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Joseph J. Triarsi, As Trustee For the Joseph H. Halpin v. Bsc Group Services

July 26, 2011


On appeal from Superior Court of New Jersey, Law Division, Union County, Docket No. L-1324-09.

The opinion of the court was delivered by: Waugh, J.A.D.



Argued February 8, 2011

Before Judges Carchman, Messano, and Waugh.

The opinion of the court was delivered by WAUGH, J.A.D.

Plaintiff Joseph Triarsi, acting as trustee of the Joseph H. Halpin Insurance Trust (Trust), appeals the order of the Law Division dismissing his suit against defendants BSC Group Services (BSC) and Herbert Wright. He also appeals the denial of his motion for reconsideration. We affirm in part and reverse in part, and remand for further proceedings consistent with this opinion.


We discern the following facts and procedural history from the record on appeal.

For approximately twenty years, Halpin and a partner ran Earnings Performance Group, a business which provided consulting services to banks. In 2003, Halpin created the Trust, an irrevocable life insurance trust to support his wife and children upon his death, and appointed Triarsi to act as trustee. Halpin purchased a life insurance policy in the amount of $1,150,000, payable to the Trust upon his death. That policy was the sole asset of the Trust.

Halpin obtained the policy through BSC, an insurance broker. Wright handled the transaction for BSC, by which he was employed as an insurance agent. According to Triarsi's complaint, Wright acquired intimate knowledge of Halpin's financial affairs and assisted him in the application for the policy. Subsequently, premium notices were sent to both Halpin and Wright, but not to Triarsi. According to Triarsi, Wright had responsibility for ensuring that the premiums were paid.

Triarsi asserts that "Wright assumed a role beyond that of a broker arranging for the Insured's insurance needs" because he met regularly with Halpin to review and maintain his "insurance needs" and also became familiar with Halpin's family. Triarsi alleges that because of these regular communications between Halpin and Wright, the latter knew that the policy was "critical" to Halpin's estate plan as the sole asset of the Trust. Triarsi points to the fact that Wright had "on at least one occasion" advanced the premium for the policy, and then been reimbursed by Halpin.

In 2008, Halpin's health declined and he became seriously

ill. Halpin was hospitalized in November 2008 and died on December 28, 2008. His illness, according to Triarsi, caused Halpin to become "despondent and inattentive to his personal and business affairs." Triarsi contends that Wright knew that Halpin's illness was having that effect.

In November or December 2008, Triarsi discovered that the insurance policy had been cancelled. Halpin's wife subsequently found unopened letters from the insurance carrier in Halpin's mail. The documents revealed that the insurance carrier had sent a notice of intent to cancel the policy to both Halpin and Wright on February 25, 2008. In March 2008, Halpin had sent the carrier a check in the premium amount. However, the carrier returned the payment to Halpin because it had been received after the end of the grace period for renewal. Halpin, however, had never opened the letter containing the carrier's check for the returned premium, and also failed to open a letter containing instructions on procedures to reinstate the policy.

On April 3, 2009, Triarsi filed a complaint against BSC and Wright alleging: (1) breach of defendants' fiduciary duty to Halpin and Triarsi as insured and trustee, respectively; (2) breach of defendants' duty of reasonable care in performing their duties as life insurance agent and broker; and (3) breach of the special relationship between insurance agent and client in connection with life insurance policies. Triarsi alleged that Wright and BSC "regularly received copies of all notices from the insurance carrier concerning the Policy, including the notice of intent to cancel for lack of payment, notice of cancellation, and the return of the premium check along with the [reinstatement] form." Consequently, Triarsi contends that they had a duty to effectuate the renewal of the policy or its reinstatement following cancellation.

Although Triarsi's case information statement (CIS) did not list the action as one involving a claim of professional negligence, the CISs filed by both defendants designated the matter as a professional malpractice case requiring that an affidavit of merit be served pursuant to the Affidavit of Merit (AOM) statute, N.J.S.A. 2A:53A-27. However, the case management conference required by the Supreme Court to facilitate the timely service of affidavits of merit, known as a Ferreira*fn1

conference, was never scheduled by the court.

Triarsi declined to serve an affidavit of merit, contending that based on "consultation with experts" an affidavit was not necessary. Wright filed a motion to dismiss, which was joined by BSC. Triarsi opposed the motion, but did not file an affidavit of merit. At the hearing on the motion, Triarsi argued (1) that the AOM statute did not apply to counts one and three, and (2) that, if they were found to be within the purview of the statute, the common knowledge exception applied.

The judge rejected Triarsi's arguments and dismissed the complaint with prejudice on February 16, 2010. In his oral decision, the judge held that the AOM statute applies to malpractice suits against insurance producers, such as BSC and Wright, because they are licensed by the State.*fn2 The judge then cited Couri v. Gardner, 173 N.J. 328 (2002), and held that our Supreme Court in the Couri opinion found that it's not the label placed on the action that is pivotal but the nature of the legal inquiry. Accordingly, when presented with a tort or contract claim asserted against the professional specified in the statute, rather than focusing on whether the claim is denominated as tort or contract, attorneys and courts should determine if the claims underlying the factual allegation require proof of a deviation from the professional standard of care applicable to that specific profession. If such proof is required, an Affidavit of Merit is required for that claim unless some exception applies.

This court has had the opportunity to review the complaint in its entirety and I find that in this case, the factual allegations set forth in the complaint would require proof of a deviation from the professional standard of care applicable to insurance producers.

The judge concluded that the AOM statute was applicable to all three counts of Triarsi's complaint and dismissed all of them with prejudice because ...

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