MaGee v. Paul Revere Life Ins. Co.

• Decision Date: 17 February 1997
• Docket Number: CV 95-4574 (ADS).
• Parties: Robert C. MaGEE, Plaintiff, v. The PAUL REVERE LIFE INSURANCE COMPANY, Defendant.
• Court: U.S. District Court — Eastern District of New York

954 F.Supp. 582

Robert C. MaGEE, Plaintiff, v. The PAUL REVERE LIFE INSURANCE COMPANY, Defendant.

CV 95-4574 (ADS).

United States District Court, E.D. New York.

February 17, 1997.

Westermann & Tryon, by Michael D. Tryon, Leslie C. Flynn, Garden City, NY, for Plaintiff.

Windels, Marx, Davies & Ives, by Thomas Mulligan, New York City, for Defendant.

MEMORANDUM OF DECISION AND ORDER

SPATT, District Judge:

This diversity action arises from the claims of the plaintiff, Robert C. MaGee ("MaGee" or the "plaintiff"), against the defendant, The Paul Revere Life Insurance Company ("Paul Revere" or the "defendant"), as the result of the parties' dispute as to whether the plaintiff is entitled to certain disability insurance benefits. MaGee alleges that as a result of Paul Revere's decision to deny him benefits, he is entitled to damages for breach of contract, violation of New York General Business Law § 349, anticipatory breach, breach of a waiver of premiums clause, intentional infliction of emotional distress and prima facie tort. MaGee seeks compensatory and punitive damages and a declaration that he is entitled to benefits. Presently before the Court is the defendant's motion to dismiss the General Business Law, anticipatory breach and the tort claims pursuant to Fed. R.Civ.P. 12(b)(6) and to strike the prayer for punitive damages.

I. Background

The following facts are taken from the complaint. The plaintiff, Robert C. MaGee, is resident of Garden City, New York. The defendant, The Paul Revere Life Insurance Company is Massachusetts corporation authorized to do business in the State of New York.

From October 1, 1988 until January 13, 1992, MaGee was employed as the President and Chief Executive Officer of Lane Office Equipment, a "furniture company" in Manhattan. On November 7, 1988, the defendant issued to MaGee "Disability Income Insurance Policy, No. 0102368238" (the "policy") which provides for lifetime disability payments in the event the plaintiff suffers a "total disability in his occupation." According to the complaint, the term "total disability" is defined as an "inability to perform the important duties of his occupation as President and Chief Executive Officer of a wholesale furniture company located in New York City." The policy provides for a monthly payment of $6,250 in the event the plaintiff suffers a total disability. The policy also obligates MaGee to pay annual premiums in the amount of $4,220.64 for all periods during which he is not disabled. The plaintiff alleges that he has paid the required premiums at all relevant times.

On January 16, 1992, MaGee experienced "a major depressive episode." As a result, he was hospitalized at Mercy Medical Center until January 27, 1992. Although the complaint does not specify a starting date, MaGee apparently began receiving benefits under the terms of the policy at this time. During this period, the plaintiff was treated by Loretta Lodico, M.D for "extreme depression." After his release from the hospital, MaGee continued treatment with Dr. Stephen B. Rashkin, a psychologist, who apparently continues to treat the plaintiff "on a regular basis."

According to Dr. Rashkin's medical reports, MaGee's depression is the result of job related stress and "a severe accident where the automobile in which MaGee and his family were travelling rolled over several times." The complaint describes MaGee as suffering from "classic symptoms of depression, including hopelessness, feelings of inadequacy, agitation, dysphoria, and hypersomnia."

In October 1992, the plaintiff experienced a "second depressive episode." As a result, he was hospitalized from October 16, 1992 until November 3, 1992 at South Oaks Hospital where he was treated by Eugenio Tassy, M.D. for "depression." Dr. Tassy remains the plaintiff's treating psychiatrist.

According to the plaintiff, the defendant's unlawful conduct, which interfered with the plaintiff's treatment, began in August 1992, when

an agent of Paul Revere wrote a letter to Dr. Rashkin, MaGee's treating psychologist, with the intent to interfere in the physician [sic] patient relationship and to induce Dr. Rashkin to change his opinion. In that letter, Paul Revere intentionally, improperly and maliciously misrepresented facts concerning MaGee's claim and made disparaging remarks impugning MaGee's reputation.

In July 1994, at the request of the defendant, the plaintiff met with James L. Maher Jr., M.D., a consulting psychiatrist employed by Paul Revere. MaGee alleges, upon information and belief, that Dr. Maher subsequently contacted Jerome L. Missel, M.D., a Boston psychiatrist "to obtain additional information about MaGee in an attempt to reach a medical opinion favorable to Paul Revere." Dr. Missel's relationship to MaGee, if any, is not specified. In any event, the plaintiff alleges that in early 1995,

... Dr. Missel maliciously and intentionally interfered with MaGee's treatment and his relationship with his treating professionals by directly contacting MaGee's treating physicians, Drs. Tassy and Rashkin, with the intent to influence their opinions. In addition, Dr. Missel misrepresented, among other things, the substance of settlement negotiations entered into between MaGee and Paul Revere.

