Scuttlebutt About Town Did Not Trigger Insured's Obligation to Give Notice of Occurrence to His Homeowners Insurer

HOMEOWNERS – LATE NOTICE – INDEPENDENT RIGHT OF INJURED PARTY TO GIVE NOTICE – INSURANCE LAW § 3420(A)(3)
Nationwide Mut. Fire Ins. Co. v. Maitland
(3rd Dept., decided 12/9/2010)

On January 24, 2007, upon encountering his old high school friend in a bar, Alex Maitland tried to hoist Lisa Turner onto his shoulders but lost his balance and dropped poor Lisa on her head, temporarily rendering her unconscious (Be honest.  Who's thinking "there but for the grace of God go I"?).  According to Maitland, after she came to, Turner was walking around and did not appear to be injured, even refusing to get into an ambulance that had been summoned until Maitland convinced her to do so as a precautionary measure.  Turner was later diagnosed with a head injury and released from the hospital that evening.  The decision does not indicate whether Maitland accompanied Turner to the hospital.

Several months later, in April 2007, Turner was diagnosed with two herniated disks and subsequently underwent surgery.  Although Maitland acknowledged having heard rumors in the summer of 2007 that he might be sued by Turner, he allegedly believed those rumors were simply "scuttlebutt about town," as the information did not come from Turner herself — or anyone with direct knowledge — and he did not learn of Turner's diagnosis of bulging disks until much later.  Maitland also denied any recollection of having received two letters sent in August and September 2007 by the bar's insurer and two letters sent in May and October 2007 by Turner's counsel.

Turner and her husband thereafter commenced a personal injury action against Maitland and others.  After Maitland was served, he notified Nationwide, his insurer, of the action on February 4, 2008, slightly more than a year after the incident.  Nationwide disclaimed coverage on the ground that neither Maitland nor Turner gave prompt notice of the incident.  Nationwide then commenced this action seeking a judgment declaring that it had no duty to defend or indemnify Maitland and his wife in connection with Turner's personal injury action.  Following joinder of issue, Nationwide moved and the Maitlands cross-moved for summary judgment.  Hamilton County Supreme Court (Aulisi, J.) denied both motions, prompting this appeal by Nationwide.

In AFFIRMING Supreme Court's denial of Nationwide's motion for summary judgment, the Third Department agreed that questions of fact existed as to whether there was a reasonable excuse for the insured's and injured party's delays in notifying Nationwide of the accident:

Where, as here, "a policy of liability insurance requires that notice of an occurrence be given 'as soon as practicable,' such notice must be accorded the carrier within a reasonable period of time" (Great Canal Realty Corp. v Seneca Ins. Co., Inc., 5 NY3d 742, 743 [2005] [citation omitted]; see Sorbara Constr. Corp. v AIU Ins. Co., 11 NY3d 805, 806 [2008]).  There may be circumstances that excuse a delay in notifying the insurer, such as the insured's good faith reasonable belief in nonliability (see Great Canal Realty Corp. v Seneca Ins. Co., Inc., 5 NY3d at 743; U.S. Underwriters Ins. Co. v Carson, 49 AD3d 1061, 1063 [2008]; Spa Steel Prods. Co. v Royal Ins., 282 AD2d 864, 865 [2001]).  "The reasonableness of the insured's belief, as well as a failure to conduct further inquiry, generally remains a question of fact for the jury" (Morehouse v Lagas, 274 AD2d 791, 794 [2000] [citations omitted]; see Preferred Mut. Ins. Co. v New York Fire-Shield, Inc., 63 AD3d 1249, 1251 [2009]). Guided by these principles, we find that questions of fact exist as to whether there was a reasonable excuse for Maitland's delay in providing notice.

