D & R Plaza Jewelry v Those Lead Underwriters at Bellmarine, S.A.

[*1] D & R Plaza Jewelry v Those Lead Underwriters at Bellmarine, S.A. 2008 NY Slip Op 52060(U) [21 Misc 3d 1113(A)] Decided on October 16, 2008 Supreme Court, Kings County Demarest, 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 October 16, 2008
Supreme Court, Kings County

D & R Plaza Jewelry, d/b/a FLAWLESS JEWELRY, Plaintiff,

against

Those Lead Underwriters at Bellmarine, S.A. Index No. 37499/06 SUBSCRIBING TO POLICY NO. 200.447/969817, AND ALL THOSE INTERESTED UNDERWRITERS OF AXA BELGIUM, S.A., AND AT B.D.M.S.A., SUBSCRIBING TO SAID POLICY, Defendants.



37499/06



Attorney for Plaintiff

Michael F. Newton, Esq.

286 Madison Avenue, Suite 702

New York, NY 10016

Attorney for Defendants

Lisa A. Scognamillio, Esq.

Badiak & Will, LLP

106 Third Street

Mineola, NY 11501-4404

Carolyn E. Demarest, J.

Defendants Those Lead Underwriters at Belmarine, S.A., AXA Belgium, S.A., and B.D.M.S.A. ("Defendants") move for summary judgment, pursuant to CPLR 3212, dismissing the claims of plaintiff D & R Plaza Jewelry d/b/a Flawless Jewelry ("D & R") for breach of contract on an insurance sales agreement. Defendants also seek an order pursuant to 22 NYCRR §130-1.1 for sanctions. Defendants' motion for summary judgment dismissing the verified complaint with prejudice is granted and defendants' request for sanctions is denied.

BACKGROUND

[*2]This case arises out of an alleged armed robbery at the plaintiff's jewelry store and the subsequent claim submitted under the insurance policy issued by defendant. On August 12, 2005, plaintiff entered into an insurance agreement contract ("Policy"), commonly known as a jewelers's block insurance policy, with defendants for a period of 12 months. The Policy insured plaintiff for all risks of physical loss or damage from any cause whatsoever on stock, including other people's goods, up to $500,000 subject to certain conditions, exclusions and clauses stated in the agreement. Per the Policy, the premises limit was increased to $1,000,000.00 for the months of November, December and January.

To finance the premium payments due under the Policy, plaintiff entered into a premium finance agreement ("Finance Agreement") dated August 12, 2005, with Standard Funding Corporation ("Standard"). Under said agreement, plaintiff agreed to pay Standard, which had paid the defendants' premium in full, the sum of $963.53 monthly for a term of 12 months commencing on September 11, 2005. S.J. International Brokers ("S.J.") is listed on the face of the Finance Agreement as agent for plaintiff, and Belmarine, S.A., the lead underwriter, is listed as the insurance company. Neither Standard nor S.J. is a party to this action. Pursuant to the Finance Agreement, plaintiff appointed Standard as its attorney-in-fact and authorized Standard to cancel the Policy if plaintiff failed to make payments as agreed.

Standard did not receive the payment from plaintiff which was due on November 11, 2005. Defendants allege that Standard, as attorney-in-fact for plaintiff, sent defendants a notice of cancellation dated December 2, 2005 that was effective as of 12:01 A.M. on December 3, 2005. However, the "INSURED COPY" of the "INSURED'S NOTICE OF CANCELLATION" issued by Standard, submitted in support of the motion to dismiss, appears to be addressed to the plaintiff and S.J., but not the defendants. Furthermore, the address below "Flawless Jewelry" and "D & R Plaza Jewelry" on the notice of cancellation is the address of S.J., not the plaintiff. Plaintiff argues that they did not receive the notice of cancellation prior to the cancellation date.

