# Correa v. New England Life Insurance Company

> District Court, E.D. New York · September 30, 2024

URL: https://www.frixlaw.com/law-library/cases/10659578

## Case

- **Court:** District Court, E.D. New York
- **Decided:** September 30, 2024
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/10659578

## How later opinions describe it (automated extraction)

- stating that “[t]he dearth of New York cases applying the laws of more than one state to an insurance policy — or any contract — is a significant factor in our decision” to apply only New York law
- applying Section 3211(c) in conjunction with the common-law presumption
- holding that “because the instant action is one for a declaratory judgment, rather than to recover on the policy, it is not time-barred by the two year statute of limitation”

## Opinion text

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
------------------------------------x

RAUL CORREA and GLADYS CORREA,

Plaintiffs,
MEMORANDUM & ORDER
20-CV-3711(EK)(MMH)
-against-

NEW ENGLAND LIFE INSURANCE COMPANY
and BRIGHTHOUSE FINANCIAL, INC.,

Defendants.

------------------------------------x
ERIC KOMITEE, United States District Judge:
Raul and Gladys Correa seek a declaratory judgment
that a life insurance policy they own remains in effect. The
policy was issued by the New England Life Insurance Company,
which is referred to herein as “NELICO.” The Correas assert
that because they never received proper notice that the policy
would lapse for lack of payment, NELICO could not have legally
terminated the policy.
NELICO now moves for summary judgment, arguing
primarily that the undisputed facts are sufficient to establish
a legal presumption that notice was properly mailed and received
prior to the policy’s termination. For the reasons that follow,
that motion is granted in part and denied in part.
I. Background1
The Correas purchased the life insurance policy at
issue from a bankruptcy estate. Pl. 56.1 Resp., at 24 ¶ 1. The
policy insures the lives of Wilmos and Olga Friedman. Id. at 1

¶ 1. The Correas appear to have made a practice of buying
insurance policies for investment: they own “over seventy life
insurance policies.” Raul Correa Declaration (“Correa Decl.”)
¶ 8, ECF No. 62-2. They manage the policies through an entity
they control called Insurance Advisors and Administrators. Id.
¶¶ 4, 8. The Correas, who reside in Florida, maintain a post
office box in Miami at which they receive insurance notices.
Id. ¶¶ 3, 6.
A. The Policy
NELICO issued the Flexible Premium Adjustable Variable
Survivorship Life insurance policy at issue — hereinafter simply

“the policy” — in 2000. It insured the lives of two Brooklyn
residents, Wilmos and Olga Friedman, for $2.3 million. Policy
at 4, 33, ECF No. 61-4.2 If both Friedmans died before the

1 The facts in this order are drawn from the parties’ submissions in
connection with the motion for summary judgment, including the defendants’
Local Rule 56.1 Statement (“Def. 56.1” (ECF No. 61-2)) and plaintiffs’
response to this statement (“Pl. 56.1 Resp.” (ECF No. 62-1)). The Court
views the facts in the light most favorable to the plaintiff. Citations to a
party’s Rule 56.1 Statement incorporate by reference the documents cited
therein.
2 This was the face amount of the policy, but the amount actually paid
would “depend on the Death Benefit Option in effect” when the last insured
died and would be reduced to reflect an outstanding loan balance. Policy at
16.
policy’s “Maturity Date,” the death benefit would become payable
on the latter death. Policy at 11, 16.
The original owner of the policy — and the beneficiary
thereunder — was the Friedmans’ son Moses. Id. at 34. The

Policy allowed the transfer of ownership, as well as changes to
the designated beneficiary, upon written notice to NELICO. Id.
at 25. In January 2015, ownership transferred to the Correas,
ECF No. 1-4, at 2, who became co-owners and co-beneficiaries.
Id.; ECF No. 1-3, at 5; Pl. 56.1 Resp. at 24 ¶ 1.
The policy required the payment of “annual premiums”
of $45,000 for the first four years of the policy, $15,000 for
years five through ten, and $0 thereafter. Policy at 4. It
also required the payment of monthly expense charges and
administrative charges. Id. at 5. The policy provided some
optionality as to the timing of payments: they could be made “at
any frequency agreed to by” NELICO. Id. at 18.

In the ordinary course, however, the policy holder was
not required to cut a check to pay premiums. Instead, NELICO
would make a monthly deduction from the policy’s “cash value” on
the first of every month — if the cash value exceeded the amount
then due. Id. at 19, 21. That is, to the extent that the cash
value was sufficient to cover the required premium (plus
expenses and administrative charges), NELICO simply reduced the
cash value of the policy by that total.
If, on the other hand, the cash value was insufficient
to cover a monthly deduction, the Policy required NELICO to
“mail a premium notice to [the owner] at [the] address on
record.” Id. 19. It also triggered the beginning of a grace

period — the owner would have “62 days from the date when the
Monthly Deduction was due in which to pay a premium large enough
to permit the Monthly Deduction to be made.” Id. But “[i]f the
premium remain[ed] unpaid at the end of its 62-day grace period,
the Policy [would] lapse without value.” Id.3
B. NELICO “Terminates” the Policy
NELICO used a third-party administrator, Alliance
One, to administer life insurance policies, including by mailing
out notices. Pl. 56.1 Resp. at 5 ¶¶ 15, 17.4 According to
NELICO, Alliance One determined on June 7, 2018, that the cash
value of the Correas’ policy was insufficient to pay the monthly
deduction due that day. Id. at 10 ¶ 30. In a sworn

declaration, Leslie Kress — an employee of Alliance One —
averred that Alliance One mailed the Correas a notice on June

