Date: May 28, 2026

Denial of Summary Judgment Does Not Bar Trial Finding of “Willful and Avowed Obstruction” Supporting a Noncooperation Disclaimer Under Insurance Law § 3420

1. Introduction

Foddrell v Utica First Ins. Co. (2026 NY Slip Op 03294 [249 AD3d 1153] [2d Dept May 27, 2026]) addresses a recurring tension in New York’s direct-action framework: an injured plaintiff’s statutory right to pursue a tortfeasor’s insurer under Insurance Law § 3420(a)(2) versus an insurer’s ability to defeat that claim by proving the insured’s lack of cooperation.

The plaintiff, Thomas Foddrell, obtained a judgment in a construction-accident personal injury action against Joney & Rana Construction Corp. (“J&R”), Utica’s insured. After the judgment went unsatisfied, Foddrell sued Utica directly under § 3420(a)(2). Utica defended on the ground that J&R (through its principal, Gardeep Singh) failed to cooperate in the defense—most notably by repeatedly failing to appear for court-ordered depositions despite notice and warnings.

Two key issues drove the appeal: (1) whether the Second Department’s earlier decision affirming denial of Utica’s summary judgment motion constrained the trial court from later determining at trial that the insured’s conduct was “willful and avowed obstruction,” and (2) whether Utica met the stringent evidentiary burden required to disclaim coverage for noncooperation in the context of a § 3420(a)(2) direct action.

2. Summary of the Opinion

The Appellate Division affirmed the judgment after a nonjury trial dismissing the complaint against Utica. It held:

The appeal from the decision (as opposed to the judgment) was dismissed because “no appeal lies from a decision,” citing Schicchi v J.A. Green Constr. Corp., 100 AD2d 509 [1984].
The prior appellate ruling (Foddrell v Utica First Ins. Co., 178 AD3d 901 [2019]) did not bar the trial court from deciding at trial whether J&R’s conduct constituted “willful and avowed obstruction,” because that issue had not been determined on the merits, citing J.C. Tarr, Q.P.R.T. v Delsener, 70 AD3d 774, 778 [2010].
Although the plaintiff proved the statutory prerequisites for a § 3420(a)(2) action, Utica proved noncooperation under the governing three-part standard: diligent efforts, reasonable calculation to obtain cooperation, and the insured’s willful obstruction. Accordingly, Utica established a valid defense and the complaint was properly dismissed.

3. Analysis

3.1. Precedents Cited

A. Appellate procedure and scope of review

Schicchi v J.A. Green Constr. Corp., 100 AD2d 509 [1984]: Used for the procedural proposition that an appeal does not lie from a “decision” (as distinct from an order or judgment). This limits appellate review to appealable paper and reinforces careful appellate practice.
Allstate Ins. Co. v Kapeleris, 235 AD3d 708, 708 [2025] (quoting Gelaj v Gelaj, 216 AD3d 1082, 1083 [2023]; and citing O'Brien v Dalessandro, 43 AD3d 1123, 1123 [2007]): Cited for the standard governing appellate review after a nonjury trial—broad authority comparable to the trial court, while still accounting for the trial judge’s ability to see and hear witnesses. This framing matters because noncooperation often turns on credibility, inferences, and documentary proof of notice and warnings.
J.C. Tarr, Q.P.R.T. v Delsener, 70 AD3d 774, 778 [2010]: Supports the conclusion that the earlier appeal did not resolve (on the merits) whether the insured’s conduct amounted to willful obstruction. The court uses this to reject a “law of the case” type argument aimed at freezing the issue at the summary-judgment posture.

