The New “Ride Sharing” Law in New York State
by David M. Goodman, Esq. As a result of a final budgetary push in Albany last April, ridesharing finally made its way to Upstate New York this year. Buffalo, Rochester, Syracuse, and Binghamton now have the benefit of ridesharing opportunities like Uber and Lyft that were previously only available in the New York metropolitan area. As a result, more claims will be presented involving a ridesharing component. However, although the enabling statutes are in place, many of the particular rules, regulations, and other details for this new area of law are still a work in progress. Understanding the Language Uber and Lyft are referred to as “Transportation Network Companies” (TNC). A TNC is licensed and operates in New York State and uses only a digital network (i.e., app) to connect “TNC passengers” to “TNC drivers” who operate a “TNC vehicle” to provide a “TNC prearranged trip.” A TNC prearranged trip begins when a TNC driver accepts a TNC passenger’s request through use of the digital network controlled by the TNC. The trip begins at the moment of acceptance, and ends when the last requesting passenger departs the TNC vehicle. The nexus of the process is the TNC digital network: a TNC driver receives connections to potential passengers and related services through the app, and a TNC passenger uses the app to arrange for transportation. Insurance Coverage TNC drivers are not employees of the TNC and are using their own motor vehicles. The TNC is not the owner or operator of the vehicle and is not the employer of the TNC driver. This structure does not fit within the existing framework for insurance coverage and motor vehicle liability law in New York State. The TNC law thus presents a new paradigm: no vicarious liability can be attributable to the TNC for the potential negligent acts of the TNC driver, and the TNC driver is an independent contractor whose own auto policy may not cover TNC activities. So, where does coverage come from? The TNC statute creates and establishes financial responsibilities for TNCs and drivers. The TNC is mandated to provide a “group policy” that recognizes the TNC driver and provides financial responsibility while the driver is both logged into the TNC’s app and engaged in a TNC prearranged trip. The “group policy” is fundamental. The group policy includes mandatory bodily injury, property damage, no-fault, uninsured motorist, supplementary uninsured/underinsured motorist, and motor vehicle physical damage coverages. The driver’s own insurance carrier(s) can provide an additional layer of coverage in the form of TNC endorsements and TNC umbrella coverage (should the driver choose to purchase same), and carriers are now offering coverage to TNC drivers to be purchased as an add-on to their existing automobile policies, but the TNC group policy is mandatory. The statute provides for both first-party and third-party benefits under the TNC group policy. Coverage under the group policy is not conditioned upon an unavailability of coverage from the driver’s insurer; rather, it is understood that the driver’s insurer may in fact exclude all TNC coverage. Standard no-fault coverage under the group policy is applicable to any passenger or pedestrian involved in a TNC transaction. The statutory scheme for liability coverage is as follows:
- During “Phase I,” when the TNC driver is logged into the app but has not yet received a passenger request, coverage is $75,000/$150,000.
- During “Phase II,” when the driver accepts a request and is heading toward pick-up, there is a single liability limit of $1,250,000. The same limit is provided for SUM/UIM coverage.
- During “Phase III,” when the driver is actually transporting passengers (e., from the moment of pick-up to the moment that the last passenger departs the vehicle), the same liability limits apply as for Phase II.
