A New York Richmond County Supreme Court Justice has denied an Allstate motion seeking a partial summary judgment to dismiss a complaint brought by a body shop alleging the insurer owes payments totaling $752,466 for 96 separate insurance claims. 

Barry’s Auto Body and Collision Repair of NY, located on Staten Island, is the assignee of personal property claims of assignors who brought their vehicles to the business for repairs, according to the complaint filed in 2020. In essence, these repair customers transferred their rights under the policy to the repair facility. It says each of the customers were insured by Allstate or was in an accident with someone insured by Allstate, for whom the insurer accepted liability and agreed to pay for motor vehicle repairs. 

The complaint alleges Allstate was obligated to provide sufficient coverage to pay for a proper repair and/or to restore the customer’s vehicles to their pre-accident condition but refused to pay the deficiencies for the repair of the customer’s vehicle. 

Allstate’s refusal to pay, damaged the customers billed for the full amount necessary to repair their vehicles to their pre-accident condition. 

It is alleged Allstate violated general business law in the complaint. It states Allstate has consistently and systematically provided lower estimates of the cost of repairs than what is actually the reasonable cost of repairing a given vehicle to its pre-loss condition. 

“These tactics include but are not limited to, using inappropriate methods of determining the number of hours of labor, the arbitrary capping of labor rates, arbitrary capping of paint and materials, refusing to pay for body shop materials,” the complaint states. “Allstate has also repeatedly and continuously deceived its consumers regarding the availability of other repair shops that would put the vehicle to its pre-loss condition for the amount of Allstate’s estimate.”

Allstate’s motion to dismiss the complaint was filed in June of this year. It argued the plaintiff is obligated to comply with all policy terms and conditions which includes “no one may bring an action against us in any way related to…the amount of loss for which coverage is sought… unless there is full compliance with all policy terms and such action is commenced within one year after the date of loss.” 

The motion alleges 66 of the 96 contract complaints happened within one year of their respective dates of loss, making them dismissible. 

Allstate also argues that Barry’s Auto Body of NY doesn’t have the ability to make a complaint under General Business Law on behalf of the customers because the assignments were expressly limited to their contract claims only. 

“The assignors did not assign to Plaintiff their rights to assert claims sounding in tort or statutory violations against Allstate,” the motion says.

Supreme Court Justice Orlando Marrazzo Jr. says in his decision that General Business Law prohibits deceptive acts and practices that misrepresent the nature or quality of products or services. 

“It is noteworthy in the context of this action that the Legislature specifically recognized that other businesses, such as Plaintiff herein, could be injured by this deceptive conduct, and thereby have standing to bring an action under the statute, and that the remedies were not limited to merely consumers,” Marrazzo says in the order. 

He notes that appellate courts have recognized claims brought by body shops on many occasions. 

“Contrary to Defendant’s arguments, Plaintiffs injuries claimed herein are direct and not derivative of injuries suffered by the Insureds,” the order states. 

Marrazzo also writes that the definition of a year in Allstate’s contract is ambiguous. The order says that the damage for breach of contract were not objectively ascertainable on the date of the accident. 

“The repair process includes many opportunities for negotiation between the insurer and the insured or their designated representative,” the order says. “During this process, the shop might request a supplemental estimate from the insurer which has the effect of increasing the amount paid on the claim. It is only when the negotiations are complete, and the insurer deems its obligations satisfied that the damages can be ascertainable – in this case the difference between what the shop charged the Insured and the amount that the insurer paid.” 

Barry Crupi, Barry’s Auto Body owner, says the case will either go to trial in January or reach a settlement. The body shop has seven other similar cases filed in federal court at this time, he said. 

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