3 No. 50
In the Matter of William C. Brandon,
Respondent,
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2002 NY Int. 46
April 30, 2002
This opinion is uncorrected and subject to revision before publication
in the New York Reports.
Nationwide Mutual Insurance Company, Appellant.
John F. Moore, for appellant.
George A. Kohl, 2nd, for respondent.
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KAYE, CHIEF JUDGE:
Insurance policies providing Supplementary Uninsured Motorists ("SUM")
coverage typically require the insured not only to submit a notice of
claim but also to transmit promptly to the insurer the summons and
complaint in any action the insured brings against a tortfeasor. In
many contexts, including SUM coverage, an insured's failure to furnish
timely notice of claim vitiates the contract, and the insurer may rely
on this defense regardless of whether it can demonstrate that the
insured's failure operated to its prejudice. Today an insurer asks us,
by analogy, to hold that it need not demonstrate prejudice to rely on
the defense that the insured forfeited SUM coverage by failing to
timely submit the tort action summons and complaint. We decline to
take this step, as did the Appellate Division, whose order we now
affirm.
On March 1, 1997, a motor vehicle driven by Griselda Cancel(1)
collided with a parked 1985 Buick in which petitioner was a passenger
and which was owned and insured by petitioner's son. Nine days later,
petitioner forwarded a sworn "Notice of Intention to Make Claim" to
his insurer, respondent Nationwide Mutual Insurance Company. The
notice of claim indicated that Cancel negligently struck the Buick,
injuring petitioner, and that treating these injuries would cost a sum
yet to be determined. The notice also indicated that Cancel drove an
"uninsured car," and that petitioner was making his claim under his
policy's "Uninsured Automobile Endorsement."(2)
Petitioner sent the notice of claim to his local Nationwide agent. An
employee of the agency acknowledged receipt, but evidently did not
SNIPPETS:
Insurance policies providing Supplementary Uninsured Motorists coverage typically require the
In many contexts, including SUM coverage, an insured's failure to furnish timely notice of
Today an insurer asks us, by analogy, to hold that it need not demonstrate prejudice to rely
We decline to take this step, as did the Appellate Division, whose order we now affirm.
On March 1, 1997, a motor vehicle driven by Griselda Cancelcollided with a parked 1985 Buick
Nine days later, petitioner forwarded a sworn "Notice of Intention to Make Claim" to his
The notice of claim indicated that Cancel negligently struck the Buick, injuring petitioner,
An employee of the agency acknowledged receipt, but evidently did not forward it to
Nationwide made no payment on the no-fault claim and eventually closed the no-fault file.
Meanwhile, on September 19, 1997, petitioner brought a personal injury action against Cancel,
Other relevant clauses provide that Nationwide pays on an SUM claim only after the limits of
In deference to these latter provisions, petitioner did not immediately accept a January 1999
Nationwide moved to stay arbitration permanently, and Supreme Court, assuming that
Co. v Acker-Fitzsimmons Corp.,, 31 NY2d 436, 440 ).
This is known as a "no-prejudice" exception.(3) We have, indeed, followed Security Mutual,
Neither Mancuso nor any other decision answers this question, and accordingly we consider
The rationales for this limited exception include the insurer's need to protect itself from
At bottom, then, Nationwide's position must be that it needs a no-prejudice exception here
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