C.C.R. Realty of Dutchess v. N.Y. Central Mut

Full title: C.C.R. REALTY OF DUTCHESS, INC., ET AL., plaintiffs-respondents, v. NEW…

Court: Appellate Division of the Supreme Court of New York, Second Department

Date published: Nov 3, 2003

1 A.D.3d 304 (N.Y. App. Div. 2003)

766 N.Y.S.2d 856

Opinion

2002-09329

Argued September 16, 2003.

November 3, 2003.

In an action for a judgment declaring that the defendant New York Central Mutual Fire Insurance Company is obligated to defend and indemnify the plaintiffs in an underlying action entitled Springer v. C.C.R. Realty of Dutchess, pending in the Supreme Court, Dutchess County, under Index No. 2348/99, the defendants Rosemary Springer and Joseph Springer appeal from an order of the Supreme Court, Dutchess County (Dolan, J.), dated September 10, 2002, which granted the motion of the defendant New York Central Mutual Fire Insurance Company for summary judgment.

Finkelstein Partners, Newburgh, N.Y. (George A. Kohl 2nd of counsel), for appellants.

Boeggeman, George, Hodges Corde, P.C., White Plains, N.Y. (Leslie K. Arfine and Cynthia Dolan of counsel), for defendant-respondent.

Before: A. GAIL PRUDENTI, P.J., NANCY E. SMITH, WILLIAM D. FRIEDMANN, HOWARD MILLER, JJ.

DECISION ORDER

ORDERED that the order is affirmed, with costs, and the matter is remitted to the Supreme Court, Dutchess County, for the entry of a judgment declaring that the defendant New York Central Mutual Fire Insurance Company is not obligated to defend and indemnify the plaintiffs in the underlying action.

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 ( see White v. City of New York, 81 N.Y.2d 955, 957; Brooks v. Zurich-American Ins. Group, 300 A.D.2d 176, 178; Pierre v. Providence Wash. Ins. Co., 286 A.D.2d 139, 143, affd 99 N.Y.2d 222; New York Cent. Mut. Fire Ins. Co. v. Riley, 234 A.D.2d 279). Absent a showing of legal justification, the failure to comply with the notice condition vitiates coverage ( see Matter of Allcity Ins. Co., 78 N.Y.2d 1054, 1055; Matter of Interboro Mut. Indem. Ins. Co. v. Napolitano, 232 A.D.2d 561, 562; Greater N.Y. Mut. Ins. Co. v. Farrauto, 136 A.D.2d 598, 599). However, a failure to give notice may be excused when an insured has a reasonable belief of nonliability ( see White v. City of New York, supra at 957-958; Security Mut. Ins. Co. of N.Y. v. Acker-Fitzsimons Corp., 31 N.Y.2d 436; United Talmudical Academy of Kiryas Joel v. Cigna Prop. Cas. Co., 253 A.D.2d 423, 424). The burden is on the insured to show the reasonableness of its belief, and whether that belief is reasonable is ordinarily a question for the trier of fact ( see United Talmudical Academy of Kiryas Joel v. Cigna Prop. Cas. Co., supra; Kreger Truck Renting Co. v. American Guar. Liab. Ins. Co., 213 A.D.2d 453; Argentina v. Otsego Mut. Fire Ins. Co., 207 A.D.2d 816, affd 86 N.Y.2d 748).

However, the duty to give notice arises "when, from the information available relative to the accident, an insured could glean a reasonable possibility of the policy's involvement" ( Paramount Ins. Co. v. Rosedale Gardens, 293 A.D.2d 235, 239-240). Furthermore, knowledge of an occurrence obtained by an agent charged with the duty to report such matters is imputed to the principal ( see White v. City of New York, supra at 958).

In the present case, the evidence established that the plaintiffs should have realized that there was a reasonable possibility of the subject policy's involvement once they learned about the accident and its surrounding circumstances. Having failed to offer a valid excuse as to why they waited approximately six months to inform their insurance agent of the occurrence ( see Paramount Ins. Co. v. Rosedale Gardens, supra; Ciaramella v. State Farm Ins. Co., 273 A.D.2d 831, 832), the Supreme Court properly granted the insurer's motion for summary judgment ( see Sayed v. Macari, 296 A.D.2d 396; Lukralle v. Durso Supermarkets, 238 A.D.2d 318).

The appellants' remaining contention is without merit.

We note that since this is a declaratory judgment action, the matter must be remitted for the entry of a judgment declaring that the defendant New York Central Mutual Fire Insurance Company is not obligated to defend and indemnify the plaintiffs in the underlying action ( see Lanza v. Wagner, 11 N.Y.2d 317, 334, appeal dismissed 371 U.S. 74, cert denied 371 U.S. 901).

PRUDENTI, P.J., SMITH, FRIEDMANN and H. MILLER, JJ., concur.