Merchants Mut. Ins. Co. v. Arzillo

• Decision Date: 23 January 1984
• Citation: 98 A.D.2d 495,472 N.Y.S.2d 97
• Parties: MERCHANTS MUTUAL INSURANCE COMPANY, etc., Appellant v. Salvatore ARZILLO, Respondent.
• Court: New York Supreme Court — Appellate Division

Page 97

472 N.Y.S.2d 97

98 A.D.2d 495

MERCHANTS MUTUAL INSURANCE COMPANY, etc., Appellant v.Salvatore ARZILLO, Respondent.

Supreme Court, Appellate Division Second Department.

Jan. 23, 1984.

Gwertzman, Pfeffer, Toker & Lefkowitz, New York City(Ellen Lefkowitz, New York City, of counsel), for appellant.

Before LAZER, J.P., and GIBBONS, NIEHOFF and BOYERS, JJ.

NIEHOFF, Justice.

On June 18, 1978 a fire occurred at the premises of State Utilities, Inc. in Lindenhurst, New York, causing serious damage to the building and its contents.The present action is brought by the plaintiff, Merchants Mutual Insurance Company, as subrogee of State Utilities, Inc., to recover the sum of $49,222.22 which Merchants Mutual expended for coverage of the loss under a fire insurance policy on the damaged premises.

Following the fire the defendantSalvatore Arzillo was indicted for arson in the third degree, the People claiming that he had been responsible for the fire.After a number of court appearances, the defendant entered a Serrano-type plea of guilty (People v. Serrano, 15 N.Y.2d 304, 258 N.Y.S.2d 386, 206 N.E.2d 330) to a reduced charge of arson in the fourth degree.In the instant action for recovery of the amount of the fire loss, Merchants Mutual alleges that "defendant recklessly and wantonly damaged said building belonging to plaintiff's subrogor when he intentionally caused a fire to start which caused great damage".

The issue to be resolved on this appeal is whether the defendant's plea of guilty to arson in the fourth degree for the very same incident which is the subject of this civil lawsuit collaterally estops the defendant from litigating the question of willful responsibility for the fire or whether, by entering a Serrano plea, at which time he claimed to have been framed, and by continuing to protest his innocence thereafter when he was sentenced, defendant is entitled to a trial on the issue of his legal responsibility to pay money for damages for the fire loss.

The appeal comes to us as a consequence of Special Term's denying Merchant Mutual's motion for summary judgment.In denying the motion, Special Term wrote:

"Defendant's prior plea to [sic ] guilty of arson in the fourth degree before Acting County Court Judge Best on January 14, 1981 in the County Court of Suffolk represents an admission and is receivable in evidence in this civil action against him (Fisch on NY Evidence [2 ed]Sec. 803;Ando v. Woodberry, 8 N.Y.2d 165, 167[203 N.Y.S.2d 74, 168 N.E.2d 520] ).While defendant may not relitigate the issue of his guilt, he may offer proof relevant to character of crime committed (Matter of Levy, 37 N.Y.2d 279[372 N.Y.S.2d 41, 333 N.E.2d 350] ) and is entitled to the opportunity to explain it (Chamberlain v. Iba, 181 N.Y. 486, 490[74 N.E. 481] )."

For reasons set forth below, we conclude that the doctrine of collateral estoppel applies to defendant's Serrano plea of guilty and that the plaintiff is entitled to summary judgment on the question of defendant's liability for civil money damages.

The essential facts are as follows:

By Suffolk County indictment number 2587/79 the defendant, Salvatore Arzillo, was charged with violating section 150.10 of the Penal Law, arson in the third degree (a class C felony).On January 14, 1981, after some 15 court appearances, the defendant withdrew his previously entered plea of not guilty to the charge of arson in the third degree and interposed a plea of guilty to arson in the fourth degree, a class E felony (Penal Law, § 150.05).Before the County Court accepted defendant's plea of guilty to the reduced charge, the County Court conducted a detailed allocution concerning the voluntariness of the plea.

After noting the defendant's desire to plead guilty to arson in the fourth degree, the court indicated its intention to sentence the defendant to a period of probation, inquired if any promises or threats were made to the defendant, advised the defendant of his rights, including the burden on the People to prove the case beyond a reasonable doubt, the defendant's right to call witnesses on his own behalf and cross-examine the People's witnesses, and defendant's right to counsel, admonished the defendant that his guilty plea constituted a waiver of those rights, and informed defendant of various sentencing alternatives.After questioning the defendantthe court found as follows:

"THE COURT: The Court finds you alert and intelligent, and you understand the nature of the charges against you, and appreciate the consequences of the guilty plea.The Court finds you understand your rights, and are willing to give them up by a plea of guilty at this time.

