CPLR § 1004 When joinder unnecessary
Augello v Koenig-Rivkin, 2008 NY Slip Op 08690 (App. Div., 2nd)
"CPLR 1004, the exception to the real party in interest rule, provides that an insured person who has executed a subrogation receipt or other similar agreement may sue without joining the person for whose interest the action is brought" (CNA Ins. Co. v Carl R. Cacioppo Elec. Contrs., 206 AD2d 399, 400). While an insurer also has the right to commence an action on behalf of its insured even where there is a subrogation agreement between the parties, "[n]either the case law nor the statute require that the insurance company be substituted as the plaintiff under such circumstances" (id. at 400; see generally Krieger v Insurance Co. of N. Am., 66 AD2d 1025; Point Tennis Co. v Urban Inds. Corp., 63 AD2d 967).
Here, pursuant to the release and trust agreement (hereinafter the release) executed [*2]by the plaintiff upon receipt of the underinsured motorist benefits paid to him by the nonparty-appellant (hereinafter the insurer), the plaintiff agreed, inter alia, to "hold any moneys received as a result of settlement or judgment in trust for the [insurer] to be paid to said [insurer] immediately upon recovery thereof provided that any sum received in excess of the amount paid by the [insurer] . . . shall be retained by the [plaintiff]." "The meaning and coverage of a general release necessarily depends upon the controversy being settled and upon the purpose for which the release was given. A release may not be read to cover matters which the parties did not intend to cover" (Gale v Citicorp, 278 AD2d 197; see generally Kaminsky v Gamache, 298 AD2d 361, 361-362).
The purpose of the release in this case was to protect the insurer's subrogation claim while also protecting the right of the plaintiff to retain any recovery in excess of the insurer's subrogation claim. Thus, where, as here, the plaintiff seeks damages in excess of the insurer's subrogation claim, the release cannot be interpreted to require the substitutions requested by the insurer (cf. Faraino v Centennial Ins. Co., 103 AD2d 790; Skinner v Klein, 24 AD2d 433, 434).
The bold is mine.
