GREENWAY MEWS REALTY v. LIBERTY INSURANCE UNDERWRITERS INC (2025)

Order, Supreme Court, New York (Arthur F. Engoron, J.), entered July 29, 2024, which granted interpleader defendant Seneca Insurance Company's motion to dismiss interpleader defendant Federal Insurance Company's cross-claims against it, unanimously modified, on the law, to deny the motion as to the unjust enrichment cause of action, and otherwise affirmed, without costs.

Seneca's waiver arguments have been raised and addressed in multiple prior actions.  Consistent with our prior decisions, Seneca has again failed to “establish as a matter of law that Federal waived its subrogation rights by failing to join Seneca in the lawsuit seeking to recover settlement funds” (Greenway Mews Realty, L.L.C. v. Liberty Ins. Underwriters, Inc., 180 A.D.3d 412, 413, 118 N.Y.S.3d 104 [1st Dept. 2020];  see also Greenway Mews Realty, L.L.C. v. Liberty Ins. Underwriters Inc., 200 A.D.3d 519, 520, 157 N.Y.S.3d 468 [1st Dept. 2021];  Greenway Mews Realty, L.L.C. v. Liberty Ins. Underwriters, Inc., 214 A.D.3d 411, 413, 185 N.Y.S.3d 58 [1st Dept. 2023]).  Seneca has failed to produce any new evidence that would warrant a departure from this Court's prior decisions.

Since Seneca failed to establish waiver as a matter of law, the court should not have dismissed the unjust enrichment cause of action.  Seneca failed to show that it would not be “against equity and good conscience to permit” Seneca “to retain what is sought to be recovered,” namely that bulk of the settlement that Federal funded (Georgia Malone & Co., Inc. v. Rieder, 19 N.Y.3d 511, 516, 950 N.Y.S.2d 333, 973 N.E.2d 743 [2012] [internal quotation marks omitted];  see Manufacturers Hanover Trust Co. v. Chemical Bank, 160 A.D.2d 113, 117, 559 N.Y.S.2d 704 [1st Dept. 1990], lv denied 77 N.Y.2d 803, 568 N.Y.S.2d 15, 569 N.E.2d 874 [1991];  see also Fasso v. Doerr, 12 N.Y.3d 80, 90–91, 875 N.Y.S.2d 846, 903 N.E.2d 1167 [2009]).  The documentary evidence produced by Seneca does not establish that Federal explicitly waived its subrogation rights or assigned them, nor does it conclusively refute Federal's assertion that it was unaware that Seneca was trying to recover the money Federal had paid in the settlement until several years later.

The court properly held, however, that the constructive trust cause of action should be dismissed, as there was no confidential or fiduciary relationship between Federal and Seneca (see Bankers Sec. Life Ins. Socy. v. Shakerdge, 49 N.Y.2d 939, 940, 428 N.Y.S.2d 623, 406 N.E.2d 440 [1980];  see also Talansky v. Schulman, 2 A.D.3d 355, 360, 770 N.Y.S.2d 48 [1st Dept. 2003]).

We have considered the remaining arguments and find them unavailing.