Metropolitan Prop. & Cas. Ins. Co. v Thomas

[*1] Metropolitan Prop. & Cas. Ins. Co. v Thomas 2007 NY Slip Op 52389(U) [18 Misc 3d 1103(A)] Decided on December 6, 2007 Supreme Court, New York County Edmead, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on December 6, 2007
Supreme Court, New York County

Metropolitan Property and Casualty Insurance Company, Plaintiff,

against

Richard F. Thomas, Richard Thomas d/b/a American Plow and Andrew Uffenheimer, Defendants.



114642/06

Carol Robinson Edmead, J.

Plaintiff Metropolitan Property and Casualty Insurance Company ("Metropolitan") moves for an order pursuant to CPLR 3212, granting summary judgment declaring that Metropolitan has no obligation to defend or indemnify defendant Richard F. Thomas ("Thomas").

The underlying bodily injury lawsuit was commenced by defendant Andrew Uffenheimer ("Uffenheimer"), in which he alleges that he was injured on January 11, 2005 in or about the driveway of 16 Indian Hill Road, Mahopac, New York when his hand was caused to be crushed under a plow while defendant Richard F. Thomas was conducting and operating a snow plowing business known as American Plow. According to Thomas, Thomas and Uffenheimer were in the process of taking a snow plow off the front of Thomas's pick-up truck when the plow fell on Uffenheimer's hand.

Uffenheimer's bodily injury lawsuit was commenced as against defendants Thomas and American Plow through the filing and service of a summons and complaint dated November 22, 2005.

Metropolitan's Contentions

Metropolitan issued a Homeowner's insurance policy to Thomas which contained the following pertinent provisions:

SECTION II - CONDITIONS

1.Your Duties in the Event of an Accidental Loss. In the event of an occurrence or offense, we have no obligation to provide coverage under this policy if you failto comply with the following duties.

A.Promptly notify us or our representative in writing, stating:

1.your name and policy number; [*2]

2.the date, place and circumstances of the accident;

3.the name and address of anyone who might have a claim against you; and

4.the names and addresses of any witnesses

B.Immediately send us any legal papers relating to the accident.

C.At our request, you must:

1.cooperate with us and assist us in any matter concerning a claim or suit;

2.help us to enforce any right of recovery against any person or organization who may be liable to you;

3.attend any hearing or trial; and

4.help us in collecting and giving evidence and obtaining the attendance of witnesses.

SECTION II - LOSSES WE DO NOT COVER

COVERAGE F - PERSONAL LIABILITY AND COVERAGE G - MEDICAL PAYMENTS TO OTHERS

4.Business. We do not cover bodily injury or property damage arising out of or in connection with your business activities. The exclusion applies but is not limited to an act or omission, regardless of its nature or circumstance, involving a service or duty rendered, promised, owed or implied to be provided because of the nature of the business.

The first notice that Metropolitan received of the incident involving Uffenheimer was through correspondence dated August 15, 2006 from counsel for the defendant/underlying plaintiff Uffenheimer, which enclosed a copy of the summons and complaint.

Through correspondence dated September 14, 2006, Metropolitan issued a denial of coverage for the incident involving Uffenheimer citing the notice condition referenced above as well as the policy exclusion for business activities.

Metropolitan's disclaimer should be upheld as a matter of law based upon the insured's breach of the notice condition of the policy. Where an insurance policy requires that notice of an occurrence be given promptly, notice must be given within a reasonable time in light of all of the facts and circumstances. Absent a valid excuse for a delay in furnishing notice, such as a good faith belief in non-liability, failure to satisfy the notice requirement vitiates coverage. The requirement that an insured provide notice of an occurrence to the insurance company within a reasonable time is considered a condition precedent to the insurer's obligation to defend or indemnify. The insured has the burden of demonstrating the reasonableness of any excuse for the failure to comply with the notice condition, such as a reasonable belief in non-liability. The belief in non-liability must be reasonable under all circumstances and it may be relevant on the issue of reasonableness, whether and to what extent the insured has inquired into the circumstances of the accident or condition. The notice here which was provided some 19 months after the incident is untimely as a matter of law and the insured has failed to meet his burden and demonstrate an excuse for the untimely notice, such as a reasonable belief of non-liability. [*3]

On August 17, 2007 Metropolitan served a Notice to Admit upon the defendants. No response was received and thus, the assertions set forth therein are deemed admitted. The Notice states in pertinent part as follows:

5.Richard F. Thomas was aware of the incident involving Andrew Uffenheimer on January 11, 2005.