Plaintiff alleged in the complaint that they sustained a loss covered under the policy "on or about December 10, 2005." Defendants retained Donald Yick ("Yick"), an insurance adjuster, to investigate the alleged loss. After receiving notification of the alleged loss and pursuant to the terms of the policy, Yick contacted David Shimunov ("Shimunov"), principal and one half owner of the plaintiff, on December 12, 2005, and instructed Shimunov to close the store to business and activate the alarm until December 15, 2005, the date on which a representative of the plaintiff was scheduled to be interviewed and formal post-loss inventory conducted. According to Yick, he met with Shimunov and Roman Khaimov ("Khaimov"), the other one half owner of plaintiff, on December 15, 2005 and Shimunov reported the following during the interview: the plaintiff's jewelry store was robbed on December 11, 2005 and Shimunov reported the incident to the local police at the 63rd Precinct, noting that approximately $400,000.00 - $500,000.00 worth of jewelry was stolen; the robbery was reported to S.J. on December 12, 2005; the plaintiff had completed a physical inventory in October 2005; and the inventory in the store is controlled by computer and a manual backup. Yick was provided with the contact information for Shimunov and Khaimov, including the business address, their individual residence addresses and cell phone numbers.

According to Yick, during his investigation of the insurance claim he learned that the alarm system had not been activated on December 12, contrary to Yick's instructions. Yick was advised that an employee, Nathan Kataev ("Kataev"), was also in the store the evening of the alleged robbery, but was unable to appear at the December 15 meeting because he was preparing [*3]for a trip to Russia through the end of January 2006. Yick claims he requested that he be contacted upon Kataev's return to schedule an interview, but was never contacted by the insured regarding Kataev's return. Khaimov also informed Yick that, along with his father, Ilya Khaimov, he had entered the store between December 12 and 15, worked on the inventory, and Ilya Khaimov had removed merchandise from the premises that was allegedly on consignment from Ilya Khaimov's own jewelry manufacturing company. While Yick viewed a video of the alleged robbery that was recorded on the store's surveillance system and requested a copy of the video from Shimunov, the plaintiff never provided Yick with a copy of the video. At the December 15, 2005 meeting, Yick presented Shimunov with a statement regarding the loss for his review and signature and, despite numerous requests for the signed document, Shimunov did not sign the statement until May 29, 2008, for inclusion in plaintiff's opposition to the present motion. Yick also requested a formal written claim detailing the alleged loss along with a copy of the physical inventory per the Policy.

In May of 2006, Yick contacted Shimunov and Khaimov through the cell phone numbers provided at the December 15, 2005 meeting and indicated that specific documents were still needed to substantiate plaintiff's claims. Both agreed to appear for an interview. However, neither appeared at the scheduled place and time. Yick claimed in his affidavit in support of this motion that he made several subsequent attempts to interview Shimunov and Khaimov, left three messages on the voicemail of Shimunov's cell phone, and never received a response from either individual. Yick sent plaintiff's broker, S.J., a written request for a formal claim and documents, including the most recent inventory conducted, on January 16, 2006. When the plaintiff did not respond to Yick's requests, Yick followed up with interviews of S.J.'s employees and three visit's to S.J.'s offices to obtain the file on the claim. S.J. did not provide Yick with the file and was unwilling to co-operate in the investigation.

John Kim ("Kim") was the certified public accountant hired to assist in the post-loss inventory. According to Kim's affidavit in support of the motion, a letter was sent to plaintiff [FN1] and S.J. on January 16, 2006 that included a copy of the count sheets from the physical inventory. The letter requested a number of inventory documents, bank statements, invoices and tax returns from the plaintiff. A follow up letter from Kim was addressed to Shimunov at his personal address on February 17, 2006. Kim wrote to S.J. on February 28, 2006, March 1, 2006, and May 4, 2006 indicating that he had been unable to reach Shimunov and requested that the letter be forwarded to Shimunov. On May 8, 2006, Lenny Madowicz of S.J. wrote to Kim indicating that the plaintiff was gathering the requested documents and they would be provided within 30 days. Kim never received the documents requested from either the plaintiff or S.J..