"The Court finds you understand the facts the district attorney must prove to establish your guilt, and these facts are--knowing all this, as to the charge of Arson in the Fourth Degree, a Class E felony, how do you plead?

"THE DEFENDANT: Guilty."

After so finding, the court asked Salvatore Arzillo about the incident in question.In answer to the query the defendant stated that there was an ongoing feud between him and the proprietor of State Utilities, Inc. and that he had been framed.Understandably concerned by the defendant's statements, the County Court Judge pursued this line of inquiry and painstakingly explained all of the ramifications of a guilty plea to Mr. Arzillo.During that discussion Mr. Arzillo's attorney stated that the "purpose of this plea is in the form of the guidelines of the Seroano [sic ] plea, that his Honor and the district attorney and the Court is familiar with", after which the prosecutor outlined the People's case for the court as follows:

"I would like to outline for the Court, the proof that the People would adduce at trial, were this case to go to trial, and indicate to the Court that we would prove that a fire happened at State Utilities Corporation, on the 18th day of June, 1978, at 290 West Hoffman Avenue, Lindenhurst.

"We would also prove there was a long outstanding history of personal animosity between the owner of the property that the fire occurred on, and Mr. Arzillo.So we'd be able to establish a motive.

"We would also be able to produce a witness, a Kevin O'Reilly, known to Mr. Arzillo, who would testify that Mr. Arzillo discussed with him, prior to the fire, his desire to have a fire occur at this particular location, and that Mr. O' Reilly would testify that Mr. Arzillo paid him to, in fact, see that a fire occurred at this particular location.

"Mr. O'Reilly received some two hundred dollars from Mr. Arzillo over a period of some two weeks, in installments.He, in fact--Mr.O'Reilly had someone else start the fire which occurred on the 18th day of June, 1978, and that members of the Suffolk County Arson Squad would testify that, as a result of information they received some few days after the fire, their investigation showed that Mr. O'Reilly's version of how, in fact, the fire was started and occurred, at the location on the 18th, was corroborating; in fact, that a certain brick was located at the property and it was thrown--it was located in the area where Mr. O'Reilly indicated a brick was thrown.Gasoline was poured through an office window and the fire was started in that fashion.

"It's our feeling that were we pressed to try this case, we would be able to prove, beyond a reasonable doubt, that Mr. Arzillo, in fact, was the moving force and the person who caused this fire to occur.

"However, as in any case, certainty is not something's [sic ] positive, so we've decided to offer Mr. Arzillo this plea under these particular circumstances".

After continued colloquy and a further claim by defendant that he had been framed, the following occurred:

"THE COURT: Sir, the more you tell me you were framed, the more I might be inclined not to accept your plea.Do you understand that?I don't want to have somebody tell me they want me to accept their plea, and with the same breath, tell me they were framed.

"The record is inconsistent in that regard.Do you want me to accept your plea?

"THE DEFENDANT: Yes.

"THE COURT: Is that your final decision, sir?I don't want you to now say that any injustice was done to you in this Court.Do you understand that, sir?

"THE DEFENDANT: Yes.

"THE COURT: I don't want you to say that somebody framed you, and you can maintain your innocence.But I don't want you to say, in the second breath, that you were framed.Do you understand that?

"THE DEFENDANT: Yes.

"THE COURT: Do I make my point to you, sir?

"THE DEFENDANT: Yes, your Honor.

"THE COURT: You're asking me to accept this plea?

"THE DEFENDANT: Yes, your Honor.

"THE COURT: All right.I will accept your plea.

"I will accept your plea on the basis that, if you did stand trial, you may well be found guilty of the higher charge and you may well have to face greater punishment.This is what you are escaping.Is that right?

"THE DEFENDANT: Yes".

Having thus satisfied itself as to the voluntariness of Mr. Arzillo's plea the court directed the clerk to record the plea on the record.During that portion of the proceeding the following transpired:

"THE CLERK: Are you pleading guilty of your own free will?

"THE DEFENDANT: I am.

"THE CLERK: Do you know that your plea of guilty is an admission that you committed the crime to which you now plead guilty?

"THE DEFENDANT: Yes.

MR. GIORGINI [Defense Counsel]: The last question that was asked is yes, sir, with the stipulation that he is maintaining his innocence, and entering the Seroano [sic ] plea.

"THE COURT: The record is clear as to what his position is.But he must understand that he's pleading guilty to an Arson in the Fourth Degree.

"MR. GIROGINI [sic ]: He understands that, your Honor.

"THE COURT: That means guilty.It doesn't mean anything else.

"Mr. Arzillo, you just signed this paper.It was filled out by your attorney?

"THE DEFENDANT: Yes, your Honor.

"THE COURT: You were asked those questions...