Preview
FILED: SUFFOLK COUNTY CLERK 05/25/2021 02:30 PM INDEX NO. 608053/2021
NYSCEF DOC. NO. 11 RECEIVED NYSCEF: 05/25/2021
SUPREME COURT OF THE STATE OF NEW YORK
COUNTYOF SUFFOLK
--- ---- -----------x
HOME LINE PROPERTIES OF ISLIPTERRACE, LLC, Index No. 608053/2021
RAFAEL AVGI and RACHEL AVGI,
Plaintiffs,
-against-
KINGSTONE INSURANCE COMPANY, K. BELL &
ASSOCIATES, INC. and KEN BELL, INDIVIDUALLY,
Defendants.
____________________. ---------------x
MEMORANDUM OF LAW IN SUPPORT OF
K. BELL & ASSOCIATES, INC. AND
KEN BELL'S MOTION TO DISMISS
SULLIVAN & KLEIN, LLP
Attorneysfor Defendants
K. BELL & ASSOCIATES, INC. and KEN
BELL, individually
260 Madison 8thfloor
Avenue,
New York,New York 10016
(212) 695-0910
File No.:03-888
OF COUNSEL:
ROBERT M. SULLIVAN
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TABLE OF CONit TS
Page(s)
TABLE OF AUTHORITIES...................................................................
ii
PRELIMINARY STATEMENT...............................................................
1
STATEMENT OF FACTS......................................................................
2
A) The Nature of the Action...............................................................
2
B) nefenannes
The Claims Against .....................................................
3
C) Kingstone's of Rights
Reservation ..................................................
5
ARGUMENT.....................................................................................
6
PO1NT I
THE COMPLAINT MUST BE DISMissED IN ITS ENTIRETY
AS AGAINST K. BELL AND KEN.................................................
6
POINT II
THE VERIFIED COMPLAINT FAILS TO ALLEGE THAT KEN
COMMITTED ANY INDEPENDENTLY TORTIOUS ACTS NOT
WITHIN THE SCOPE OF HIS AUTHORITY ON BEHALF OF K. BELL... 8
POINT III
THE VERIFIED COMPLAINT MUST BE DISMISSED TO
THE EXTENT THAT IT SEEKS TO RECOVER ATTORNEY'S FEES...... 11
POINT IV
THE INSTANT ACTION AGAINST K. BELL AND KEN IS FRIVOLOUS.. 12
CONCLUSION....................................................................................
14
i
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TABLE OF AUTHORITIES
Page(s)
Case Law:
Adams v. WashingtonGroup, LLC,
49 A.D.3d786 (2ndDept., 2008)................................................................
11
Aliv. Pacheco,
19 A.D.3d439 (2nd Dept. 2005).................................................................
9,10
Board of M ñGs of100 Congress C v. SDS Ceneress. LLC,
152 A.D.3d478 (2"d Dept., 2017)...............................................................
6-7
In re Brookside
Mills,
(1" Dept.
1950).............................................
8
276 A.D.357, 94 N.Y.S.2d
509
Buckleyv. 112 Cent. Park South
285 App.Div. 233, 236..............................................
331, 334, 136 N.Y.S.2d 8
Chase Meahm_n Bank, N.A.v Bound
Each E div idual Underwriter to
Lloyd'sPolicy,
258 A.D.2d1 (1" Dept.,
1999)..................................................................
11
Desideriov. Geico Gen. Ins. Co.,
153 A.D.3d1322 (2nd Dept., 2017).............................................................
13
Hunt v. Sharp,
85 N.Y.2d883 (1995).............................................................................
11
Ir.±E=±cdConstr.Servs., Inc. v. Scc"sd±
Ins. Co.,
(2nd Dept. 2011)........................................................
6
82 A.D.3d1160, 1162
Leon v. Lis acz,
84 N.Y.2d83, 87-88 (1994)......................................................................
6
Lewiarzv. TravcoIns. Co.,
82 A.D.3d1464 (3rd Dept. 2011)................................................................
10
LidoBeach Towers v. Denis A. Miller
Ins. Agency,
128 A.D.3d1025 (2nd Dept. 2015)...................................
.................
9,10
Mendez v. City
of N.Y.,
259 A.D.2d441 (1" Dept.
1999)................................................................
8-9
ii
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Page(s)
Michaelsv. Lisnenard
IIaiding
Corp.,
11 A.D.2d12, 201 N.Y.S.2d
611 (1960).......................................................