6.The first notice provided to METROPOLITAN PROPERTY AND CASUALTY INSURANCE COMPANY of the incident involving Andrew Uffenheimer was given in August, 2006.

No denial of the aforementioned facts was made. Thus, the Notice to Admit conclusively establishes that Thomas was aware of the incident of January 11, 2005 and failed to provide notice to Metropolitan until August 2006. Based on the foregoing, the disclaimer issued by Metropolitan must be upheld in its entirety.

Further, according to the complaint, Uffenheimer's injuries occurred while the insured was operating a snow plow business from the insured residence. In addition, the Notice to Admit referenced above asserts that Thomas was operating the snow plow business at the time of the incident involving Uffenheimer. The facts set forth in the Notice to Admit were not denied and are therefore deemed established. Satisfaction of the business pursuit test is realized where the insured is involved in a customary engagement or continued activity for the purpose of profit. For the exclusion to apply, the business engaged in need not necessarily be his sole occupation or employment.

Uffenheimer's Opposition

Metropolitan claims it did not receive notice from Thomas until August 2006, but presents a letter in which counsel for Thomas states that notice was provided in April 2006. Metropolitan claims that the underlying lawsuit was commenced on November 22, 2005, but the pleading was served by nail and mail on December 20, 2005 at the wrong address, and the only reasonable inference as to when Thomas first heard of the underlying lawsuit was late March, 2006, weeks before notice was provided by both defendants herein in April, 2006.

The Notice to Admit is improper in that it concerns the ultimate and fundamental facts which Metropolitan knew were in dispute based on Thomas' answer.

The underlying plaintiff has an independent right to give notice to the insurance company and cannot be charged vicariously with the insured's delay.

Thomas' Opposition

Thomas was never engaged in the business of snow removal, nor has he received any compensation for the snow removal of the private roads of his nearby friends or family. Thomas purchased the plow for his truck because of the inadequate municipal snow removal service provided to the roads surrounding his home. Thomas concedes that he contemplated entering the business of snow removal, but after becoming aware of the substantial cost of a business liability insurance policy, he decided against it.

The underlying pleading was placed on the wrong house, and Thomas received the pleadings from a neighbor on or about January 2007 and sent them via facsimile to his agent Hubert Paris ("Paris"). Thereafter, on or about the end of March 2007, Thomas received default judgment papers in the underlying action and contacted his attorney who then contacted [*4]Uffenheimer's counsel, Metropolitan and Paris. Thomas believes that the underlying pleadings were forwarded to Paris in April of 2006. And, on or about August 15, 2006, Thomas's counsel sent the underlying pleadings to Metropolitan, as well as Paris.

As such, Thomas was never properly served in the underlying action, putting him at an instant disadvantage. Once Thomas received the pleadings they were forwarded immediately to Metropolitan and/or its agent in January of 2006, and then again on two other occasions - that is in April and August of 2006.

Finally, the Notice to Admit was palpably improper as it addressed questions of fact that should be addressed at trial on an evidentiary basis, as opposed to a motion for summary judgment.

Metropolitan's Reply

The incident involving Uffenheimer occurred on January 11, 2005. Thomas acknowledges in the opposition submitted to this motion that he was present when Uffenheimer was allegedly injured in the process of removing a snow plow from the front of Thomas' pick-up truck when the plow allegedly fell on Uffenheimer's hand. Even assuming arguendo that Thomas did not receive the summons and complaint until January 2007 as alleged, Metropolitan has established that the insured failed to comply with the separate obligation under the policy to promptly notify Metropolitan of an occurrence in writing, as detailed in Section II - Conditions of the policy. Thomas' conceded breach of the afore-mentioned notice condition of the policy warrants granting the within motion for summary judgment - alone.

The failure to object to the Notice to Admit establishes the fact that Thomas was operating a snow plow business. And, the policy clearly excludes liability coverage for bodily injury or property damage arising out of or in connection with the insured's business activities.

