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HOW SHIM YU, Plaintiff–Appellant, v. GENERAL SECURITY INSURANCE CO., Defendant–Respondent.

Decided: May 17, 2012

TOM, J.P., SAXE, SWEENY, RICHTER, MANZANET–DANIELS, JJ. Shayne, Dachs, Corker, Sauer & Dachs, LLP, Mineola (Jonathan A. Dachs of counsel), for appellant. Melito & Adolfsen P.C., New York (S. Dwight Stephens of counsel), for respondent.

Order, Supreme Court, New York County (Richard F. Braun, J.), entered June 21, 2010, which granted defendant's motion for summary judgment dismissing the complaint and denied plaintiff's cross motion for summary judgment, unanimously reversed, on the law, with costs, the motion denied, the cross motion granted, and the matter remanded for further proceedings consistent herewith.

This is an action pursuant to Insurance Law § 3420(a)(2) by an injured person (plaintiff) against the insurer (defendant) of a tortfeasor (nonparty Lep Keng Corp.), which has not satisfied a judgment against it in plaintiff's favor. It is undisputed that Lep Keng's notice to defendant was late. However, “[a]n insurer's failure to provide notice as soon as is reasonably possible precludes effective disclaimer, even [where] the policyholder's own notice of the incident to its insurer is untimely” (Matter of New York Cent. Mut. Fire Ins. Co. v. Aguirre, 7 N.Y.3d 772, 774, 820 N.Y.S.2d 848, 854 N.E.2d 146 [2006] [internal quotation marks omitted] ).

Defendant learned by August 27, 2004, at the latest, that plaintiff served the summons and complaint in the underlying personal injury action on the Secretary of State on December 31, 2001, that the Secretary of State had sent the documents to the address on file for Lep Keng, and that the documents had been returned unclaimed. Thus, defendant was aware by that date “of the grounds for disclaimer of liability or denial of coverage” (id. [internal quotation marks omitted] ). Nevertheless, it did not disclaim until July 18, 2007, almost three years later, a delay that is unreasonable as a matter of law (see e.g. First Fin. Ins. Co. v. Jetco Contr. Corp., 1 N.Y.3d 64, 66, 769 N.Y.S.2d 459, 801 N.E.2d 835 [2003] ). Defendant's contention that it had to wait until the motion court in the underlying action confirmed the Special Referee's finding that Lep Keng had deliberately left mail unclaimed, is unavailing (see Republic Franklin Ins. Co. v. Pistilli, 16 A.D.3d 477, 479, 791 N.Y.S.2d 639 [2005] ).

Because neither the motion papers below nor the briefs on appeal addressed the amount of the judgment that should be entered and whether interest should be assessed, the matter should be remanded for further proceedings.

In light of the above disposition, we do not reach the parties' remaining arguments.

The Decision and Order of this Court entered herein on February 23, 2012 is hereby recalled and vacated (see M–1074 decided simultaneously herewith).