9
Martha v. Yonkers
ChildCare Ass'n,
45 N.Y.2d913 (1978)............................................................................
8,9,l
I
Nunez v. Mohamed,
104 A.D.3d921 (2nd Dept., 2013)..............................................................
6
Pasculanoulos Jr., M.D..
v. Carlos Ortiz, P.C.,
143 N.Y.S.3d571 (2ªd Dept., 2021)............................................................
13
QK HealthcareInc. v. InSource, Inc.,
108 A.D.3d56 (2"d Dept., 2013)............................................
...........6
Inc. v. 1828 51 LLC,
Retained Realty,
153 A.D.3d1438 (2"d Dept., 2017).............................................................
13
Rosin v. Weinberg,
107 A.D.3d682 (2nd Dept., 2013)..............................................................
6
Rovellov.OrofinoRealtyCo.. Inc.,
40 N.Y.2d633 (1976)............................................................................
6
Thomas v. Thomas,
(15t Dept. 2010)..........................
70 A.D.3d588, 590 6
Urbach,Kahn & Werlin,P.C. v. 250/PAS
Assocs.,
(1S1Dept.
176 A.D.2d151, 152 9,10,11
1991)..........................................................
Statutes/Rules:
CPLR 3211(a)(7)...................................................................................
1, 6,8,
14,15
22 NYCRR § 130-1.1(a) and (b)..................................................................
1,12,
14,15
22 NYCRR and (c)(2)...........................................................
§ 130-1.I(c)(1) 1,12,15
22 NYCRR § 202.48................................................................................
1,15
iii
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PRELIMINARY STATEMENT
DefendantsK. Bell& Assedatac,Inc.("K.Bell") and Ken Bell,individually
("Ken")
"Ds'
the
(jointly, by their
edants"), ancracya,Sullivan& Klein,
LLP, submitthis m-=-d
of law in suppc±
of their metien
for an Order:
a) Pürsaantto CPLR d
3211(a)(7) nising the ThirdCause ofAction allegedinthe
hified Complaint inits with
cntirety, as against
prejudice, K. Belland Ken for
failure
to state a cause of action;
b) Alter±cely, purcuentto CPLR 3211(a)(7)21--°Mag theThird Cause of action
c"2ged inthe Verified
Ce-plñt inits with
entirety prejudice
as againstKen for
to state a cause of
failure actionon the gn s that Ken
cen-net be held
personally
for acts performed
liable on behalf of K. Bell;
c) Puisuantto CPLR 3211(a)(7),
dkr°ring so much of theThird Cause of Action
--p'-2" attorneys' incurrod
allegedinthe VerifiedC as seeks torecover fees in
connectionwiththis action;
d) Pürsüantto 22 N.Y.C.R.R.130-1.1(a)
linpasingupon Plaintiffs
and theircennsel
Defendents attorncys'
rease-'-1; fees incursd
in makingthis
sanctiGna and c---dng
rMien on the i;:cnd:
that the filing and Ken °°--"+
of this action against K. Bell +3
fi claus onnh°+as that term is defined under 22 N.Y.C.R.R.
130-1.1 (c)(1)
and (c) 2
e) D1=_C.6 the Clerk of the Court to enter dgsont, iñcI-diug costs and
di±m:=cnts, in favor of Defendants pursuant to 22 NYCRR
§ 202.48;and
f) For such other and farther
relief may deem just and proper.
as this Court
D- '
m:tiesmust be granted for the fulluelag
reasons:
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C
the Verified
First, '±‡ of any a'kg-.±!c=
is devoid denied coverage
that Kingstone
T' ¬ based upon notice"
to "L-proper as cilegedinparagraph57 of the ThirdCause of
Action.In fact,
as estebli±rd
by the tworeservation
of rights
letters, not only
is it established
that Kingstone based upon "fr;r;r
did not deny covciãge it did not deny coverage at
notice",
all.Kingstoneaclu~nledged sccciptofnoticeof the lossunderthe wrong policy and then
creded its original of rights and reserved its rights under the cerect
reservation policy.
Second, theVerifiedCemp!2int fails
to allege
thatKen eammitted anyindanandently
act in his capacity and cmp'cyee
as an officer of K. Bell. Cer;''"
Rather, the Verified
alleges that all actions taken by Ken described in the Verified
C:n were withinthe scope
ofKen's c±ri"f to act on behalf
of K.Bell.Ken cannot be held liable
individually forsuch
actions.
Enemays'
Third,Fleintifs
cannot recover fees incurred
in ceiü±Glen withthis litigMI.
statute or court rule providing
absent the existence of an ngrc:n:nt, for same. P-" have not
statute or court rule.
n'logcd, nor can they prove, the evio*aam of any such =gresªPat,
=ªt'
Fóürth,the instant
actionassened -±+ K. Belland Ken is ± legal was
merit,
in±itnted to K. Bell
to harass and cause injury and Ken and is predicated
upon false statcincñts
ofmaR1al facts.
