SUPREME COURT OF THE STATE OF NEW YORK

Appellate Division, Fourth Judicial Department

442 

CA 14-01751 

PRESENT: SCUDDER, P.J., CENTRA, PERADOTTO, VALENTINO, AND WHALEN, JJ. 

 

JEFFREY CONSTANTINE, M.D., 

PLAINTIFF-RESPONDENT-APPELLANT, 

V MEMORANDUM AND ORDER

STELLA MARIS INSURANCE COMPANY, LTD., CATHOLIC 

HEALTH EAST, CATHOLIC HEALTH SYSTEM, DOING 

BUSINESS AS SISTERS OF CHARITY HOSPITAL,

DEFENDANTS-APPELLANTS-RESPONDENTS, 

MARY SERIO AND NICHOLAS SERIO, AS PARENTS AND 

NATURAL GUARDIANS OF NICOLE SERIO, AN INFANT,

DEFENDANTS-RESPONDENTS-APPELLANTS. 

 

PHILLIPS LYTLE LLP, BUFFALO (KENNETH A. MANNING OF COUNSEL), FOR

DEFENDANT-APPELLANT-RESPONDENT STELLA MARIS INSURANCE COMPANY, LTD.

ZDARSKY, SAWICKI & AGOSTINELLI, LLP, BUFFALO (DAVID E. GUTOWSKI OF

COUNSEL), FOR DEFENDANTS-APPELLANTS-RESPONDENTS CATHOLIC HEALTH EAST

AND CATHOLIC HEALTH SYSTEM, DOING BUSINESS AS SISTERS OF CHARITY

HOSPITAL. 

THE TARANTINO LAW FIRM, LLP, BUFFALO (TAMSIN J. HAGER OF COUNSEL), FOR

PLAINTIFF-RESPONDENT-APPELLANT. 

PAUL WILLIAM BELTZ, P.C., BUFFALO (WILLIAM A. QUINLAN OF COUNSEL), FOR

DEFENDANTS-RESPONDENTS-APPELLANTS. 

 

Appeals and cross appeals from an order of the Supreme Court,

Erie County (Joseph R. Glownia, J.), entered January 10, 2014. The

order denied the respective motions and cross motion of the parties

for summary judgment. 

It is hereby ORDERED that said cross appeal by defendants Mary

Serio and Nicholas Serio is unanimously dismissed and the order is

affirmed without costs. 

Memorandum: Plaintiff commenced this action seeking a

declaration that he is a “covered person” under a liability policy

issued by defendant Stella Maris Insurance Company, Ltd. (SMI). As we

explained in a prior appeal (Constantine v Stella Maris Ins. Co.,

Ltd., 97 AD3d 1129), “SMI is a single-parent captive insurance company

doing business in the Cayman Islands. Its sole shareholder,

[defendant] Catholic Health East (CHE), a not-for-profit Pennsylvania

corporation . . . , has a joint operating agreement with [defendant]
-2- 442 

CA 14-01751 

Catholic Health System, [doing business as Sisters of Charity Hospital

(hereafter, Sisters Hospital)] . . . in Buffalo. CHE and its

affiliates, including [CHS] and, in turn, Sisters Hospital, are named

as ‘covered persons’ in the professional liability policy issued by

SMI to CHE. In the underlying medical malpractice action, defendant

Nicholas Serio alleges medical malpractice by, inter alia, plaintiff

in connection with the birth of his daughter at Sisters Hospital. 

Plaintiff commenced this action seeking a declaration that SMI is

obligated to indemnify him in connection with the underlying medical

malpractice action” (id. at 1130).

 

 SMI moved for summary judgment dismissing the complaint against

it, alleging that plaintiff failed to provide timely notice pursuant

to the provisions of the policy and that plaintiff is not a covered

person under the policy because he was not employed by Sisters

Hospital and he was not acting under his contract as an on-call

physician when he was the attending physician at the labor and

delivery. Plaintiff cross-moved for summary judgment with respect to

the declaration sought in the complaint, asserting that the policy is

ambiguous and must therefore be construed against SMI. Defendants

Mary Serio and Nicholas Serio supported plaintiff’s cross motion. CHE

and Sisters Hospital moved for summary judgment dismissing the

complaint and all cross claims against them on the ground that they

are not insurers and thus there is no justiciable controversy between

plaintiff and them. Supreme Court denied the respective motions and

cross motion. SMI, CHE and Sisters Hospital appealed, and plaintiff

cross-appealed. As a preliminary matter, we note that, although Mary

Serio and Nicholas Serio also cross-appealed, they are not aggrieved

by the order and thus their cross appeal is dismissed (see CPLR 5511).