3 This sixty-two day grace period is slightly longer than the grace
period required under New York law for cancellation. See N.Y. Ins. Law §
3203 (requiring all life insurance policies issued in New York to provide
for, at minimum, “a sixty-one day grace period”).
4 The parties dispute whether DXC Technology Company or Alliance One
Services, Inc., was the administrator of the Correas’ policy. Pl. 56.1
Resp., at 5 ¶ 15. But an uncontroverted declaration from Joshua Miller, a
compliance manager at DXC, explains that DXC is the parent company of
Alliance One. Joshua Miller Declaration (“Miller Decl.”) ¶¶ 1-2, ECF No.
63-2. To avoid confusion, this order refers to the third-party administrator
of the Correas’ policy as Alliance One.
14, 2018. Leslie Kress Declaration (“Kress Decl.”) ¶ 13, ECF
No. 61-3. According to Kress, that notice warned the Correas
that the policy had entered its grace period and would lapse on

August 16 unless the Correas made a payment in the amount of
$22,429.69 beforehand. Id. ¶ 16. She attached a copy of the
notice saved to Alliance One’s internal systems to her
declaration as Exhibit C. It is not, however, addressed to the
Correas by name. Instead, it shows only the words “ET AL” and
the address of the Correas’ Miami P.O. box. See Exhibit C
Notice, at 2, ECF No. 61-6.
The Correas maintain that they did not receive any
notice until August 17. Pl. 56.1 Resp., 25 ¶ 8. They attached
a copy of the notice they received in August — addressed to
“Raul Correa” — to their complaint. See Exhibit 15 Notice, ECF
No. 1-16. The parties agree that the Correas did not make the
payment demanded by the notice before August 16. Id. at 14 ¶

42.
In her declaration, Kress attested that Alliance One
mailed a second notice to the Correas on August 16, informing
them that the policy had lapsed. Kress Decl. ¶ 18. She
attached a copy of that notice to her declaration. Aug. 16
Lapse Notice, ECF No. 61-7. Soon thereafter, NELICO received a
check from the Correas for $23,000. Pl. 56.1 Resp., at 15 ¶ 44.
Because, in its view, the policy had already lapsed,
NELICO did not apply the check towards the policy, but instead
refunded it to the Correas. Id. at 17 ¶ 50. Soon thereafter,
NELICO sent Raul Correa a letter informing him that he would

need to complete a reinstatement application if he wished to
bring the policy back into effect. Id. at 16 ¶ 48. The Correas
never applied to reinstate the policy — because, they maintain,
the policy had never properly lapsed. Id. at 16 ¶ 49.
C. Procedural History
The Correas filed this suit in August 2020 against
NELICO and its parent company, Brighthouse Financial, Inc.,
invoking the court’s diversity jurisdiction. Complaint ¶ 6, ECF
No. 1.5
The Correas assert two claims. In Count I, they “seek
a declaratory judgment that Defendants prospectively treat the
Policy as remaining in full force and effect.” Complaint ¶ 71.

In Count II, they seek “a declaratory judgment . . . to clarify
their rights and Defendants’ obligations under the Policy.” Id.
¶ 80. The complaint invoked New York law in support of Count I,
but a Florida statute in support of Count II.
The defendants moved for summary judgment on both claims.
Defendants’ Memorandum of Law (“Def. Mem.”) at 6, ECF No. 61-1.
Following oral argument, the Court invited the Correas to submit

5 The Correas reside in Florida, NELICO is domiciled in Massachusetts,
and Brighthouse is domiciled in Delaware and North Carolina. Id. ¶¶ 2-5.
NELICO sells insurance in New York. Id. ¶ 4.
supplemental briefing “setting out their view as to which
state’s law governs this policy and should be applied in this
case — and why.” April 1, 2024 Order.
II. Legal Standards

Summary judgment is appropriate when “the movant shows
that there is no genuine dispute as to any material fact” and
that he “is entitled to judgment as a matter of law.” Fed. R.
Civ. P. 56(a). A material fact is one that “can affect the
outcome under the applicable substantive law.” Graham v.
Henderson, 89 F.3d 75, 79 (2d Cir. 1996).6 A genuine dispute is
one that can “reasonably be resolved in favor of either party.”
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986). In
performing this analysis, the court must resolve all ambiguities
and draw all inferences in favor of the non-moving party. Gallo
v. Prudential Residential Servs., Ltd. P’ship, 22 F.3d 1219,

1223 (2d Cir. 1994). “If, in this generous light, a material
issue is found to exist, summary judgment is improper.”
Nationwide Life Ins. Co. v. Bankers Leasing Ass'n, 182 F.3d 157,
160 (2d Cir. 1999).
The moving party may establish that there is no
genuine dispute “by showing that little or no evidence may be
found in support of the nonmoving party’s case.” Gallo, 22 F.3d

