| Matter of Union Indem. Ins. Co. of N.Y. |
| 2009 NY Slip Op 08061 [67 AD3d 469] |
| November 10, 2009 |
| Appellate Division, First Department |
| In the Matter of Liquidation of Union Indemnity InsuranceCompany of New York. Superintendent of Insurance of the State of New York, Respondent;Robert A. Spira, Appellant. |
—[*1] Mait, Wang & Simmons, New York (Michael C. Simmons of counsel), forrespondent.
Judgment, Supreme Court, New York County (Jacqueline W. Silbermann, J.), enteredFebruary 14, 2008, awarding plaintiff the sum of $257,858.62 against defendant, pursuant to anorder, same court (Karla Moskowitz, J.), entered February 14, 2008, which granted plaintiff'smotion to confirm the report and recommendation of a special referee, and directed entry ofjudgment in accordance with the recommendation, unanimously affirmed, without costs. Appealfrom the above order unanimously dismissed, without costs, as subsumed in the appeal from thejudgment.
Defendant's statute of limitations argument is barred by res judicata. Originally dismissed byJustice Gammerman in an earlier decision in this matter, affirmed by this Court (289 AD2d 173[2001], lv denied 98 NY2d 672 [2002]), this argument was raised again by defendant onan appeal in 2004, which was dismissed with prejudice by order of this Court entered August 18,2005.
Defendant's argument that his right to offsets for the diminution in value of certain stockswhich were subject to a restraining order is without merit as the order was made with the consentof the defendant. Moreover, it would be purely speculative to conclude that defendant wouldhave sold the stock prior to some degree of diminution, since defendant never sought permissionto sell any of the stock and does not offer any record support for his alleged losses. In any event,such decrease in value was not caused by the restraints on his stock, but by market forces(see Miller v Ferry, 2 NYS 863 [1888]).
The reference to the special referee was properly made. The motion court correctly perceivedthat the only issue remaining as to any alleged improper conduct by the liquidator, which had notalready been dismissed by Justice Gammerman (289 AD2d at 174), was whether the liquidatorhad unjustifiably prolonged the litigation, and the court properly limited defendant's discovery tothat issue. Moreover, this referral was consistent with the earlier [*2]referral by Justice Gammerman, in that both sought to have thespecial referee determine the reasonableness of interest and attorneys' fees associated with thecollection of the underlying debt which defendant guaranteed. No issue relating to the failure tonotify defendant or to accept defendant's proffered assistance remains because, even though theliquidator would then "proceed[ ] at his own risk," that risk is limited to the later necessity ofproving, at the time of seeking reimbursement from the indemnitor (defendant), that theindemnitor would have been liable and that there was no good defense (L. B. Kaye Assoc. vLibov, 139 AD2d 440 [1988]). Those issues were established in the aforementionedproceedings before Justice Gammerman (see 289 AD2d 173 [2001]). Defendant'schallenge to the legality of the reference is waived, since he did not object to it and fullyparticipated in the proceedings before the special referee (see Matter of Nilda S. v DawnK., 302 AD2d 237, 238 [2003], lv denied 100 NY2d 512 [2003]).Concur—Tom, J.P., Saxe, Renwick, DeGrasse and Richter, JJ.