Here, Maitland stated that he did not believe that Turner had sustained any type of significant injury on the date of the incident, explaining that she was walking after the fall, did not appear to be injured and refused to get into an ambulance until he convinced her to do so as a precautionary measure.  Although Maitland indicated that he heard rumors in the summer of 2007 that he might be sued by Turner, he believed it to be simply "scuttlebutt about town," as the information did not come from Turner herself — or anyone with direct knowledge — and he did not learn of Turner's diagnosis of bulging disks until much later.  Furthermore, while plaintiff submitted two letters that were sent to Maitland in August and September 2007 from the insurer of the bar inquiring as to the incident that caused Turner's injuries, as well as correspondence sent from Turner's counsel in May and October 2007 advising Maitland that Turner was being represented for serious injuries sustained as a result of the January 2007 incident, Maitland stated that he does not recall ever receiving these letters.  Maitland averred that his address is "P.O. Box 789, Lake Pleasant" and that the correspondence, which was addressed to either "Route 8, Lake Pleasant" or "Route 8, Speculator," would likely not have reached his home without the inclusion of his post office box number since "Route 8 is a large expanse of state highway in Lake Pleasant and beyond."  Maitland did mention in a recorded statement to the insurer that he received a letter from "an attorney" in September or October 2007, but there is no evidence as to the contents of that letter or who sent it, and Maitland subsequently averred that he did not recall receiving a letter from Turner's attorney.  In light of these credibility issues and the conflicting inferences that may be drawn from the facts, and mindful of the preference for permitting a jury to decide the question of reasonableness, we find that Supreme Court properly denied plaintiff's summary judgment motion (see North Country Ins. Co. v Jandreau, 50 AD3d 1429, 1431 [2008]; Klersy Bldg. Corp. v Harleysville Worcester Ins. Co., 36 AD3d 1117, 1119 [2007]; Morehouse v Lagas, 274 AD2d at 794; G.L.G. Contr. Corp. v Aetna Cas. & Sur. Co., 215 AD2d 821, 822 [1995]).

Similarly unpersuasive is plaintiff's assertion that Turner's notice to it was untimely as a matter of law. Insurance Law § 3420 (a) (3) affords an injured party an independent right to give notice so as to preserve his or her right to proceed directly against an insurer, notwithstanding the timeliness of the notice given by an insured (see American Tr. Ins. Co. v Sartor, 3 NY3d 71, 76 [2004]; General Acc. Ins. Group v Cirucci, 46 NY2d 862, 863-864 [1979]; U.S. Underwriters Ins. Co. v Carson, 49 AD3d at 1064; Lauritano v American Fid. Fire Ins. Co., 3 AD2d 564, 568 [1957], affd 4 NY2d 1028 [1958]).  "Significantly, the notice required of an injured party to an insurer is measured less rigidly than the notice required of an insured . . . 'since what is reasonably possible for the insured may not be reasonably practical for the injured person'" (GA Ins. Co. of N.Y. v Simmes, 270 AD2d 664, 666 [2000], quoting Jenkins v Burgos, 99 AD2d 217, 221 [1984]; accord U.S. Underwriters Ins. Co. v Carson, 49 AD3d at 1064).  "In each case, the test is one of reasonableness, measured by the diligence exercised by the injured party in light of the prospects afforded to him [or her] under the circumstances" (Jenkins v Burgos, 99 AD2d at 221 [citation omitted]; see GA Ins. Co. of N.Y. v Simmes, 270 AD2d at 666).

Here, within a few weeks of being diagnosed with herniated disks and advised of the need for surgery, Turner retained an attorney. Her attorney promptly engaged the services of a private investigator, but the investigator was unable to locate or speak with Maitland ^[FN1]. After ascertaining that Turner had a viable claim, Turner's attorney immediately requested in a May 1, 2007 letter, and again in an October 2007 letter, that Maitland provide notice to his insurer and to contact him if he was not insured.  Under these circumstances, the reasonableness of Turner's actions in attempting to provide notice to plaintiff presents a question of fact for the jury to resolve (see U.S. Underwriters Ins. Co. v Carson, 49 AD3d at 1064; Allstate Ins. Co. v Marcone, 29 AD3d 715, 717 [2006], lv dismissed 7 NY3d 841 [2006]; GA Ins. Co. of N.Y. v Simmes, 270 AD2d at 666-667).