6 Unless otherwise noted, when quoting judicial decisions this order
accepts all alterations and omits all citations, footnotes, and internal
quotation marks.
at 1223-24 (citing Celotex Corp. v. Catrett, 477 U.S. 317, 325
(1986)). If the moving party meets this burden, the non-moving
party “must come forward with specific facts showing that there
is a genuine issue for trial.” LaBounty v. Coughlin, 137 F.3d

68, 73 (2d Cir. 1998). However, the non-moving party “must do
more than simply show that there is some metaphysical doubt as
to the material facts, and may not rely on conclusory
allegations or unsubstantiated speculation.” Brown v. Eli Lilly
& Co., 654 F.3d 347, 358 (2d Cir. 2011). If “no rational finder
of fact could find in favor of the nonmoving party because the
evidence to support its case is so slight, summary judgment must
be granted.” Id.
III. Discussion
In their supplemental submission, the Correas advised
— and the Court agrees — that we “should apply New York law when

analyzing the [insurance] contract” at issue. Plaintiff’s
Supplemental Letter (“Pl. Supp. Ltr.”) at 2, ECF No. 72.
Nonetheless, they seek declarations that NELICO did not validly
“lapse” — i.e., terminate — the policy under both New York and
Florida law. In their view, Florida law applies in addition to
— rather than in place of — New York law, but solely as to the
discrete issue of whether the Correas were entitled to designate
a secondary addressee to receive lapse notices. See Fl. Ins.
Code § 627.4555.
Consequently, the Court first applies New York law to
Count I, before deciding whether Florida law indeed applies to
the Correas’ Count II. See Fed. Ins. Co. v. Am. Home Assur.
Co., 639 F.3d 557, 566 (2d Cir. 2011) (“[W]here the parties

agree that New York law controls, this is sufficient to
establish choice of law.”). On Count I, NELICO has not
sufficiently established under New York law that the Correas
received notice of the policy’s lapse to garner summary
judgment. However, for the reasons discussed below, summary
judgment is granted as to Count II.
A. Declaratory Judgment Under New York Law (Count I)
New York law required NELICO to send a lapse notice to
the Correas prior to terminating the policy, and this
requirement was enshrined in the policy itself. See N.Y. Ins.
Law § 3211(a)(1); Policy, at 19. The defendants argue that they
properly terminated the policy following nonpayment and the

expiration of the grace period. Def. Mem. at 9. At a trial in
this case, the burden of establishing the valid cancellation of
the policy would rest with NELICO. See, e.g., Abuhamra v. New
York Mut. Underwriters, 170 A.D.2d 1003, 1003 (4th Dep’t 1991).
The Correas maintain that they received no
cancellation notice until after the policy had already lapsed.
The defendants argue, in response, that (i) they are entitled to
the benefit of a New York-law “presumption of receipt,” which
the plaintiffs have not adequately rebutted, and (ii) in any
event they can prove actual (and timely) receipt by the
plaintiffs.
1. The Defendants Have Not Established the
Presumption of Receipt
a. Legal Standard
In New York, a common law “presumption of receipt”
arises when a party establishes the existence of “an office
practice and procedure followed by the insurers in the regular
course of their business, which shows that the notices of
cancellation have been duly addressed and mailed.” Nassau Ins.
Co. v. Murray, 46 N.Y.2d 828, 829 (1978).7 Where the presumption

applies, “mere denial of receipt is insufficient” to raise a
genuine dispute of fact on the issue. Ma v. Merrill Lynch,
Pierce, Fenner & Smith, Inc., 597 F.3d 84, 92 (2d Cir. 2010).
Through Insurance Law Section 3211(c), New York has
prescribed the type of evidence sufficient to establish the
presumption in the life insurance context. An insurance company
can submit “[t]he statement of any officer, employee or agent of
[the] insurer, or of any one authorized to mail such notice,
subscribed and affirmed by his as true under the penalties of

7 A similar presumption applies under federal law. There, the “rule is
well settled that proof that a letter properly directed was placed in a post
office creates a presumption that it reached its destination in usual time
and was actually received by the person to whom it was addressed.” Hagner v.
United States, 285 U.S. 417, 419 (1932) (citing cases).
perjury.” N.Y. Ins. Law § 3211(c). New York state courts
appear to read Section 3211(c) to prescribe the medium in which
the insurance company’s showing can be made, but not to alter

the common-law requirements of what needs to be established.
Thus, the submission must “state[] facts” that meet the common
law’s requirement to show “that the notice required by this
section has been duly addressed and mailed.” Id.8
When considering a Section 3211(c) submission, New
York courts ask whether it reveals the “the office practice” in
question to be “geared so as to ensure the likelihood that the
notice is always properly addressed and mailed.” CIT Bank N.A.
v. Schiffman, 36 N.Y.3d 550, 556 (2021). The affirmation must
speak to multiple steps in the mailing process: “how the
envelopes were addressed so as to ensure that the address was
correct”; how and when the envelopes were affixed with postage;

and how they were “transferred to the care and custody of the
United States Postal Service.” Progressive Cas. Ins. Co. v.
Infinite Ortho Prods., Inc., 127 A.D.3d 1050, 1051-52 (2d Dep’t
2015). The affiant’s “personal knowledge is required only to
establish regular office procedure, not the particular mailing.”
Meckel v. Cont'l Res. Co., 758 F.2d 811, 817 (2d Cir. 1985).

