15-3337-cv
Stein v. American General Life Insurance Company


                                 UNITED STATES COURT OF APPEALS
                                     FOR THE SECOND CIRCUIT
                                                   SUMMARY ORDER
RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A
SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED
BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1.
WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY
MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE
NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY
OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

       At a stated term of the United States Court of Appeals for the Second Circuit, held
at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New
York, on the 5th day of December, two thousand sixteen.
PRESENT: JON O. NEWMAN,
                 GERARD E. LYNCH,
                 CHRISTOPHER F. DRONEY,
                                 Circuit Judges.
----------------------------------------------------------------------
ALLEN STEIN, AS TRUSTEE OF THE RACHEL MEISELS
IRREVOCABLE TRUST 2006B,
                                 Plaintiff-Appellant,

                               v.                                             No. 15-3337-cv

AMERICAN GENERAL LIFE INSURANCE COMPANY,
                                 Defendant-Appellee.
----------------------------------------------------------------------

 FOR PLAINTIFF-APPELLANT:                                    IRA S. LIPSIUS, Lipsius-BenHaim Law
                                                             LLP, Kew Gardens, NY.

 FOR DEFENDANT-APPELLEE:                                     DAVID     T. MCDOWELL, Edison,
                                                             McDowell & Hetherington LLP,
                                                             Houston, TX.

      Appeal from a judgment of the United States District Court for the Eastern District
of New York (Irizarry, J.).



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    UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED,
AND DECREED that the judgment of the district court is AFFIRMED.

      Plaintiff-Appellant Allen Stein, Trustee of the Rachel Meisels Irrevocable Trust
2006B (the “Trust”), filed a notice of appeal from the July 22, 2014, order and the
September 28, 2015, order of the district court. The first order denied both parties’
motions for summary judgment; the second order granted summary judgment in favor of
Defendant-Appellee American General Life Insurance Company (“American General”)
and ordered the case dismissed. We will treat the notice of appeal as seeking to appeal the
judgment, entered September 29, 2015, implementing the order entered September 28.1

      In 2009, an insurance policy issued by American General insuring the life of
Rachel Meisels lapsed due to nonpayment of premiums. In 2011, Stein brought suit
seeking a declaration that the insurance policy was still in force.2 The district court
concluded that there were no genuine disputes of material fact that the policy had lapsed.
This appeal followed. We assume the parties’ familiarity with the underlying facts, the
procedural history of the case, and the issues on appeal, which we reference only as
necessary to explain our decision to affirm.

       This Court reviews de novo a district court’s grant of summary judgment.
Matthews v. City of New York, 779 F.3d 167, 171 (2d Cir. 2015). Summary judgment is
proper only if “‘the movant shows that there is no genuine dispute as to any material fact
and the movant is entitled to judgment as a matter of law.’” Id. (quoting Fed. R. Civ. P.
56(a)). This Court “also review[s] de novo the district court’s interpretation and
application of state law.” Phansalkar v. Andersen Weinroth & Co., 344 F.3d 184, 199 (2d
Cir. 2003) (per curiam).

       On appeal, Stein argues that: (1) American General failed to mail the Trust a
“Grace Period Notice,” as required by New York law; (2) even if such Notice was
mailed, it was legally deficient; and (3) American General was compelled to accept a
replacement check and keep the policy in force. These arguments are meritless.




1
  To the extent that the notice of appeal sought to appeal the order entered July 22, 2014, it was improper, as that
was an unappealable pretrial order, and unnecessary, as an appeal from the final judgment would have brought up
for review all prior orders of the district court that produced the judgment. See SongByrd, Inc. v. Estate of
Grossman, 206 F.3d 172, 178 (2d Cir. 2000).
2
  This action was originally filed in New York state court. It was removed to the United States District Court for the
Eastern District of New York on the basis of diversity jurisdiction.


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              1. Proof of Mailing

        Under New York law, an insurer may not terminate a life insurance policy for
failure to pay premiums without first notifying the policyholder by mail of the impending
lapse. N.Y. Ins. Law § 3211 (McKinney 2008). A presumption of receipt of such notice
arises when “the record establishes office procedures, followed in the regular course of
business, pursuant to which [the] notice[] ha[s] been addressed and mailed.” Ma v.
Merrill Lynch, Pierce, Fenner & Smith, Inc., 597 F.3d 84, 92 (2d Cir. 2010) (citing
Nassau Ins. Co. v. Murray, 386 N.E.2d 1085, 1086 (N.Y. 1978)). “To rebut this
presumption, a litigant must show that ‘routine office practice was not followed or was so
careless that it would be unreasonable to assume that notice was mailed.’” Id. (quoting
Nassau, 386 N.E.2d at 1086). “Mere denial of receipt is insufficient to rebut the
presumption.” Id.

       At summary judgment, American General offered extensive evidence regarding its
office procedures as proof that a Grace Period Notice was mailed to the Trust in May
2009, including: (1) the declaration of James Daniel, Director of Information
Technology; (2) the declaration of Frank Vallis, Director of Records Management; and
(3) the deposition testimony of Jeremy Ciszewski, General Manager for Pitney Bowes,
American General’s mail processor. Stein contends that this evidence is insufficient
because Ciszewski lacked personal knowledge of the mailing. Specifically, Stein asserts
that the Grace Period Notice was mailed from Pitney Bowes’s Stafford, Texas facility
and that, as an employee of the Houston facility, Ciszewski could not have testified as to
how the Notice was mailed or to the mailing procedures in effect at the Stafford facility
during the time period when the Notice was mailed.