In plaintiff's opposition to the present motion, dated May 30, 2008, filed with the court, Shimunov included copies of the plaintiff's inventory records. These records include various documents including receipts, inventory spreadsheets and a check. The records range in date from at least as early as July 23, 2004 to as late as a spreadsheet titled "STORE SALES" which [*4]included the sale of two watches on December 11, 2005. In the defendants' reply memorandum of law in support of the present motion, defendants' counsel indicated that, despite Shimunov's affidavit in opposition to the motion noting the inclusion of the inventory documents, defense counsel did not receive those documents in their copy of the affidavit provided by plaintiff. In light of this, this court will not consider these records. More than two years after the alleged robbery, defendants still have not received a complete list of the inventory allegedly lost in the robbery, with the market value and cost of each article.

In his opposing affidavit, Shimunov states he provided Yick with a copy of the security video on June 16, 2006 when Yick took his recorded statement.[FN2] Shimunov claims he never saw the prepared statement from Yick until May of 2008 and did not receive any of Yick's correspondence as the store was permanently closed after the robbery. Shimunov admitted that the he did not turn on the alarm per Yick's request, however, he contends that no one entered the store after the robbery until December 15, 2005 and the safes were locked during that time.

Plaintiff commenced the instant action on December 7, 2006, before the one year limit to file suit on the Policy expired, to recover for a loss by peril in the amount of $1,000,000.00, allegedly sustained and covered under the Policy provided by defendants. The complaint alleges that plaintiff paid the premiums due and complied with each and every obligation pursuant to the terms of the Policy. Plaintiff alleges that the jewelry store was robbed while the Policy was in full force and effect and defendants refused to pay for the loss by peril covered under the Policy thereby breaching the contract.

Defendants filed a verified answer on April 25, 2007 denying liability and asserting various affirmative defenses including, inter alia, breach of contract, failure to co-operate with the conditions precedent and subsequent in the Policy and misrepresentation and concealment of material facts. Defendants have argued that the Policy was cancelled by Standard as of December 3, 2005, at least seven days prior to the alleged robbery "on or about December 10, 2005," and the plaintiff was not therefore covered under the Policy on the day of the robbery. On September 6, 2007, plaintiff's counsel sent defendants' counsel a series of documents as proof that plaintiff paid S.J. the premium due on the Policy on December 1, 2005 and that, since S.J. is claimed to be the agent for Standard and "Bellmarice, S.A. Insurance" [sic], plaintiff's account with Standard was effectively timely paid on December 1, 2005. These documents included a facsimile from Lenny Madowicz of S.J. to plaintiff's counsel indicating that S.J. received a check from plaintiff on December 1, 2005, prior to the notice of cancellation, and S.J. in turn sent a check to Standard that was allegedly posted to Standard's account on December 9, 2008.

Defendants have moved for summary judgment dismissing the complaint against them pursuant to CPLR 3212 on the grounds that the Policy was cancelled prior to the alleged loss, that plaintiff's failure to satisfy conditions precedent in deliberately and repeatedly failing to co-[*5]operate with the defendants' investigation of the alleged loss precludes its recovery under the Policy, and that plaintiff's material misrepresentations in their application voided the Policy.

DISCUSSION

A court may grant summary judgment under CPLR 3212 when there is sufficient evidence to demonstrate the absence of any material issues of fact. The burden is on the moving party to demonstrate a prima facie entitlement to judgment as a matter of law (Ayotte v Gervasio, 81 NY2d 1062, 1063 [1993]). Once the moving party demonstrates a prima facie entitlement, the burden shifts to the opposing party to produce evidentiary proof in admissible form sufficient to establish the existence of material issues of fact which require a trial of the action (Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]). "[T]he parties' competing contentions must be viewed in a light most favorable to the party opposing the motion" (Marine Midland Bank, N.A. v Dino & Artie's Automatic Transmission, 168 AD2d 610 [2d Dept 1990]). "[C]onclusory assertions are insufficient to demonstrate the absence of any material issues of fact," and "[t]he failure to make [a] prima facie showing requires a denial of the motion, regardless of the sufficiency of the opposing papers" (Ayotte, 81 NY2d at 1063).