[] Dr. Missel's improper contact with Drs. Tassy and Rashkin was followed by memoranda from Dr. Missel to Drs. Tassy and Rashkin. In each case, the memorandum misrepresented the statements of MaGee's treating professionals in their prior interviews with Dr. Missel. Each memorandum attributed statements and opinions to MaGee's treating professional which were both untrue and unfavorable to MaGee.

On July 20, 1995, the plaintiff met with Robert Lloyd Goldstein, M.D., a consulting psychiatrist employed by Paul Revere who conducted an examination "lasting about 45 minutes." According to the complaint, on August 24, 1995, based on Dr. Goldstein's report, the defendant determined that no further benefits would be paid under the policy and no benefits have been paid since that date.

On November 7, 1995, the plaintiff commenced this action. On December 18, 1995, the defendant served its answer. By stipulation dated February 7, 1996, the parties consented to the filing of an amended complaint alleging the following causes of action based on the events set forth above: (1) breach of contract; (2) anticipatory breach; (3) breach of waiver of premiums clause; (4) declaratory judgment; (5) violation of New York General Business Law § 349; (6) intentional infliction of emotional distress; and (7) prima facie tort.

Paul Revere moves pursuant to Fed. R.Civ.P. 12(b)(6) to dismiss for failure to state a claim, the causes of action for anticipatory breach, violation of the General Business Law, intentional infliction of emotional distress and prima facie tort and to strike the plaintiff's prayer for punitive damages. The plaintiff opposes the motion arguing that he has set forth sufficient allegations to support his claims.

II. Discussion

A. Rule 12(b)(6) standard

A complaint is to be dismissed under Fed. R.Civ.P. 12(b)(6) for failure to state a claim, if it "appears beyond doubt that the plaintiff can prove no set of facts in support of his claim that would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 102, 2 L.Ed.2d 80 (1957); accord Gagliardi v. Village of Pawling, 18 F.3d 188, 191 (2d Cir.1994); Allen v. West-Point-Pepperell, Inc., 945 F.2d 40, 44 (2d Cir.1991). In addition, such a motion is addressed solely to the face of a pleading, and "[t]he court's function ... is not to weigh the evidence that might be presented at a trial but merely to determine whether the complaint itself is legally sufficient." Goldman v. Belden, 754 F.2d 1059, 1067 (2d Cir.1985).

In assessing the sufficiency of a pleading on a motion to dismiss, "all factual allegations in the complaint must be taken as true," La Bounty v. Adler, 933 F.2d 121, 123 (2d Cir. 1991), and all reasonable inferences must be construed in favor of the plaintiff. Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 1686, 40 L.Ed.2d 90 (1974); Bankers Trust Co. v. Rhoades, 859 F.2d 1096, 1099 (2d Cir.1988), cert. denied sub nom., Soifer v. Bankers Trust Co., 490 U.S. 1007, 109 S.Ct. 1642, 104 L.Ed.2d 158 (1989).

The Court is also mindful that under the modern rules of pleading, the plaintiff need only aver "a short and plain statement showing that the pleader is entitled to relief," Fed.R.Civ.P. 8(a)(2), and that "[a]ll pleadings shall be so construed as to do substantial justice." Fed.R.Civ.P. 8(f).

B. The anticipatory breach cause of action

Paul Revere moves to dismiss MaGee's claim for anticipatory breach which is based on the defendant's alleged "demonstra[tion] that it does not intend to resume payment of the disability benefits due MaGee at anytime in the future." An anticipatory breach occurs when a party disclaims the duty to perform under a contract prior to the time designated for its performance and before it has received all consideration due. O'Shanter Resources, Inc. v. Niagara Mohawk Power Corp., 915 F.Supp. 560, 567 (W.D.N.Y.1996), citing, Wester v. Casein Co. of Am., 206 N.Y. 506, 513-14, 100 N.E. 488 (1912). There must be a clear manifestation of intent communicated in advance of the time for performance that when the time arrives, performance will not be rendered. Id. (internal citations omitted).

In the absence of special circumstances "New York does not apply the doctrine of anticipatory breach where there is an alleged repudiation of an executory contract for the payment of money only." Romar v. Alli, 120 A.D.2d 420, 501 N.Y.S.2d 877, 878 (1st Dep't 1986). As the Second Department recognized in Apostolou v. Mutual of Omaha Ins. Co., 72 A.D.2d 781, 421 N.Y.S.2d 600 (2d Dep't 1979):

Even assuming that an action based upon an anticipatory breach of an accident and health insurance policy could be maintained in New York, a requisite...