        Under New York law, “personal knowledge is required only to establish regular
office procedure, not the particular mailing.” Meckel v. Cont’l Res. Co., 758 F.2d 811,
817 (2d Cir. 1985); Bossuk v. Steinberg, 447 N.E.2d 56, 58 (N.Y. 1983). Here,
Ciszewski’s deposition testimony clearly demonstrates that he had personal knowledge of
Pitney Bowes’s regular office procedure as of May 2009. Ciszewski testified that he
worked at Pitney Bowes, in both mail sorting and human resources capacities, since
2002. He testified that, during that time, he worked at three different facilities, and that
all three “follow[ed] a very similar approach.” App’x at 50. Ciszewski then described
Pitney Bowes’s mailing procedures in detail. Ciszewski further testified that office
procedures at that facility had not changed between May 2009, when the Grace Period
Notice was sent, and November 2009, when Ciszewski began working at the Stafford
facility. We agree with the district court that this testimony, along with the other evidence
offered by American General, is sufficient to create a presumption of receipt. Because
Stein offers no evidence to rebut this presumption, apart from denying that the Notice


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was ever received, we conclude that there is no genuine dispute that American General
has satisfied its mailing obligations under New York law.

              2. The Grace Period Notice

        Pursuant to New York Insurance Law § 3211, a Grace Period Notice must state:
(1) the amount of payment owed; (2) the date when payment is due; (3) the place where
and the person to whom payment can be made; and (4) that, without such payment, the
policy will terminate or lapse. N.Y. Ins. Law § 3211(b)(2) (McKinney 2008). Although
“forfeiture of life insurance coverage for late payment of premiums is ‘not favored in the
law,’” Speziale v. Nat’l Life Ins. Co., 159 F. App’x 253, 255 (2d Cir. 2005) (summary
order) (quoting N.Y. Life Ins. Co. v. Eggleston, 96 U.S. 572, 577 (1877)), these notice
requirements should not be construed as creating a “trap” for either the insurer or the
insured, McCormack v. Sec. Mut. Life Ins. Co., 116 N.E. 74, 77 (N.Y. 1917). Thus, minor
variations from the statutory notice requirements of § 3211 will not automatically render
a grace period notice noncompliant. See McCormack, 116 N.E. at 77 (interpreting § 3211
and asserting that, while everything of substance must be stated, “there is no requirement
of literal adherence to one invariable form”); see also Zeligfeld v. Phx. Life Ins. Co., 975
N.Y.S.2d 370 (Table), 2013 WL 1688902, at *4 (N.Y. Sup. Ct. 2013) (concluding that
notice containing minor error or obvious typographical error in premium amount due may
still provide essential information required by § 3211, and therefore be found in
compliance).

       Stein maintains that, even if American General mailed the Trust a Grace Period
Notice, the Notice failed to clearly and accurately convey the amount owed, the date due,
and the payee. The district court concluded otherwise, and we agree. As to amount owed,
there can be no genuine question that the Notice clearly indicated that, unless a payment
of $22,361.91 was received, the policy would lapse. Indeed, the payment stub also read,
“Pay This Amount: $22,361.91.” App’x at 157. That the Notice also indicated the
minimum quarterly premium required is irrelevant. As to date due, even if the Notice
erroneously indicated that payment was due prior to July 20, 2009, instead of on or
before that date, such error was de minimis. Stein had approximately two months’ notice
of the deadline, and was advised that prompt action was required to keep the policy in
force. See McCormack, 116 N.E. at 77 (noting that “the purpose of the [grace period]
notice is to spur the assured to diligence”). Finally, as to the appropriate payee, American
General submitted evidence showing that: (1) the Trust had made checks for premium
payments out to “American General,” “American General Life Insurance,” and “AIG” in
the past, all of which had been accepted; and (2) the Trust had received a nearly identical
Grace Period Notice in June 2008, and subsequently mailed payment to the correct
address. Thus, despite the fact that the Notice listed three different corporate entities and
included two different addresses, any resulting ambiguity could not have confused or

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prejudiced Stein. In sum, we conclude that no genuine issue of material fact exists, and
that the Grace Period Notice adequately conveyed all the information required by law.

              3. The Replacement Check

       On June 3, 2009, American General mailed the Trust a Quarterly Notice of
Payment Due, indicating that a premium payment of $15,000 was due by July 17, 2009.
On July 16, 2009, American General received a $15,000 check from the Trust,
erroneously made out to “R. Meisels” (the name of the insured). As a result, American
General returned the check to the Trust, along with a form letter that stated, in relevant
part: “Please correct and return to us. We will process promptly upon receipt.” App’x at
216. The Trust subsequently submitted a corrected check, but American General declined
to accept it because, by the time of its receipt, the grace period had expired and the policy
had lapsed.

       Stein maintains that the form letter constituted a promise by American General to
accept the replacement check, regardless of the grace period deadline, and keep the
policy in force. That argument fails for two reasons. First, we find no genuine dispute that
the form letter, which did not reference the policy’s impending lapse and simply
requested a replacement check made out to the correct party, did not extend the
applicable grace period deadline. Second, even if such an extension were made, the
$15,000 replacement check was well below the amount required to keep the policy in
force. Accordingly, we reject Stein’s argument.

                                      *      *       *

      We have considered Stein’s remaining arguments and conclude that they are
without merit. We therefore AFFIRM the judgment of the district court.

                                   FOR THE COURT:
                                   Catherine O’Hagan Wolfe, Clerk of Court




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