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CAROL CAMPANELLI, respondent, v. FLUSHING ULTRASOUND SERVICES, INC., appellant, ET AL., defendants (ACTION NO. 1). MEDICAL MALPRACTICE INSURANCE ASSOCIATION, ET AL., respondents,

ORDERED that the order is affirmed insofar as appealed from, with one bill of costs to the plaintiffs payable by the appellants, and the matters are remitted to the Supreme Court, Nassau County, for the entry of a judgment in Action No. 2 declaring that the County of Nassau has the duty to defend and indemnity Andresito Pacis in Action No. 1.

The plaintiff in Action No. 1, Carol Campanelli, had a mammogram performed at the defendant Nassau County Department of Health. Although she received a report indicating that the mammogram revealed no suspicious findings, she was subsequently diagnosed with metastatic cancer.

The plaintiff commenced Action No. 1, a negligence action, against the County of Nassau (hereinafter the County), the Nassau County Department of Health, Flushing Ultrasound Services, Inc. (hereinafter Flushing Ultrasound), and Dr. Andresito Pacis (hereinafter Dr. Pacis). The County retained Flushing Ultrasound to read and interpret mammograms. Flushing Ultrasound had obtained an insurance policy to cover any professional liability claims made against radiologists and also agreed that it would defend and hold harmless the County against any claims or lawsuits.

Dr. Pacis, the radiologist who reviewed and prepared the report with respect to the plaintiff's mammogram, was paid by Flushing Ultrasound according to the number of mammograms or X-ray films that he read, and was covered under a malpractice policy issued by the Medical Malpractice Insurance Association (hereinafter MMIA). Dr. Pacis requested that the County provide him with a defense in the negligence action, and the County refused. Thereafter, MMIA and Dr. Pacis commenced Action No. 2, seeking a declaration that the County has a duty to defend and indemnify him.

In the negligence action, Flushing Ultrasound moved for summary judgment dismissing the complaint on the ground that it was not vicariously liable for the acts of Dr. Pacis since he was an independent contractor. In the declaratory judgment action, MMIA and Dr. Pacis also moved for summary judgment in their favor, seeking a declaration that the County has a duty to defend and indemnify Dr. Pacis, pursuant to General Municipal Law 50-d. The Supreme Court denied the motion of Flushing Ultrasound, finding that there were triable issues of fact. However, the Supreme Court granted the motion of MMIA and Dr. Pacis, finding that neither the doctor's employment status nor the fact that Flushing Ultrasound agreed to indemnify the County avoided the statutory obligation imposed by General Municipal Law 50-d.

The Supreme Court properly denied the summary judgment motion of Flushing Ultrasound in the negligence action. Contrary to Flushing Ultrasound's contention, there is a triable issue as to whether Pacis was retained as an employee or as an independent contractor (see, Felter v. Mercy Community Hosp. of Port Jervis, 244 A.D.2d 385, 386; Felice v. St. Agnes Hosp., 65 A.D.2d 388, 396).

In Action No. 2, the declaratory judgment action, the Supreme Court also correctly determined that the County has a duty to defend and indemnify Dr. Pacis, as neither the doctor's employment status nor the contractual provision wherein Flushing Ultrasound agreed to indemnify the County avoided the statutory obligation imposed by General Municipal Law 50-d (see, Pedrero v. Moreau, 81 N.Y.2d 731; Norr v. Speigler, 44 N.Y.2d 809).

The County's remaining contentions are either without merit or are improperly raised for the first time on appeal (see, Goldblatt v. LaShellda Maintenance Co., 278 A.D.2d 451; Matter of ELRAC, Inc. v. Edwards, 270 A.D.2d 414).

We note that since Action No. 2 is a declaratory judgment action, the Supreme Court should have directed the entry of a judgment declaring that the County has the duty to defend and indemnity Dr. Pacis in Action No. 1 (see, Lanza v. Wagner, 11 N.Y.2d 317, 334, appeal dismissed 371 U.S. 74, cert denied 371 U.S. 901).

O'BRIEN, J.P., FRIEDMANN, SMITH and COZIER, JJ., concur.

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CAMPANELLI v. FLUSHING ULTRASOUND SVCS
(Oct 1, 2001)