8 See Matsil v. Utica First Ins. Co., 150 A.D.3d 982, 982 (2d Dep’t
2017) (applying Section 3211(c) in conjunction with the common-law
presumption); Guckenberger v. Prudential Ins. Co. of Am., 472 F. App’x 69,
69-70 (2d Cir. 2012) (same); Stein v. Am. Gen Life Ins. Co., 665 F. App’x 73,
75-76 (2d Cir. 2016) (same).
In Meckel, Citibank — acting as trustee under an
indenture — claimed to have mailed a redemption notice to the
holders of certain debentures. The notice advised the holders

not only of the pending redemption, but also of “their option to
convert their debentures into common stock by a certain date.”
Id. at 813. This option had substantial value: the common stock
in question was trading at “more than double” the conversion
price available to the holders. Id. at 814. Despite this, a
number of holders failed to exercise the conversion option.
They later sued, alleging that the defendants had “failed to
provide adequate notice of redemption.” Id.
Applying New York State law, the district court
granted summary judgment to the defendants, and the Second
Circuit affirmed. Meckel v. Cont’l Res. Co., 586 F. Supp. 407,
409 (S.D.N.Y. 1984), aff’d 758 F.2d 811 (2d Cir. 1985). The

Court of Appeals held that “[p]roof of mailing [was] established
by the affidavit of a Citibank employee who ‘caused’ the notice
to be mailed, and by the affidavit and deposition of a Citibank
manager who testified about the regular procedures Citibank used
to mail notices.” Meckel, 758 F.2d at 814. First, Citibank
obtained “a mailing list from a computer register,” which
undisputedly “accurately reflected” the recipient’s address.
Id. at 814-15. Citibank then used four methods to verify that
“the number of labels, envelopes, stuffed envelopes and stamped
envelopes conformed to the count of [addresses] as of the record
date.” Id. at 814-15.
But courts have refused to accord the presumption

based on affidavits that do not sufficiently demonstrate the
integrity of a defendant’s process. In Progressive Casualty,
the Second Department declined to apply the presumption based on
an affidavit that did not explain “how the envelopes were
addressed so as to ensure that the address was correct.” 127
A.D.3d at 1051-52. The affidavit also failed to explain whether
the “envelope was addressed by the automated system or by an
employee,” or “how and when the envelopes . . . were transferred
to the care and custody of the United States Postal Service.”
Id.
Similarly, in Riker Danzig et al. v. Premier Capital,
LLC, the presumption was not established because the affiant did

not explain “how the address on the cover letter is generated or
whether anyone confirms its accuracy.” No. 15-CV-8293 (ALC),
2017 WL 2779709, at *6 (S.D.N.Y. June 26, 2017). “Without
testimony regarding the accuracy of the address,” there could be
no presumption of receipt. Id. And in Matter of Government
Employees Insurance Company (Hartford Insurance Company), the
Second Department declined to apply the presumption absent
evidence excluding a possible mistake created by the system.
112 A.D.2d 226, 227 (2nd Dep’t 1985). There, the notices showed
the addresses of both the intended addressee and their insurance
broker. Id. The court declined to apply the presumption
because there was “no proof to exclude the real possibility”

that notices might “mistakenly be sent to a broker whose name
and addresses appeared on the notice along with that of the
insured.” Id. at 228.
b. NELICO’s Process
To establish the presumption in this case, the
defendants rely on the declaration from Ms. Kress — the Senior
Customer Support Associate at NELICO’s third-party administrator
— and her deposition testimony. Kress Decl. ¶ 1; Deposition
Excerpts (“Kress Dep.”), ECF No. 61-12. Kress testified that it
was her job “to keep the policies functioning” by “filling
customer requests and “sending out forms.” Kress Dep. at 12:17-
25.9

Kress describes the administrator’s procedures in some
detail. The picture that emerges is of an antiquated process,
carried out by multiple computer systems that did not speak to
one another and therefore required human input to bridge the
gaps. The first of those is Alliance One’s “VNCH” system. VNCH
was programmed to monitor each policy’s Net Cash Value and

9 The Correas argue that Kress’s testimony cannot be relied upon to
establish the presumption because “she was only in training at the time” that
the Correas’ notice was mailed. Plaintiff’s Memorandum in Opposition (“Pl.
Opp. Mem.”), ECF No. 62, at 14. But her level of seniority is not relevant
to whether or not she has the requisite personal knowledge.
determine, each month, whether that value was adequate to
satisfy the upcoming “Monthly Deduction.” Kress Decl. ¶ 8.
When a cash value was insufficient, VNCH “automatically

generated a Required Payment Notice indicating the amount” the
policyholder had to pay, as well as the date when the Policy
would lapse if payment was not made.” Id. That Notice would be
“electronically sent to an output queue for overnight printing
in Alliance One’s print center.” Id.
So far, so good; but cracks in the process begin to
emerge here. First, the VNCH system is responsible for printing
address information on the Required Payment Notice, but it is
apparently set up to fail in that task with some frequency. One
recurring error arose from the system’s inability to handle
longer names. According to Kress, if a policyholder’s name was
“too long,” the system would not simply print whatever number of

