy often continue to operate. The purpose of the VWP bankruptcy was to hold the mortgage holder at bay, thereby pennitting Mr. Freligh’s employer, VW Parts, to continue operating. (R. at 380-81). Deposition of Respondent’s Adjuster: Aderonke Adeshelia testified on behalf of Respondent. (R. at 61). She had no involvement whatsoever in Mr. Freligh’s claim prior to her deposition. (R. at 68- 69). She only became involved in Mr. Freligh’s claim for her deposition. (R. at 69). Ms. Adesheila’s testimony was not based on any firsthand knowledge, but rather was premised on a conversation with another adjuster and her review of some documents. (R. at 70; 72-78). Procedural History: The summons and complaint were filed on May 9, 2014. (R. at 24). Respondent answered on June 27, 2014. (R. at 28). Discovery has been completed. Summary Judgment Motion: 5 www.BaschKeegan.com Respondent submitted a summary judgment motion claiming that Mr. Freligh’s lost earnings were not “reasonably projected,” despite the fact that he received a written job offer with a definitive salary and start date, and accepted the offer prior to being injured in the subject collision. (R. at 46; 411-12). Respondent overlooked the fact that there was an employment relationship established prior to the collision based upon the job offer and acceptance, but that performance of the agreement could not occur due to the injuries that Mr. Freligh sustained in the collision. Additionally, Respondent sought summary judgment based on its claim that it did not receive a completed NF-6 form from Mr. Freligh’s employer. (R. at 12-13). However, Mr. Hrazanek did not recall ever receiving any such form and Respondent did not submit evidence from anyone with firsthand knowledge of this matter that the form was actually sent to Mr. Freligh’s employer. Moreover, Respondent received ample evidence, both in the form of documentation and testimony, to verify Mr. Freligh’s employment status. (R. at 33-35; 41-60; 88- 394). Supreme Court’s Decision: Supreme Court recited the facts and claims made by the parties. (R. at 4-6). Thereafter, Supreme Court held that there was conflicting testimony, which raised issues of fact that could not be resolved on a summary judgment motion. (R. at 6). In reaching its decision, Supreme Court may have erred in finding the existence of conflicting testimony. In actuality, Respondent failed to submit any testimony that conflicts with Mr. Freligh’s and Mr. Hrazanek’s testimony. Rather, Respondent’s attorney submitted arguments that could raise issues of credibility. Even considering the documentary evidence and hearsay submitted by Respondent, there are triable questions of fact based on the testimony of Mr. Freligh and Mr. Hrazanek. After Supreme Court denied summary judgment, Respondent appealed to the Appellate Division. 6 www.BaschKeegan.com Appellate Division’s Decision: The Appellate Division issued a 3-2 split decision. The majority reversed the Supreme Court’s decision and dismissed the action. There are multiple issues with the majority’s opinion that warrant reinstatement of this action. Firstly, by dismissing the entire action, the majority implicitly assumed that Mr. Freligh would have never worked at VW Parts, or anywhere else, had he not been injured in the collision. To the contrary, there is ample evidence that Mr. Freligh would have begun working on January 1, 2013. Thus, his earnings for the week following January 1, 2013 are reasonably calculable. As time progresses, more variables come into play, as with any future lost earnings claim. Any future lost earnings claim becomes less certain when looking progressively further into the future. However, future lost earnings claims are not rendered entirely speculative based on potential variables, but rather are left for a factfinder to determine when there is evidence that future employment would occur. Disconcertingly, the majority viewed Mr. Freiigh’s future lost earnings claim as being entirely speculative by dismissing the complaint. Contrary to the majority’s view, there are issues of fact regarding whether Mr. Freligh would have begun working on January 1, 2013, and for how long thereafter he would have remained employed by VW Parts. These are absolute questions of fact, which should not and cannot be resolved on a summary judgment motion. Secondly, the majority engaged in making creditability determinations. The majority initially stated that it credited Mr. Hrazanek’s claims, but then undermined and rejected his credibility in the ensuing four paragraphs of the decision. The majority also questioned and rejected Mr. Freiigh’s ability to run a successful business because his last business venture was unsuccessful. As the dissenting Justices aptly stated, there are issues of fact regarding whether Mr. Freligh had a legitimate job offer and whether his future lost earnings were in fact reasonably projected. 