April 26, 1971
In a proceeding to stay arbitration, petitioner appeals from an order of the Supreme Court, Westchester County, dated July 16, 1970, which denied the application. Order reversed, on the law, without costs, application granted pending a judicial determination of the validity of the disclaimer by Cosmopolitan Mutual Insurance Company and proceeding remitted to Special Term to determine whether or not the disclaimer was valid and for further proceedings in accordance with such determination. The arbitration was demanded by respondents upon their claims under the automobile accident indemnification indorsement in an automobile liability insurance policy issued by petitioner to Robert Semidey, whose automobile, in which respondents were traveling, was involved in an accident on December 10, 1967 with a car owned and operated by Efrain Gonzalez and insured by Cosmopolitan Mutual Insurance Company. The petition herein is based on petitioner's allegation that an attempted disclaimer of coverage by the insurer of the Gonzalez vehicle, on the grounds of lack of co-operation and failure to turn over process to the carrier, is invalid. On March 27, 1970, respondents' attorney sent a letter to petitioner by certified mail, indicating an intention to arbitrate the issues arising out of the personal injuries sustained by respondents in the accident. The usual 10-day preclusion notice was included therein. However, the letter did not include the address of the party serving the notice, as required by the pertinent statute (CPLR 7503, subd. [c]). Moreover, the letter is totally devoid of any information as to why arbitration is required, other than that an accident occurred. The insured's name, the policy number, and the cause of arbitration (whether under the hit-and-run driver, or uninsured motorist, clause) are all missing. Under these facts, the letter cannot serve as a basis to preclude petitioner's motion for a stay, dated May 25, 1970, on the ground that it was not made within 10 days from receipt of the notice to arbitrate and was therefore untimely ( Matter of Hesslein Co. v. Greenfield, 281 N.Y. 26; Matter of Allstate Ins. Co. [ Neithardt], 24 A.D.2d 941; Matter of Lipsky [ Fashion Art Corp.], 23 A.D.2d 775; Matter of Electronic Missile Facilities [ Campbell], 20 A.D.2d 891; Matter of Newmeyer [ Bill Chan's, Inc.,] 23 A.D.2d 836). Thereafter, on April 6, 1970, respondents served petitioner with a formal demand for arbitration. However, it was served by regular mail, in contravention of CPLR 7503 (subd. [c]). In view of this fact, the demand for arbitration dated April 6, 1970 could not serve to preclude petitioner for having failed to move for a stay within 10 days after receipt of the demand. ( Matter of Napolitano [ MVAIC], 26 A.D.2d 757, revd. on other grounds 21 N.Y.2d 281; Matter of Hesslein Co. v. Greenfield, supra; Matter of Merchants Mut. Ins. Co. [ Anziano], 59 Misc.2d 673). In its motion papers, petitioner alleged that the attempted disclaimer by insurer Cosmopolitan was invalid. In their opposition papers, respondents did not address themselves to this issue. The declaration of noncoverage by Cosmopolitan does not preclude judicial inquiry in respect of the validity of the disclaimer and, under the statutes (Insurance Law, § 167, subd. 2-a; § 600, subd. ), the appellant-insurer should be given an opportunity to litigate before a court, rather than before an arbitrator, the question whether the disclaiming insurer's policy was validly canceled, that question to be so litigated by "preliminary jury trial on the question of whether or not the alleged tort-feaser was or was not insured" ( Matter of Motor Vehicle Acc. Ind. Corp. [ Malone], 16 N.Y.2d 1027, 1028). Hopkins, Acting P.J., Munder, Martuscello, Latham and Brennan, JJ., concur.