| Zimmerman v Peerless Ins. Co. |
| 2011 NY Slip Op 05491 [85 AD3d 1021] |
| June 21, 2011 |
| Appellate Division, Second Department |
| Erwin Zimmerman, Respondent-Appellant, v PeerlessInsurance Company, Appellant-Respondent. |
—[*1] Charles G. Eichinger & Associates, P.C., Islandia, N.Y. (Denise K. O'Rourke of counsel), forrespondent-appellant.
In an action for a judgment declaring that the defendant, Peerless Insurance Company, isobligated to defend and indemnify the plaintiff, Erwin Zimmerman, in an underlying actionentitled Angst v Zimmerman, pending in the Supreme Court, Suffolk County, underindex No. 12184/07, the defendant appeals, as limited by its brief, from so much of an order ofthe Supreme Court, Suffolk County (Rebolini, J.), dated April 28, 2010, as denied its motion forsummary judgment declaring that it is not obligated to defend or indemnify Erwin Zimmerman inthe underlying action, and Erwin Zimmerman cross-appeals, as limited by his brief, from somuch of the same order as denied his cross motion for summary judgment.
Ordered that the order is reversed insofar as appealed from, on the law, the defendant'smotion for summary judgment declaring that it is not obligated to defend or indemnify ErwinZimmerman in the underlying action is granted, and the matter is remitted to the Supreme Court,Suffolk County, for the entry of a judgment declaring that the defendant, Peerless InsuranceCompany, is not obligated to defend and indemnify Erwin Zimmerman in the underlying actionentitled Angst v Zimmerman, pending in the Supreme Court, Suffolk County, underindex No. 12184/07; and it is further,
Ordered that the order is affirmed insofar as cross-appealed from; and it is further,
Ordered that one bill of costs is awarded to the defendant.
On October 31, 2006, while jogging in Eaton's Neck, Arthur Angst allegedly was bitten byErwin Zimmerman's dog, which was not on a leash. Angst and Zimmerman had a brief verbalconfrontation, during which Zimmerman saw blood on Angst's hand. He offered to pay Angst'smedical expenses, but Angst declined, and the two men did not exchange contact information.Zimmerman was aware of an incident several years before, in which his dog had "nipped" aneighbor. Within 48 hours of the incident involving Zimmerman's dog and Angst, the SuffolkCounty Department of Health requested the dog's vaccination records and informed Zimmermanthat the dog would be restricted to Zimmerman's property.[*2]
On May 8, 2007, Zimmerman was served with thesummons and complaint in the underlying personal injury action. The next day, for the first time,he notified his insurer, Peerless Insurance Company (hereinafter Peerless), of the incident.Zimmerman's insurance policy (hereinafter the policy) required that "in case of an. . . 'occurrence,' the 'insured' will perform the following duties thatapply. . . Give written notice to us or our agent as soon as is practical, which setsforth: (1) The identity of the policy and 'insured'; (2) Reasonably available information on thetime, place and circumstances of the . . . 'occurrence'; and (3) Names and addressesof any claimants or witnesses" The policy defined an "occurrence" as "an accident. . . which results, during the policy period, in: . . . 'Bodily injury'. . . , and "Bodily injury" was defined, in relevant part, as "bodily harm."
By letter dated May 11, 2007, Peerless disclaimed coverage on the ground that Zimmermanhad not complied with the notice provisions of the policy. Zimmerman commenced this actionseeking a judgment declaring that Peerless was required to defend and indemnify him in theunderlying action. Following discovery, Peerless moved, and Zimmerman cross-moved, forsummary judgment. The Supreme Court denied the motion and cross motion, and both partiesappeal.