Analysis

To obtain summary judgment, the movant must establish its cause of action or defense sufficiently to warrant the court as a matter of law in directing judgment in its favor (CPLR § 3212 [b]). This standard requires that the proponent of a motion for summary judgment make a prima facie showing of entitlement to judgment as a matter of law, by advancing sufficient "evidentiary proof in admissible form" to demonstrate the absence of any material issues of fact (Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853 [1985]; Zuckerman v City of New York, 49 NY2d 557, 562 [1980]; Silverman v Perlbinder, 307 AD2d 230, 762 NYS2d 386 [1st Dept 2003]; Thomas v Holzberg, 300 AD2d 10, 11, 751 NYS2d 433, 434 [1st Dept 2002] [defendant not entitled to summary judgment where he failed to produce admissible evidence demonstrating that no triable issue of fact exists as to whether plaintiff would have been successful in the underlying negligence action]). Thus, the motion must be supported "by affidavit [from a person having knowledge of the facts], by a copy of the pleadings and by other available proof, such as depositions" (CPLR § 3212 [b]). A party can prove a prima facie entitlement to summary judgment through the affirmation of its attorney based upon documentary evidence (Zuckerman, supra ; Prudential Securities Inc. v Rovello, 262 AD2d 172[1st Dept 1999]).

Alternatively, to defeat a motion for summary judgment, the opposing party must show facts sufficient to require a trial of any issue of fact (CPLR §3212 [b]). Thus, where the proponent of the motion makes a prima facie showing of entitlement to summary judgment, the burden shifts to the party opposing the motion to demonstrate by admissible evidence the [*5]existence of a factual issue requiring a trial of the action, or to tender an acceptable excuse for his or her failure to do so (Vermette v Kenworth Truck Co., 68 NY2d 714, 717 [1986]; Zuckerman v City of New York, supra , 49 NY2d at 560, 562; Forrest v Jewish Guild for the Blind, 309 AD2d 546, 765 NYS2d 326 [1st Dept 2003]). Like the proponent of the motion, the party opposing the motion must set forth evidentiary proof in admissible form in support of his or her claim that material triable issues of fact exist (Zuckerman, supra at 562). Mere conclusions, expressions of hope or unsubstantiated allegations or assertions are insufficient (Alvord and Swift v Steward M. Muller Constr. Co, 46 NY2d 276, 281-82, 413 NYS2d 309 [1978]; Fried v Bower & Gardner, 46 NY2d 765, 767, 413 NYS2d 650 [1978]; Platzman v American Totalisator Co., 45 NY2d 910, 912, 411 NYS2d 230 [1978]; Mallad Const. Corp. v County Fed. Sav. & Loan Assn., 32 NY2d 285, 290, 344 NYS2d 925 [1973]; Plantamura v Penske Truck Leasing, Inc., 246 AD2d 347, 668 NYS2d 157 [1st Dept 1998]).

Timely Notice of Claim

It is established that where as here the insured is required to "promptly" notify the insurer of an "occurrence" that is a potential claim, such requirement acts as a condition precedent to coverage ( Great Canal Realty Corp. v Seneca Ins. Co., Inc., 5 NY3d 742, 743, 800 NYS2d 521, 833 NE2d 1196 [2005]; White v City of New York, 81 NY2d 955, 957, 598 NYS2d 759, 615 NE2d 216 [1993] ), and the insured's failure to provide timely notice of an occurrence vitiates the contract as a matter of law ( Argo Corp. v Greater NY Mut. Ins. Co., 4 NY3d at 339, 794 NYS2d 704, 827 NE2d 762; Modern Cont. Constr. Co. v Giarola, 27 AD3d 431, 432-433, 812 NYS2d 115 [2006] ). While the Court of Appeals has recognized that circumstances may exist that excuse a failure to give timely notice, such as a "good faith belief of non-liability," that belief must be reasonable "under all circumstances, and it may be relevant on the issue of reasonableness, whether and to what extent, the insured has inquired into the circumstances of the accident or occurrence" ( Security Mut. Ins. Co. of NY v Acker-Fitzsimons Corp., 31 NY2d 436, 441, 340 NYS2d 902, 293 NE2d 76 [1972], see also White v City of New York, 81 NY2d at 958, 598 NYS2d 759, 615 NE2d 216 ["where a reasonable person could envision liability, that person has a duty to make some inquiry"] ). Moreover, the insured must shoulder the burden of demonstrating the reasonableness of the proffered excuse ( Great Canal Rlty. Corp. v Seneca Ins. Co., Inc., 5 NY3d at 744, 800 NYS2d 521, 833 NE2d 1196; White v City of New York, 81 NY2d at 957, 598 NYS2d 759, 615 NE2d 216), and the courts have found even relatively short periods of unexcused delay in giving notice to be unreasonable as a matter of law ( The Doe Fund, Inc. v Royal Indem. Co., 34 AD3d 399, 400, 825 NYS2d 450 [2006] ). We further note that an appellate court may search the record and grant summary judgment to eligible parties ( Hughes v Solovieff Realty Co., L.L.C., 19 AD3d 142, 143, 796 NYS2d 354 [2005]; CPLR 3212[b] ).