The first issue is whether the Policy was in effect on December 11, 2005, the date of the alleged robbery. Defendants argue that the Policy was cancelled by Standard, as the insured's attorney-in-fact, on December 3, 2005, at least seven days prior to the alleged loss, and that plaintiff is therefore not entitled to recover on the Policy. In response, plaintiff claims that on December 1, 2005, prior to the December 2, 2005 notice of cancellation, plaintiff issued their broker, S.J., a check for the outstanding premium and plaintiff did not receive proper notice of the cancellation pursuant to the Policy.

The "LATE PAYMENTS, DEFAULTS" paragraph of the Finance Agreement states, "[i]f I do not pay as agreed, I appoint STANDARD, its successors and/or assigns as my ATTORNEY-IN-FACT who may legally cancel the insurance policy(ies) . . . No payment received after STANDARD has mailed me a Notice of Cancellation will cause my insurance to be reinstated, and such payment will only be applied to reduce the loan balance I owe." The "Broker's Cancellation Clause" of the Policy states "that in the event of the Assured, or their Agents on whose instructions insurance may have been effected, failing to pay the premium or any installment thereof on the due date, this Policy may be forthwith Cancelled by giving to the Underwriters notice in writing . . .." Therefore, pursuant to the terms of the Finance Agreement and Policy, the defendants were authorized to cancel the Policy forthwith upon Standard's written notice to defendants of cancellation as attorney-in-fact for plaintiffs. However, although Standard was authorized to cancel the plaintiff's Policy if plaintiff did not make a timely payment pursuant to the terms of the Finance Agreement,[FN3] the Policy requires notice in writing to the defendants for the policy to be cancelled forthwith. Moreover, the effectiveness of the [*6]cancellation also depends upon Standard providing notice of the cancellation to the insured.

Defendants have not demonstrated that the Policy was properly cancelled on December 3, 2005. According to the notice of cancellation included in support of defendants' motion, Standard only notified plaintiff [FN4] and S.J. of the cancellation. Although defendants argue that Standard sent defendants notice of cancellation on December 3, 2005, the only support the defendants provide for this assertion is the "INSURED COPY" of the "INSURED'S NOTICE OF CANCELLATION," which is not addressed to the defendants, but to S.J. and plaintiff, but at S.J.'s address. This notice of cancellation to S.J. is not deemed to be notice to the defendants as defendants have not produced any evidence that S.J. was an agent of the defendants (See Matter of Temple Constr. Corp. v Sirius Am. Ins. Co., 40 AD3d 1109, 1111 [2d Dept 2007]; MTO Assoc., Ltd. Partnership v Republic-Franklin Ins. Co., 21 AD3d 1008 [2d Dept 2005]) (holding "an insurance broker is considered the agent of the insured, not the insurance company" except "where there is some evidence of action on the insurer's part, or facts from which a general authority to represent the insurer may be inferred"). Accordingly, defendants have not demonstrated prima facie that Standard, as attorney-in-fact for plaintiff, cancelled the Policy effective December 3, 2005 pursuant to the "Brokers' Cancellation Clause" of the Policy.

Standard was also required to comply with the cancellation notice requirements of New York Banking Law §576, which sets forth the procedures that a premium finance agency must follow to effect cancellation of an insurance contract. Specifically, Banking Law §576 [a] requires the premium finance agency to provide not less then ten days written notice to the insured of the intent to cancel the policy unless the default is cured within the ten day period. Three days is added to the ten days notice for mailing. Based upon the documents submitted in support and opposition to the present motion, it appears that Standard did not comply with the 13 day statutory notice requirement prior to the December 3, 2005 cancellation date. As there is an issue of fact as to whether Standard cancelled the Policy pursuant to the terms of the Policy and in accordance with the requirements of Banking Law § 576 [a], defendants have failed to demonstrate prima facie evidence that the policy was cancelled prior to the alleged loss on December 11, 2005.

