SUPREME COURT OF THE STATE OF NEW YORK

Appellate Division, Fourth Judicial Department

835 

CA 13-01599 

PRESENT: CENTRA, J.P., CARNI, LINDLEY, AND DEJOSEPH, JJ. 

 

 

MICHAEL J. CARLSON, SR., INDIVIDUALLY AND 

AS ADMINISTRATOR OF THE ESTATE OF CLAUDIA 

D’AGOSTINO CARLSON, DECEASED, AND AS ASSIGNEE 

OF WILLIAM PORTER, PLAINTIFF-RESPONDENT, 

V MEMORANDUM AND ORDER

 

AMERICAN INTERNATIONAL GROUP, INC., ET AL., 

DEFENDANTS,

AND AMERICAN ALTERNATIVE INSURANCE CO., 

DEFENDANT-APPELLANT. 

 

RUBIN, FIORELLA & FRIEDMAN LLP, NEW YORK CITY (PAUL KOVNER OF

COUNSEL), FOR DEFENDANT-APPELLANT. 

BROWN CHIARI LLP, LANCASTER (EDWARD J. MARKARIAN OF COUNSEL), FOR

PLAINTIFF-RESPONDENT. 

 

Appeal from an order of the Supreme Court, Niagara County (Ralph

A. Boniello, III, J.), entered December 4, 2012. The order, insofar

as appealed from, denied the cross motion of defendant American

Alternative Insurance Co. to dismiss the first cause of action against

it. 

It is hereby ORDERED that the order insofar as appealed from is

unanimously reversed on the law without costs, the cross motion is

granted in part, and the first cause of action against defendant

American Alternative Insurance Co. is dismissed. 

Memorandum: Plaintiff commenced this action pursuant to

Insurance Law § 3420 (a) (2) to collect on certain insurance policies

after a second amended judgment against MVP Delivery and Logistics,

Inc. (MVP) and William Porter was entered upon a jury verdict (see

Carlson v Porter [appeal No. 2], 53 AD3d 1129, lv denied 11 NY3d 708). 

Defendant American Alternative Insurance Co. (AAIC) issued a

commercial umbrella policy to Airborne, Inc. and later changed the

named insured to DHL Express, Risk Management (DHL). AAIC cross-moved

to dismiss, inter alia, the first cause of action of the complaint

against it, which alleged that AAIC was responsible to plaintiff for

payment of the judgment pursuant to Insurance Law § 3420 (a) (2) and

(b). 

Supreme Court erred in denying that part of the cross motion. 

“[T]he right to sue a tortfeasor’s insurance company to satisfy a
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CA 13-01599 

judgment obtained against the tortfeasor” exists only pursuant to

Insurance Law § 3420 (Lang v Hanover Ins. Co., 3 NY3d 350, 352). 

Here, plaintiff may not recover against AAIC pursuant to section 3420

(a) (2) because the policy was not “issued or delivered in this state”

(id.). The parties and the court have improperly conflated the phrase

“issued or delivered” with “issued for delivery,” which was used in

the former version of Insurance Law § 3420 (d), and therefore the

definition of “issued for delivery” is not relevant here (see

Preserver Ins. Co. v Ryba, 10 NY3d 635, 642). The policy here was

issued in New Jersey and delivered in Seattle, Washington, and then in

Florida. It was not issued or delivered in New York, and therefore

the first cause of action of the complaint against AAIC must be

dismissed (cf. American Cont. Props. v National Union Fire Ins. Co. of

Pittsburgh, 200 AD2d 443, 446-447).

Contrary to plaintiff’s alternative contention (see Parochial

Bus. Sys. v Board of Educ. of City of N.Y., 60 NY2d 539, 545-546), he

may not seek payment of the judgment against AAIC pursuant to the MCS90 endorsement. That federally-mandated endorsement provides, inter

alia, that “the insurer . . . agrees to pay . . . any final judgment

recovered against the insured” (49 CFR 387.15; see Pierre v Providence

Washington Ins. Co., 99 NY2d 222, 225-226, 228). In Pierre, the Court

held that any entity meeting the insurer’s definition of an “insured”

under the policy qualified as an “insured” under the MCS-90

endorsement (id. at 230-231). After that decision was rendered, the

Federal Motor Carrier Safety Administration (FMCSA), which regulates

the interstate trucking industry, defined the term “insured” on the

MCS-90 endorsement as the named insured only (see 70 Fed Reg 58065-

58066). Insurance companies had sought regulatory guidance from FMCSA

in response to federal and state court decisions, including Pierre,

regarding the definition of the term “insured” as used in the MCS-90

form (see 70 Fed Reg 58066). FMCSA stated that form MCS-90 was “not

intended, and do[es] not purport, to require insurance companies or

sureties to satisfy a judgment against any party other than the motor

carrier named in the endorsement or its fiduciary” (id.). It is well

settled that “[a]n agency’s interpretation of its own regulation ‘is

entitled to deference if that interpretation is not irrational or

unreasonable’ ” (Matter of IG Second Generation Partners L.P. v New

York State Div. of Hous. & Community Renewal, Off. of Rent Admin., 10

NY3d 474, 481; see Matter of Brown v Wing, 93 NY2d 517, 524; Matter of

Rodriguez v Perales, 86 NY2d 361, 367). We give such deference to

FMSCA’s interpretation of “insured” on the MCS-90 form, and we

conclude that plaintiff cannot seek payment of the judgment against

AAIC on behalf of either MVP or Porter, neither of whom are named

insureds on the AAIC policy (see Armstrong v U.S. Fire Ins. Co., 606 F

Supp 2d 794, 825-826). 

Entered: July 2, 2015 Frances E. Cafarell

Clerk of the Court