Strelkovski v. Liberty Insurance Corporation

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF NEW YORK
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STANISLAV STRELKOVSKI,
Plaintiff,
-v- 3:25-CV-107
LIBERTY INSURANCE
CORPORATION,
Defendant.
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APPEARANCES: OF COUNSEL:
PRIME PROPERTY LAW PLLC SOLOMON ABADY, ESQ.
Attorneys for Plaintiff
1185 Avenue of the Americas,
3rd Floor
New York, NY 10036
LAW OFFICES OF JASON LOWE JASON LOWE, ESQ
Attorneys for Plaintiff
225 West 106th Street, 8M
New York, NY 10025
GOLDBERG SEGALLA LLP ASHLYN M. CAPOTE, ESQ.
Attorneys for Defendant JONATHAN SCHAPP, ESQ.
665 Main Street
Buffalo, NY 14203
DAVID N. HURD
United States District Judge
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DECISION and ORDER
I. INTRODUCTION
Plaintiff Stanislav Strelkovski (“Strelkovski” or “plaintiff”) filed this
action in New York Supreme Court, Delaware County seeking to recover
damages stemming from the alleged breach of a homeowner’s insurance
policy issued by Liberty Insurance Corporation (“Liberty” or “defendant”).
Dkt. No. 2. Thereafter, Liberty timely removed this case to federal court and
moved to partially dismiss the complaint to the extent the Strelkovski seeks
extracontractual damages. Dkt. Nos. 1, 6. On February 18, 2025, plaintiff
filed both an opposition to Liberty’s motion and an amended complaint. Dkt.
Nos. 9–10. Liberty again moved to partially dismiss plaintiff’s amended
complaint insofar as it seeks extra-contractual damages. Dkt. No. 14. The
motion has been fully briefed and will be considered on the basis of the
submissions and without oral argument. Dkt. Nos. 1, 14-4, 17, 18.
II. BACKGROUND
This is a breach of contract action. Strelkovski is a resident of New York
who owns a property located in Walton, NY (the “Property”). Am. Compl. ¶¶
1, 4. Liberty is “a foreign corporation organized and existing under the laws
of Illinois.” Id. ¶ 2. At all times relevant in this matter, defendant was
authorized to issue insurance policies in New York, including the Policy. Id.
¶ 3.
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At some point in time before August 26, 2023, plaintiff contends defendant
issued him an insurance policy (the “Policy”) insuring the Property against
“all risks of loss.” Am. Compl. ¶ 6. On or around August 26, 2023, while the
policy was in effect, plaintiff alleges the Property was damaged by “a covered
peril.” Id. ¶ 7. On or around September 6, 2023, plaintiff allegedly submitted
a claim to Liberty seeking indemnification for the damage that occurred to
the Property, including loss of use and loss of rent. Id. ¶ 8.
Strelkovski contends that Liberty “failed and refused to timely investigate
or adjust the entirety of [his] claim” and instructed him not to perform
certain repairs to the Property so they could investigate the claim before
taking months to act. Am. Compl. ¶¶ 10–11. As a result, plaintiff asserts he
was deprived of the benefits of the Policy and incurred significant losses
which were avoidable had Liberty performed as set forth under the Policy.
Id. ¶ 14.
Plaintiff alleges that the Policy states: “Payment under Loss of Rental
Value will be for the shortest time required to repair or replace that part of
the ‘residence premises’ rented or held for rental.” Am. Compl. ¶ 15.
Strelkovski contends that when Liberty delayed investigating and
determining the damage to the Property for months before partially denying
his claim, they violated the terms of the Policy. Id. ¶ 16. As a result of this
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breach of the Policy, plaintiff asserts he is entitled to both compensatory and
“extracontractual damages.” Id. ¶¶ 17, 22.
Strelkovski argues Liberty’s bad faith and unjust refusal to pay for the
loss of rent compelled him to bring this suit and that, as a result of Liberty’s
“breach of contract and bad faith delays,” he has “been damaged in excess of
$270,000 in compensatory damages. Am. Compl. ¶ 22. In addition to being
liable for the compensatory damages related to his loss, Strelkovski alleges
Liberty owes “consequential damages which were a reasonably foreseeable
consequence[.]” Id. ¶¶ 22–23.
