Opinion
007720/05.
Decided October 31, 2005.
The action before the Court is an insurance dispute wherein an insurer is seeking summary judgment pursuant to CPLR § 3212 and a declaratory judgment declaring that Physicians' Reciprocal Insurers (PRI) has no duty to defend or indemnify defendant James E. Giugliano, D.O. in the underlying action Dupree v. Giugliano, Index No. 19557/04, pending in Supreme Court, Suffolk County.
PRI had issued a professional liability policy to defendant Giugliano, a physician, that was in effect at the time period in question. PRI asserts, however, that the action in Suffolk County involves an alleged sexual relationship that defendant had with a patient, Kristin Dupree, and that the policy does not cover sexual misconduct. Ms. Dupree's first complaint maintained that her marriage failed as result of the negligent actions of defendant and sued him for medical malpractice based on their ongoing sexual relationship.
That first complaint was dismissed, whereupon Ms. Dupree served an amended complaint pursuant to CPLR § 205(a) claiming that defendant's sexual contact with her while providing therapeutic counseling and prescribing antidepressants was negligent and below the standard of care established for physicians.
In the second cause of action seeking exemplary and punitive damage, Ms. Dupree added the claim of willful disregard fo the unreasonable risk of harm to his patient's care beyond mere negligence. She asserts that the Wellbutrin she was taking pursuant to defendant's direction caused a major increase in her libido, that defendant failed to advise her that her increased sex drive was attributable to the drug and that because of the counseling sessions, she mistakenly attributed her increased libido to an "overwhelming and irresistible attraction" to the defendant.
The Suffolk County Supreme Court found that the amended complaint stated a cause of action (Pitts, J., July 25, 2005). Thereafter, PRI for the second time disclaimed its obligation to both defend and indemnify Dr. Giugliano based upon specific exclusions from coverage for sexual acts or intimacy, molestation, harassment, exploitation, or assault, as well as willful, fraudulent or malicious and criminal acts and for punitive or exemplary damages.
Plaintiff's argument in the instant application is that even when a court finds a cause of action sounding in malpractice, a determination that is not on the merits (see, Storch v. Gorden, 37 Misc 2d 731), plaintiff is not bound by that decision in its coverage of an insured and the contract language prevails.
The first issue the Court must consider is PRI's duty to defend which is broader than the duty to indemnify (Villa Charlotte Bronte, Inc. v. Commercial Union, 64 NY2d 846). A plaintiff insurer must establish as a matter of law that there is no possible factual or legal basis on which it might eventually be obligated to indemnify a defendant ( Id.). Indeed, the duty to defend is the gravamen of defendant Giugliano's cross-motion in which his affidavit states simply that he does not acknowledge any of the malpractice alleged by Ms. Dupree.
There are several scenarios before this Court derived from the facts as pleaded in the amended malpractice complaint ranging from failure to properly treat Ms. Dupree's underlying anxiety disorder by exacerbating Mrs. Dupree's stress through sexual conduct, to failing to advise her regarding the possible libido enhancing effects of the drugs prescribed.
In Chung v. PRI, 221 AD2d 907, app. den. 1996 WL 46219, the Fourth Department held that the duty to defend is broader than the duty to indemnify if the complaint contains facts or allegations which bring the claim even potentially within the policy provisions. In the case at bar, the conduct alleged in the underlying amended complaint can be construed as falling within coverage for professional services as they are not cast solely within the exclusion for sexual acts. The alleged causal relationship between Ms. Dupree's treatment with an antidepressant and the harm she alleges are the defining assertions. Thus, at the very least, PRI has a duty to defend (e.g., Hirst v. St. Paul Fire Marine Ins. Co., 683 P2d 440).
Plaintiff's reliance on two cases, both arising from Nassau County actions involving PRI and its duty to defend under similar circumstances, is misplaced (PRI v. Loeb, 291 AD2d 541, Nassau County Index No. 27051/99; PRI v. Blank, 258 AD2d 573, Nassau County Index Nos. 014581/97 and 37224/95).
In Blank, the trial court presided over both the declaratory action and the underlying malpractice action. PRI agreed to defend its insured and did so throughout the discovery process. The defendant admitted to consensual sexual intercourse in his answer and at his examination before trial, whereupon PRI disclaimed coverage. The lower court's decision holding that PRI had no duty to defend or indemnify based its conclusion on the fact that disclosure revealed it was uncontroverted that the patient's alleged injuries arose solely from the sex act.
In Loeb, the Second Department's decision was actually based upon the doctrine of collateral estoppel. The medical malpractice action was commenced in a different county. Dr. Loeb was successful in having the cause of action for medical malpractice dismissed, leaving the remaining causes of action sounding in assault, negligence and recklessness, as well as other theories of recovery.
In the declaratory judgment action below, the court found that PRI had a duty to defend and indemnify Dr. Loeb. The appellate division reversed, stating both Dr. Loeb and the alleged victim had a full and fair opportunity to litigate whether the pleading asserted a cause of action to recover damages for medial malpractice. That issue having been determined, the court was barred under the doctrine of collateral estoppel from finding there was no cause of action for medical malpractice.
In the case at bar, the Supreme Court, Suffolk County has already determined that the amended complaint states a cause of action for medical malpractice (Pitts, J., July 25, 2005).
Accordingly, plaintiff's motion is in all respects denied at this juncture with leave to renew after discovery has been completed.
Defendant's cross-motion is granted insofar as PRI has a duty to defend unless and until the undersigned rules otherwise should plaintiff renew its application.