characters could be accommodated. Instead, the system would
replace the entire name with a short, “default” identifier — the
phrase “ET AL.” Kress Dep. at 43:1-17; see also id. 44:1-3
(Kress: “Yeah, we would see statements like that, [which] just
say et al.”). Kress did not know how long was too long; asked
what “limit” the system imposed on the number of characters,
Kress replied, “I don’t know the exact number.” Kress Dep. at
43:4-11. But the parties agree that this error occurred in this
case — on the notice that NELICO relies on, “the recipient’s
name was printed as ‘ET AL’ instead of ‘Raul Correa.’” Kress
Decl. ¶ 13.
Alliance One’s process relied on human inputs to catch
such errors. Id. ¶ 9 (“During the relevant time period, the

printed Required Payment Notices were manually reviewed by
approximately three (3) associates in Alliance One’s Johnstown,
PA office.”). These associates would eyeball the notices. If a
notice was “missing information” or otherwise “looked off,”
Kress Dep. 44:4-9, the associates would consult a second system
— the Client Information File, or CIF — to perform this check.
Kress Decl. ¶ 10. Kress conceded that this step was at the
discretion of the Associate: if “nothing appeared to be
missing,” the associates did not check the Client Information
File. Kress Dep. 44:10-14.
When an Associate concluded that an address was

incorrect, he or she “applied white correction tape over the
incorrect information and re-typed correct information onto the
tape.” Kress Decl. ¶ 10. The record reveals no indication that
an Associate who identified an incorrect address would update
that address in VNCH.10

10 Responsibility for updating CIF rested with a different department.
Id. at 58:15-59:3. Kress testified that the (unnamed) other department would
act only if a notice was returned as “undeliverable.” Id. at 58:10-11.
Asked what that department did upon receiving undelivered notices, Kress
answered: “Depending, then, who was working that case, they would then go in
and start to investigate the address to see why it was undeliverable.” Id.
at 58:15-20.
Given the incompatible systems and the resulting
manual checks, it is understandable that the process called for
the whited-out address corrections to be memorialized. Thus,

after applying the correction tape and typing over it, the
Associate “[t]ypically” “scanned the corrected notice,” saved a
copy into “Alliance One’s system,” and “printed a clean copy for
mailing.” Kress Decl. ¶ 10.
The scanned copy was to be saved into a third computer
system: the “BOSS” system. Kress Dep. 38:20-23. Kress
confirmed that the BOSS system was siloed from CIF: “Those two
do not talk to each other.” Kress Dep. 26:10-12. Therefore, it
appears that any addressing errors would persist, and the entire
process would need to be repeated the next month in which a
cash-value shortfall occurred.
Kress acknowledges that the manual address-correction

process was followed only partially in this case (at best): “the
reviewing associate applied correction tape to the printed June
2018 Required Payment Notice and then typed the correct name
(‘Raul Correa’) onto the correction tape.” Kress Decl. ¶ 13.
But that associate “did not make a copy of the corrected June
2018 Required Payment Notice.” Id. Instead, he or she “mailed
the original” without saving a copy. Id. Only the “uncorrected
June 2018 Required Payment Notice was uploaded to the BOSS
system.” Kress Decl. ¶ 14 (emphasis added). Kress infers that
an associate made the relevant correction because the notice
that the Correas filed alongside their complaint — the Exhibit
15 Notice — carries Raul’s name, rather than ET AL.

To complete the process, the reviewing associate
“inserted [the notice] into an envelope.” Id. ¶ 11. That
envelope would be “sealed by an associate or a machine,” id.,
though the record does not indicate why the two methods
prevailed side-by-side. Sealed envelopes would be placed “on
carts, which were then transported into the mailroom.” Id.
“Mailroom associates” took the envelopes to a loading dock,
where they were picked up by the United States Postal Service.
Id. The USPS was responsible for stamping and delivering the
envelopes. Id.
c. NELICO’s Process Does Not Warrant the
Presumption
At this stage, NELICO’s evidence of procedure is
insufficient to establish the presumption of receipt, for two
reasons. First, the process is set up to generate known errors
in addressing notices (as happened in this case), and then to
rectify those errors through discretionary human inputs (which
failed in this case, at least as to the requirement to
memorialize a copy of the corrected notice). This is not a
process “geared so as to ensure the likelihood that the notice
is always properly addressed.” CIT Bank N.A., 36 N.Y.3d at 556.

Indeed, the Associates were tasked with rectifying the incorrect
address information only on the physical notice in front of
them. No one, apparently, was assigned the task of correcting
the data (or functioning) of the VNCH system. Given that, it is

perhaps unsurprising that (per Raul Correa’s declaration)
Alliance One “continued sending premium notices to the former
owner” of the policy at his address in Texas for several years
after the Correas’ purchase. Correa Decl. ¶ 7.11
And second, Kress’s description explained how the
system addressed the notices — not the envelopes into which
those notices are then inserted. There are cases in which these
addresses are one and the same — the address is printed on the
notice itself, and the notice is placed in the envelope so as to
display that address through a clear window. See, e.g.,
Preferred Mutual Ins. Co. v. Donnelly, 111 A.D.3d 1242, 1244
(4th Dep’t 2013) (according presumption to insurer that used

“envelopes with windows so that the address on the notice was
the one used for mailing”); cf. Matter of Gov. Employees Ins.
Co., 112 A.D.2d at 227 (“There is no evidence to show that any
procedure was followed to ensure that notices [mailed] in window
envelopes, were handled in such a way as to ensure that the
proper address on the notice appeared in the window.”). Here,

11 The Correas attached to the complaint a copy of a letter Raul Correa
sent to NELICO in January 2015, requesting that notices be sent to his P.O.
box in Miami. ECF No. 1-6. They also attached a copy of a lapse notice
NELICO nonetheless incorrectly sent to the former owner of the policy in
Dallas, Texas, a full year later. ECF No. 1-8.
we do not know if that was the case; Alliance One merely tells
us that the notices were “folded” and “inserted into an
envelope.” Kress Decl. ¶ 11.