Liberty now moves to partially dismiss plaintiff’s complaint to the extent
that it requests extracontractual damages pursuant to Federal Rule of Civil
Procedure (“Rule”) 12(b)(6). Def.’s Mem., Dkt. No. 14-4.
III. LEGAL STANDARD
To survive a Rule 12(b)(6) motion to dismiss, the complaint’s factual
allegations must be enough to elevate the plaintiff’s right to relief above the
speculative level. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). So
while legal conclusions can provide a framework for the complaint, they must
be supported with meaningful allegations of fact. Ashcroft v. Iqbal, 556 U.S.
662, 679 (2009). In short, a complaint must contain “enough facts to state a
claim to relief that is plausible on its face.” Twombly, 550 U.S. at 570.
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To assess this plausibility requirement, the court must accept as true all of
the factual allegations contained in the complaint and draw all reasonable
inferences in the non-movant’s favor. Erickson v. Pardus, 551 U.S. 89, 94
(2007). In doing so, the court generally confines itself to the facts alleged in
the pleading, any documents attached to the complaint or incorporated into it
by reference, and matters of which judicial notice may be taken. Goel v.
Bunge, Ltd., 820 F.3d 554, 559 (2d Cir. 2016) (quoting Concord Assocs., L.P.
v. Ent. Props. Tr., 817 F.3d 46, 51 n.2 (2d Cir. 2016)).
IV. DISCUSSION
Strelkovski seeks to recover damages he allegedly incurred when Liberty
unnecessarily delayed the investigation and processing of an insurance claim
he submitted under the Policy. Specifically, plaintiff is seeking both
compensatory damages for Liberty’s breach of the Policy as well as
consequential damages for their breach of the covenant of good faith and fair
dealing. Am. Compl. ¶¶ 21–22. Plaintiff's complaint concludes with a
generalized demand for compensatory damages in excess of $270,000 and,
without specifying a dollar amount, an assertion that defendant is also liable
for consequential damages. Id. ¶ 22–23.
A. Consequential Damages
Liberty argues the consequential damages Strelkovski is seeking are
unavailable because such damages were not contemplated under the Policy.
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Def’s. Mem., Dkt. No. 14-4 at 7–9.1 Liberty contends that plaintiff has failed
to allege with any specificity what the consequential damages he suffered
were and instead offers only the bare conclusion that he suffered avoidable
losses. Id. at 9. Broadly stated, Liberty’s position is that plaintiff’s
allegations amount to nothing more than a breach of contract claim. Id.
“In addition to general contract damages—i.e., damages that flow from the
natural and probable consequences of the breach—a plaintiff asserting a
breach of contract claim may also recover ‘special’ or ‘consequential’ damages,
which compensate for ‘additional losses.’” Sanderson v. First Liberty Ins. Co.,
2017 WL 5176371, at *6 (quoting East Coast Res., LLC v. Town of
Hempstead, 707 F. Supp. 2d 401, 410 (E.D.N.Y. 2010)) (cleaned up). “Under
New York law, ‘consequential damages resulting from a breach of the
covenant of good faith and fair dealing may be asserted in an insurance
contract context, so long as the damages “were within the contemplation of
the parties as the probable result of a breach at the time of or prior to
contracting.”’” Ripka v. Safeco Ins., 2015 WL 3397961, at *4 (N.D.N.Y. May
26, 2015) (citing Panasia Estates, Inc. v. Hudson Inc. Co., 10 N.Y.3d 200 (N.Y.
2008)) (quoting Bi-Econ. Mkt., Inc. v. Harleysville Ins. Co., 10 N.Y.3d 187
(N.Y. 2008)).
1 Pagination corresponds to CM/ECF headers.
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To demonstrate such an understanding between the parties, New York
courts often require that a specific contractual provision permits recovery for
consequential damages. See e.g., Globecon Group, LLC v. Hartford Fire Ins.
