BANK SADERAT IRAN NEW YORK AGENCY v. NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH PA (1997)

Order, Supreme Court, New York County (Ira Gammerman, J.), entered January 31, 1997, which, in an action to recover on a fidelity bond, dismissed the complaint for failure to state a cause of action, unanimously affirmed, with costs.

 Defendant's documentary evidence established that plaintiff discovered its employee's dishonesty, and therefore its “loss”, in March 1992;  that plaintiff thereafter submitted a proof of loss for a single transaction that defendant accepted as timely, investigated and settled;  and that two years later, plaintiff submitted additional proofs of loss for two other transactions involving the same employee.   The IAS court correctly held that these later claims were untimely under the “single loss” discovery and notice provisions of the subject bond (see, Commodore Intl. v. National Union Fire Ins. Co., 184 A.D.2d 19, 22, 591 N.Y.S.2d 168), which are unambiguous in requiring that all dishonest transactions in which a particular employee is involved or implicated be considered as single loss for which proof of loss had to be given within six months after discovery of the first loss.   It is also clear that under section 12 of the bond, coverage terminated with respect to this employee and all matters in which he was implicated upon discovery of his dishonesty.   Plaintiff, therefore, had six months from March 1992 to investigate all matters in which this employee was implicated and to include same in its proof of loss.   Neither settlement of the claim in the initial matter nor defendant's investigation of the transactions identified in the untimely proofs of loss constituted waiver of or estoppel against these provisions of the bond (see, Gilbert Frank Corp. v. Federal Ins. Co., 70 N.Y.2d 966, 525 N.Y.S.2d 793, 520 N.E.2d 512).   Nor does it avail plaintiff that the rejected claims were for losses that occurred prior to the accepted claim.   We have considered plaintiff's other arguments and find them to be without merit.

MEMORANDUM DECISION.