I Am He as You Are He as You Are Me and We Are All Together

CGL – LATE NOTICE – NOTICE TO BROKER
Prince Seating Corp. v. QBE Ins. Co.
(2nd Dept., decided 5/11/2010)

Since this is an insurance coverage blog, I should probably start with a disclaimer:  I am not the walrus, have never written a song lyric (or anything else for that matter) to the rhythm of a police siren or while on an acid trip, have never sat on a cornflake or had my grade school study and interpret any writings of mine (at least to my knowledge), have never done anything to be called or been called "the Eggman", do believe in the concept of element'ry penguin, and agree that the song just wouldn't have been the same if entitled "I Am the Carpenter".

In insurance coverage parlance, "you" and "your" and "we", "our" and "us" have defined and generally understood meanings, right?  After all, insurance contracts long ago dropped the "party of the first part" and  "party of the second part" (hence "first-party coverage" and "third-party coverage") lingo.

New York Insurance Law § 3420(a)(3) requires bodily injury and property damage liability policies issued or delivered in this state to contain

(3)  A provision that notice given by or on behalf of the insured, or written notice by or on behalf of the injured person or any other claimant, to any licensed agent of the insurer in this state, with particulars sufficient to identify the insured, shall be deemed notice to the insurer.  (Emphasis added.)

Applicable policies that don't contain such a provision will be "deemed" to include one.

The legal difference between an insurance agent and broker is especially significant in regard to the notice requirements or conditions of a liability insurance policy.  New York case law is "legion", as some lawyers love to say, that  notice provided to an an insured's broker is not notice to its liability insurer.   This is not one of those cases. 

The ISO-standard Commercial General Liability Coverage Form contains the following notice of occurrence condition:

2.     Duties In The Event Of Occurrence, Offense, Claim Or Suit

a.  You must see to it that we are notified as soon as practicable of an "occurrence" or an offense which may result in a claim.

Who is the "we" in that condition?  Most would unhesitatingly say the insurance company, because the CGL form also states:

Throughout this policy the words "you" and "your" refer to the Named Insured shown in the Declarations, and any other person or organization qualifying as a Named Insured under this policy. The words "we", "us" and "our" refer to the company providing this insurance.  (Bold and underlining added.)

Most but not all.  Like the insured in this case, and the Second Department under this policy language.

Prince Seating Corp. provided notice of an underlying claim to its broker, Century Coverage Corp., rather than, as required by its insurance policy, to its insurer, QBE Insurance Company.  QBE disclaimed for late notice, and Prince Seating commenced this declaratory judgment action to upset that disclaimer. 

In AFFIRMING Supreme Court's (Jacobson, J.) denial of QBE's motion for summary judgment, the Second Department reiterated its 2006 holding in Jeffrey v. All City Ins. Co., that a policy provision which uses the pronouns “we” and “us” to describe who should be notified without clearly identifying the insurer as the party to whom those terms apply is ambiguous:

It is well settled that, absent some evidence of an agency relationship, even timely notice of an accident by an insured to a broker is not effective and does not constitute notice to the insurance company, as a broker is considered to be an agent only of the insured (see Security Mut. Ins. Co. of N.Y. v Acker-Fitzsimmons Corp., 31 NY2d 436; Matter of Temple Constr. Corp. v Sirius Am. Ins. Co., 40 AD3d 1109, 1111-1112; 120 Whitehall Realty Assoc., LLC v Hermitage Ins. Co., 40 AD3d 719, 721; Gershow Recycling Corp. v Transcontinental Ins. Co., 22 AD3d 460, 462; Rendiero v State-Wide Ins. Co., 8 AD3d 253). Moreover, absent a valid excuse, the failure to satisfy a provision in an insurance policy requiring notice of a covered occurrence, a condition precedent to the insurer's duty to defend and/or indemnify claims against the insured, vitiates the policy (see Empire City Subway Co. v Greater N.Y. Mut. Ins. Co., 35 NY2d 8; Security Mut. Ins. Co. of N.Y. v Acker-Fitzsimmons Corp., 31 NY2d at 440; Jeffrey v Allcity Ins. Co., 26 AD3d 355, 356; Centrone v Staste Farm Fire & Cas., 275 AD2d 728). In this case, there is no evidence that a principal-agent relationship between Century and QBE existed. 