Co., 2003 WL 22144316 at *3 (S.D.N.Y. Sept. 17, 2003) (collecting cases).
However, absent allegations that plaintiff’s specific injury was contemplated
by the parties at the time of contracting, a claim for consequential damages
should be dismissed. Ripka, 2015 WL 3397961, at *4 (quoting Cont’l Info.
Sys. Corp. v. Fed. Ins. Co., 2003 WL 145561, at *4 (S.D.N.Y. Jan.17, 2003))
(collecting cases).
In addition, New York courts do “not recognize a separate cause of action
for breach of the implied covenant of good faith and fair dealing when a
breach of contract claim, based upon the same facts, is also pled,” and “the
latter claim” should “be dismissed as redundant.” Sikarevich Fam. L.P. v.
Nationwide Mut. Ins. Co., 30 F. Supp. 3d 166, 170 (E.D.N.Y. 2014) (cleaned
up).
Upon review, even at this pre-answer stage, Strelkovski’s claim for
consequential damages fails on several fronts. First, plaintiff alleges that
defendant’s failure to timely or fully investigate his claim of loss, along with
their improper denial of his claim, amounts to a breach of the covenant of
good faith and fair dealing that warrants an award of consequential damages.
Am. Compl. ¶ 13. In support, Strelkovski points to language in the Policy
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regarding payment in the event of loss of rent or rental value. Id. ¶ 15–16.
However, plaintiff has not alleged that this policy language makes any
mention of consequential damages. Indeed, plaintiff has not pointed to any
language in the Policy mentioning consequential damages in his Amended
Complaint. Nor has he cited to any language in the Policy suggesting he was
entitled to consequential damages. Instead, plaintiff offers only the bare
conclusion that Liberty’s alleged breach of the covenant of good faith and fair
dealing entitles him to consequential damages. Id. ¶ 17.
Next, plaintiff has not offered a distinct set of facts to distinguish his
breach of the covenant of good faith and fair dealing claim from his breach of
contract claim. To the contrary, both claims arise from the same set of facts.2
In both cases, plaintiff contends that: (1) he suffered damage to his home; (2)
he submitted an insurance claim to Liberty pursuant to the Policy; (3)
Liberty delayed in investigating or otherwise addressing his claim; (4) his
claim was partially or fully denied. Strelkovski’s breach of the covenant of
good faith and fair dealing claim, for which he now seeks consequential
damages, will also be dismissed as redundant. See Sikarevich Fam. L.P. 30
F. Supp. 3d at 170.
2 Plaintiff’s amended complaint is not a model of clarity and does not articulate the specific
claims in brings. Nevertheless, the Court construes it to bring a breach of contract and breach of the
implied covenant of good faith claim.
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Finally, even if Strelkovski’s consequential damages claim was plausibly
alleged, it would still require dismissal. Special damages claims “must be
fully and accurately stated, with sufficient particularity to identify actual
losses .... [and] a general allegation of a dollar amount ... will not suffice.”
Ripka, 2015 WL 3397961, at *5 (quoting Ebrahimian v. Nationwide Mut. Fire
Ins. Co., 960 F.Supp.2d 405, 418 (E.D.N.Y.2013)). In this matter, not only
has plaintiff not alleged a dollar amount, he has also failed to plead with any
particularity the actual losses he suffered which would warrant an award of
consequential damages. Strelkovski has not offered any allegations to give
this Court an idea of the losses he suffered. Merely requesting a “sum in
excess of $270,000 in compensatory damages” and asserting plaintiff’s
liability for consequential damages in a conclusory fashion will not suffice
and will be denied. Am. Compl. ¶ 22–23.
V. CONCLUSION
Therefore, it is
ORDERED that
1. Defendants’ partial motion to dismiss (Dkt. No. 14) is GRANTED;
2. Plaintiff’s claim for consequential damages is DENIED;
3. Defendant is ordered to file an answer to plaintiff’s breach of contract
claim by no later than February 27, 2026.
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The Clerk of the Court is further directed to terminate the pending motion
and set deadlines accordingly.
IT IS SO ORDERED.
Dated: February 13, 2026
Utica, New York.
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