In the instant case, the earliest practicable time to notify Metropolitan of the "occurrence" of Uffenheimer sustaining an injury when his hand was caused to be crushed under a plow when the plow fell on Uffenheimer's hand while defendant Richard F. Thomas was in the process of taking a snow plow off the front of Thomas's pick-up truck, was within a reasonable time from the date of the occurrence - January 11, 2005. The notice here which was provided, by defendants' explanation, as of April 2006 is some 15 months after the incident, and is untimely as a matter of law and the insured has failed to meet his burden and demonstrate an excuse for the untimely notice, such as a reasonable belief of non-liability.

Thomas acknowledges in the opposition submitted to this motion that he was present [*6]when Uffenheimer was allegedly injured. Even assuming arguendo that Thomas did not receive the summons and complaint until January 2007 as alleged, Metropolitan has established that the insured failed to comply with the separate obligation under the policy to promptly notify Metropolitan of an occurrence in writing, as detailed in Section II - Conditions of the policy. Thomas' conceded breach of the afore-mentioned notice condition of the policy warrants granting the within motion for summary judgment - alone.

Notwithstanding the above determination by this court, Metropolitan would prevail on the issue of insurance policy exclusion.

Insurance Policy Exclusion

It is well settled that the insurer has the burden to demonstrate that an exclusion from coverage contained in the policy is applicable and that "the policy language relied upon by the insurer in support of the exclusion is subject to no other reasonable interpretation' " ( McCarthy v New York Prop. Ins. Underwriting Assn., 158 AD2d 961, 962, 551 NYS2d 120, quoting Seaboard Sur. Co. v Gillette Co., 64 NY2d 304, 311, 486 NYS2d 873, 476 NE2d 272). Further, insurance policy exclusions "are not to be extended by interpretation or implication, but are to be accorded a strict and narrow construction" ( Seaboard Sur. Co., 64 NY2d at 311, 486 NYS2d 873, 476 NE2d 272).

In the instant case, Metropolitan relies on Thomas' failure to respond to the Notice to Admit to establish the applicability of the insurance policy exclusion.

Notice to Admit

Through the use of a notice to admit, a party can request another party to admit stated facts or the genuineness of a document, where the party requesting the admission "reasonably believes there can be no substantial dispute at the trial and ... [where the matters] are within the knowledge of such other party or can be ascertained by him upon reasonable inquiry" (CPLR 3123[a]; see also Taylor v Blair, 116 AD2d 204 [1985] ).

If a party fails to respond to a notice to admit within 20 days after service, the matters therein are deemed admitted for the purpose of the litigation (CPLR 3123[a]; Marine Midland Bank, N.A. v Custer, 97 AD2d 974 [1983], affd 62 NY2d 732 [1984] ). A matter deemed admitted pursuant to a notice to admit, however, is still "subject to all pertinent objections to admissibility which may be interposed at the trial" (CPLR 3123[b] ), and it is not necessarily of such probative value as to relieve a party of the necessity of establishing its right to ultimate relief upon the trial ( see 44A NY Jur 2d, Disclosure § 295, at 189).

However, a Notice to Admit may not be used to elicit an admission of fundamental and material issues or ultimate facts. Meadowbrook-Richman, Inc. v Cicchiello, 273 AD2d 6 [1st Dep't 2000]; PDG Psychological, P.C. v. State Farm Ins. Co., 12 Misc 3d 1183(a)(2006).

As defined above, a Notice to Admit may be used to settle any fact that is not at issue. A Notice to Admit should not contain any questions that would require that the opposing party concede any material facts. It is for this reason that failure to respond to a notice to admit is deemed as an admission.