Given the obligation to draw “all permissible factual
inferences in favor of the party against whom summary judgment
is sought,” NELICO cannot be accorded the presumption here.
Sec. Ins. Co. of Hartford v. Old Dominion Freight Line, Inc.,
391 F.3d 77, 83 (2d Cir. 2004).
2. If the Presumption of Receipt Were Established,
It Has Been Rebutted
Even if the defendants’ evidence was sufficient to
establish a presumption of receipt based on their regular office
procedure, that presumption would be rebutted by the evidence
that those procedures broke down in this instance. The
presumption of receipt is rebutted if the recipient both denies
receipt and shows “proof of a material deviation from an aspect
of the office procedure that would call into doubt whether the
notice was properly mailed.” CIT Bank N.A., 36 N.Y.3d 557.
“[T]he crux of the inquiry is whether the evidence of a defect
casts doubt on the reliability of a key aspect of the process
such that the inference” of proper mailing and receipt “is
significantly undermined.” Id.
The requirement to scan and save a copy of the
corrected notice is a key aspect of Alliance One’s process, and

the failure to follow that procedure significantly undermines
any inference of receipt. Kress claims that the reviewing
associate applied correction tape to the printed June 2018
Notice and then typed Raul Correa’s name onto it. Kress Decl.

¶ 13. But the required memorialization of that action did not
occur. The associate “did not make [or scan] a copy of the
corrected June 2018 Required Payment Notice”; he or she simply
“mailed the original.” Id. The version of the notice saved to
the BOSS system does not include a name, only “ET AL.” ECF No.
61-6, at 2. Thus, the basis for the presumption has been
rebutted.
NELICO then argues that, with or without the
presumption, it can prove that the Correas actually received the
corrected notice. Defendants’ Reply (“Def. Rep.”) at 6-7, ECF
No. 63. In support, they point to Exhibit 15 of the Correa’s
complaint — a Required Payment Notice addressed to Raul Correa
at the Miami P.O. Box. See Exhibit 15 Notice at 2. But that

document is not dated. The notice sets out a “Due Date” of June
7, 2018, but no native indication of when it was printed or
mailed. NELICO’s theory is that this is the “corrected” notice
that was mailed on June 14 — the day the uncorrected notice was
saved to the BOSS system.
The defendants benefit from no presumption in making
this argument: instead, they face the usual summary judgment
burden to show the absence of a genuine dispute. And the
Correas dispute NELICO’s theory. In Raul Correa’s sworn
declaration, he swears that he did not receive the notice until
August 17, 2018 — after the policy had already lapsed. Correa

Decl. ¶ 13. The notice bears a stamp reading “Aug 17 REC’D,”
which provides some further support for this claim. Exhibit 15
Notice at 2. In the end, this is a question for a jury to
resolve.
3. The Defendants’ Remaining Arguments Under New
York Law Fail
The defendants make two other arguments in favor of
summary judgment on the Correas’ claim for a declaratory
judgment in Count I. Neither is persuasive.
a. Termination After One Year
The defendants argue that even if they did not send a
timely notice, the policy still lapsed after a year because the
Correas “did not make a meaningful attempt to pay premiums after
the Policy lapsed on August 16, 2018.” Def. Mem. at 21, ECF No.
61-1. It is true that under Section 3211(a)(1), insurers are
only required to provide notice prior to terminating a policy
for failure to pay premiums if they terminate the policy “less
than one year after such default.” N.Y. Ins. Law § 3211(a)(1).
Ultimately, “after a year of nonpayment the insurer may lapse
the policy without any notice.” Blau v. Allianz Life Ins. Co.
of N. Am., No. 14-CV-3202, 2018 WL 949222, at *6 (E.D.N.Y. Feb.
16, 2018) (citing Weiss v. Sec. Mut. Life Ins. Co. of N.Y., 45
N.Y.S.3d 169, 171 (App. Div. 2017)).
But the defendants cannot claim that lapse was proper

after a year of failing to pay premiums when they also
acknowledge that NELICO actively refused to accept payment
proffered by the Correas. The defendants admit that “five days
after the Policy lapsed, NELICO received a $23,000 check” to
cover the Correas’ payment. Def. 56.1 ¶ 44. NELICO then
“issued a check in the amount of $23,000” on October 22 to
“refund the remittance” to the Correas. Id. ¶ 50. The
defendants argue that the Correas’ policy lapsed because they
failed to make a payment — but that payment failed only due to
NELICO’s own refusal to accept it. An insurance company may not
“depend upon a default in which its own negligence or wrongful
act contributed, and but for which a lapse might not have
occurred.” In re Preston’s Will, 29 N.Y.2d 364, 371 (1972); see
also Jakobovits v. Alliance Life Ins. Co. of N. Am., No. 15-CV-