"Where an insurance policy requires that notice of an occurrence be given 'as soon aspracticable,' notice must be given within a reasonable time in view of all of the circumstances"(Ponok Realty Corp. v United Natl.Specialty Ins. Co., 69 AD3d 596, 597 [2010]; see Great Canal Realty Corp. v Seneca Ins. Co., Inc., 5 NY3d 742,743 [2005]; Courduff's Oakwood Rd.Gardens & Landscaping Co., Inc. v Merchants Mut. Ins. Co., 84 AD3d 717 [2011]; Bigman Bros., Inc. v QBE Ins. Corp.,73 AD3d 1110, 1111 [2010]; Genova v Regal Mar. Indus., 309 AD2d 733, 734[2003]; cf. 120 Whitehall Realty Assoc.,LLC v Hermitage Ins. Co., 40 AD3d 719, 721 [2007]). With respect to policies issuedbefore January 17, 2009 (see Insurance Law § 3420 [c] [2] [A]), as Zimmerman'swas, an insurer could disclaim coverage without regard to prejudice when the insured failed tosatisfy the notice condition (Ponok Realty Corp. v United Natl. Specialty Ins. Co., 69AD3d at 597; cf. Insurance Law § 3420 [a] [5]; Waldron v New York Cent. Mut. Fire Ins. Co., 84 AD3d 1480[2011]). The insured's failure is seen as " 'a failure to comply with a condition precedent which,as a matter of law, vitiates the contract' " (Great Canal Realty Corp. v Seneca Ins. Co.,Inc., 5 NY3d at 743, quoting ArgoCorp. v Greater N.Y. Mut. Ins. Co., 4 NY3d 332, 339 [2005]; see Ponok RealtyCorp. v United Natl. Specialty Ins. Co., 69 AD3d at 597; Sputnik Rest. Corp. v United Natl. Ins. Co., 62 AD3d 689 [2009]).Nevertheless, even with respect to claims involving policies in which the insurer was notrequired to demonstrate prejudice before disclaiming, the insured is permitted to demonstrate theexistence of circumstances that would "excuse or explain the insured's delay in giving notice,such as a reasonable belief in nonliability" (Genova v Regal Mar. Indus., 309 AD2d at734; see Great Canal Realty Corp. v Seneca Ins. Co., Inc., 5 NY3d at 743-744; Courduff's Oakwood Rd. Gardens &Landscaping Co., Inc. v Merchants Mut. Ins. Co., 84 AD3d 717 [2011]; PonokRealty Corp. v United Natl. Specialty Ins. Co., 69 AD3d at 597). The burden ofdemonstrating the reasonableness of the excuse lies with the insured (see Bigman Bros., Inc.v QBE Ins. Corp., 73 AD3d at 1112; Ponok Realty Corp. v United Natl. Specialty Ins.Co., 69 AD3d at 597; Genova v Regal Mar. Indus., 309 AD2d at 734).
Generally, the existence of a good faith belief that the injured party would not seek to holdthe insured liable and the reasonableness of such belief are questions of fact, but summaryjudgment may be awarded to the insurer if, construing all inferences in favor of the insured, theevidence establishes as a [*3]matter of law that the insured'sbelief in nonliability was unreasonable or in bad faith (see Courduff's Oakwood Rd. Gardens & Landscaping Co., Inc. v MerchantsMut. Ins. Co., 84 AD3d 717 [2011]; Ponok Realty Corp. v United Natl. SpecialtyIns. Co., 69 AD3d at 597; Bigman Bros., Inc. v QBE Ins. Corp., 73 AD3d at 1111).
Here, Peerless established its prima facie entitlement to judgment as a matter of law thatZimmerman's failure to notify Peerless for six months was not based on a reasonable or goodfaith belief in nonliability by demonstrating that Zimmerman knew immediately that his dogallegedly bit Angst and that Angst may have been injured by the bite. Indeed, Zimmerman knewwithin 48 hours that a complaint had been made about the incident, even if he did not knowAngst's identity. In addition, Zimmerman knew of at least one substantiated incident involvinghis dog prior to the incident with Angst (see Steinberg v Hermitage Ins. Co., 26 AD3d 426, 427 [2006]; C.C.R. Realty of Dutchess v New YorkCent. Mut. Fire Ins. Co., 1 AD3d 304, 305 [2003]; 120 Whitehall Realty Assoc.,LLC v Hermitage Ins. Corp., 40 AD3d at 721; cf. Courduff's Oakwood Rd. Gardens & Landscaping Co., Inc. v MerchantsMut. Ins. Co., 84 AD3d 717 [2011]; Ponok Realty Corp. v United Natl. SpecialtyIns. Co., 69 AD3d at 597; Sputnik Rest. Corp. v United Natl. Ins. Co., 62 AD3d at689). Consequently, the burden shifted to Zimmerman to raise a triable issue of fact as towhether there existed a reasonable excuse for his delay in notifying Peerless (see PonokRealty Corp. v United Natl. Specialty Ins. Co., 69 AD3d at 597; Sputnik Rest. Corp. vUnited Natl. Ins. Co., 62 AD3d at 689). Even construing all inferences in favor ofZimmerman, he failed to raise a triable issue of fact (see Hanson v Turner Constr. Co., 70 AD3d 641, 643 [2010];120 Whitehall Realty Assoc., LLC v Hermitage Ins. Corp., 40 AD3d at 721;Steinberg v Hermitage Ins. Inc., 26 AD3d at 427; C.C.R. Realty of Dutchess v NewYork Cent. Mut. Fire Ins. Co., 1 AD3d at 305). We reject Zimmerman's argument that thepolicy was ambiguous as to whether he was obligated to give notice of the occurrence beforelearning of the possible claimant's identity (see Magistro v Buttered Bagel, Inc., 79 AD3d 822 [2010]).Accordingly, the Supreme Court erred in denying Peerless' motion for summary judgmentdeclaring that it is not obligated to defend or indemnify Zimmerman in the underlying action. Inlight of this determination, the Supreme Court properly denied Zimmerman's cross motion forsummary judgment.
Since this is a declaratory judgment action, we remit the matter to the Supreme Court,Suffolk County, for the entry of a judgment declaring that Peerless is not obligated to defend andindemnify Zimmerman in the underlying action (see Lanza v Wagner, 11 NY2d 317, 334[1962], appeal dismissed 371 US 74 [1962], cert denied 371 US 901 [1962]).Skelos, J.P., Covello, Balkin and Austin, JJ., concur.