However, the terminology of the policy, including the notice provision, in which the words "we," "us," and "our," referring to "the company providing this insurance," were used to describe who should be notified, is ambiguous. QBE was not clearly identified as the party to whom those terms applied. Given that ambiguity, there is an issue of fact as to whether "the contract should be interpreted to allow notice to [the] broker" (Jeffrey v Allcity Ins. Co., 26 AD3d at 356).

Check your policy language.  Do the "we", "our" and "us" clearly refer to the underwriting insurer usually listed on the policy's declarations page?  If not, notice to the insured's broker may be held to be notice to the insurer.

Element'ry penguin.  Man you should have seen them kicking Edgar Alan Poe.  And even though Paul was my favorite, thank you John (and whoever wrote "Marching to Pretoria") for today's post title.

Legal Malpractice Policy Found to Constitute Insurance Against Liability for "Injury to Person(s)" Under New York Insurance Law § 3420(A)

PROFESSIONAL LIABILITY – NOTICE OF CLAIM – INSURANCE LAW § 3420(A) – INSURANCE AGAINST "LIABILITY FOR INJURY TO PERSON"
McCabe v. St. Paul Fire & Mar. Ins. Co.
(Sup. Ct., Erie Co., decided 8/19/2009)

New York Insurance Law § 3420(a) mandates that certain provisions be included in all policies issued or delivered in New York State that insure against liability for "injury to person . . . or . . . injury to, or destruction of, property[.]"  One such required provision allows injured persons to satisfy an insured's contractual obligation to give timely notice of an occurrence (accident) and/or claim:

§ 3420. Liability insurance; standard provisions; right of injured person

(a) No policy or contract insuring against liability for injury to person, except as provided in subsection (g) of this section, or against liability for injury to, or destruction of, property shall be issued or delivered in this state, unless it contains in substance the following provisions or provisions that are equally or more favorable to the insured and to judgment creditors so far as such provisions relate to judgment creditors:

*  *  *  *  *

(3) A provision that notice given by or on behalf of the insured, or written notice by or on behalf of the injured person or any other claimant, to any licensed agent of the insurer in this state, with particulars sufficient to identify the insured, shall be deemed notice to the insurer.

(4) A provision that failure to give any notice required to be given by such policy within the time prescribed therein shall not invalidate any claim made by the insured, an injured person or any other claimant if it shall be shown not to have been reasonably possible to give such notice within the prescribed time and that notice was given as soon as was reasonably possible thereafter.

There's no question that  § 3420(a) applies to auto, homeowners and commercial general liability policies, but does it apply to a legal malpractice policy issued or delivered in New York?  Yes it does, says this court. 

St. Paul Fire and Marine Insurance Company insured attorney David Fretz under a $1 million claims-made professional liability policy effective from January 14, 2006 and January 14, 2007.  Coverage under that policy depended on two preconditions:  (1) that a claim for legal malpractice was made against Fretz during the policy period; and (2) that such claim was reported to St. Paul within the policy's period or 60-day extended reporting period of January 14, 2006 through March 14, 2007.

Fretz represented the plaintiffs on their insurance claim for the December 2003 fire loss of their home.  As a consequence of Fretz' neglect of their insurance claim, plaintiffs lost their ability to recover on that claim.  After sending several letters to Fretz, including one dated January 2, 2007, plaintiffs commenced an action for malpractice against Fretz in late March 2007.  Fretz failed to notify St. Paul of plaintiffs' malpractice claim against him in time for St. Paul to submit an answer on his behalf in the action, and Fretz eventually was determined to be in default.  In December 2007, following an inquest on damages, plaintiffs were awarded compensatory damages of $226,000, and those damages were ordered trebled pursuant to Judiciary Law § 487. Accordingly, by judgment entered January 2, 2008, Fretz was directed to pay plaintiffs just over $700,000, inclusive of costs, disbursements, and interest to the date of entry of the judgment.

