Nick Orso’s Body Shop in Syracuse, New York, is no
stranger to "assignment of proceeds" cases – and no stranger to what owner Mike Orso terms "the bullying some insurance companies attempt to use to avoid paying claims."
"From Syracuse to New York City, we’ve observed
motions based on various legal opinions where [insurers] are consistently
losing," Orso says, referring to the Mid Island Collision case where
Allstate lost in Nassau County Court in May 2010 (MVB Collision vs. Allstate
Ins. Co. – 2009 NY Slip Op 29251) and other cases he has won.
In the most recent case, Nationwide filed a motion to
dismiss on "standing" with the Syracuse City Court, arguing that its policy strictly prohibits assignments. Orso’s attorney, Joseph
Talarico, argued that "post-loss" assignment was well established in
New York case law, citing a recent decision he won on the same basis.
Syracuse City Court Judge Rory A. McMahon denied
Nationwide’s motion to dismiss on "standing," citing specific case
law and also a previous case Nick Orso’s had won in the State Supreme Court in
Onondaga County in June 2010. In that case (Nick’s Garage, Inc. dba Nick Orso’s
Body Shop and Service Center vs. Adirondack Ins. Exchange, Index #2008-9681,5 –
County Ct. Onondaga 2010), Adirondack filed a similar motion on
"standing," arguing that the policy couldn’t be assigned. Supreme
Court Judge William D. Walsh agreed with that provision "pre-loss,"
but opined that "post-loss" assignments were allowed and wrote:
The New York Court of Appeals held as long ago as
1858 that "post-loss" anti-assignment clauses in insurance policies are NOT
binding. It is, indeed, well settled in New York law that enforceability of
anti-assignment clauses in insurance contracts are limited, in that as a
general matter such provisions are valid with respect to pre-loss assignments,
but NOT with respect to post-loss assignments. New York is among the majority
of jurisdictions in the United States which allow post-loss assignments.
Orso filed a cross motion for bad faith. The judge did
not agree, however, that Nationwide’s motion for dismissal amounted to bad faith and
therefore denied Orso’s request to have court and attorney costs paid for by
the insurer.
"We’re deciding whether to appeal the cross
motion," said Orso. "When case law supports our position over and
over, it’s my opinion that the action of insurers is more of an exercise of
holding back the floodwaters.
"I think it’s a foregone conclusion that assignments
are a battle [insurers] won’t win, it appears they just like to fight. The
three ‘D’ defense is alive and well: Deny, Delay and Defend! It would make
sense to negotiate a settlement and settle these claims at the time of
repair."
Added Ed Kizenberger, executive director of the New York
State Auto Collision Technicians Association (NYSACTA), "These recent
court decisions send a strong message that the justice system understands our
issues when asked to make decisions that will help consumers and repairers get
properly compensated. Our industry’s responsibility initially was to do a
proper repair. It’s unfortunate that it has become necessary to go to court to
be paid. We applaud all repairers who have chosen this difficult path to
protect their customers’ interest in getting a proper and safe
repair."
Orso, president of NYSACTA, is not involved in any DRPs.
"Nick Orso’s is a 57-year-old collision repair shop,
and for 57 years our focus has not changed. We don’t believe the insurance
company is the expert. Their estimate is an offer of payment, period. Since the
shop holds the liability in a repair and is responsible to the customer for
every detail of that repair, we’ll continue to make our own repair decisions
based on manufacturer-recommended repair procedures or techniques that render
the best results. If [insurers] are willing to work with us, great. If not, we use
the process we’ve developed for collecting the short pays. Many companies have
come around and are willing to settle during the repair. It just took them a
few trips to court to know we were serious."
More information:
Ohio Collision Repairer Wins Two ‘Assignment of Proceeds’ Cases Against Nationwide
