IN RE: MERCHANTS MUTUAL INSURANCE COMPANY

Reset A A Font size: Print

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

IN RE: MERCHANTS MUTUAL INSURANCE COMPANY, Respondent, v. Salvatore FALISI, et al., Appellants.

Decided: April 22, 2002

SONDRA MILLER, J.P., GABRIEL M. KRAUSMAN, HOWARD MILLER and THOMAS A. ADAMS, JJ. O'Brien & O'Brien (John M. Denby, East Setauket, NY, and Stephen L. O'Brien of counsel), for appellants. Milber Makris Plousadis & Seiden, LLP, Garden City, NY, (Christine Andreoli and William Brocks of counsel), for respondent.

In a proceeding pursuant to CPLR article 75 to permanently stay arbitration of a supplementary uninsured motorist claim, the appeal is from a judgment of the Supreme Court, Suffolk County (Underwood, J.), entered October 31, 2001, which granted the petition.

ORDERED that the judgment is affirmed, with costs.

 The appellant insureds correctly argue that their supplementary uninsured motorist (hereinafter SUM) arbitration claim cannot be stayed because they violated a policy provision requiring prompt notice of the legal action they commenced against the driver of the allegedly offending vehicle.   Their insurer, the petitioner Merchants Mutual Insurance Co. (hereinafter Merchants), did not include that ground in its letter of disclaimer.   Thus, it waived any right to assert that ground in its petition to stay arbitration as a basis for denying coverage (see General Acc. Ins. Group v. Cirucci, 46 N.Y.2d 862, 414 N.Y.S.2d 512, 387 N.E.2d 223;  Benjamin Shapiro Realty Co. v. Agricultural Ins. Co., 287 A.D.2d 389, 731 N.Y.S.2d 453;  Matter of Fireman's Fund Ins. Co. v. Freda, 156 A.D.2d 364, 365-366, 548 N.Y.S.2d 319).

 Nevertheless, affirmance of the judgment staying arbitration is warranted.   Merchants properly disclaimed coverage due to the appellants' demonstrated failure to provide notice and proof of their SUM claim as soon as practicable, as required by the policy (see Matter of Allstate Ins. Co. v. Earl, 284 A.D.2d 1002, 726 N.Y.S.2d 522;  Witterschein v. State Farm Ins. Co., 278 A.D.2d 317, 718 N.Y.S.2d 192;  Matter of Nationwide Mut. Ins. Co. v. Wexler, 276 A.D.2d 490, 713 N.Y.S.2d 878;  Matter of Eagle Ins. Co. v. Bernardine, 266 A.D.2d 543, 699 N.Y.S.2d 85;  State Farm Mut. Auto. Ins. Co. v. Romero, 109 A.D.2d 786, 486 N.Y.S.2d 297).

The appellants' remaining contentions are meritless.

Copied to clipboard