Opinion
December 27, 1994
Appeal from the Supreme Court, Westchester County (Gurahian, J.).
Ordered that the order is affirmed insofar as appealed from, with costs.
The Supreme Court properly granted the defendant's motion to amend its answer to add two additional affirmative defenses. Leave to amend a pleading should be freely given except where the amendment is palpably improper, fails as a matter of law, or prejudices the nonmoving party (see, Town of Hempstead v Zara Sons Contr. Co., 173 A.D.2d 536, 537).
The defendant did not waive its right to raise affirmative defenses based on the fact that the insured had concealed that he smoked and suffered from hypertension when he applied for coverage. An insurer does not waive defenses of which it was ignorant at the time it drafted its original letter of disclaimer and its initial verified answer (see, Luria Bros. Co. v Alliance Assur. Co., 780 F.2d 1082, 1090; see also, Guberman v William Penn Life Ins. Co., 146 A.D.2d 8). Nor is the defendant estopped from raising the defenses that emerged unexpectedly during discovery, since it was ignorant of the facts underlying those defenses when it first disclaimed and answered (see, Guberman v William Penn Life Ins. Co., supra; see also, Bleckner v General Acc. Ins. Co., 713 F. Supp. 642, 651-652), and because the insured's beneficiary, which stands in the shoes of the insured, may not claim prejudice as a result of the defendant's initial failure to discover a fraud perpetrated by the insured on his policy application (see, S E Motor Hire Corp. v New York Indem. Co., 255 N.Y. 69, 72-75; Cherkes v Postal Life Ins. Co., 285 App. Div. 514, 516, affd 309 N.Y. 964; Zeldman v Mutual Life Ins. Co., 269 App. Div. 53, 58; Fernandez v Windsor Life Ins. Co., 83 Misc.2d 301, affd 52 A.D.2d 589).
The defendant's allegations that the insured smoked and suffered from high blood pressure are contested. It is also not clear from this record whether the defendant would have sold the insured the policy at issue had all the facts regarding the insured's habits and health (whatever they may prove to be) been known. We find, therefore, that the issues of whether there was a misrepresentation on the insured's application for insurance, and whether this misrepresentation was material, must await a trial of the action (see, Mutual Benefit Life Ins. Co. v JMR Elecs. Corp., 848 F.2d 30; Process Plants Corp. v Beneficial Natl. Life Ins. Co., 53 A.D.2d 214; Greene v United Mut. Life Ins. Co., 38 Misc.2d 728). Bracken, J.P., Balletta, Friedmann and Krausman, JJ., concur.