Acendingy, K. Belland Ken are entitld
to recover
allcosts and expenses,
in legal fees incurred
luding in connection
withthe defense of this acEer
STATEMENT OF FACTS
A) The Natmof the Action
The instant
actionis an action
by the Gymers of
a rentalpropc"yagainstan inr'arnee
brakerage,K. Bell,and its Ken,
president, forr."cgednegliy,cace
resultingin theloss of
insurance coverage.
2
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The Verified
C:n;! "A"
, a copy of which
is annexed as Exhibit to the accen;paicg
affirndi:nof RobertM. Esq., asserts one cause of
Sulliv:=, action,the Third
Cause of Action
against K. Bell
and Ken.
The VelifiedCen;1tin±alleges that K.
Belland Ken failedto p:cvide
propernoticeof
loss of a fire loss to Kingstone
which occurred on Mc-
fire loss allegedly 'uor 28, 2020.
The Verified
Complaint also alleges two causes of action in breach of enntract
and breach of the covenant
of good faith
and fair
dealiñg against an insurer,
T&gatcñc Trance
Company ("Kingstone").
B) The ClaimsAgainst nafendent;
to the instant Cerf- a+ makes allegations
To the extent p:rtinst moticia, the Verified
and Ken, in portinciit
against K. Bell part, as follows:
"...8.
That upon ±n at all
and belief, timeshen _ñcr
estirned, the DefendantK. Bell& Inc.
Associatcs, (hereinaRer
referredtoas 'K.Bell'),was a domesticor foreigncorporation
licensed to do business in the State of New
York.
9. That upon i±n Eticil
and at
belief, alltimes hereinaher
mentioned,the DefendantK. Bell,was and still
is a ce-peration
duly and misting
us;;±id-ed under and by virtue
of the laws of the
State of New
York, with at 29 Main
offices Street, #2, Cold
Spring
Harbor, NewYork 11724.
10. Thatat alltimeshercliiaRer
mentioned,the Defr±nt Ken
Bell, was
indi.idually, and still
isa residentof theCounty of
York..."
State of New
Suffolk,
With respect to co-defendant
Kingstone,it is alleged:
Defendant
"...23. Kingstonehas 1==±cd its obligations
under the
contractofinsuranceto Plaintiffs
as first
partybciicIlclaries
by
refusingtoachewledge and pay the firedamage claim as the
rigitE entitytomake them whole underthe regulations
ofthe
New YorkState Iñ:nimice
Law and under the terms of the contract
for insurance...
3
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xx x
28. If Defedant, Kingetane is seeldngto disclaim coverage
pursuant to an eyel"chn there is a duty to timely
in the policy, and
properlydisclâlai
coverage.
xxx
has, as a matter of law, passed the time to
39. Defendant Kingstene
issue a demand that could be casidered
timelyunder the insurance
law...
xxx
43. Defendant
KINGSTONE has breached the implied
covenet of
good faith
and fairdealinginone or more ofthe following
ways
(1)by and
arbitrarily inrecklessdisregardforPlaintiffs
rights,
refusingto acknowledge itsobligationsunder the insurance
the New
contract, York State Insurance
Law and the regulati.
as
accompanying the InsuranceLaw to actas payor offirstparty
benefits to Ph.latifs
and their
obligation after
to make them whole
theirloss; (2)by knowingly and recklesslydisregardingits
to effectuate
obligation a prompt,fairand eg±^'s schmst of
Plaintiffs'
claimfor payment of theirbenefits spiteof
in 11
NYCRR 65.3-19(e)
making it clear Dafendat,
KINGSTONE must
do so; (3)inignaringthe New York State Mrance Law and
accompanying regulaticas
and to
contianing refuseto pay and
make whole Plaintiffs fashion
in a timely as required
by law;and
(4)by failingtoproperlyceinennicatewith and their
Pleintiffs
and by
replesentatives failingtoprcmptly pay Plaintiffs
despite
having no basis in law or fact for denying
such paymcat.
44. Plaintiffs
have been damaged by Defendant,KINGSTONE's
breach of the implied
cavcnantof good faith
and fair
dealingin an
trial."
amount to be determined
at
And and Ken the Verified
again, as to K. Bell Comp!±t, in its
ThirdCause of Action
sounding in negligence,
alleges:
That Defendants
"...53. K. BELL & ASSOCIATES, INC. & KEN
BELL owed a dutyto the Pi of follevñng
the standard and
accepted practices of the insurance industry.