B. The § 3420(a)(2) direct action framework (“steps into the shoes”)

DeLuca v RLI Ins. Co., 187 AD3d 709, 711-712 [2020] (quoting Lang v Hanover Ins. Co., 3 NY3d 350, 354-355 [2004]): Provides the modern statement of the statutory prerequisites (judgment, service, 30-day wait) and explains that the injured party’s rights are derivative— the claimant “steps into the shoes” of the insured and can assert only those rights the insured could assert.
Lang v Hanover Ins. Co., 3 NY3d 350, 354-355 [2004]: Central authority describing § 3420(a)(2)’s limited circumstances and derivative nature. In practice, this means an insurer may assert against the claimant the same defenses it could assert against the insured, including noncooperation.
Coleman v New Amsterdam Cas. Co., 247 NY 271, 275 [1928]: Used (via DeLuca v RLI Ins. Co.) for the foundational purpose of the statute: to give the injured claimant a cause of action for essentially the same indemnity/reimbursement relief the insured would have after satisfying the judgment. This historical framing supports the derivative-rights concept.

C. Disclaimer for noncooperation: burden and elements

Insurance Law § 3420(c)(1) (quoted via DeLuca v RLI Ins. Co., 187 AD3d at 712): Places the burden on the insurer to prove the insured’s alleged failure or refusal to cooperate when raised as a defense in a § 3420(a)(2) action.
Matter of Government Empls. Ins. Co. v Fletcher, 147 AD3d 940, 940 [2017] (quoting Utica First Ins. Co. v Arken, Inc., 18 AD3d 644, 645 [2005]): Supplies the controlling three-part test for noncooperation disclaimers: (1) diligent efforts, (2) efforts reasonably calculated to obtain cooperation, and (3) willful and avowed obstruction by the insured.
Matter of Hereford Ins. Co. v McKoy, 160 AD3d 734, 737 [2018] (quoting Thrasher v United States Liab. Ins. Co., 19 NY2d 159, 168 [1967]): Reinforces that the insurer’s burden to prove lack of cooperation is “heavy.” The court’s repeated invocation of this principle highlights that dismissal was not automatic; it depended on a sufficiently documented course of conduct and notice.
Pawtucket Mut. Ins. Co. v Soler, 184 AD2d 498, 499 [1992]: Supports the point that an insured’s minimal early participation (here, a written statement) does not reasonably satisfy ongoing duties to cooperate in litigation (e.g., appearing for depositions).
Allstate Ins. Co. v United Intl. Ins. Co., 16 AD3d 605, 606 [2005] and Utica First Ins. Co. v Arken, Inc., 18 AD3d at 645: Cited as comparable applications where the insurer met its burden. These cases function as analogues validating that repeated missed deposition appearances—paired with proper notice and warnings—can rise to willful obstruction.

3.2. Legal Reasoning

A. The prior appeal did not decide “willful obstruction” on the merits

The plaintiff sought to treat the Second Department’s 2019 affirmance of the denial of summary judgment (Foddrell v Utica First Ins. Co., 178 AD3d 901 [2019]) as precluding (or at least constraining) the trial court’s later determination that J&R’s conduct was “willful and avowed obstruction.” The court rejected that position.

The key point is procedural and doctrinal: a denial of summary judgment generally means only that triable issues exist; it is not a merits determination of the disputed factual question. By citing J.C. Tarr, Q.P.R.T. v Delsener, the court underscored that the earlier appellate ruling did not conclusively decide willfulness and thus did not bar a contrary finding after trial evidence was weighed.

B. The plaintiff met § 3420(a)(2) prerequisites—but takes the insured’s vulnerabilities

The court confirmed the plaintiff made out the statutory prima facie case: judgment against the insured, service on the insurer, and waiting 30 days. Under Lang v Hanover Ins. Co. and DeLuca v RLI Ins. Co., that opens the courthouse door, but does not eliminate defenses. Because the injured party “steps into the shoes” of J&R, Utica could invoke any coverage defense that would have defeated J&R’s own claim for defense/indemnity—here, noncooperation.

