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Carrier: Law firm isn’t entitled to coverage

Photo Credit: Cliffview Pilot

The malpractice carrier for Scarinci and Hollenbeck has asked a federal judge to rule that it doesn’t have to defend a lawsuit accusing two of the firm’s attorneys of fraud.


Prosecutors have charged Joel Glucksman and Frank Kapusinski of Scarinci and Hollenbeck with fraud and dishonest acts, which Navigators Insurance Co. of Rye Brook, N.Y., says it shouldn’t have to cover under terms of the firm’s $5 million professional liability policy.

What’s more, Navigator says, the policy was written after the alleged acts occurred.

Bel Air Holdings LLC, owners of a 24-story Newark apartment building that was the subject of a 2001 foreclosure action, want $24 million in compensatory damages from the Scarinci firm, which represented First Bank and Trust Co. in the procedure.

The complaint says the receiver appointed by the firm didn’t drain the building’s pipes before the winter, leading to devastating water damage the following spring.

Glucksman and Kapusinski about it but didn’t say anything, Bel Air contends.

It also says Scarinci lawyers swindled the company by cconspiring in a plan to develop the property as a low-income senior housing complex. That mean less of a return for Bel Air’s work renovating the property.

“Glucksman, Kapusinski and/or Scarinci & Hollenbeck either knew or could have reasonable foreseen that such acts, errors or omissions as alleged in the underlying action might be expected to be the basis of a claim,” Navigators alleges in the federal court action. “Accordingly, coverage under the policy for the underlying action is excluded.”

What’s more, the suit alleges, “such fraudulent and dishonest acts as alleged … cannot reasonably have been construed as having been committed in the rendering of professional services.”


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