4
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54. ThatDefendantsdepartedfrom standarac and
these accepted
norms by not notifying
KINGSTONE with the proper
information,
and/or in a timely
insidics,n creing the loss and its details.
55. That this departure by the Defenda.nts has caused Kingstone
to
refuse to pay the claim
and relinqui±the moneythat is rigi.tfsily
due to the Plaintiffs
under the applicable
policyof insurance
56. That Plaintiffs
have no otherremedy at law or in equity
withoutproceedingagainstK. BELL & ASSOCIATES & KEN
BELL if KINGSTONE is not decracd the responsible party.
57. As a result
ofthisdeparturefrom the accepted
and standard
of
practices the insuranceindustry,
namely providingirnerenci:
noticeof the claim
and/orincident
to the carrier,
ifKINGSTONE
is not responsible
for paymentof the claim
due to improper
notice
providedto them fromeither K.
BELL & ASSOCIATES, INC.or
KEN BELL, Plaintiffs
individually, are entitled
to judg:nent
againstdefendantsK. BELL & ASSOCIATES INC. & KEN
BELL, in
individually the sum of$1,890,392.00plus statutory
interest
at a rateof 9% per arGrers plus
attorneysfeesto be
trial."
determinedat (emphasis supplied)
C) Kingstone'sReservatianof Rights
s'
letter dated De r 17, 2020, Kingstone
By acknc dged receipt
of a Notice
of Loss
the fire having
eccused at P1 ' premises on
regnding N cshcr 28, 2020. A copy of that
e-p-
letter is ardicxed to the ing afErmation
of Robert M. Esq. as Exhibit
Sullivan, "B".In
the letter, Kingstone
advised Phintiffs,
inter
alia,that it was reserving
its rights
under the policy
Phintiffe'
due to failure
to 2:r;12tethe inv Esa of the loss and fraud
and misrepresentation
sgsfing the occupancyof the premises. .. in theletter
is thereany declination
of
coverage by KY:no notice"
based upon "improper as alleged in the Third
Cause of Action.
' -- -
Ina "Su; Reservationof Rights,
dated February
16, 2021, a copy
of whichis
annexed toacc:n;:nying af"-+n of RobertM. Sullivan,Esq.as Exhibit"C",Kiñgstene
relimiedthe same grundsfor its reservation
of rights
but stated:
5
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"...Ina letter
addressed to you dated December 17,2020,
KingstoneInsuranceCesp issued a Reservation
("Kingstone")
of Rights to investigate
thisclaim,which isincegarated by
referenceherein.
The ReservationofRights letter
inadv«tently
referencedthewrong policy n=bor. Ac- gly,Kingstone is
=¹
providingyou with this Eng! of Rights..."
Reservation
ARGUMENT
POINT 1
THE COMPLAINT MUST BE DISMISSED IN ITS ENTIRETY
AS AGAINST K. BELL AND KEN
A C^-7'^" should be dismissedifitfailstostatea cause of action.See CPLR
3211(a)(7).
When a Courtdetermines a m:±irn
to disiniss
for failure
to state on a cause of action
pursuant to CPLR321 l(a)(7),
it must detemline
whetherthe :n:set forth
a proper
cause
of action.
Ifthe facts do not fit
intoa cegrlzeble
legal theory,
the etie_eto dismi
s shet!ld be
granted.See Leon v. M±ir_:z,84 N.Y.2d 83, 87-88
(1994); stcgratedConstr.
Servs., Inc.
v.
ScG=ds's Ins. Co., 82 A.D.3d (2nd Dept.
1160, 1162 2011);Thomas v. Themn 70 A.D.3d588,
590 (13t Dept. 2010).
CPLR permitsthe submieien or other evidence to f:
of affdavits - not
3211(a)(7)
-7hMli- -'
only a essylainthas stated a cause of but
action, whetherthe infacthas a
cause. Rovello Co..
