Huffner v. Arnot Ogden Med. Ctr.

State of New York
Supreme Court, Appellate Division
Third Judicial Department

Decided and Entered: July 8, 2004
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WILLIAM E. HUFFNER,

v

Appellant,

ARNOT OGDEN MEDICAL CENTER,
Respondent.
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Calendar Date: May 24, 2004

MEMORANDUM AND ORDER

Before: Cardona, P.J., Peters, Spain, Carpinello and Kane, JJ.

__________

Ziff, Weiermiller, Hayden & Mustico L.L.P., Elmira (Jay
L.T. Breakstone of Breakstone Law Firm, Bellmore, of counsel),
for appellant.

Sayles & Evans, Elmira (Paul R. Corradini of counsel), for
respondent.

__________

Kane, J.

Appeal from an order of the Supreme Court (Mulvey, J.),
entered May 21, 2003 in Chemung County, which, inter alia,
granted defendant’s cross motion for summary judgment dismissing
the complaint.

Plaintiff was employed by defendant as an emergency room
physician and chair of the emergency department. On behalf of
all of defendant’s emergency room physicians, plaintiff
negotiated an employment agreement which was signed by the
parties in September 1992. The contract specifically provided
that each physician would be able to purchase from the hospital
long-term disability insurance that provides for 60% of the
physician’s income to age 65. As the prior policy had a cap of

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$10,000 per month and 60% of increased salaries under the new
contract could exceed that cap, defendant contacted its insurance
policy holder, the Hospital Association of New York State Group
Insurance Trust (hereinafter HANYS), to obtain a long-term
disability policy with a higher cap of $13,600. HANYS procured a
policy through its existing long-term disability insurance
underwriters, First UNUM Life Insurance Company. First UNUM
issued a policy effective January 1, 1993 that contained the
$13,600 cap and, apparently unbeknownst to either party, added a
preexisting condition exclusion. The parties did not receive the
booklets containing the policy terms and conditions until months
after the contract was signed.

In late January 1993, plaintiff became totally disabled due
to a condition for which he had been treated in the previous
year. When he applied for long-term disability benefits in May
1993, he was granted benefits of $10,000 per month and denied
additional payment based on the preexisting condition exclusion.
Plaintiff commenced this action alleging breach of contract.
This action was suspended while plaintiff prosecuted a separate
action against HANYS and First UNUM, which was ultimately
dismissed based on the Employee Retirement Income Security Act.
Plaintiff then moved for summary judgment in this action and
defendant cross-moved for summary judgment dismissing the
complaint. Supreme Court denied plaintiff’s motion and granted
defendant’s cross motion. Plaintiff appeals.

Because the parties are bound by the unambiguous terms of
their contract (see Dierkes Transp. v Germantown Cent. School
Dist., 295 AD2d 683, 684 [2002]), Supreme Court properly granted
defendant’s cross motion for summary judgment. While plaintiff
avers that he negotiated for a long-term disability insurance
policy consistent with prior policies that would provide him
coverage without exclusion, defendant argues that, pursuant to
the express terms of the contract, it only agreed to provide such
insurance with terms and conditions to be determined by the
insurer. An attachment to the contract included a provision for
“Long Term Disability Insurance,” which stated that “[i]n any
situation regarding coverage, the terms and conditions of the
[long-term disability] policy will prevail.” This language
clearly supports defendant’s position that it agreed to provide

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long-term disability insurance with terms and conditions to be
determined by the insurer. As defendant provided such insurance
benefits, albeit with a preexisting condition exclusion inserted
by First UNUM, it did not breach the contract.

Cardona, P.J., Peters, Spain and Carpinello, JJ., concur.

ORDERED that the order is affirmed, with costs.

ENTER:

Michael J. Novack
Clerk of the Court