7 www.BaschKeegan.com The dissent reiterated that the basic concept that the facts and evidence must be viewed in the light most favorable to the non-moving party on a summary judgment motion. When doing so in this case, the dissent found questions of fact as to whether Mr. Freligh “indeed had a bona fide position with the parts business effective January 1, 2013 and, further, whether plaintiff would have been able to begin work at the stated salary, but for the intervening motor vehicle accident.” The dissent relied on several significant factors, including that Mr. Hrazanek was basing the future of his business upon Mr. Freligh’s expertise, that Mr. Freligh had extensive experience and knowledge about automotive parts and Audis in particular, and that Mr. Freligh would have been well-suited to facilitate the operation of Mr. Hrazanke’s automotive parts business. The dissent noted that VW Parts eventually ceased operations and was ultimately sold, which was a “salient fact that cuts both ways.” The ultimate failure of this business lends credence to Mr. Hrazanek’s claim that the entire future of his overall business hinged upon hiring someone with Mr. Freligh’s particular demonstrated skill set. Thus, there are questions of fact regarding whether VW Parts would have remained solvent and continued to conduct business had Mr. Hrazanek been able to hire Mr. Freligh, in light of his vast knowledge and expertise in Audi and Volkswagen parts. The dissent viewed this as another issue that should be left to a factfinder to resolve. Furthermore, the dissent was not persuaded that the ultimate “fire sale” of VW Parts “somehow bears upon whether Hrazanek could have met [Mr. Freligh’s] promised salary had their business relationship gone forward.” Accordingly, the eventual sale of the business is not necessarily indicative of Mr. Hrazanek’s ability to pay Mr. Freligh’s agreed upon salary, had he been able to begin working at VW Parts. This is yet another issue of fact that the dissent believed should be resolved by a jury. In conclusion, the dissent found that there is ample evidence in the Record, particularly when viewed in the light most favorable to the plaintiff and avoiding making creditability determinations, to raise issues of fact regarding whether Mr. Freligh’s future lost earnings were reasonably projected. 8 www.BaschKeegan.com ARGUMENT “No-fault reform was enacted to provide prompt uncontested, first-party insurance benefits. That is part of the price paid to eliminate common-law contested lawsuits ... The tradeoff of the no-fault reform still allows carriers to contest ill-founded, illegitimate and fraudulent claims, but within a strict, short-leashed contestable period and process designed to avoid prejudice and red-tape dilatory practices.” Viviane Etienne Med. Care, P.C. v. Country'-Wide Ins. Co.. 25 N.Y.3d 498, 507 (2015) (referencing Presbyterian Hosp. v. Maryland Cas. Co.. 90 N.Y.2d 274, 285 (1997); Hosp. for Joint Diseases v. Travelers Prop. Cas. Ins. Co.. 9 N.Y.3d 312 (2007)). By failing to pay Mr. Freligh’s claim, which was made more than four years ago, Appellant has deliberately circumvented one of the primary statutory purposes of “providing] no-fault claimants with opportunity for immediate redress N.Y. Ins. Law § 5106, note 1) (referencing Roggio v. Nationwide Mut. Ins. Co.. 66 N.Y.2d 260 (1985)); see also Hosp. for Joint Diseases. 5 A.D.3d at 442 (emphasis added). Pursuant to both the Insurance Law and the regulations promulgated by the Superintendent of Insurance, an insurer is required to either pay or deny a claim for no-fault automobile insurance benefits within 30 days from the date an applicant supplies proof of claim. See Ins. Law § 5106(a); 11 NYCRR 65.15 (g)(3). Failure to pay benefits within the 30-day requirement renders benefits “overdue,” and all overdue payments bear interest at a rate of 2% per month. See Ins. Law § 5106(a); 11 NYCRR 65.15(h). Additionally, a claimant is entitled to recover attorney’s fees where a “valid claim or portion” was denied or overdue. See InsJLaw § 5106(a); 11 NYCRR 65.15(i). Presbyterian Hosp.. 90 N.Y.2d at 285. “[T]he designated interest rate is designed to inflict an economic sanction or penalty