v-C___"___Realty 40 N.Y.2d
Inc., 633 (1976);Board ofh-rv of 100
Congress C± v. SDS Cengress.LLC, 152 A.D.3d 478 (2"d
Preview
FILED: SUFFOLK COUNTY CLERK 05/25/2021 02:30 PM INDEX NO. 608053/2021 NYSCEF DOC. NO. 11 RECEIVED NYSCEF: 05/25/2021 SUPREME COURT OF THE STATE OF NEW YORK COUNTYOF SUFFOLK --- ---- -----------x HOME LINE PROPERTIES OF ISLIPTERRACE, LLC, Index No. 608053/2021 RAFAEL AVGI and RACHEL AVGI, Plaintiffs, -against- KINGSTONE INSURANCE COMPANY, K. BELL & ASSOCIATES, INC. and KEN BELL, INDIVIDUALLY, Defendants. ____________________. ---------------x MEMORANDUM OF LAW IN SUPPORT OF K. BELL & ASSOCIATES, INC. AND KEN BELL'S MOTION TO DISMISS SULLIVAN & KLEIN, LLP Attorneysfor Defendants K. BELL & ASSOCIATES, INC. and KEN BELL, individually 260 Madison 8thfloor Avenue, New York,New York 10016 (212) 695-0910 File No.:03-888 OF COUNSEL: ROBERT M. SULLIVAN 1 of 21 FILED: SUFFOLK COUNTY CLERK 05/25/2021 02:30 PM INDEX NO. 608053/2021 NYSCEF DOC. NO. 11 RECEIVED NYSCEF: 05/25/2021 TABLE OF CONit TS Page(s) TABLE OF AUTHORITIES................................................................... ii PRELIMINARY STATEMENT............................................................... 1 STATEMENT OF FACTS...................................................................... 2 A) The Nature of the Action............................................................... 2 B) nefenannes The Claims Against ..................................................... 3 C) Kingstone's of Rights Reservation .................................................. 5 ARGUMENT..................................................................................... 6 PO1NT I THE COMPLAINT MUST BE DISMissED IN ITS ENTIRETY AS AGAINST K. BELL AND KEN................................................. 6 POINT II THE VERIFIED COMPLAINT FAILS TO ALLEGE THAT KEN COMMITTED ANY INDEPENDENTLY TORTIOUS ACTS NOT WITHIN THE SCOPE OF HIS AUTHORITY ON BEHALF OF K. BELL... 8 POINT III THE VERIFIED COMPLAINT MUST BE DISMISSED TO THE EXTENT THAT IT SEEKS TO RECOVER ATTORNEY'S FEES...... 11 POINT IV THE INSTANT ACTION AGAINST K. BELL AND KEN IS FRIVOLOUS.. 12 CONCLUSION.................................................................................... 14 i 2 of 21 FILED: SUFFOLK COUNTY CLERK 05/25/2021 02:30 PM INDEX NO. 608053/2021 NYSCEF DOC. NO. 11 RECEIVED NYSCEF: 05/25/2021 TABLE OF AUTHORITIES Page(s) Case Law: Adams v. WashingtonGroup, LLC, 49 A.D.3d786 (2ndDept., 2008)................................................................ 11 Aliv. Pacheco, 19 A.D.3d439 (2nd Dept. 2005)................................................................. 9,10 Board of M ñGs of100 Congress C v. SDS Ceneress. LLC, 152 A.D.3d478 (2"d Dept., 2017)............................................................... 6-7 In re Brookside Mills, (1" Dept. 1950)............................................. 8 276 A.D.357, 94 N.Y.S.2d 509 Buckleyv. 112 Cent. Park South 285 App.Div. 233, 236.............................................. 331, 334, 136 N.Y.S.2d 8 Chase Meahm_n Bank, N.A.v Bound Each E div idual Underwriter to Lloyd'sPolicy, 258 A.D.2d1 (1" Dept., 1999).................................................................. 11 Desideriov. Geico Gen. Ins. Co., 153 A.D.3d1322 (2nd Dept., 2017)............................................................. 13 Hunt v. Sharp, 85 N.Y.2d883 (1995)............................................................................. 11 Ir.±E=±cdConstr.Servs., Inc. v. Scc"sd± Ins. Co., (2nd Dept. 2011)........................................................ 6 82 A.D.3d1160, 1162 Leon v. Lis acz, 84 N.Y.2d83, 87-88 (1994)...................................................................... 6 Lewiarzv. TravcoIns. Co., 82 A.D.3d1464 (3rd Dept. 2011)................................................................ 10 LidoBeach Towers v. Denis A. Miller Ins. Agency, 128 A.D.3d1025 (2nd Dept. 2015)................................... ................. 9,10 Mendez v. City of N.Y., 259 A.D.2d441 (1" Dept. 1999)................................................................ 