While issues of fact remain as to whether the Policy was effectively cancelled prior to the alleged loss, giving plaintiff the benefit of the presumption that the Policy was in effect at the time of loss, which defendants also appear to have done in undertaking a prompt and vigorous investigation of the claim, defendants nevertheless have demonstrated prima facie that the plaintiff failed to comply with conditions precedent under the Policy and that such failure defeats plaintiff's right to recover.

"A condition precedent is an act or event, other than a lapse of time, which, unless the condition is excused, must occur before a duty to perform a promise in the agreement arises" (Oppenheimer & Co. v Oppenheim, 86 NY2d 685, 690 [1995]). Before a claimant can recover under an insurance policy, an express condition precedent must be literally complied with before the claimant may recover (Oppenheimer, 86 NY2d at 690; Sulner v G.A. Ins. Co., 224 AD2d 205, 206 [1st Dept 1996]; Seaport Park Condominium v Greater NY Mut. Ins. Co., 39 AD3d 51, 55 [1st Dept 2007]). "An insured seeking to recover for a loss under an insurance policy has the [*7]burden of proving that a loss occurred and also that the loss was a covered event within the terms of the policy" (Gongolewski v Travelers Ins. Co., 252 AD2d 569 [2d Dept 1998]; Vasile v Hartford Acc. & Indem. Co., 213 AD2d 541 [2d Dept 1995]). The Policy included a number of conditions precedent under the clearly labeled "CONDITIONS PRECEDENT TO LIABILITY HEREON" section of the Policy.

Paragraph F of the conditions precedent to the Policy provides:

F. In the event of loss or damage, or of anything likely to result in a claim under this Policy, the Assured shall give immediate notice in writing to the Underwriters, protect the property from loss or damage, furnish a complete list of the lost or damaged property stating the market value and cost of each article and the amount claimed thereon; and the Assured shall within sixty (60) days after the loss or damage . . . render to the Underwriters a proof of loss signed and sworn to by the Assured as to the following: -

the time and cause of the loss or damage; -

the interest of the Assured and of all others in the property affected; -

the cash value of each item thereof; -

the amount of loss of or damage thereto; -

all encumbrances thereon; -

all other contracts of insurance, whether valid or not, covering any of such property, and shall furnish a copy of all the descriptions and the schedules in all such insurance Policies, if required. (Emphasis added)

However, under Insurance Law § 3407 [a]:

The failure of any person insured against loss or damage to property under any contract of insurance . . . to furnish proofs of loss to the insurer or insurers as specified in such contract shall not invalidate or diminish any claim of such person insured under such contract, unless such insurer or insurers shall, after such loss or damage, give to such insured a written notice that it or they desire proofs of loss to be furnished by such insured to such insurer or insurers on a suitable blank form or forms."(Emphasis added)

Although defendants' agent, Yick, provided an affidavit averring that he personally gave Shimunov a copy of a printed statement regarding the loss and requested that Shimunov complete and return the document, defendants have not demonstrated that they provided blank proof of loss forms as required under Insurance Law § 3407 [a] (Ingarra v General Accident/PG Ins. Co., 273 AD2d 766, 767 [3d Dept 2000]; Medical Facilities, Inc. v Pryke, 172 AD2d 338 [1st Dept 1991] (holding that insurer failed to meet the requirement of Insurance Law § 172 (now § 3407) by providing insured with proof of loss forms filled in with amounts instead of blank forms as required by statute)). Plaintiff's failure to provide a proof of loss statement within 60 days of the alleged loss does not, therefore, require dismissal of plaintiff's action.

