Category: Firm Results

Aboulafia Law Firm vacated a default judgment of nearly $4 million entered against the owner of an apartment building in the Bronx. The plaintiff alleged that she slipped on the floor of the building’s lobby in February 2021. She served the summons and complaint through the New York Secretary of State, but the address on file with the Secretary of State was associated with the owner’s prior principal. The owner, a limited liability company, had been purchased by new members in March 2022 and, after the sale, conducted all of its business from offices in Brooklyn, so it never received the summons and complaint, the motion for a default judgment, or notice of the inquest. The plaintiff eventually obtained a judgment against the owner for $3.95 million. The owner first learned of the lawsuit in May 2026, when its bank received an information subpoena and restraining notice to collect on the judgment.

The Supreme Court, Bronx County, vacated the default judgment, the inquest, and the judgment under CPLR 317, which allows a defendant that was served by a method other than personal delivery (e.g., through the Secretary of State) to defend the action if it did not personally receive notice of the summons in time to defend and has a potentially meritorious defense. Unlike a motion to vacate under CPLR 5015(a)(1), CPLR 317 does not require a reasonable excuse for the default. The Court agreed that a failure to keep a current address on file with the Secretary of State is generally not a reasonable excuse, but held that it does not bar relief under CPLR 317, particularly where, as here, nothing suggested that the defendant deliberately tried to avoid service. The Court also found that the owner raised a potentially meritorious defense as to whether it had actual or constructive notice of the alleged condition, because a separate entity was contractually responsible for maintaining and cleaning the building’s common areas, and its superintendent never observed any hazardous condition around the time of the alleged fall. The Court ordered that the owner’s answer be accepted, allowing the case to proceed on the merits.

The decision is a reminder for business owners, especially those who acquire an existing company or property-owning entity, to confirm that the address on file with the New York Department of State is current. It also confirms that, even where a business has no good excuse for missing a lawsuit served through the Secretary of State, CPLR 317 can still provide relief from a default judgment if the business acts promptly after learning of it.

Read the Decision below:

Sammy v. 2001 Arthur Avenue LLC, Index No. 811476/2023E (Sup. Ct. Bronx Cnty. Aug. 20, 2026), NYSCEF Doc. No. 55.

Aboulafia Law Firm defeated an insurer’s motion for summary judgment in the U.S. District Court for the Eastern District of New York on behalf of a client that operates a nursing home and assisted living facility in New York. In June 2021, while a contractor was replacing the facility’s roof, the contractor removed the roof’s gravel ballast, one of the roof’s four layers, which holds the roof membrane in place. During a storm, the wind lifted the membrane, and rain entered the building, damaging thirteen patient rooms, a lounge, and a hallway. The insurer limited its payment to $10,000 under the policy’s rain limitation, which capped coverage for interior rain damage unless the building first sustained damage to its “roof” by a covered cause of loss. The insurer argued that, with the ballast removed, there was no “roof” at all.

The Court rejected that argument. Because the policy did not define “roof,” the Court applied its ordinary dictionary meaning (“the cover of a building” or “the covering that forms the top of a building”) and held that the three remaining layers of the roof, including the membrane, were sufficient to constitute a “roof” on the day of the loss. The Court distinguished cases in which an insured had removed the roof entirely and covered the opening with only a tarp, and held that, even if the term “roof” were ambiguous, it must be construed in favor of the insured. The Court also held that questions of fact existed as to whether the windstorm or the contractor’s workmanship was the cause of the loss, and as to whether it was feasible to preserve the damaged property for the insurer’s inspection, and it therefore denied the insurer’s motion.

The decision has since been cited and followed outside of New York. In 11640 Woodbridge Condominium Homeowners’ Association v. Farmers Insurance Exchange, the California Court of Appeal relied on this decision in reversing a summary judgment for an insurer that had denied a rain damage claim during a roof replacement. Like the court here, the California court concluded that the remaining layers of a roof under repair were sufficient to constitute a “roof,” and held that “a roof under repair remains a ‘roof’ within the meaning of the policy.” 110 Cal. App. 5th 211, 331 Cal. Rptr. 3d 319 (Cal. Ct. App. 2025).

Read the Decision below:

Wellsville Manor LLC v. Great American Ins. Co., No. 22-CV-1229 (MKB), 2024 WL 4362599, at *7–8 (E.D.N.Y. Oct. 1, 2024), ECF No. 71.

Aboulafia Law Firm successfully compelled an insurer to participate in appraisal on behalf of a homeowner in Rockland County, New York. The insured’s home was damaged when a pipe froze and burst, and the insured submitted a claim for approximately $187,000, covering repairs to the bathroom, closets, stairs, bedrooms, and floors, as well as personal property and additional living expenses. The insurer offered only about $11,000, and issued a partial denial limited to damage to the stairway carpet, a small piece of the overall claim.

The insured demanded appraisal of the covered damage, excluding the stairway carpet, but the insurer refused, pointing to its partial denial letter. The Supreme Court, Rockland County, sided with the insured and compelled the insurer to participate in appraisal, noting that the appraisal demand excluded the stairway carpet (the one item with a genuine coverage dispute) and included only the undisputed, covered portions of the loss, which made up the bulk of the claim. The decision confirms that an insurer’s partial denial does not excuse it from appraisal of the covered portions of a loss.

Read the Decision below:

Leonel Rivas v. United States Automobile Association, Index No. 036345/2024 (Sup. Ct. Rockland Cnty. Aug. 11, 2025).

For more on appraisal of partially covered claims, see our article, Appraisals for Partially Covered Claims.

 

Aboulafia Law Firm defeated an insurer’s motion for summary judgment in federal court on behalf of the owners of three neighboring buildings in Union, New Jersey. During Hurricane Ida in 2021, sewer water backed up into the buildings. The policy included a Water Back-Up and Sump Overflow Endorsement covering water that “backs up through or overflows or is otherwise discharged from a sewer,” but the insurer denied the claim. It argued that the hurricane’s rain had overwhelmed the city’s drainage system, and that this amounted to a “flood” excluded under the policy.

The U.S. District Court for the District of New Jersey rejected the insurer’s position and denied its motion. Applying New Jersey law, the Court held that the policy’s flood exclusion, which defined “flood” as “the overflow of surface water, waves, tides, tidal waves, streams, or other bodies of water,” applies only to the overflow of a body of water, such as a river, lake, or stream. Rain falling on city streets and overwhelming the municipal sewers, without any body of water overflowing, is not a “flood.” The Court also predicted that New Jersey’s highest court would read the undefined term “surface water” to mean a body of water on the surface of the land, consistent with the Appellate Division’s decision in Sosa v. Massachusetts Bay Insurance Co., and it reaffirmed that ambiguities in insurance policies are construed in favor of coverage. The decision is an important one for property owners whose buildings suffer sewer backups during severe storms.

Read the decision here:

G.E.M.S. Partners LLC v. AmGUARD Ins. Co., No. 22-1664 (MEF)(JBC), ECF No. 44 (D.N.J. July 29, 2024).