8-9 ii 3 of 21 FILED: SUFFOLK COUNTY CLERK 05/25/2021 02:30 PM INDEX NO. 608053/2021 NYSCEF DOC. NO. 11 RECEIVED NYSCEF: 05/25/2021 Page(s) Michaelsv. Lisnenard IIaiding Corp., 11 A.D.2d12, 201 N.Y.S.2d 611 (1960)....................................................... 9 Martha v. Yonkers ChildCare Ass'n, 45 N.Y.2d913 (1978)............................................................................ 8,9,l I Nunez v. Mohamed, 104 A.D.3d921 (2nd Dept., 2013).............................................................. 6 Pasculanoulos Jr., M.D.. v. Carlos Ortiz, P.C., 143 N.Y.S.3d571 (2ªd Dept., 2021)............................................................ 13 QK HealthcareInc. v. InSource, Inc., 108 A.D.3d56 (2"d Dept., 2013)............................................ ...........6 Inc. v. 1828 51 LLC, Retained Realty, 153 A.D.3d1438 (2"d Dept., 2017)............................................................. 13 Rosin v. Weinberg, 107 A.D.3d682 (2nd Dept., 2013).............................................................. 6 Rovellov.OrofinoRealtyCo.. Inc., 40 N.Y.2d633 (1976)............................................................................ 6 Thomas v. Thomas, (15t Dept. 2010).......................... 70 A.D.3d588, 590 6 Urbach,Kahn & Werlin,P.C. v. 250/PAS Assocs., (1S1Dept. 176 A.D.2d151, 152 9,10,11 1991).......................................................... Statutes/Rules: CPLR 3211(a)(7)................................................................................... 1, 6,8, 14,15 22 NYCRR § 130-1.1(a) and (b).................................................................. 1,12, 14,15 22 NYCRR and (c)(2)........................................................... § 130-1.I(c)(1) 1,12,15 22 NYCRR § 202.48................................................................................ 1,15 iii 4 of 21 FILED: SUFFOLK COUNTY CLERK 05/25/2021 02:30 PM INDEX NO. 608053/2021 NYSCEF DOC. NO. 11 RECEIVED NYSCEF: 05/25/2021 PRELIMINARY STATEMENT DefendantsK. Bell& Assedatac,Inc.("K.Bell") and Ken Bell,individually ("Ken") "Ds' the (jointly, by their edants"), ancracya,Sullivan& Klein, LLP, submitthis m-=-d of law in suppc± of their metien for an Order: a) Pürsaantto CPLR d 3211(a)(7) nising the ThirdCause ofAction allegedinthe hified Complaint inits with cntirety, as against prejudice, K. Belland Ken for failure to state a cause of action; b) Alter±cely, purcuentto CPLR 3211(a)(7)21--°Mag theThird Cause of action c"2ged inthe Verified Ce-plñt inits with entirety prejudice as againstKen for to state a cause of failure actionon the gn s that Ken cen-net be held personally for acts performed liable on behalf of K. Bell; c) Puisuantto CPLR 3211(a)(7), dkr°ring so much of theThird Cause of Action --p'-2" attorneys' incurrod allegedinthe VerifiedC as seeks torecover fees in connectionwiththis action; d) Pürsüantto 22 N.Y.C.R.R.130-1.1(a) linpasingupon Plaintiffs and theircennsel Defendents attorncys' rease-'-1; fees incursd in makingthis sanctiGna and c---dng rMien on the i;:cnd: that the filing and Ken °°--"+ of this action against K. Bell +3 fi claus onnh°+as that term is defined under 22 N.Y.C.R.R. 130-1.1 (c)(1) and (c) 2 e) D1=_C.6 the Clerk of the Court to enter dgsont, iñcI-diug costs and di±m:=cnts, in favor of Defendants pursuant to 22 NYCRR § 202.48;and f) For such other and farther relief may deem just and proper. as this Court D- ' m:tiesmust be granted for the fulluelag reasons: 5 of 21 FILED: SUFFOLK COUNTY CLERK 05/25/2021 02:30 PM INDEX NO. 608053/2021 NYSCEF DOC. NO. 11 RECEIVED NYSCEF: 05/25/2021 C the Verified First, '±‡ of any a'kg-.±!c= is devoid denied coverage that Kingstone T' ¬ based upon notice" to "L-proper as cilegedinparagraph57 of the ThirdCause of Action.In fact, as estebli±rd by the tworeservation of rights letters, not only is it established that Kingstone based upon "fr;r;r did not deny covciãge it did not deny coverage at notice", all.Kingstoneaclu~nledged sccciptofnoticeof the lossunderthe wrong policy and then creded its original of rights and reserved its rights under the cerect reservation policy. Second, theVerifiedCemp!2int fails to allege thatKen eammitted anyindanandently act in his capacity and cmp'cyee as an officer of K. Bell. Cer;''" Rather, the