By letter to plaintiffs' attorney dated July 17, 2007, St. Paul disclaimed coverage under Fretz' legal malpractice policy on the ground that, although plaintiffs' claim against Fretz may have been made (as claimed in their attorneys' letter) within the policy period, such claim had not been reported to St. Paul within the policy period or the 60-day Extended Reported Period, as required by the policy.

After obtaining a money judgment against Fretz, plaintiffs commenced this action against St. Paul in June 2008 pursuant to Insurance Law §§ 3420(a)(2) and (b)(1). St. Paul interposed an answer and counterclaim, asserting only that the plaintiffs' malpractice claim had not been timely reported.  Subsequently, by letter dated October 7, 2008 letter, St. Paul attempted to add a new and additional basis for disclaiming coverage, i.e., that plaintiffs' letter to Fretz of January 2, 2008 did not in fact constitute the making of a claim by plaintiffs against Fretz within the policy period, as required in order to give rise to coverage under the policy.  Plaintiffs moved and St. Paul cross-moved for summary judgment.

In granting plaintiffs' motion for summary judgment, Erie County Supreme Court Justice Patrick Nemoyer held that St. Paul's professional liability policy fell constituted a policy insuring against liability for "injury to person" within the meaning of Insurance Law § 3420(a).  Thus, in the opinion of the court, "plaintiffs acted diligently in an attempt to garner the relevant insurance information from Fretz [and], as a matter of law, plaintiffs did not unduly or unreasonably delay in reporting the claim to St. Paul":

Plaintiffs reported the making of the claim to St. Paul on June 22, 2007, the very day on which they were informed of St. Paul's identity as Fretz's malpractice insurer. The period of delay to be examined with reference to plaintiffs' asserted diligent efforts is the period from March 14, 2007, the end of the 60-day extension period, until June 22, 2007, when notice was given to St. Paul. During that period alone, more particularly on March 26, April 9, April 24, and May 8, 2007, plaintiffs' then attorney Doyle sent four certified letters to Fretz, repeatedly emphasizing the importance of notice being given immediately to his malpractice insurance carrier and pleading with Fretz to reveal the name of such carrier so that plaintiffs could exercise their independent right to give such notice. Those letters were in addition to an unspecified number of telephone calls made for the same purpose. In each instance, the mentally incapacitated Fretz failed to respond to the letter or telephone call. Doyle was reduced to asking this Court for an order compelling Fretz to disclose the identity of his carrier, and only then were plaintiffs made aware of that identity. Those various attempts by Doyle were a follow up to his earliest certified letter of March 2, 2007, in which Doyle likewise sought to have Fretz provide him with the identity of his carrier and place that carrier on notice of the malpractice claim. That plaintiff first undertook and were thwarted in those efforts to discover the identity of the insurer before March 14, 2007, at a time when it would have been possible for them to comply with the requirements of the policy, demonstrates their due diligence as a matter of law. 

 Justice Neymoyer also rejected as untimely St. Paul's second ground for disclaiming coverage -- that no malpractice claim had actually been made against Fretz within the policy period:

