McCarthy v. American Intern. Group, Inc.

• Decision Date: 12 March 2002
• Docket Number: Docket No. 01-7543.
• Parties: Thomas D. McCARTHY, Plaintiff-Appellant, v. AMERICAN INTERNATIONAL GROUP, INC., AIG Life Companies, American International Life Assurance Company of New York, AIG Life Insurance Company and American Centurion Life and Accident Assurance Company, Defendants-Appellees.
• Court: U.S. Court of Appeals — Second Circuit

Page 121

283 F.3d 121

Thomas D. McCARTHY, Plaintiff-Appellant, v. AMERICAN INTERNATIONAL GROUP, INC., AIG Life Companies, American International Life Assurance Company of New York, AIG Life Insurance Company and American Centurion Life and Accident Assurance Company, Defendants-Appellees.

Docket No. 01-7543.

United States Court of Appeals, Second Circuit.

Argued December 20, 2001.

Decided March 12, 2002.

John V. Henry (Susan Regan-Henry, Henry & Regan-Henry, White Plains, NY, of counsel), for Appellant.

Craig Stephen Brown, New York City (Ellen G. Margolis, Mound, Cotton, Wollan & Greengrass, New York City, of counsel), for Appellee.

Before MESKILL, KEARSE and CALABRESI, Circuit Judges.

MESKILL, Circuit Judge.

Plaintiff-appellant Thomas D. McCarthy (McCarthy) appeals from an order of the United States District Court for the Eastern District of New York, Johnson, J., granting defendant-appellee AIG Life Insurance Company's (AIG Life) motion for summary judgment. Jurisdiction is premised on diversity of citizenship pursuant to 28 U.S.C. § 1332(a)(1), McCarthy being a citizen of New York, AIG Life being a Delaware corporation and having its principal place of business in Delaware, and the claimed damages exceeding $75,000. We have appellate jurisdiction pursuant to 28 U.S.C. § 1291 as this is an appeal from a final judgment of the district court. The district court found that McCarthy's claim for breach of contract was based on a claim for insurance benefits related to an injury that occurred during a time period not covered by an insurance policy issued by AIG Life. In the alternative, the district court determined that even if the claim was related to an injury that occurred during a period covered by the policy, McCarthy failed to file a timely notice of claim with AIG Life.

We conclude that, under the terms of the policy, the date of injury to which McCarthy's notice of claim related, and whether that date fell within the period covered by the policy, is irrelevant to the determination of whether he filed a facially valid notice of claim. We also conclude that there exists a genuine issue of material fact as to whether McCarthy's claim was for a 1991 injury or a 1995 injury. We further conclude that there is a genuine issue of material fact as to whether McCarthy's notice of claim was timely. We therefore vacate the district court's order and remand the case for further proceedings.

BACKGROUND

McCarthy was employed by USAir as a utility man for its maintenance department at LaGuardia Airport. Through this employment, McCarthy entered into an insurance policy offered by AIG Life, the premiums for which were paid through payroll deductions. There is no dispute that McCarthy paid all relevant premiums. The policy coverage began in 1993.

In August 1991, McCarthy tripped and fell while at work, tearing cartilage in his left knee. In September 1991 he saw a physician and began physical therapy. Due to the limp he manifested from the knee injury, he developed back pains in early 1992. In April 1992, eight months after his knee injury, McCarthy underwent arthroscopic surgery on his knee. After returning to work he experienced very serious back pain that caused him to miss work on several occasions.

On April 17, 1995, McCarthy's back "gave out" while he was working. He has not returned to work since that date.

McCarthy sent to AIG Life a document entitled "Proof of Loss: Accidental Permanent Total Disability" (Proof of Loss Form), dated April 30, 1996. The separate sections of the form were completed by USAir, McCarthy, and McCarthy's physician. According to the directions on the Proof of Loss Form, USAir was required to fill out the portion of the form detailing the date of the accident and the date of the disability. USAir listed August 29, 1991 as the date of the accident and April 17, 1995 as the date of the disability.

On August 15, 1996, AIG Life denied McCarthy's claim, stating that because the injury for which he was seeking benefits occurred in 1991, and his coverage under their policy did not begin until 1993, he was not covered. On September 7, 1996, McCarthy wrote back, seeking reconsideration of his claim, stating that the 1991 injury was "unrelated to the accident of 4-17-95." In his letter he also asserted that "the current Insurance carrier has stated that the injury of 4-17-95 is ... new and unrelated to any previous condition." AIG Life reconsidered the claim and denied it, stating that "[o]ur evaluation and review of the documents reveal that you were injured while at work on April 17, 1995." But AIG Life further noted that McCarthy's doctor had concluded that McCarthy suffered from a "mild partial disability" and that the New York Worker's Compensation Board designated him "permanently partially disabled." Under the terms of his policy, he was not eligible for payment unless he was designated "permanently and totally disabled" by a physician. In neither letter did AIG Life state that McCarthy's notice of claim was untimely.