9977, 2017 WL 3049538, at *6 (S.D.N.Y. July 18, 2018). This
argument fails.12

12 The defendants also argue that the Correas’ “failure to pay premiums
may also be construed as a repudiation or abandonment of the Policy.” Def.
Mem. at 22. They rely on the Pennsylvania Supreme Court’s decision in Walsh
v. Aetna Life Ins. Co., 352 Pa. 429, 443 (1945). Even assuming that
repudiation would function the same way in New York, Walsh is distinguishable
because the Correas attempted to make a payment in August of 2018 and were
rejected. See id. (insured repudiated the policy in part because they “made
no objection to the notice of lapse, no tender of payment of premiums”).
b. Statute of Limitations
Next, the defendants argue that the New York statute
of limitations bars the Correas from bringing this action.

Under Section 3211(d), actions to “recover on any life insurance
policy” must be “instituted within two years from the date of
such default.” N.Y. Ins. Law § 3211(d). But the Correas are
not asking “to recover” any money; they seek instead a
declaration that the policy remains in force. And the time bar
in Section 3211(d) does not apply to actions for a declaratory
judgment. Weiss, 45 N.Y.S.3d at 171 (holding that “because the
instant action is one for a declaratory judgment, rather than to
recover on the policy, it is not time-barred by the two year
statute of limitation”); see Halberstam v. Allianz Life Ins. Co.
of N. Am., No. 16-CV-6854, 2017 WL 10187689, at *23 (E.D.N.Y.
June 9, 2017) (PAREN). Accordingly, this argument fails.

B. Declaratory Judgment Under Florida Law (Count II)
In their second cause of action, the Correas request a
second declaratory judgment that NELICO did not validly lapse
the policy — this time under Florida law. Complaint ¶ 72-80.
The Correas maintain that Florida law applies at least as to the
discrete issue of designating a secondary addressee on the
policy. See id. ¶ 75. Section 627.4555 of the Florida
Insurance Code provides that a life insurance contract “may not
be lapsed for nonpayment of premiums” unless the insurer mails a
lapse notice to both the policyowner “and to a specified
secondary addressee if such addressee has been designated” by
the policyowner. Fl. Ins. Code § 627.4555. It also obligates

insurers to “notify the applicant of the right to designate a
secondary addressee at the time of application for the policy.”
Id. However, Florida law does not govern the policy. Even if
it did, NELICO would not have had the obligation the Correas
invoke.
1. Choice of Law
A federal court sitting in diversity applies the
choice-of-law rules of the forum state. See Klaxon Co. v.
Stentor Elec. Mfg. Co., 313 U.S. 487 (1941). Here, the forum
state is New York, so New York choice-of-law rules govern.
Under New York choice-of-law rules, “[t]he first step in any
case presenting a potential choice of law issue is to determine

whether there is an actual conflict between the laws of the
jurisdictions involved.” Allstate Ins. Co. v. Stolarz, 81
N.Y.2d 219, 223 (1993). “Where the applicable law from each
jurisdiction provides different substantive rules, a conflict of
laws analysis is required.” Curley v. AMR Corp., 153 F.3d 5, 12
(2d Cir. 1998).
Absent a controlling choice-of-law clause in the
contract at issue, New York looks to the contract’s “center of
gravity.” AEI Life LLC v. Lincoln Benefit Life Co., 892 F.3d
126, 132 (2d Cir. 2018) (citing In re Allstate Ins. Co., 81
N.Y.2d at 226). This is determined by reference to “the places
of negotiation and performance; the location of the subject

matter; and the domicile or place of business of the contracting
parties.” Zurich Ins. Co. v. Shearson Lehman Hutton, Inc., 84
N.Y.2d 309, 317 (1994). “In disputes involving life insurance,
this approach often results in the dispute being governed by the
law of the state where the insured resided at the time the
policy was applied for.” U.S. Bank Nat’l Ass'n v. Sun Life
Assurance Co. of Canada, No. 14-CV-4703, 2016 WL 8116141, at *11
(E.D.N.Y. Aug. 30, 2016).
Here, it is undisputed that Wilmos and Olga Friedman
(the insureds), as well as their son Moses (the original
policyowner and beneficiary), applied for the policy from
Brooklyn, New York. Policy at 33-34. New York’s center of

gravity analysis therefore points to the application of New York
law. Indeed, the Correas agree that the Friedmans’ residence in
New York at the time they “applied for the Policy” is
“dispositive of the issue of the governing law for Count 1.”
Pl. Supp. Ltr. at 2.
The Correas nevertheless maintain that Florida law
governs the discrete issue of “Plaintiffs’ rights to assign a
secondary notice addressee” for the policy. Id. But New York
law “generally opposes the application of multiple states’ laws
to a single insurance policy.” Maryland Cas. Co. v. Continental
Cas. Co., 332 F.3d 145, 154 & n.8 (2d Cir. 2003); Narrangansett
Elec. Co. v. Am. Home Assur. Co., 921 F. Supp. 2d 166, 176