However, defendants have successfully demonstrated that the plaintiff did not comply with other conditions precedent to payment of a claim under the policy and plaintiff failed to rebut this evidence by submitting evidence raising an issue of fact. When "the record is indicative of a pattern of noncooperation for which no reasonable excuse has been offered the [*8]complaint [is] properly dismissed unconditionally" (Argento v Aetna Casualty and Surety Co., 184 AD2d 487, 488 [2d Dept 1992]). "[T]he [insured's] continued failure, without explanation or excuse, to provide the requested information constitute[s] a material breach of the policy that preclude[s] recovery by the [insured]" (Cabe v Aetna Cas. & Sur. Co., 153 AD2d 653, 654 [2d Dept 1989]; See Pizzirusso v Allstate Ins. Co., 143 AD2d 340, 341 [2d Dept 1988] (granting summary judgment and dismissing complaint due to plaintiff's willful refusal to fulfill obligations under the insurance policy and provide material information and documentation); Bulzomi v New York Cent. Mut. Fire Ins. Co., 92 AD2d 878, 879 [2d Dept 1983] (granting summary judgment and dismissing complaint due to plaintiff's pattern of noncooperation for which no reasonable excuse for noncompliance had been offered); 232 B'way Corp. v NY Prop. Ins. Underwriting Ass'n, 206 AD2d 419, 421 [2d Dept 1994] (holding insured's failure to co-operate as required under policy precluded recovery)). To deny coverage based upon lack of cooperation, "the insurer must demonstrate that it acted diligently in seeking to bring about the insured's co-operation, that the efforts employed by the insurer were reasonably calculated to obtain the insure[d]'s co-operation, and that the attitude of the insured, after his co-operation was sought, was one of willful and avowed obstruction'" (Thrasher v United States Liab. Ins. Co., 19 NY2d 159, 168-169 [1967] (citations omitted); Pawtucket Mut. Ins. Co. v Soler, 184 AD2d 498, 499 [2d Dept 1992]). "Willful noncooperation has been found to exist when there is a pattern of noncompliance for which no reasonable excuse can be offered, or where the failure to cooperate is persistent" (Levy v Chubb Ins., 240 AD2d 336, 337 [1st Dept 1997]).

Paragraph A, E and J of the conditions precedent of the Policy required the plaintiff to provide the defendants with records and various documentation as well as to submit to an examination under oath in the event of a loss as follows:A. The Assured shall keep detailed records of all sales, purchases and other transaction, and that such records shall be available for inspection by the Underwriters or their representative in case of a claim being made under this Policy. (Emphasis added) E. The Assured shall in case of loss or damage and as a condition precedent to any right of indemnification in respect thereof give to the Underwriters, via the negotiating brokers, such information and evidence as to the property lost or damaged and the circumstances of the loss or damage as the Underwriters may reasonably require and as may be in the Assured's power. (Emphasis added)J. The Assured shall in the event of loss or damage and as per Underwriters' request submit to an examination under oath by any persons authorized by the Underwriters relative to any and all matters concerning the claim and subscribe to the same; and shall produce for examination all books of accounts, bills, invoices and other vouchers or certified copies thereof if originals be lost, at such reasonable time and place as may be designated by Underwriters or its representatives and shall permit extracts and copies thereof to be made. (Emphasis added)The defendants undertook diligent efforts that were reasonably calculated to bring about plaintiff's cooperation with regard to Paragraphs A, E and J by sending letters to the plaintiff at the personal address of Shimunov, sending letters and faxes to the plaintiff's broker, setting up interviews with Shimunov and Khaimov, leaving phone messages on the personal phone number of Shimunov, and making multiple appearances at the office of the plaintiff's broker to review the claim file. As noted above, defendants' attempts were futile. The pattern of noncooperation and unexplained delay, which continued for over two years, was clearly persistent and unreasonable.

Although Shimunov states in his amended affidavit that he was at all times willing to [*9]appear for an examination under oath, he did not dispute Yick's statement that he did not appear for an interview as scheduled in May 2006 or deny receiving Kim's February 17, 2006 letter request for documentation. The only explanation offered for the delay is David Shimunov's reference to his prior attorney's suspension on October 10, 2006, prior to commencement of suit, and his "ex-partner[ s]" attempt to intervene in this action by separate counsel, neither of which would have logically influenced his ability to co-operate with defendants' investigation prior thereto. Mr. Shimunov also makes reference to his conviction for possession of counterfeit funds as having created a depression for which he has been taking medication. This court does not find such excuses sufficient to justify plaintiff's failure to provide defendants with the documentation as required under the Policy. Despite defendants' numerous attempts addressed to both Mr. Shimunov and Mr. Khaimov, to obtain documentation regarding the inventory at the time of the alleged robbery, the documentation was still not provided as of March 26, 2008, the day this motion was filed. It is noted that neither Mr. Khaimov, a fifty percent owner of plaintiff, nor the broker S.J., has provided any explanation for their failure to co-operate with the investigation. It was plaintiff's burden under the Policy to support its claim in a timely fashion so as to afford defendants the opportunity to verify both the fact of the loss and its value. It did not meet such burden.

