Goldstein Affiliates, Inc. v. Affiliated FM Insurance

Order, Appellate Term, First Department (Stanley Ostrau, J. P.; Stanley Parness, William McCooe, JJ.), entered March 14, 1991, which modified a judgment of the Civil Court, New York County (Ira Harkavy, J.), upon a jury verdict, entered July 7, 1989, to the extent of granting judgment in favor of plaintiffs against Affiliated FM Insurance ("Affiliated”) in the sum of $157,500 plus interest, unanimously affirmed, with costs. Plaintiffs, two public fire adjusters, commenced this action to recover a portion of the proceeds of two insurance policies issued by Affiliated to a group of defendants (collectively referred to as Len Art defendants). Following a 1976 fire which caused extensive damage to the insured premises, the Len Art defendants jointly retained plaintiffs to assist in their insurance claim in return for a lien and assignment of "12.5% of the amount of the loss including salvage when adjusted or otherwise recovered from the companies”. Although plaintiffs withdrew as adjusters for a period of sixty days, they properly exercised their option, pursuant to the agreement, to resume their position as adjusters following the expiration of a sixty day period without a settlement or an advance of $250,000 from Affiliated. When the Len Art defendants sued Affiliated to recover under the policy, the matter was settled for $1.5 million without any payment to plaintiffs. The jury found inter alia that plaintiffs had given notice to Affiliated of their claim to a portion of the insurance proceeds but erroneously found that Affiliated was not obligated to include plaintiffs as a loss payee in the settlement checks. (See, Continental Purch. Co. v Van Raalte Co., 251 App Div 151.) While the trial court initially granted plaintiffs’ motion to set aside this portion of the verdict, the court later reversed itself and reinstated the jury’s verdict. The Appellate Term modified to the extent of reversing the dismissal of the com- ‘ plaint against Affiliated and granting judgment in favor of plaintiffs against Affiliated in the sum of $157,500, a sum constituting 12.5% of the recovered proceeds less $30,000 which had earlier been paid to plaintiffs. The evidence adduced at trial supports the conclusion that defendant Affiliated had notice of plaintiffs’ retainer agreement, of plaintiffs’ resumption of their capacity as public fire adjusters for Len [302] Art defendants, and as such could not escape its obligation to pay any monies due under the assignment. Contrary to Affiliated’s contentions, the trial court’s instructions and interrogatories to the jury adequately conveyed to the jury the appropriate principles of law and burden of proof in a clear and unambiguous manner. Nor is Affiliated entitled to a set off or deduction against a portion of insurance proceeds paid out to the mortgagee of the premises. We have considered the remaining claims of Affiliated and find them to be without merit. Concur—Sullivan, J. P., Wallach, Kupferman, Asch and Kassal, JJ.