on those insurers who do not comply” with Insurance Law § 5106(a) and 11 NYCRR 65.15(h)(1). Cardinell v. Allstate Ins. Co.. 302 A.D.2d 772, 774 (3d Dep’t 2003) (referencing Dermatossian v. New York City Transit Auth.. 67 N.Y.2d 219, 224 (1986); Aetna Casualty & Surety Co. v. Whitestone General Hosp., 142 Misc. 2d 67, 71 (Sup. Ct. N.Y. County 1988)). “Said differently, the statute and regulation ‘are punitive, with severe penalties, to encourage prompt 9 www.BaschKeegan.com adjustments of claims.’” Id. (referencing Barnes v. Maryland Casualty Co.. 124 Misc. 2d 942, 944 (Civil Court, Kings County 1984)); see also LMK Psychological Servs.. P.C. v. State Farm Mut. Auto. Ins. Co.. 46 A.D.3d 1290, 1292 (3d Dep’t 2009). Rather than promptly paying Mr. Freligh’s claim, Respondent denied the existence of valid evidence and uncontroverted testimony, and refused to compensate Mr. Freligh for any of his lost earnings. THERE ARE QUESTIONS OF FACT REGARDING WHETHER MR. FRELIGH’S LOST EARNINGS WERE REASONABLY PROJECTED BASED UPON THE SPECIFIC JOB THAT WAS OFFERED AND ACCEPTED PRIOR TO THE AUTOMOBILE COLLISION. I. Insurance Law § 5102(2) provides that an injured party is entitled to “[l]oss of earnings from work which the person would have performed had he not been injured.” “[U]nder New York law, the calculation of damages cannot be based on “wholly speculative theories” but instead must be grounded in fact to a “reasonable certainty.” Flynn v. Allstate Indent, Co.. 22 Misc. 3d 1138(A) (City Ct. of Watertown, 2009) (referencing Lexington 360 Associates v. First Union National Bank of North Carolina. 234 A.D.2d 187 (1st Dep’t 1996). “It is not necessary, however, in a breach of contract case in New York to detennine damages with scientific precision to a complete certainty.” Id* (referencing Lexington Products Limited v. B.D. Communications. Inc.. 677 F.2d 251, 253 (2nd Cir.1982)). “Furthermore, under the long-standing New York rule, when the existence of damage is certain, and the only uncertainty is as to its amount, the plaintiff will not be denied recovery of substantial damages. Moreover, the burden of uncertainty as to the amount of damage is upon the wrongdoer ... “an estimate necessarily requires some improvisation, and the party who caused the loss may not insist on theoretical perfection.” Id. (referencing Contemporary Mission. Inc, v. Famous Music Core.. 557 F.2d 918, 926 (2d Cir. 1977); Entis v. Atl. Wire & Cable Corn.. 335 F.2d 759, 763 (2d Cir. 1964); Hirschfeld v. IC Sec.. Inc.. 132 A.D.2d 332, 336 (1st Dep’t 1987)). The case at bar is analogous to Orr v. Kiamesha Concord. Inc.. 167 A.D.2d 153 (1st Dep’t 1990), in which the plaintiff, “a voice-over recording artist, had 10 www.BaschKeegan.com auditioned, won the job, was promised a standard union contract and was already scheduled for her first recording session in connection with the anglicized version of the Japanese ‘Bumboo’ cartoon series when she suffered injury at defendant’s hotel, which allegedly caused her to lose the job.” The court held that the plaintiff was “able to demonstrate the existence of a ‘stable and ready market’ for her services, the performance of which was interrupted by the injury.” jd. In the case at bar, Mr. Freilgh was offered a job at VW Parts, and would have earned $2,000 per week if he had not been injured. While VW Parts was ultimately unsuccessful, Mr. Hrazanek testified that his company was basing its future on Mr. Freligh. (R. at 135). Thus, Mr. Freligh may have been able to keep the company afloat, even after portions of the business were flooded during Hurricane Irene. Additionally, the property owner, VWP, Inc., declared bankruptcy, while Mr. Freligh’s employer, VW Parts, Inc., did not. (R. at 380-81). In any event, even if his employer declared bankruptcy, that would not mean that the company would immediately close its door and lay off its employees. Companies that file for bankruptcy often continue to operate while restructuring. Significantly, even if the Court accepts Respndenf s speculative theory that Mr. Freligh would have lost his job at some point after he began working at VW Parts, he would have been eligible to collect unemployment benefits. Under such circumstances, Appellant would be obligated to pay Mr. Freligh at the rate of unemployment benefits that he would have been entitled to receive. See, e.g., State Fann Mut. Auto. Ins. Companies v. Brooks, 78 A.D.2d 456, 458 (4th Dep’t 1981). Stated differently, “[wjhere the injury renders an unemployed applicant ineligible to receive unemployment benefits, the applicant shall be entitled to receive payments for loss of earnings from work equivalent in value to the unemployment benefits which the applicant would otherwise have received.” 