The Appellate Division, First Department (the intermediate appellate state court in Manhattan) has just dismissed several (but not all) of the causes of action in a case against brokers DeWitt Stern, holding that contingent commission agreements between brokers and insurers are not illegal, and, in the absence of a special relationship between the parties, the defendant brokers had no duty to disclose the existence of the contingent commission agreement. The broker/client relationship, even though it had existed for some time, was not sufficient to impose a fiduciary duty on the brokers. (Plaintiff's allegations of negligence and breach of contract survived the motion to dismiss.)
See Hersch v. DeWitt Stern Group, 2007 NY Slip Op 06567 (1st Dept., Sept. 6, 2007).
I have no idea whether this decision will have any effect on whatever proceedings Marsh, Aon, and Willis are still involved in as a result of the Spitzer investigations. Be interesting to watch.
Wednesday, September 12, 2007
- ▼ 2007 (9)