Chase Scientific Research v. NIA Group

Chase Scientific Research, Inc. (Chase) (plaintiff) sued insurance broker NIA Group, Inc. (NIA) (defendant) for negligence and breach of contract for failing to procure adequate insurance for Chase’s warehouse. In an unrelated case, Giuseppe Gugliotta (plaintiff) sued insurance broker Apollo Roland Brokerage, Inc. (Apollo) and Apollo’s agent, Thomas Lovetere (defendants), for negligence and breach of contract for failing to procure adequate insurance for Gugliotta’s commercial building. NIA, Apollo, and Lovetere (collectively, brokers) moved to dismiss the complaints against them on statute-of-limitations grounds. Per the brokers, the complaints were time-barred because Civil Practice Law and Rules (CPLR) § 216(4), which set a three-year statute of limitations for professional-malpractice claims regardless of whether the underlying claims sounded in tort or contract, applied to them and because Chase and Gugliotta (collectively, insureds) did not file their claims on time. In both cases, the supreme court granted the brokers’ motions, and the appellate division affirmed. The insureds appealed, arguing, among other things, that insurance brokers were not professionals within the meaning of § 216(4). Specifically, Chase contended that its claims were governed by CPLR § 213(2)’s six-year statute of limitations for contract claims and that even if a three-year limitations period applied, Chases’s claim was timely because Chase sued within three years of the loss for which insurance proved to be inadequate. Gugliotta also argued that § 213(2) applied to his contract action but did not assert that his negligence claim was filed within three years of its accrual.