(S.D.N.Y. 2013) (“Having multiple states’ laws apply to a single
insurance policy is inconsistent with the approach preferred by
New York courts.”). And plaintiffs have not cited a single New
York state case applying the laws of more than one state to a
contract. The weight of authority is to the contrary. See
Maryland Cas. Co., 332 F.3d at 145 (stating that “[t]he dearth
of New York cases applying the laws of more than one state to an
insurance policy — or any contract — is a significant factor in
our decision” to apply only New York law).
The principles guiding choice of law questions in New
York similarly militate against applying both New York and
Florida law to the policy. “Section 6 of the Restatement

(Second) of Conflict of Laws embodies the general choice of law
principles” of New York. Zurich Ins. Co., 84 N.Y.2d at 318.
Among those principles are “certainty, predictability, and
uniformity of result,” “ease in the determination and
application of the law to be applied,” and “the protection of
justified expectations.” Rest. (Second) of Conflict of Laws
§ 6. The First Department has relied on those principles to
hold that, at least as to “liability insurance policies covering
multistate risk,” only the law of state of the insured’s
domicile applies. Certain Underwriters at Lloyds, London v.
Foster Wheeler Corp., 36 A.D.3d 17, 23 (1st Dep’t 2006). The
court reasoned that the “state of the insured’s domicile is a

fact known to the parties at the time of contracting” and “is
most likely to conform to their expectations.” Id. Abiding by
that simple rule has the additional benefit of “rendering the
resolution of choice-of-law issues less difficult” and making it
“more likely that consistent and uniform results will be reached
in different cases.” Id. Here, the Friedmans were domiciled in
New York at the time of contracting, Policy at 33-34, and under
New York choice of law principles, New York law therefore
applies to the exclusion of Florida law.
2. Florida Law Would Not Provide Relief
Even if Florida law governed the contract, it would
not provide the relief the Correas seek. Section 627.455 of the

Florida Insurance Code only obligates an insurer to notify
applicants of their right to designate a secondary addressee “at
the time of application for the policy.” Fl. Ins. Code
§ 627.4555. The Correas did not apply for the policy — they
purchased it on the secondary market and then notified NELICO of
that purchase via a “Change of Beneficiary” form. Change of
Beneficiary Form at 5, 10, ECF No. 1-3.
Under the policy’s terms, no “application” is
necessary to make a change in the policy’s owner or beneficiary.
The only requirements for making such a change are that it must
be “in written form satisfactory to [NELICO],” and “dated and
signed by the Owner who is making the change.” Policy at 25.

The record shows that the Correas never applied to NELICO to
make a change — they merely informed them that a change had been
made by sending a Change of Beneficiary form. An attached cover
letter stated that the signed form was enclosed, and directed
NELICO to “provide us with written confirmation” once changes
were made in NELICO’s system. Change of Beneficiary Form at 2.
The Correas do not argue that their purchase of the
policy constituted an “application” under Section 627.4555.
Instead, they maintain that the statute applies because they
“paid all their premiums in Florida.” Pl. Supp. Ltr. at 2.
They argue that those payments “created a new contract that was
performed in Florida,” id., citing James v. Hartford Life &
Accident Ins. Co., a decision from the Middle District of

Florida. No. 15-CV-1632, 2016 WL 3102211 (M.D. Fla. Feb. 8,
2016). However, James’s holding is inapplicable to the Correas’
policy.
In James, the court held that Section 627.4555 applied
to a contract “that was initially issued before § 627.4555 took
effect” because the contract was “renewed thereafter.” Id. at
*3. The court found that under Florida law, “the renewal of a
contract of insurance constitutes the making of a new contract
for the purpose of incorporating into the policy changes in the
statutes regulating insurance contracts.” Id. That was
relevant in James because the policy at issue was subject to “a

term of five years” and first expired “on January 19, 1998.”
Id. The policyholder had then “renewed the Policy in five year
terms” stretching from 1998 to 2013. Id. Under Florida law,
those renewals each incorporated into the contract “policy
changes in the statutes regulating insurance contracts” prior to
the renewal. Metro. Prop. & Liab. Ins. Co. v. Gray, 446 So.2d
216, 218 (Fla. 5th DCA 1984).
The Correas’ policy, on the other hand, is not subject
to term periods. It states that it lasts until its maturity
date — “June 7, 2035” — and is not subject to renewal. See
Policy at 2, 4. James is therefore inapplicable — no “new
contract” was formed, and the policy has not been renewed in

Florida. For that reason, and because the Correas did not apply
for the policy, Section 627.4555 is inapplicable.
IV. Conclusion
For the foregoing reasons, the defendants’ motion for
summary judgment is granted as to Count II of the Correas’
complaint, which is therefore dismissed. Summary judgment is
denied as to Count I.
Pursuant to Rule IV.B.1 of the Court’s Individual
Rules in Civil Cases, the parties are directed to file a joint
proposed pre-trial order within thirty days of this order. A
status conference on the remaining count shall be held at 10:00
a.m. on November 14, 2024, in Courtroom 6G North.

SO ORDERED.

/s/ Eric Komitee
ERIC KOMITEE
United States District Judge

Dated: September 30, 2024
Brooklyn, New York

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10659578. Public record. Not legal advice.