Verified alleges that all actions taken by Ken described in the Verified C:n were withinthe scope ofKen's c±ri"f to act on behalf of K.Bell.Ken cannot be held liable individually forsuch actions. Enemays' Third,Fleintifs cannot recover fees incurred in ceiü±Glen withthis litigMI. statute or court rule providing absent the existence of an ngrc:n:nt, for same. P-" have not statute or court rule. n'logcd, nor can they prove, the evio*aam of any such =gresªPat, =ªt' Fóürth,the instant actionassened -±+ K. Belland Ken is ± legal was merit, in±itnted to K. Bell to harass and cause injury and Ken and is predicated upon false statcincñts ofmaR1al facts. Acendingy, K. Belland Ken are entitld to recover allcosts and expenses, in legal fees incurred luding in connection withthe defense of this acEer STATEMENT OF FACTS A) The Natmof the Action The instant actionis an action by the Gymers of a rentalpropc"yagainstan inr'arnee brakerage,K. Bell,and its Ken, president, forr."cgednegliy,cace resultingin theloss of insurance coverage. 2 6 of 21 FILED: SUFFOLK COUNTY CLERK 05/25/2021 02:30 PM INDEX NO. 608053/2021 NYSCEF DOC. NO. 11 RECEIVED NYSCEF: 05/25/2021 The Verified C:n;! "A" , a copy of which is annexed as Exhibit to the accen;paicg affirndi:nof RobertM. Esq., asserts one cause of Sulliv:=, action,the Third Cause of Action against K. Bell and Ken. The VelifiedCen;1tin±alleges that K. Belland Ken failedto p:cvide propernoticeof loss of a fire loss to Kingstone which occurred on Mc- fire loss allegedly 'uor 28, 2020. The Verified Complaint also alleges two causes of action in breach of enntract and breach of the covenant of good faith and fair dealiñg against an insurer, T&gatcñc Trance Company ("Kingstone"). B) The ClaimsAgainst nafendent; to the instant Cerf- a+ makes allegations To the extent p:rtinst moticia, the Verified and Ken, in portinciit against K. Bell part, as follows: "...8. That upon ±n at all and belief, timeshen _ñcr estirned, the DefendantK. Bell& Inc. Associatcs, (hereinaRer referredtoas 'K.Bell'),was a domesticor foreigncorporation licensed to do business in the State of New York. 9. That upon i±n Eticil and at belief, alltimes hereinaher mentioned,the DefendantK. Bell,was and still is a ce-peration duly and misting us;;±id-ed under and by virtue of the laws of the State of New York, with at 29 Main offices Street, #2, Cold Spring Harbor, NewYork 11724. 10. Thatat alltimeshercliiaRer mentioned,the Defr±nt Ken Bell, was indi.idually, and still isa residentof theCounty of York..." State of New Suffolk, With respect to co-defendant Kingstone,it is alleged: Defendant "...23. Kingstonehas 1==±cd its obligations under the contractofinsuranceto Plaintiffs as first partybciicIlclaries by refusingtoachewledge and pay the firedamage claim as the rigitE entitytomake them whole underthe regulations ofthe New YorkState Iñ:nimice Law and under the terms of the contract for insurance... 3 7 of 21 FILED: SUFFOLK COUNTY CLERK 05/25/2021 02:30 PM INDEX NO. 608053/2021 NYSCEF DOC. NO. 11 RECEIVED NYSCEF: 05/25/2021 xx x 28. If Defedant, Kingetane is seeldngto disclaim coverage pursuant to an eyel"chn there is a duty to timely in the policy, and properlydisclâlai coverage. xxx has, as a matter of law, passed the time to 39. Defendant Kingstene issue a demand that could be casidered timelyunder the insurance law... xxx 43. Defendant KINGSTONE has breached the implied covenet of good faith and fairdealinginone or more ofthe following ways (1)by and arbitrarily inrecklessdisregardforPlaintiffs rights, refusingto acknowledge itsobligationsunder the insurance the New contract, York State Insurance Law and the regulati. as accompanying the InsuranceLaw to actas payor offirstparty benefits to Ph.latifs and their obligation after to make them whole theirloss; (2)by knowingly and recklesslydisregardingits to effectuate obligation a prompt,fairand eg±^'s schmst of Plaintiffs' claimfor payment of theirbenefits spiteof in 11 NYCRR 65.3-19(e) making it clear Dafendat, KINGSTONE must do so; (3)inignaringthe New York State Mrance Law and accompanying regulaticas and to contianing refuseto pay and make whole Plaintiffs fashion in a timely as required by law;and (4)by failingtoproperlyceinennicatewith and their Pleintiffs and by replesentatives failingtoprcmptly pay Plaintiffs despite having no basis in law or fact for denying such paymcat. 