Matter of New York Cent. Mut. Ins. Co. (Davalos)
Annotate this CaseDecided on August 15, 2005
Supreme Court, Kings County
In the Matter of New York Central Mutual Insurance Company, Petitioner, For an Order Staying the Arbitration Demanded by Daniel Davalos and Luis Gomez, Respondents, and Allstate Insurance, SEBASTIAN GUTIERREZ MEZA and DANIEL ASHLELY, Proposed Additional Respondents.
6369/05
Russo, Keane & Toner, LLP
David S. Gould
Attorneys for Petitioner: New York Central Mutual
26 Broadway, 28th Floor
New York, NY 10004
Held, Held & Held
Attorneys for the respondent: Luis Gomez and Daniel Davalos
6920 Bay Parkway
Brooklyn, NY 11204
Herbert Kramer, J.
Can a letter making a claim pursuant to an uninsured motorist provision which was sent at a time when the tortfeasor's vehicle was actually insured satisfy the policy's notice requirements?
Petitioner seeks a permanent stay of arbitration asserting that respondent Daniel Davalos, failed to provide timely notice of his uninsured/underinsured claim. [*2]
The underlying accident occurred on July 9, 2002. By letter dated August 2, 2002 respondent's attorney informed petitioner of his intent to make a claim under the uninsured motorist provision of the policy. He enclosed a copy of the accident report. The report showed that the offending vehicle was insured under an Allstate policy in effect at the time of the accident. It even provided a policy number. As such, the report was inconsistent with respondent's claim.
Unsurprisingly, petitioner responded to this letter with its own letter dated August 16, 2002 informing respondent that coverage was confirmed for the offending vehicle and indicating the insurer was Allstate and providing the claim number. Petitioner indicated that it was denying the uninsured claim in its entirety because the liability limits on the Allstate policy were equal to or greater than the insured's coverage.
On October 23, 2002, Allstate sent a letter to its insured disclaiming coverage for its insured's failure to cooperate, and copied that letter to respondent and his counsel. However, inexplicably, it was not until July 27 of 2004, nearly two years later that respondent informed petitioner of Allstate's disclaimer and made a claim under the uninsured motorist provision. Petitioner argues that the provisions of its policy which required that notice be "given as soon as is practicable" were violated by the nearly two year delay in providing it with notice. This Court agrees.
"[Where] [t]he relevant provision of [a] subject insurance policy require[s] that respondent . . . give notice of an uninsured motorist claim 'as soon as practicable[,]' [t] he respondent [is] required to give notice as soon as practicable from the date [he] knew or should have known that the tortfeasor was uninsured." Eagle Ins. Co. v. Bernadine, 266 AD2d 543(2d Dept. 1999). Respondent's initial letter purporting to give notice of its claim for uninsured benefits was inaccurate to, say the least, since at the time of its writing the offending vehicle was in fact insured. The offending vehicle did not become even theoretically uninsured until Allstate disclaimed coverage. The respondent's initial letter which predated Allstate's disclaimer was thus premature and did not therefore satisfy the notice requirement of the policy. See State Farm Mutual Ins. Co. v. Linero, 13 A.D.3rd 546(2d Dept. 2004).
"The respondent had an obligation to demonstrate that [he] acted with due diligence in ascertaining the insurance status of the vehicle involved in the accident . . . [or show a reasonable excuse for the delay]." Eagle, supra, 266 AD2d at 544 (Respondent who did not provide notice until two months after the disclaimer which was received 10 months after the accident, and did not show that any efforts had been made to acquire information regarding coverage or reasonable excuse for the delay did not sustain burden). See also Matter of Nationwide Insurance Co., v. Montopoli, 262 AD2d 647(2d Dept. 1999)(same result where demand for insurance information made 11 months after the accident and notice of possible under-insurance claim made 22 months after the accident).
Here respondent did not have to perform a diligent search to ascertain the insurance status of the offending vehicle since, that information was provided to him by the insurer in its letter disclaiming coverage. There is no explanation forthcoming as to why respondent waited for a period of nearly two years to notify the petitioner of the disclaimer. This lengthy unexplained delay does not comport with the provisions of the policy requiring notice as soon as is practicable. "Failure to comply with the notice provisions contained in an insurance polity within [*3]the time limit provided or within a reasonable time under the circumstances is ground for denial of a claim." Matter of Nationwide Ins. Co. v. Di Gioacchino, 255 AD2d 784(3fd Dept. 1998).
The petition for an order permanently staying uninsured motorist arbitration is granted.
This constitutes the decision and order of the Court.
J.S.C.
This is a petition to permanently stay arbitration. In this matter, respondent's initial letter seeking uninsured motorists benefits was sent to petitioner- insurer at a time when the tortfeasor's coverage was still quite obviously in effect. Coverage was at least arguably suspended thereafter when the carrier for the offending auto sent a disclaimer letter to its insured for the insured's alleged failure to cooperate. However, respondent did not notify the petitioner of the disclaimer for a period of almost two years, and the question presented was whether timely notice was given. Although there is decisional law that we believe governs this circumstance, our research did not disclose any cases in New York dealing with this precise factual situation directly and so we believe this decision may be of interest to bench and bar.
APPEARANCES:
[*4]
Allstate Insurance Co.
Additional Co-respondent
1111 Marcus Avenue 11042
Lake Success, New York
Claim No. 4815819067(SMS)
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