McCarthy initiated litigation for breach of contract against AIG Life and other defendants in New York Supreme Court, Queens County. After other defendants were dismissed from the case, AIG Life removed the case to the United States District Court for the Eastern District of New York. 28 U.S.C. §§ 1332(a)(1) (diversity jurisdiction), 1441(a) (defendant may remove state civil action to federal district court if federal district court has original jurisdiction over action). AIG Life then moved for summary judgment, asserting that McCarthy's claim was related to his 1991 injury and was thus outside the time period covered by the policy. But even if his claim was for his 1995 injury, AIG Life asserted that his notice of claim was untimely. The district court granted summary judgment to AIG Life on both independent grounds. First, it found that to the extent McCarthy's claim was for benefits arising out of a 1991 accident, his claim was not covered by AIG Life's policy, which did not go into effect until 1993. Second, the district court found that to the extent McCarthy's claim was for the 1995 accident, he was required to "notify AIG Life of his claim within 20 days after occurrence or commencement of any loss or [as] soon thereafter as is reasonably possible." The district court then concluded that McCarthy did not notify AIG Life of the 1995 accident until September 7, 1996, "16 months after it purportedly occurred. Moreover, [McCarthy] offered no excuse for the delay." The district court thus implicitly concluded that McCarthy was required to file notice within twenty days after his accident or injury and was required to notify AIG Life in his notice of claim of the date of the injury for which he was seeking benefits.

This appeal followed.

DISCUSSION

I. Standard of Review

"We review de novo the district court's grant of summary judgment, construing the evidence in the light most favorable to the nonmoving party." Giordano v. City of N.Y., 274 F.3d 740, 746 (2d Cir.2001) (citing Tenenbaum v. Williams, 193 F.3d 581, 593 (2d Cir.1999)). Summary judgment is appropriate if there are no genuine issues of material fact and the movant is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). "A dispute regarding a material fact is genuine `if the evidence is such that a reasonable jury could return a verdict for the non moving party.'" Lazard Freres & Co. v. Protective Life Ins. Co., 108 F.3d 1531, 1535 (2d Cir.1997) (quoting Anderson v. Liberty Lobby, 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)). Therefore, "`if, as to the issue on which summary judgment is sought, there is any evidence in the record from which a reasonable inference could be drawn in favor of the opposing party, summary judgment is improper.'" Id. (quoting Gummo v. Vill. of Depew, 75 F.3d 98, 107 (2d Cir.1996)). The moving party must demonstrate the absence of any genuine factual dispute. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986).

The party against whom summary judgment is sought, however, "must do more than simply show that there is some metaphysical doubt as to the material facts.... [T]he nonmoving party must come forward with specific facts showing that there is a genuine issue for trial." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) (internal quotation marks and citations omitted).

II. Policy Interpretation

The parties do not contest that New York law applies to this dispute. "The New York approach to the interpretation of contracts of insurance is `to give effect to the intent of the parties as expressed in the clear language of the contract.'" Mount Vernon Fire Ins. Co. v. Belize NY, 277 F.3d 232, 236 (2d Cir.2002) (quoting Vill. of Sylvan Beach, N.Y. v. Travelers Indem. Co., 55 F.3d 114, 115 (2d Cir.1995)). "`Unambiguous terms are to be given their plain and ordinary meaning,' and `ambiguous language should be construed in accordance with the reasonable expectations of the insured when he entered into the contract.'" Nat'l Union Fire Ins. Co. of Pittsburgh, PA. v. Stroh Cos., 265 F.3d 97, 103 (2d Cir.2001) (quoting In re Prudential Lines, 158 F.3d 65, 77 (2d Cir.1998)). New York follows the well established contra proferentem principle which requires that "equivocal contract provisions are generally to be construed against the drafter." Revson v. Cinque & Cinque, P.C., 221 F.3d 59, 67 (2d Cir.2000); accord Westchester Resco Co., L.P. v. New England Reins. Corp., 818 F.2d 2, 3 (2d Cir.1987) (per curiam).

III. Did McCarthy File a Facially Adequate Notice of Claim?

The district court based its grant of summary judgment in part on the conclusion that McCarthy's claim was for his 1991 knee injury. The district court described as "not in dispute" that McCarthy "submitted to AIG Life a written notice of claims to recover under the policy for an alleged injury...