11 NYCRR 65.15(0)(2)(v). Moreover, in the event that Mr. Freligh lost his job with VW Parts, he would have sought other employment. However, his injuries from the 12/23/12 collision prevented him from doing so. li www.BaschKeegan.com Under any of the above scenarios, Mr. Freiigh would have earned income had he not been injured in the collision. At the very least, there are questions of fact about this issue that should be resolved by a jury. Respondent relied on the distinguishable case of Sharpe v. Allstate Ins. Co., 14 A.D.3d 774 (3d Dep’t 2005). In Sharpe, the plaintiff was not employed at the time of the collision, nor was there any indication that he had received any job offers while looking for employment before the collision. In the year after the collision, the plaintiff took an examination for entry into the State Police. He passed the examination, but sought deferment due to his injuries. The Court in Sharpe referenced 11 NYCRR 65-3.16(b)(3), which states that the “[l]oss of earnings from work shall not necessarily be limited to the applicant’s level of earnings at the time of the accident, but may also include demonstrated future earnings reasonably projected.” Id- at 788. The Court ultimately ruled in favor of the defendant because the requisite degree of certainty was lacking. The “[pjlaintiff s entry into the State Police Academy and its deferral as a result of the knee injury could not have been reasonably contemplated by either party at the time of the accident, rendering his claim entirely speculative.” Id. The distinguishing feature of the case at bar is that Mr. Freiigh was offered and accepted a job that had a certain salary and a specific starting date prior to the collision, but he was unable to begin working at this job due to his injuries from the collision. Thus, there is reasonable certainty with regard to Mr. Freiigh’s lost earnings. Specifically, he would have started working on January 1, 2013 and earned $2,000.00 per week. (R. at 41). The projected duration over which Mr. Freiigh would have earned $2,000.00 per week is a question of fact for a jury to resolve. Respondent also relied on State Farm Mut. Auto. Ins. Co. v. Stack. 55 A.D.3d 594 (2d Dep’t 2008), which contains sparse facts. The Court held that the plaintiff did not submit adequate documentation to show that “he was unable to maintain his real estate business and stock market portfolio in the manner to which he was accustomed.” Id- at 596. The Court did not offer much of an explanation in this regard. Additionally, Respondent cited Faas v. State. 249 A.D.2d 731, 733 (3d Dep’t 1998), where “the only evidence submitted in support of [the plaintiffs lost earnings] claim was claimant’s testimony regarding the limitations caused by his 12 www.BaschKeegan.com injury and the number of days missed from work; such testimony, unaccompanied as it was by any documentation such as pay stubs or tax returns, lacked sufficient detail to support an award for lost wages.” Here, unlike Faas, there is substantially more than Mr. Freligh’s testimony alone to substantiate his lost earnings claim. There was a job offer in writing with a description of job duties, a certain sum for a salary, an exact start date and time, testimony from the employer at two depositions that the job offer was real, and testimony from Mr. Freligh that he received and accepted the job offer prior to the collision. (R. at 43-46; 91-153; 154-215; 342-93; 411-13). A claimant should not be expected to submit more evidence than this to an insurance company to demonstrate their future lost earnings. In any event, the evidence raises questions of fact regarding whether Mr. Freligh’s future lost earnings are reasonably calculable. Contrary to Respondent’s assertions and the findings made by the majority in the Appellate Division, the evidence in the case at bar would “enable the jury to reach its verdict based not upon speculation, but upon the logical inferences to be drawn from the evidence.” Burgos v. Aqueduct Realty Coro.. 92 N.Y.2d 544, 550 (1998) (referencing Schneider v Kings Highway Hosp. Ctr., 67 N.Y.2d 743 (1986); Gayle v. City of New York. 92 N.Y.2d 936 (1998)); see also Costello v. Pizzeria Uno of Albany, Inc.. 139 A.D.3d 1336, 1338 (3d Dep’t 2016). Accordingly, a factfinder should be permitted to resolve this case. II. THIS ACTION SHOULD BE REINSTATED BECAUSE THERE ARE ISSUES OF CREDIBILITY, WHICH CANNOT BE RESOLVED ON A SUMMARY JUDGMENT MOTION. It is well-settled that “courts may not, for purposes of defendants' summary judgment motion, make credibility determinations and must view the evidence in plaintiffs favor.” Justinian Capital SPC v. WestLB AG. 28 N.Y.3d 160, 173-74 (2016); see also Friends of Thayer Lake LLC v. Brown. 