SENECA INSURANCE COMPANY v. DISTRIBUTION INC

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Supreme Court, Appellate Division, Second Department, New York.

SENECA INSURANCE COMPANY, appellant, v. W.S. DISTRIBUTION, INC., et al., respondents.

Decided: May 29, 2007

ROBERT A. SPOLZINO, J.P., DAVID S. RITTER, PETER B. SKELOS, and WILLIAM E. McCARTHY, JJ. Tese & Milner, New York, N.Y. (Michael M. Milner of counsel), for appellant. Leonard Zack, New York, N.Y., for respondent Scott Glasgow.

In an action for a judgment declaring that the plaintiff is not obligated to defend and indemnify the defendants in an underlying action entitled Glasgow v. W.S. Distribution, pending in the Supreme Court, Kings County, under Index No. 9248/04, the plaintiff appeals, as limited by its brief, from so much of an order of the Supreme Court, Kings County (J. Schmidt, J.), entered November 29, 2006, as, in effect, denied its motion for summary judgment.

ORDERED that the order is reversed insofar as appealed from, on the law, with costs, the plaintiff's motion for summary judgment is granted, and the matter is remitted to the Supreme Court, Kings County, for the entry of a judgment declaring that the plaintiff is not obligated to defend and indemnify the defendants in an underlying action entitled Glasgow v. W.S. Distribution, pending in the Supreme Court, Kings County, under Index No. 9248/04.

  “Generally, the requirement that an insured provide notice of any 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” (C.C.R. Realty of Dutchess, Inc. v. New York Central Mut. Fire Ins. Co., 1 A.D.3d 304, 304-305, 766 N.Y.S.2d 856;  see White v. City of New York, 81 N.Y.2d 955, 957, 598 N.Y.S.2d 759, 615 N.E.2d 216;  Pierre v. Providence Wash. Ins. Co., 286 A.D.2d 139, 730 N.Y.S.2d 550, affd. 99 N.Y.2d 222, 754 N.Y.S.2d 179, 784 N.E.2d 52).   Absent a showing of legal justification, the failure to comply with the notice condition vitiates coverage (see Matter of Allcity Ins. Co. v. Jimenez, 78 N.Y.2d 1054, 576 N.Y.S.2d 87, 581 N.E.2d 1342;  Morris Park Contr. Corp. v. National Union Fire Ins. Co., 33 A.D.3d 763, 764, 822 N.Y.S.2d 616;  Interboro Mut. Indem. Ins. Co. v. Napolitano, 232 A.D.2d 561, 648 N.Y.S.2d 978).  “There may be circumstances, such as lack of knowledge or a reasonable belief in non-liability, that will excuse or explain delay in giving notice, but the insured has the burden of showing the reasonableness of such excuse” (White v. City of New York, supra at 957-958, 598 N.Y.S.2d 759, 615 N.E.2d 216;  see United Talmudical Academy of Kiryas Joel v. Cigna Prop. & Cas. Co., 253 A.D.2d 423, 676 N.Y.S.2d 645).

 Here, the plaintiff Seneca Insurance Company (hereinafter Seneca) established its prima facie entitlement to judgment as a matter of law by demonstrating that the defendant W.S. Distribution, Inc. (hereinafter Distribution), failed to timely notify it regarding the claim by the defendant Scott Glasgow that he suffered alleged injuries as a result of an accident at Distribution's facility (see Blue Ridge Ins. Co. v. Biegelman, 36 A.D.3d 736, 737, 829 N.Y.S.2d 575;  Steinberg v. Hermitage Ins. Co., 26 A.D.3d 426, 428, 809 N.Y.S.2d 569;  Travelers Indemnity Co. v. Worthy, 281 A.D.2d 411, 412, 721 N.Y.S.2d 400).   In response, Distribution failed to raise a triable issue of fact as to whether a reasonable excuse existed for its delay in notifying Seneca (see White v. City of New York, supra at 958, 598 N.Y.S.2d 759, 615 N.E.2d 216;  C.C.R. Realty of Dutchess Inc. v. New York Central Mut. Fire Ins. Co., supra at 305, 766 N.Y.S.2d 856;  Paramount Ins. Co. v. Rosedale Gardens, 293 A.D.2d 235, 239-240, 743 N.Y.S.2d 59;  see also Felix v. Pinewood Builders, Inc., 30 A.D.3d 459, 461, 818 N.Y.S.2d 119).   Moreover, as Seneca correctly argues, the Supreme Court should not have considered the affidavit of Andy Cheung submitted in opposition to Seneca's motion by Distribution, as Distribution was precluded from presenting such evidence by a prior order of the Supreme Court (see Contarino v. North Shore Univ. Hosp., 13 A.D.3d 571, 572, 786 N.Y.S.2d 326;  see also Cafaro v. Emergency Servs. Holding, Inc., 11 A.D.3d 496, 782 N.Y.S.2d 806;  Echevarria v. Pathmark Stores, 7 A.D.3d 750, 751, 776 N.Y.S.2d 902) Accordingly, the Supreme Court improperly denied that branch of Seneca's motion which was for summary judgment against Distribution.

 Insurance Law § 3420(a) provides the injured party with an independent right to give notice of the accident and to satisfy the notice requirement of the policy (see General Accident Ins. Group v. Cirucci, 46 N.Y.2d 862, 863-864, 414 N.Y.S.2d 512, 387 N.E.2d 223;  Allstate Ins. Co. v. Marcone, 29 A.D.3d 715, 717, 815 N.Y.S.2d 235).   Moreover, the injured party has the burden of proving that its attorney acted diligently in attempting to ascertain the identity of the insurer, and, thereafter, expeditiously notified the insurer (see Steinberg v. Hermitage Ins. Co., supra at 428, 809 N.Y.S.2d 569;  American Home Assur. Co. v. State Farm Mut. Auto. Ins. Co., 277 A.D.2d 409, 410, 717 N.Y.S.2d 224;  Serravillo v. Sterling Ins. Co., 261 A.D.2d 384, 689 N.Y.S.2d 521).

Seneca presented a prima facie case of entitlement to judgment as a matter of law by demonstrating that Glasgow did not timely notify it of his accident (see Steinberg v. Hermitage Ins. Co., supra at 428, 809 N.Y.S.2d 569).   In response, Glasgow failed to raise a triable issue of fact as to whether he diligently attempted to identify Seneca (see Trepel v. Asian Pac. Express Corp., 16 A.D.3d 405, 406, 791 N.Y.S.2d 161;  American Home Assurance Co. v. State Farm Mut. Auto. Ins. Co., 277 A.D.2d 409, 410, 717 N.Y.S.2d 224;  cf. Allstate Ins. Co. v. Marcone, supra at 718, 815 N.Y.S.2d 235).   Accordingly, the Supreme Court should have granted that branch of Seneca's motion which was for summary judgment against Glasgow.

Since this is a declaratory judgment action, the matter must be remitted to the Supreme Court, Kings County, for the entry of a judgment declaring that Seneca is not obligated to defend and indemnify the defendants in the underlying action (see Lanza v. Wagner, 11 N.Y.2d 317, 334, 229 N.Y.S.2d 380, 183 N.E.2d 670, appeal dismissed 371 U.S. 74, 83 S.Ct. 177, 9 L.Ed.2d 163, cert. denied 371 U.S. 901, 83 S.Ct. 205, 9 L.Ed.2d 164;  C.C.R. Realty of Dutchess, Inc. v. New York Central Mut. Fire Ins. Co., supra at 305-306, 766 N.Y.S.2d 856).

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