One cannot deem any failure to respond to a Notice to Admit as an admission to a material fact. To allow such would spawn an abuse of this disclosure device and contradict the purpose of the Notice to Admit. Further, it would prevent attorneys from regarding their ethical duty to actively participate in the litigation of each case as well as timely responding to [*7]documents submitted by opposing counsel.

In the instant case, Thomas asserts - in opposition to this motion - that he was never engaged in the business of snow removal, nor has he received any compensation for the snow removal of the private roads of his nearby friends or family. He argues that he purchased the plow for his truck because of the inadequate municipal snow removal service provided to the roads surrounding his home. Thomas concedes that he contemplated entering the business of snow removal, but after becoming aware of the substantial cost of a business liability insurance policy, he decided against it.

And, Thomas argues that he did not have to respond to the notice to admit in that it sought admissions of material facts.

Defendants' contention that Thomas did not have to respond to the notice to admit is without merit. Metropolitan properly used the notice to admit to dispose of what it believed to be uncontroverted questions of facts which would have been easily provable at trial (The Hawthorne Group, LLC v RRE Ventures, 7 AD3d 320, 324 [1st Dep't 2004]; see also Meadowbrook-Richman, Inc. v Cicchiello, 273 AD2d 6 [1st Dep't 2000]; Samsung America, Inc. v Yugoslav Korean Consulting & Trading Co., 199 AD2d 48 [1st Dep't 1993] ). The notice to admit removed "from the case those uncontested matters which would [have] merely present[ed] a time-consuming burden at trial" ( Villa v New York City Housing Authority, 107 AD2d 619-620 [1st Dep't 1985] ).

While a party is not obligated to furnish admissions in response to a notice to admit that improperly demands admissions of ultimate and fundamental issues that can only be resolved after a full trial or matters that are in actual dispute (see, Meadowbrook-Richman, Inc. v. Cicchiello 273 AD2d 6, 6; [1st Dep't 2000]; Orellana v City of New York, 203 AD2d 542, 543 [2nd Dep't 1994]; Miller v Hilman Kelly Co., 177 AD2d 1036, 1037 [4th Dep't 1991] ), "[a]ll of the items in the notice to admit involve[d] clear-cut factual matters about which one would reasonably anticipate no dispute, and the immediate disposition of which would not unfairly prejudice the defendant and would help to expedite the trial" ( Risucci v Homayoon, 122 AD2d 260, 261 [2nd Dep't 1986], citing, CPLR 3123[a]; Villa v New York City Housing Auth., 107 AD2d 619, 620 [1st Dep't 1985] ) the fact that a notice to admit will establish plaintiff's prima facie case on paper does not bar its use (id.). Simply because Thomas denied many of the facts alleged in the notice to admit in his answer to plaintiff's complaint did not establish that those facts were in actual dispute. To hold otherwise would preclude a plaintiff from requesting admissions of any fact initially denied by a defendant in its answer. If defendant actually disputed any of the facts alleged in the notice to admit, it should have submitted a timely response denying them.

Further in the underlying complaint, it is alleged that "Fourth: That at all times herein mentioned, defendant RICHARD THOMAS was conducting and operating a snow plowing business known and identified as defendant AMERICAN PLOW, located at 16 Indian Hill, Mahopac, New York, 10541."

Based on Uffenheimer's verified complaint, Metropolitan could reasonably conclude that Thomas' operation of a snow plow business was a clear-cut factual matter about which one [*8]would reasonably anticipate no dispute.

Inasmuch as defendant did not respond to the notice to admit within 20 days, defendant is deemed to have admitted all of the facts alleged therein (CPLR 3123[a] ). Thomas' failure to object to the Notice to Admit establishes the fact that Thomas was operating a snow plow business. And, the policy clearly excludes liability coverage for bodily injury or property damage arising out of or in connection with the insured's business activities.

Conclusion

Based on the foregoing, it is hereby

ORDERED that the motion of plaintiff Metropolitan Property and Casualty Insurance Company, for an order pursuant to CPLR 3212, granting summary judgment declaring that Metropolitan has no obligation to defend or indemnify defendant Richard F. Thomas, is granted;

and it is further

ORDERED that the Clerk of the Court is directed to enter judgment accordingly. And it is further

ORDERED that counsel for plaintiff shall serve a copy of this Order with notice of entry within twenty days of entry on counsel for all parties.

This constitutes the decision and order of this court.

Dated:December 6, 2007

____________________________________

Carol Robinson Edmead, J.S.C.