Having determined the applicability of Insurance Law § 3420(a)(2), it remains for this Court to determine the validity of St. Paul's disclaimer under the policy. St. Paul now contends that it validly disclaimed coverage under the policy on two grounds: first, that no claim was made during the policy period; and second, that no claim was reported to St. Paul during the policy period or the 60-day extension period. The problem for St. Paul is that only the second of those disclaimer grounds was articulated in St. Paul's July 17, 2007 disclaimer letter to Fretz. The pertinent paragraph of the letter stated that St. Paul was denying Fretz any defense and indemnity in the malpractice action on the ground that "this Claim' was neither reported to St. Paul during the Policy Period,' nor was the Claim' or your disability reported within the 60 days following the date of the St. Paul Policy's" lapse. It is of course a fundamental principle of the law in this realm that an insurer's attempt at disclaimer is strictly limited to those grounds articulated in the notice of disclaimer, and that a ground not raised in a disclaimer letter may not be later asserted by the insurer (see General Accident Ins. Co v Cirucci, 46 NY2d 862, 864 [1979]; City of Kingston v Harco Nat. Ins. Co., 46 AD3d 1320, 1321 [3d Dept 2007]; Benjamin Shapiro Realty Co. v Agric. Ins. Co., 287 AD2d 389 [1st Dept 2001]; see also Wraight v Exchange Ins. Co., 234 AD2d 916, 917-918 [4th Dept 1996] [held: where insurer disclaimed coverage based solely upon its insured's failure to provide timely notice, insurer is subsequently estopped from raising the injured party's allegedly untimely notice as a defense in the declaratory judgment action]). Indeed, St. Paul's July 17, 2007 letter explicitly assumed, based on Doyle's representations, that the claim was first made against the insured on January 2, 2007, within the policy period. The Court understands that St. Paul entertained that assumption without having seen the January 2, 2000 letter, but St. Paul's own lack of reasonable investigation into the circumstances is not a ground for departing from the aforementioned principle that the insurer is strictly limited to those disclaimer grounds articulated in the letter of disclaimer (see 2540 Associates, Inc. v Assicurazioni Generali, S.p.A., 271 AD2d 282, 284 [1st Dept 2000] [held: "as a matter of policy, reasonable investigation is preferable to piecemeal disclaimers"]; see also DiGuglielmo v Travelers Property Cas., 6 AD3d 344, 346 [1st Dept 2004], lv denied 3 NY3d 608 [2004]). Contrary to St. Paul's contention, enforcement of the rule that an insurer's attempt at disclaimer is strictly limited to those grounds articulated in the notice of disclaimer does not involve the creation of coverage where none would otherwise exist. St. Paul's belated attempt to supplement its disclaimer letter to Fretz by adding or resurrecting the "claim not timely made" disclaimer ground — an attempt not made until October 7, 2008, after the commencement of this declaratory judgment action by plaintiffs and indeed following the interposition of St. Paul's answer and counterclaim asserting only that the malpractice claim had not been timely reported — cannot avail for obvious reasons, both procedural and substantive. 

It remains to be seen, on what undoubtedly will be St. Paul's appeal to the Fourth Department, whether the court's preclusion of St. Paul's no-claim-within-policy-period defense will withstand appellate scrutiny.  New York case law is legion that coverage may not be created by either waiver or estoppel.  Three of the four cases cited by the court -- Cirucci, City of Kingston and Wraigth -- involved bodily injury claims and, as such, implicated then Insurance Law § 3420(d) (now [d][1]), which explains those courts' preclusion of coverage defenses not initially raised in a timely disclaimer or denial.  Although this court concluded that the Fretz malpractice policy insured against liability for "injury to person", the plaintiffs' claims clearly did not fall within the purview of § 3420(d)(1) because they were not ones for "bodily injury" or death.

If the Fourth Department decides that St. Paul was not precluded from asserting its no-claim-within-policy-period defense, either it or the motion court will need to address whether the plaintiffs' January 2, 2007 letter constituted a "claim" against Fretz within the meaning of his malpractice policy with St. Paul:

"We [have] attempted to contact you for over six months, we also had another attorney attempt to contact you. We don't understand what is happening with our case. Upon our own research, we understand that our insurance lawsuit with Erie Insurance has been closed, due to negligence, on your part.

Please contact us immediately to rectify this. If we do not he[ar] from you, this letter, a letter explaining our hardships, and letter explaining the irresponsibility of our lawyer, will be sent to The Attorney Grievance Committee. With or without you we are going forward."

Compare that letter with what the First Department said about what constitutes a "claim" under a legal malpractice policy in it September 2008 decision in Yale Club of New York City, Inc. v. Reliance Ins. Co. in Liquidation:

In the context of ongoing attempts by the union representing the insured's employees to resolve the parties' dispute, the letter, which neither makes any demand for payment nor advises that legal action will be forthcoming, is insufficient to state a claim.