27 N.Y.3d 1039, 1044 (2016). Stated differently, “it is beyond cavil that courts are not at liberty to make credibility determinations or weigh evidence on a summary judgment motion.” Aoki v. Aoki. 27 N.Y.3d 32, 45 (2016) (referencing Vega v. Restani Const. Corn.. 18 N.Y.3d 499 (2012); Forrest v. Jewish Guild for the Blind. 3 N.Y.3d 295 (2004); Bliss v. State. 95 N.Y.2d 911 (2000)). 13 www.BaschKeegan.com In the case at bar, as the dissent points out, the majority made credibility determinations regarding Mr. Hrazanek and Mr. Freligh. The majority initially reiterated that it could not make credibility determinations and would not do so, but then proceeded to undermine the credibility of Mr. Hrazanek and Mr. Freligh. The majority highlighted that Mr. Hrazanek “(1) had previously pleaded guilty to the crimes of insurance fraud and offering a false instrument, (2) he had made false sworn statements in regard to the bankruptcy proceeding of a corporation, (3) he had initiated that bankruptcy proceeding as a ‘ruse’ to forestall creditors and (4) he had paid his wife a salary from the parts business while she was a student at Columbia University for her ‘learning purposes.”’ The majority implicitly questioned “genuineness of Hrazanek’s offer of employment” and held “that it is unreasonable to project that, but for [Mr. Freligh’s] accident, the parts business would have actually employed plaintiff at a salary of $2,000 a week.” Mr. Hrazanek’s credibility is a relevant issue, but credibility determinations cannot be made in deciding a summary judgment motion. Furthermore, Mr. Freligh should not be penalized due to his employer’s credibility. The majority also recited that “the uncontested evidence established that plaintiff would not have had any automobile repair shop to run in January 2013 ... [and] Mr. “Hrazanek further acknowledged that he never opened such a repair shop.” The majority overlooked the fact that Mr. Freligh was hired to be a “parts specialist and warehouse manager.” (R. at 46). He was not initially hired to work at a nonexistent automotive repair shop, as the majority suggests. The majority also scrutinized Mr. Freligh’s last employment, which was owning an unsuccessful automotive repair shop and gas station. A past failed business venture is not indicative of failure in the future. In essence, the majority impermissibly concluded that Mr. Freligh would have had no future earnings, as a matter of law. While the factors cited by the majority bear on the reasonableness of Mr. Freligh’s projected future lost earnings, they do not extinguish his future lost earnings claim. Rather, these factors raise issues of fact about credibility and reasonableness. It is well-settled that these are issues for a factfinder to resolve. 14 www.BaschKeegan.com III. MR. FRELIGH’S LOST WAGE CLAIM WAS AMPLY VERIFIED BY APPELLANT, BOTH THROUGH DOCUMENTARY EVIDENCE AND TESTIMONY. The Appellate Division did not focus on this issue, but it was raised by Respondent in its summary judgment motion and appellate brief. “Where an insurer fails to pay or deny a claim within the requisite 30 days under the statute and regulations following its receipt of the proof of claim, the insurer is subject to ‘substantial consequences,’ namely, preclusion “from asserting a defense against payment of the claim.” Viviane Etienne Med. Care. P.C. v. Country-Wide Ins. Co.. 25 N.Y.3d 498, 506 (2015) (referencing Fair Price Med. Supply Corp. v. Travelers Indem. Co.. 10 N.Y.3d 556, 563 (2008)). “The only exception to preclusion recognized by this Court arises where an insurer raises lack of coverage as a defense.” Id. (referencing Fair Price Med. Supply Corp. 10 N.Y.3d at 563; Hospital for Joint Diseases v. Travelers Prop. Cas. Ins. Co.. 9 N.Y.3d 312, 318 (2007); Central Gen. Hosp. v. Chubb Group of Ins. Cos.. 90 N.Y.2d 195, 199 (1997)). “This Court has recognized that preclusion may require an insurer to pay a no-fault claim it might not have had to honor if it had timely denied the claim.” Id. (referencing Presbyterian Hosp.. 90 N.Y.2d at 285). “Nonetheless, we emphasized that the great convenience of ‘prompt uncontested, first-party insurance benefits’ is “part of the