| Matter of Interboro Ins. Co. v Maragh |
| 2008 NY Slip Op 04873 [51 AD3d 1024] |
| May 27, 2008 |
| Appellate Division, Second Department |
| In the Matter of Interboro Insurance Company,Appellant, v Patrick Maragh, Respondent. |
—[*1] Naimark & Tannenbaum, Jamaica, N.Y. (Michael Naimark of counsel), forrespondent.
In a proceeding pursuant to CPLR article 75, inter alia, to permanently stay arbitration of anuninsured motorist claim, the petitioner appeals from an order of the Supreme Court, QueensCounty (Rios, J.), entered August 13, 2007, which denied the petition and dismissed theproceeding.
Ordered that the order is reversed, on the law, with costs, the petition is reinstated, and thematter is remitted to the Supreme Court, Queens County, for a hearing in accordance herewithand a new determination of the petition thereafter.
The petitioner Interboro Insurance Company (hereinafter Interboro) commenced thisproceeding, inter alia, to permanently stay arbitration of an uninsured motorist claim by therespondent Patrick Maragh on the ground that Maragh was not a covered person under its policyand therefore, no agreement to arbitrate existed.
On July 4, 2004 Maragh was involved in an accident when, while riding a motor scooter, hewas struck by a motor vehicle owned and operated by nonparty Florida resident Donald M.Johnson. Johnson's vehicle, which was registered in the State of Florida, was insured under apolicy of insurance issued by nonparty Ocean Harbor Casualty Insurance Company (hereinafterOcean Harbor), a Florida-based insurer. Maragh received a letter dated November 16, 2004 fromOcean Harbor's managing general agent, advising him that Johnson's policy did not containbodily injury coverage.[*2]
By letter dated April 1, 2005, Maragh made a demand onInterboro for arbitration of an uninsured motorist claim (hereinafter the 2005 demand) under apolicy of insurance (hereinafter the subject policy) issued by Interboro to his mother DeloretaChouquette. It is undisputed that at the time the 2005 demand was sent, Interboro was inrehabilitation pursuant to an order of the Supreme Court, Nassau County, dated April 5, 2004.
On April 26, 2007, after emerging from rehabilitation, Interboro received another copy of the2005 demand from Maragh. On May 11, 2007 the petitioner commenced this proceedingpursuant to CPLR article 75, inter alia, to permanently stay arbitration of Maragh's uninsuredmotorist claim. The Supreme Court denied the petition, concluding that the proceeding wasuntimely commenced pursuant to CPLR 7503 (c). We disagree.
An insurer which fails to seek a stay of arbitration within 20 days after being served with anotice of intention or demand to arbitrate under CPLR 7503 (c) is generally precluded fromobjecting to the arbitration thereafter (see Matter of Steck [State Farm Ins. Co.], 89 NY2d1082, 1084 [1996]; Matter of State Farm Ins. Co. v Williams, 50 AD3d 807 [2008];Matter of Spychalski [Continental Ins. Cos.], 45 NY2d 847, 849 [1978]; Matter ofStandard Fire Ins. Co. v Mouchette, 47 AD3d 636 [2008]; Matter of Travelers Prop. Cas.Corp. v Klepper, 275 AD2d 234 [2000]). However, an otherwise untimely petition to stayarbitration may be entertained when, as here, its basis is that the parties never agreed to arbitrate(see Matter of Matarasso [Continental Cas. Co.], 56 NY2d 264 [1982]).
In this case, Interboro raised a factual issue through sworn statements of Chouquette, itsnamed insured, who denied that Maragh, her son, was a resident of her household at the time ofthe accident. In a surreply affidavit submitted in opposition, Maragh averred that he resided withhis mother at that time. The provision of the subject policy for uninsured motorists coveragedefines an "insured" as the named insured or any "family member," the latter being defined as "aperson related to [a named insured] by blood . . . who is a resident of [the namedinsured's] household." Resolution of the factual issue as to whether Maragh was an insured underthe subject policy is a condition precedent to arbitration (see Matter of Eagle Ins. Co. v Perez,299 AD2d 544, 545 [2002]; Matter of Aetna Cas. & Sur. Co. v Cartigiano, 178AD2d 472 [1991]). Further, if Maragh was not an insured under the subject policy, then noagreement to arbitrate existed between him and Interboro, and the 20-day time limit set forth inCPLR 7503 (c) is inapplicable (see Matter of Eagle Ins. Co. v Perez, 299 AD2d at 545;Matter of State Farm Mut. Auto. Ins. Co. v Mandala, 284 AD2d 472, 473 [2001];Matter of Aetna Cas. & Sur. Co. v Cartigiano, 178 AD2d at 472). Accordingly, thematter must be remitted to the Supreme Court, Queens County, for a hearing on the issue ofwhether Maragh resided with Chouquette at the time of the accident and thus was covered by thesubject policy, and thereafter, for a new determination of the petition to stay arbitration.
To the extent that the petitioner raises issues regarding that branch of the petition which wasfor prearbitration discovery, we note that such issues are not properly before us as that branch ofthe motion remains pending and undecided (see Katz v Katz, 68 AD2d 536, 542-543[1979]).
The petitioner's remaining contentions need not be reached in light of our determination.Prudenti, P.J., Miller, Carni and Chambers, JJ., concur.