National Union Fire Insurance v. Erazo

187 Misc. 2d 194, 721 N.Y.S.2d 720, 2001 N.Y. Misc. LEXIS 30
CourtCivil Court of the City of New York
DecidedJanuary 19, 2001
StatusPublished
Cited by1 cases

This text of 187 Misc. 2d 194 (National Union Fire Insurance v. Erazo) is published on Counsel Stack Legal Research, covering Civil Court of the City of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
National Union Fire Insurance v. Erazo, 187 Misc. 2d 194, 721 N.Y.S.2d 720, 2001 N.Y. Misc. LEXIS 30 (N.Y. Super. Ct. 2001).

Opinion

OPINION OF THE COURT

Paul G. Feinman, J.

The defendant’s motion to dismiss1 the complaint is denied.

[195]*195CPLR 213-b was enacted in 1992 as part of a comprehensive legislative package to enhance the rights of crime victims after the original “Son of Sam” Law was ruled unconstitutional. 2 On this motion, the court is called upon to answer what appears to be a question of first impression: whether an insurance company which has paid its insured for defalcations by a dishonest employee qualifies as a “crime victim” or “representative of a crime victim” within the meaning of this CPLR provision. As is more fully discussed below, the court answers this question in the affirmative, and therefore plaintiff may rely on the seven-year Statute of Limitations of CPLR 213-b, rather than the three-year Statute of Limitations ordinarily applicable to claims sounding in conversion. However, because the court is unable to determine the date plaintiff’s cause of action accrued, the motion is held in abeyance pending further submissions from the parties consistent with this decision.

Procedural and Factual History

Plaintiff is an insurance company which issued a policy to Memorial Sloan Kettering Hospital covering losses arising out of employee infidelity. Defendant is a former employee of the insured hospital. It is undisputed that at some point prior to 1995 defendant stole approximately $100,000 from the plaintiff’s insured, the hospital.

Annexed as an exhibit to plaintiff’s affidavit in opposition is a copy of the court action sheet from defendant’s guilty plea in Supreme Court, New York County, Criminal Term. That matter, captioned People v Erazo, was prosecuted by superior court information, rather than by indictment, thus requiring the defendant’s consent and written waiver. The court does not have before it a copy of the underlying superior court information, and the accompanying written waiver of indictment, nor of the underlying Criminal Court felony complaint filed prior to the matter’s transfer to the Supreme Court. These documents would, of course, be helpful in making a determination of how [196]*196much defendant admitted stealing, and when the theft occurred.

The action sheet reveals that defendant was arraigned and pleaded guilty in Supreme Court on October 13, 1995 on a superior court information charging him with grand larceny in the fourth degree, in violation of Penal Law § 155.30 (1). On November 21, 1995, defendant was sentenced to five years’ probation. As a condition of probation, defendant was ordered to pay restitution to the plaintiffs insured in the amount of $100,000. Defendant paid $50,000 of the restitution immediately upon sentencing. The repayment terms for the balance of the restitution are not set forth on the court action sheet. As the actual restitution order designating the New York City Department of Probation as the agency to collect restitution is not before this court, it is unclear whether the $100,000 figure was meant to include the statutory 5% surcharge that is imposed when restitution is ordered through the Department of Probation. (See, Penal Law § 60.27.)

Plaintiff alleges that after defendant made the initial $50,000 payment on the date of sentencing, defendant failed to make any other payments whatsoever. The Supreme Court action sheet farther indicates that on September 24, 1998 the defendant was “restored to probation.” Although this would imply that at some point the defendant was brought back before the sentencing Judge for an alleged violation of the terms and conditions of his probation, in the absence of a copy of the written specifications filed by the Department of Probation, or a transcript of any such proceedings, this court can only speculate as to whether the failure to comply with the restitution order was the basis for a declaration of delinquency having been filed. Also, in the absence of more information, the court cannot ascertain whether defendant is still on probation, because it is unclear whether his sentence was effectively tolled during the period his alleged delinquency was adjudicated. (See, Penal Law § 65.15 [2].)

In. the civil summons and complaint filed in the Supreme Court, Civil Term, in June 1999, and subsequently transferred to this court pursuant to CPLR 325 (d), plaintiff alleges that its insured, the hospital, made a claim for the loss arising out of defendant’s defalcation. The complaint alleges that, after calculating its insured’s actual damages at $102,638.53, and reducing that sum by the $25,000 deductible and the $50,000 already repaid by defendant, plaintiff paid out $26,638.53 to its [197]*197insured.3 Plaintiff, rather than suing as subrogee, alleges in October 1997 it took “a full assignment of all the rights of action held by Memorial Sloan Kettering against defendant herein including any and all rights under defendant’s restitution agreement.” (Complaint 11.) The complaint, filed in June 1999, seeks $50,000, on the ground that defendant’s failure “to honor his plea agreement has resulted in his ‘unjust enrichment.’ ” (Complaint 14.)

Parties’ Contentions

Defendant seeks dismissal on the ground that the action is barred by the Statute of Limitations. In so doing,.he characterizes the plaintiff’s cause of action as sounding in conversion, and relies on the three-year Statute of Limitations set forth in CPLR 214.

Plaintiff argues that the relevant Statute of Limitations is the seven-year period for a “crime victim” or a “representative of a crime victim” set forth in CPLR 213-b. This statute specifically defines “representative” by reference to the simultaneously re-enacted Executive Law § 621 (6).3 4 It does not, however, define “crime victim.” Plaintiff contends that it meets the definition of “representative” because it received an assignment of the hospital’s rights to restitution, and its action is therefore timely.5

Analysis

As an initial matter, the court must determine whether plaintiff is entitled to invoke the benefit of the longer Statute of Limitations set forth in CPLR 213-b. It has been observed that,

“ ‘[c]rime victim’ is not defined in the statute, but presumably the intent was to include the victim of any type of crime. The title of the section refers generally to the ‘victim of a criminal offense’ and the text provides that the civil action may be brought against a defendant convicted of ‘a crime’ [198]*198and ‘for any injury or loss resulting therefrom.’ Thus, § 213-b apparently embraces both felonies and misdemeanors and applies to case of financial harm (e.g., larceny, criminal fraud) as well as physical injuries and property damage. ‘Representative of a crime victim’ is specifically defined by cross-reference to § 621(6) of the Executive Law” (Alexander, Practice Commentaries, McKinney’s Cons Laws of NY, Book 7B, CPLR 213-b, 2001 Pocket Part, at 208).

Thus, the statute should apply if the plaintiff, an insurance company, can be considered as “crime victim” or “representative of a crime victim.”

Plaintiff’s contention that it meets the definition of a “representative of a crime victim” is premised on its being an “assignee” of its insured’s right to restitution.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Pitt v. Feagles
2021 NY Slip Op 07299 (Appellate Division of the Supreme Court of New York, 2021)

Cite This Page — Counsel Stack

Bluebook (online)
187 Misc. 2d 194, 721 N.Y.S.2d 720, 2001 N.Y. Misc. LEXIS 30, Counsel Stack Legal Research, https://law.counselstack.com/opinion/national-union-fire-insurance-v-erazo-nycivct-2001.