price paid to eliminate common-law contested lawsuits.” Id. (referencing Presbyterian Hosp.. 90 N.Y.2d at 28; Fair Price Med. Supply Corp. 10 N.Y.3d at 565-566). In the case at bar, Appellant has not issued a denial of Mr. Freligh’s no fault claim. Appellant requested additional verification and has long since received whatever information it could possibly need to evaluate Mr. Freligh’s claim. The only qualm that Appellant has with regard to the proof of claim aspect is that it did not receive a completed NF-6 form from Mr. Freligh’s employer. Appellant is untenably requesting that Mr. Freligh’s lost wage claim be dismissed simply because his employer did not complete a specific form, which the employer disputes ever receiving. (R. at 138-39; 413). Appellant has received ail of the information that would be contained on an NF-6 fonn through the various submissions that were made by Mr. Freligh and his counsel, and also through conducting two depositions of Mr. Hrazanek. The claim has been verified. 15 www.BaschKeegan.com Appellant received a no fault application from Mr. Freligh; received Mr. Freligh’s resume; obtained Mr. Freligh’s employment application for VW Parts; hired an investigator who contacted Mr. Hrazanek about Mr. Freligh’s employment; deposed Mr. Freligh once and Mr. Hrazanek twice; and obtained numerous additional documents that support Mr. Freligh’s claim. (R. at 32-37; 41-47; 50-60; 88-89; 91-397). As such, there has been more than substantial compliance with the defendant’s request. Appellant is not claiming that there is any additional information needed to verify Mr. Freligh’s claim. Rather, Appellant is alleging that Mr. Freligh’s claim is not ripe because the formality of submitting an NF-6 form was not followed, which is not a valid basis to refuse to pay a claim. 11 NYCRR 65-3.5(m) provides that “[t]he failure of an employer, or other third party, to provide information necessary to establish proof of claim for lost wages on behalf of an applicant shall not be utilized as a basis for denial of claim based upon late submission of proof of claim.” This regulation is designed to prevent insurers from denying claims based on an employer’s failure to submit requested forms or documents. While an insurer is not required to pay or deny a claim until it has been verified, Appellant has verified Mr. Freligh’s claim in a belabored and exhaustive manner. Furthermore, 11 NYCRR 65.15(e) mandates “At a minimum, if any requested verification has not been supplied to the insurer 30 calendar days after the original request, the insurer shall, within 10 calendar days, follow up with the party from whom the verification was originally requested, either by a telephone call, properly documented in the file, or by mail. At the same time the insurer shall inform the applicant and such person’s attorney of the reason(s) why the claim is delayed by identifying in writing the missing verification and the party from whom it was requested.” In the instant case, there is no evidence that Appellant met or attempted to meet these requirements. Appellant argues that its investigation “raised doubts” about Mr. Freligh’s claim. (Appellant’s Brief at 13). However, an insurance adjuster’s doubts about a claim will not entitle an insurance company to summary judgment. Rather, at most, there are credibility issues that cannot be resolved on a summary judgment motion. It is well-settled that “[i]t is not the court’s function on a motion for summary judgment 16 www.BaschKeegan.com to assess credibility.” Ferrante v. Am. Lung Ass’n, 90 N.Y.2d 623, 631 (1997); see also Friends of Thayer Lake LLC v. Brown. 27 N.Y.3d 1039, 1044 (2016); Aoki v. Aoki, 27 N.Y.3d 32, 45 (2016). Accordingly, Appellant’s summary judgment motion was properly denied. CONCLUSION “Summary judgment is the procedural equivalent of a trial.” England v. Vacri Const. Corn., 24 A.D.3d 1122, 1 124 (3d Dep’t 2005). “Issue finding, rather than issue determination, is the function of the court on a motion for summary judgment.” Patricia YY v. Albany County7 Dept, of Social Services. 238 A.D.2d 672, 673 (3d Dep’t 1997). Based on the foregoing, Mr. Freligh respectfully requests that the Court affirm the Decision and Order of the Supreme Court. Respectfully submitted, DEREK J. S/ADk BASCH & KEE(BAN, LLP Attorneys for Plaintiff 307 Clinton Avenue P.O. Box 4235 Kingston, New York 12402 (845)338-8884 Thuillez, Ford, Gold, Butler & Monroe, LLP Attorney for Respondent 20 Corporate Woods Boulevard Albany, New York 12211 (518) 455-9952 cc: 17 www.BaschKeegan.com