We also note as a preliminary matter that the policy provides

that its provisions are to be governed by Pennsylvania law. In

addition, SMI contends that this declaratory judgment action is

premature because the indemnification policy provides that no action

shall lie against it until liability is established by judgment or

settlement and, here, plaintiff’s liability has not been determined in

the underlying medical malpractice action. We agree with plaintiff

that Pennsylvania law permits a declaratory judgment action regarding

insurance coverage prior to a determination of liability (see Foster v

Mutual Fire, Marine & Inland Ins. Co., 154 Pa Commw 356, 360-361, 623

A2d 928, 930, affd sub nom. Maleski v Evanston Ins. Co., 535 Pa 516,

636 A2d 627; see also Eureka Fed. Sav. & Loan Assn. v American Cas.

Co. of Reading, Pa., 873 F2d 229, 231 [9th Cir 1989]). 

We reject the contention of CHE and Sisters Hospital that the

court erred in denying their motion for summary judgment dismissing

the complaint and cross claims against them. It is undisputed that

CHE and Sisters Hospital are insured as covered persons by SMI. 

Inasmuch as CHE and Sisters Hospital possess information relevant both

to the underlying medical malpractice action and to this declaratory

judgment action, and Sisters Hospital is a defendant in the underlying

medical malpractice action, we conclude that they are necessary

parties to this action (see generally White v Nationwide Mut. Ins.
-3- 442 

CA 14-01751 

Co., 228 AD2d 940, 941).

We further conclude that the court properly denied SMI’s motion

based on plaintiff’s alleged failure to provide timely notice pursuant

to the provisions of the policy. Even assuming, arguendo, that SMI

met its initial burden, we conclude that plaintiff raised an issue of

fact sufficient to defeat the motion on that ground (see generally

Zuckerman v City of New York, 49 NY2d 557, 562). Plaintiff asserted

in an affidavit that he was unaware of the existence of the policy

until SMI commenced a declaratory judgment action in federal court in

2010. Plaintiff also provided an excerpt from the deposition

testimony of SMI’s president and chief executive officer in the

underlying medical malpractice action wherein SMI’s counsel stated

that “there’s no issue about notice in this case . . . Notice has

absolutely nothing to do with his case.” Furthermore, there had been

no discovery with respect to the timing of SMI’s notice of the

“medical incident” pursuant to the policy or notice of plaintiff’s

claim for excess coverage with respect to his potential liability in

the underlying medical malpractice action.

We likewise conclude that there is an issue of fact whether

plaintiff is a covered person under the policy, and thus that neither

SMI nor plaintiff is entitled to summary judgment in that respect (see

generally id.). Although the record establishes that plaintiff was

not acting either as an employee of Sisters Hospital or as the

scheduled on-call physician at the time of the alleged malpractice, we

reject SMI’s contention that the policy provides liability coverage

for plaintiff only in the event that he was acting pursuant to his

contract with Sisters Hospital to provide on-call coverage. Instead,

we conclude that SMI itself raised an issue of fact whether plaintiff

was acting pursuant to the policy provisions and thus is a covered

person by providing plaintiff’s deposition testimony in the underlying

medical malpractice action, wherein he testified that it was a

hospital rule that residents be present for the delivery of twins, as

was the case here, for purposes of their education and to assist the

attending physician (see generally Winegrad v New York Univ. Med.

Ctr., 64 NY2d 851, 853). It is undisputed that two residents were

present during Mary Serio’s labor and the delivery of the twins, one

of whom is the subject of the underlying action. SMI failed to

establish that plaintiff lacked any responsibility with respect to the

supervision or proctoring of the residents who were present for the

labor and delivery of twins. Plaintiff, however, failed to establish

that his contract with Sisters Hospital covers the situation herein,

i.e., that he supervised or proctored residents while attending a

private patient, or that he supervised or proctored residents who were

present pursuant to a rule or policy of Sisters Hospital that

residents be present for the delivery of twins for purposes of their

education and to assist the attending physician. We conclude that

plaintiff’s affidavit stating that he provided “necessary supervision”

is conclusory and thus is insufficient to establish his entitlement to

judgment (see id.), and the physicians’ affidavits provided by SMI

regarding the responsibility of the on-call physician with respect to

the residents treating hospital or other non-private patients are not

relevant here. Furthermore, we reject plaintiff’s contention that the
-4- 442 

CA 14-01751 

policy language is ambiguous and thus must be construed against SMI

(see generally 401 Fourth St., Inc. v Investors Ins. Group, 583 Pa

445, 455, 879 A2d 166, 171). 

We have reviewed SMI’s remaining contention and conclude that it

is without merit. 

Entered: May 1, 2015 Frances E. Cafarell

Clerk of the Court