First Department Holds that Injured Party Did Not Act Diligently in Identifying and Timely Notifying Landlord's Liability Insurer of Accident

COMMERCIAL LIABILITY – LATE NOTICE – 5-MONTH DELAY – INJURED PARTY'S LACK OF DUE DILIGENCE
Tower Ins. Co. of N.Y. v. Jaison John Realty Corp.
(1st Dept., decided 3/3/2009)

This case is not especially remarkable for its holding that an insured's 5-month delay in providing notice of an accident is unreasonably late as a matter of law. No, Tower Insurance Company has been obtaining summary judgment in New York courts on similarly short delays -- 7 months, 9 months and 9 months -- for some time. This case is remarkable for its holding that the injured party herself did not act with due diligence in identifying and notifying Tower of the accident.

I blogged this case when New York Supreme decided it against Tower last June. While finding that the insured's notice was unreasonably late, the motion court ruled that "under the circumstances, [the insured party's] counsel was reasonably diligent in his efforts to ascertain the identity of John's insurer."

New York Insurance Law § 3420(a)(3) gives injured parties an independent right to notify tortfeasors' liability insurers of an accident or occurrence. The standard or test used to measure late notice by an injured party is, however, less stringent than the one applicable to insureds. Notice by an injured party, even if much later than what would be expected from an insured, will be deemed timely if the injured party is found to have acted with due diligence to identify the tortfeasor's liability insurer, and then have placed that insurer on notice as soon after learning that insurer's identity as possible. "The sufficiency of notice by an injured party is governed not by mere passage of time but by the means available for such notice." Appel v Allstate Ins. Co., 20 AD3d 367 (1st Dept. 2005), quoting National Grange Mut. Ins. Co. v Diaz, 111 AD2d 700, 701 (1985).

In this case, counsel for the injured party wrote to the insured landlord three months after the accident and commenced this action one month later. In MODIFYING the order appealed from to hold that the injured party had not timely exercised her independent right under Insurance Law § 3420(a)(3) to place Tower on notice of the accident, the First Department ruled:

Concerning the declaration in favor of Dias and against Tower, the December 20, 2006 letter from Dias's counsel to John advised John to notify his insurer of the accident, and that if counsel did not hear from John's insurer or legal representative within 20 days, Dias would commence an action. A month later, on or about January 23, 2007, having received no response and still unaware of the identity of John's insurer, Dias commenced suit against John, and, less than two weeks later, Tower received notice of the accident when John forwarded a copy of the summons and complaint. This is insufficient under Insurance Law § 3420(a)(3). Dias never attempted to ascertain the identity of John's insurer and merely relied on correspondence to John (Tower Ins. Co. of N.Y. v Lin Hsin Long Co., 50 AD3d 305 [2008]).

If counsel's letter had not merely advised the landlord to notify its liability insurer but had also asked the landlord for that insurer's identity, would the result in this case been different? Perhaps, especially in light of the First Department's statement that "Dias never attempted to ascertain the identity of John's insurer[.]"

Of course, New York liability insurers will soon be required to prove prejudice from notification delays of less than two years in order to sustain a late notice disclaimer. Accidents occurring on and after January 17, 2009 submitted for coverage under New York liability policies issued or renewed on and after that date will trigger the new prejudice requirement. See, End of an Era -- The Last Hours of New York's No Prejudice Rule. Under that new rule, liability insurers will be hard pressed to demonstrate coverage disqualifying prejudice from a four or five month delay in accident notification. But for the "old" cases, this holding supports the view that an injured party who sends out only a "put your liability insurer on notice" letter without also asking for that insurer's identity or otherwise taking steps to ascertain that insurer's identity does not satisfy the policy's notice of accident or occurrence requirement.

Post Script ~~ Max Gershweir, whose office represented Tower in this case, answers my question about whether the result would have been different had the injured party's attorney also asked for the identity of the insurer in his letter to the landlord:

Changing the wording in the claim letter in the manner you suggest certainly would have helped the claimant, as it would have signaled that the claimant was seeking to give independent notice rather than relying solely on the insured to do it, but it probably would not have changed the outcome. The other necessary element -- although a couple of decisions in the last few years seem to have dispensed with it -- is that the claimant, once armed with the insurer's identity, actually give notice of some kind to the insurer within a reasonable time thereafter, which did not occur here. The 1st Dep't majority in the Lin Hsin Long decision, another Tower case handled by my office, which the Jaison John court cited, made clear that this other element is indeed required.