C. Utica satisfied the “heavy burden” to prove noncooperation

Applying the Matter of Government Empls. Ins. Co. v Fletcher / Utica First Ins. Co. v Arken, Inc. framework (itself shaped by the “heavy burden” principle from Thrasher v United States Liab. Ins. Co. and reiterated in Matter of Hereford Ins. Co. v McKoy), the court affirmed the trial court’s findings:

Diligence: Utica retained defense counsel and an investigator, attempted to contact Singh, and pursued attendance at depositions after earlier failures. The record reflected repeated efforts over time, not a single perfunctory request.
Efforts reasonably calculated to obtain cooperation: The insurer and counsel used direct calls, investigator contact, scheduling information, and explicit warnings—steps calibrated to reach the principal decision-maker of the corporate insured.
Willful and avowed obstruction: The decisive facts were notice and warnings followed by unexplained nonappearance. The court emphasized Singh was told the time and place of the April 13, 2009 deposition; was informed that the answer could be struck; and was warned Utica would disclaim coverage if he failed to attend. Singh even indicated to counsel he would appear—yet did not. That sequence supported the inference of deliberate obstruction rather than misunderstanding, negligence, or inability.

The court also rejected any notion that Singh’s earlier written statement discharged the duty to cooperate, citing Pawtucket Mut. Ins. Co. v Soler to reinforce that cooperation is ongoing and litigation-specific (especially where depositions are court-ordered and directly affect the defense posture).

3.3. Impact

Clarifies the post-summary-judgment trial landscape: The decision reinforces that an appellate affirmance of a summary-judgment denial does not lock in disputed factual issues for the remainder of the case. Parties must expect that credibility assessments and a fuller evidentiary record at trial can produce findings different from what seemed plausible at the summary-judgment stage.
Reinforces best practices for insurers asserting noncooperation: Utica prevailed on a “heavy burden” because it documented repeated outreach, used multiple channels (counsel + investigator), and delivered clear warnings tied to specific litigation events (depositions) and consequences (disclaimer, striking of pleadings). Future insurers will cite this case for the proposition that well-documented notice plus repeated nonappearance can satisfy “willful and avowed obstruction.”
Signals risk to injured plaintiffs in § 3420(a)(2) actions: Even with a valid unsatisfied judgment, the claimant’s recovery remains vulnerable to insured-based defenses. Practically, plaintiffs may increase focus on building a record in the underlying action showing the insured’s ability to cooperate (or exploring alternative coverage/parties) because the derivative nature of § 3420(a)(2) is outcome-determinative.
Corporate insureds and deposition compliance: The factual pattern highlights a particular risk for corporate insureds whose principal is the only meaningful witness/representative. Failure of that principal to appear for depositions can forfeit the coverage intended to fund the defense and satisfy judgments, leaving the corporation exposed and the injured party with an uncollectible judgment.

4. Complex Concepts Simplified

Insurance Law § 3420(a)(2) (direct action): A statute allowing an injured person to sue the tortfeasor’s insurer directly after obtaining a judgment against the tortfeasor, serving it on the insurer, and waiting 30 days without payment. It is not a free-standing claim; it depends on the insured’s rights under the policy.
“Steps into the shoes”: The injured plaintiff inherits the insured’s position against the insurer—no better and no worse. If the insured would lose due to a policy defense, the injured plaintiff can lose for the same reason.
Noncooperation / lack of cooperation: A coverage defense where the insurer claims the insured failed to assist in the defense (e.g., refusing to appear for depositions, failing to provide information). New York requires strict proof before allowing a disclaimer on this basis.
“Willful and avowed obstruction”: More than mere forgetfulness or negligence. It refers to conduct showing a deliberate refusal to cooperate after the insurer has clearly sought cooperation, typically supported by evidence of notice, warnings, and repeated noncompliance.
Nonjury trial appellate review: After a bench trial, the Appellate Division has broad power to review facts, but still recognizes the trial judge’s advantage in seeing and hearing witnesses (as stated in Allstate Ins. Co. v Kapeleris).

5. Conclusion

Foddrell v Utica First Ins. Co. confirms two practical rules in New York insurance litigation. First, an earlier appellate affirmance of a summary-judgment denial does not preclude a trial court from later finding—on a full record—that an insured’s conduct constitutes “willful and avowed obstruction.” Second, while the insurer’s burden to prove noncooperation remains “heavy,” it can be met where the insurer documents diligent, targeted efforts to secure attendance and the insured nonetheless repeatedly fails to appear—particularly after explicit notice of deposition details and clear warnings of coverage consequences.