Labor Law: Court of Appeals Latest Attempt to Rein in Section 240(1) Liability
by Richard A. Galbo, Esq. On March 30, 2017, the Court of Appeals issued a 4-3 decision in O’Brien v. Port Auth. of N.Y. & N.J., 2017 N.Y. Slip Op. 02466, 2017 WL 1166795. Considering the three new Judges appointed to the Court in the last year, and despite a strident dissent by Judge Rivera, this decision may reflect a significant shift under section 240 of the New York Labor Law. The decision could have the effect of limiting liability under section 240, or at the very least curtailing summary judgment awards. The plaintiff was working at ground level on a rainy day. At the time of the accident, he was heading to his employer’s shanty to get his rain jacket. To do so, he used a temporary exterior metal staircase (also referred to as a temporary scaffold), which was wet due to rain. As the plaintiff stepped off the tread of the top step, his foot slipped and he fell down the stairs, sustaining injury. He was unable to prevent the fall because his hand slipped off the rail, which was also wet. Plaintiff’s motion for summary judgment included an expert affidavit opining that (1) the staircase was “not in compliance with good and accepted standards of construction site safety and practice” because the stairs were “smaller, narrower and steeper than typical stairs,” making it difficult to maintain proper footing; (2) the stairs showed signs of wear; and (3) the anti-slip measures (small protruding nubs) were inadequate as they afforded limited slip protection and were otherwise worn. The defendants countered with their own expert who opined that (1) the stairs were “designed and manufactured so as to provide traction acceptable within industry standards and practice in times of inclement weather”; (2) the use of perforated holes to allow water to pass and raised nubs to provide traction were sufficient anti-slip measures; (3) the tread depth met good and acceptable construction industry standards; and (4) there was no evidence the treads were worn. The trial Court found issues of fact under section 240(1). While the Appellate Division acknowledged the conflicting expert opinions, it found the plaintiff entitled to summary judgment because the plaintiff fell, such that the staircase as a safety device therefore either malfunctioned or was inadequate to protect the plaintiff against the risk of falling. The Appellate Division granted leave to appeal, asking the Court of Appeals to review its decision granting summary judgment to the plaintiff on his section 240(1) claim. The Court of Appeals reversed, holding that the conflicting expert opinions raised an issue of fact as to whether the staircase provided adequate protection. The Court went on to hold that to the extent the Appellate Division’s opinion can be read to say a statutory violation occurred merely because the plaintiff fell down the stairs, this does not provide an accurate statement of the law. However, this is precisely the way courts have interpreted section 240 – i.e., rarely allowing a jury to decide whether a safety device was inadequate, and considering a plaintiff’s injury prima facie evidence of inadequacy. As such, for the dissenting Judges, liability was undisputed because the stairway is a safety device that failed to adequately protect the plaintiff from the risk of slipping and that failure was a proximate cause of the plaintiff’s injuries. However, the Court’s majority now disputes this interpretation of section 240, and states that a presumption that a device was not good enough to provide proper protection is only valid in cases where the scaffold or ladder collapses or malfunctions for no apparent reason. Where this is not the case, then liability under section 240 will become an issue of fact for the jury and will be subject to the jury weighing competing expert opinions regarding the adequacy of the safety device to afford proper protection, even where the plaintiff is injured using the device in its intended manner. The Court leaves for future interpretation what factors a jury will be allowed to consider as “proper protection” by stating that compliance with industry standards would not, in itself, establish the adequacy of a safety device under section 240. The Court also read the defendants’ expert opinion as stating more than compliance with industry standards but did not elaborate on the “more,” leaving the question of what proof will be sufficient to defeat summary judgment and place the matter before a jury, as well as the question of what will be sufficient evidence of proper protection to sustain a finding of no liability.
While trial will remain all-or-nothing, without a liability finding before trial more cases are likely to settle for sums less than under the damage-only regime. Also, subjecting liability to expert proof will require the introduction of all of the facts and circumstances of the accident into trial, and even though the plaintiff’s culpable conduct will not be a defense, the plaintiff’s conduct could in any event influence the jury’s liability finding and/or damage assessment. This decision represents the most significant jurisprudential development under the Labor Law since the introduction of the defenses of “recalcitrant worker” and “sole proximate cause.” It is surely a favorable development for construction industry defendants – a fact not lost on the three dissenting Judges who argue at length that the decision misapprehends the statute’s legislative intent to protect workers under a strict liability standard that allows for a liability determination without reference to industry custom or practice.
The decision appears to rewrite the rules for the courts by curtailing the circumstance in which summary judgment is granted, putting plaintiffs to their proof before a jury and allowing a battle of experts to decide liability, thereby relieving some of the strain of strict liability on defendants.
Court of Appeals Decision: Insurer Found to Have Breached the Duty to Defend Loses Right to Rely on Policy Exclusions to Dispute its Duty to Indemnify
Fourth Department upholds Labor Law 240(1) Liability for Planks Dropped on Plaintiff’s Head.
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Plaintiff’s Fall through an Attic Access Door within Ambit of Labor Law §240(1).
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Second Department finds Question of Fact whether Plaintiff’s Failure to Follow Instructions was Sole Proximate Cause of her Accident.
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Replacing a Ballast in a Florescent Light Fixture is Maintenance Unrelated to Construction Excavation or Demolition.
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