At times, insureds are given a second chance, but "[t]he delay and avoidance here has precluded any possibility of obtaining anything but stale information" (Levy v Chubb Ins., 240 AD2d 336, 338 [1st Dept 1997]). Plaintiff's non-co-operation is held to be wilful as the defendant demonstrated that the plaintiff's failure to co-operate was persistent (see Levy v Chubb Ins., 240 AD2d at 337). Plaintiff's continued failure to provide the defendants with the requested inventory records, purchase records, list of the property allegedly lost, information as to Kataev's availability for an interview, and Shimunov and Khaimov's failure to appear for an interview without a valid explanation or excuse constituted a material breach of the Policy which precludes plaintiff's recovery (see Cabe, 153 AD2d at 653; Pizzirusso, 143 AD2d at 340; Bulzomi, 92 AD2d at 878; 232 B'way Corp., 206 AD2d at 419). The belated attempt by Shimunov to provide the requested documentation cannot cure the actual prejudice to defendants caused by the extended delay and the ultimate failure to co-operate by providing access to witnesses with relevant knowledge.

Accordingly, as defendants have demonstrated prima facie that plaintiff did not comply with conditions precedent to recovery under the Policy, and plaintiff failed to rebut this evidence by raising a genuine issue of fact, plaintiff may not recover under the Policy (see Oppenheimer, 86 NY2d at 690; Sulner, 224 AD2d at 205; Seaport Park Condominium, 39 AD3d at 55). Therefore, defendants' motion for summary judgment must be granted.

SANCTIONS

Pursuant to 22 NYCRR §130-1.1, a court may award sanctions, in its discretion, for actual expenses reasonably incurred and reasonable attorney's fees, resulting from frivolous conduct. This court declines to grant sanctions pursuant to 22 NYCRR §130-1.1.

CONCLUSIONThe defendants' motion for summary judgment dismissing the complaint is granted. The defendants' request for sanctions is denied.[*10]

This constitutes the decision and order of the Court.

E N T E R

___________________________

J.S.C. Footnotes

Footnote 1:It is noted that while the January 16, 2006 letter submitted in support of the present motion appears to be addressed to Shimunov at plaintiff's place of business, subsequent correspondence from Kim suggests that the envelope was actually addressed to Shimunov's personal residence. Kim claims that the January 16, 2006 letter was returned as unclaimed and submitted a copy of the returned envelope with Shimunov's personal address.

Footnote 2:Shimunov mentioned the alleged June 16, 2006 meeting and "recorded statement" only once in his affidavit, but did not discuss where the meeting took place, how or when the meeting was arranged, or what information about the alleged robbery was conveyed to Yick at that meeting. Yick's affidavit did not address a meeting on June 16, 2006 or include any documentation or recorded statements from Shimunov from a meeting on June 16, 2006. However, in reply, defendants do not dispute that such meeting took place.

Footnote 3:Above Shimunov's signature, the first page of the Finance Agreement states, "THE BROKER OR AGENT WHOSE NAME APPEARS BELOW IS NOT A REPRESENTATIVE OF STANDARD AND HAS NO AUTHORITY TO PROMISE ANYTHING ON BEHALF OF STANDARD." Thus, plaintiff was given notice that Standard would not be bound by representations made by S.J. to plaintiff and that S.J. was the agent of plaintiff and not that of Standard. Plaintiff had no basis to rely on payments made to S.J. as constituting timely payment to Standard.

Footnote 4:As the notice of cancellation was not addressed to plaintiff's place of business as listed on the Finance Agreement, it is not clear whether plaintiff received Standard's notice of cancellation.