44. Plaintiffs have been damaged by Defendant,KINGSTONE's breach of the implied cavcnantof good faith and fair dealingin an trial." amount to be determined at And and Ken the Verified again, as to K. Bell Comp!±t, in its ThirdCause of Action sounding in negligence, alleges: That Defendants "...53. K. BELL & ASSOCIATES, INC. & KEN BELL owed a dutyto the Pi of follevñng the standard and accepted practices of the insurance industry. 4 8 of 21 FILED: SUFFOLK COUNTY CLERK 05/25/2021 02:30 PM INDEX NO. 608053/2021 NYSCEF DOC. NO. 11 RECEIVED NYSCEF: 05/25/2021 54. ThatDefendantsdepartedfrom standarac and these accepted norms by not notifying KINGSTONE with the proper information, and/or in a timely insidics,n creing the loss and its details. 55. That this departure by the Defenda.nts has caused Kingstone to refuse to pay the claim and relinqui±the moneythat is rigi.tfsily due to the Plaintiffs under the applicable policyof insurance 56. That Plaintiffs have no otherremedy at law or in equity withoutproceedingagainstK. BELL & ASSOCIATES & KEN BELL if KINGSTONE is not decracd the responsible party. 57. As a result ofthisdeparturefrom the accepted and standard of practices the insuranceindustry, namely providingirnerenci: noticeof the claim and/orincident to the carrier, ifKINGSTONE is not responsible for paymentof the claim due to improper notice providedto them fromeither K. BELL & ASSOCIATES, INC.or KEN BELL, Plaintiffs individually, are entitled to judg:nent againstdefendantsK. BELL & ASSOCIATES INC. & KEN BELL, in individually the sum of$1,890,392.00plus statutory interest at a rateof 9% per arGrers plus attorneysfeesto be trial." determinedat (emphasis supplied) C) Kingstone'sReservatianof Rights s' letter dated De r 17, 2020, Kingstone By acknc dged receipt of a Notice of Loss the fire having eccused at P1 ' premises on regnding N cshcr 28, 2020. A copy of that e-p- letter is ardicxed to the ing afErmation of Robert M. Esq. as Exhibit Sullivan, "B".In the letter, Kingstone advised Phintiffs, inter alia,that it was reserving its rights under the policy Phintiffe' due to failure to 2:r;12tethe inv Esa of the loss and fraud and misrepresentation sgsfing the occupancyof the premises. .. in theletter is thereany declination of coverage by KY:no notice" based upon "improper as alleged in the Third Cause of Action. ' -- - Ina "Su; Reservationof Rights, dated February 16, 2021, a copy of whichis annexed toacc:n;:nying af"-+n of RobertM. Sullivan,Esq.as Exhibit"C",Kiñgstene relimiedthe same grundsfor its reservation of rights but stated: 5 9 of 21 FILED: SUFFOLK COUNTY CLERK 05/25/2021 02:30 PM INDEX NO. 608053/2021 NYSCEF DOC. NO. 11 RECEIVED NYSCEF: 05/25/2021 "...Ina letter addressed to you dated December 17,2020, KingstoneInsuranceCesp issued a Reservation ("Kingstone") of Rights to investigate thisclaim,which isincegarated by referenceherein. The ReservationofRights letter inadv«tently referencedthewrong policy n=bor. Ac- gly,Kingstone is =¹ providingyou with this Eng! of Rights..." Reservation ARGUMENT POINT 1 THE COMPLAINT MUST BE DISMISSED IN ITS ENTIRETY AS AGAINST K. BELL AND KEN A C^-7'^" should be dismissedifitfailstostatea cause of action.See CPLR 3211(a)(7). When a Courtdetermines a m:±irn to disiniss for failure to state on a cause of action pursuant to CPLR321 l(a)(7), it must detemline whetherthe :n:set forth a proper cause of action. Ifthe facts do not fit intoa cegrlzeble legal theory, the etie_eto dismi s shet!ld be granted.See Leon v. M±ir_:z,84 N.Y.2d 83, 87-88 (1994); stcgratedConstr. Servs., Inc. v. ScG=ds's Ins. Co., 82 A.D.3d (2nd Dept. 1160, 1162 2011);Thomas v. Themn 70 A.D.3d588, 590 (13t Dept. 2010). CPLR permitsthe submieien or other evidence to f: of affdavits - not 3211(a)(7) -7hMli- -' only a essylainthas stated a cause of but action, whetherthe infacthas a cause. Rovello Co.. v-C___"___Realty 40 N.Y.2d Inc., 633 (1976);Board ofh-rv of 100 Congress C± v. SDS Cengress.LLC, 152 A.D.3d 478 (2"d