Opinion
No. 121 SSM 7.
Decided April 1, 2010.
APPEAL, from an order of the Appellate Division of the Supreme Court in the First Judicial Department, entered October 8, 2009. The Appellate Division, with two Justices dissenting, modified, on the law, so much of an order of the Supreme Court, New York County (Marcy S. Friedman, J.), as had denied defendant Arthur Brown's motion for summary judgment on his counterclaim and plaintiffs cross motion for summary judgment declaring that it was not obligated to satisfy a default judgment obtained by defendant Brown against defendant Albertano Batista. The modification consisted of granting Brown's motion and declaring that plaintiff was obligated to satisfy the default judgment in the amount of $81,830 with interest from July 19, 2007.
On November 12, 2002, Arthur Brown was involved in a motor vehicle accident with Albertano Batista, plaintiffs insured. Plaintiff acknowledged receipt of Brown's third-party claim by letter dated January 28, 2003. Brown settled his claim for property damage with plaintiff and commenced a personal injury action against Batista on November 9, 2005. Brown forwarded copies of the summons and complaint to plaintiff on or about January 26, 2006. These copies were mailed to plaintiff at the address set forth in its January 2003 letter. Unbeknownst to Brown however, plaintiff had moved its offices in November 2003. Upon Batista's failure to appear in the action, Brown moved for a default judgment and proceeded to inquest on June 21, 2007. The underlying judgment in the amount of $81,830 was entered in favor of Brown against Batista on July 19, 2007. Pursuant to Insurance Law § 3420 (a) (2), Brown served copies of the unsatisfied judgment with notices of entry upon plaintiff and Batista on August 9, 2007. Plaintiff promptly issued a letter of disclaimer and commenced the instant declaratory judgment action on the ground that neither Batista nor Brown gave it timely notice of the underlying lawsuit as required by Batista's insurance policy.
The majority at the Appellate Division concluded that Brown had a valid excuse for forwarding the summons and complaint to plaintiffs former address since he was never notified of the change of address. The dissent concluded that there was no legal obligation for a defendant's insurer to notify a potential plaintiff or plaintiffs counsel of the insurer's change of address, and that plaintiffs current address could have easily been ascertained via the Internet.
American Tr. Ins. Co. v Brown, 66 AD3d 447, reversed.
Marjorie E. Bornes, New York City, for appellant.
Blank Star, PLLC, Brooklyn ( Scott Star and Helene E. Blank of counsel), for respondent.
Before: Chief Judge LIPPMAN and Judges CIPARICK, GRAFFEO, READ, SMITH, PIGOTT and JONES.
OPINION OF THE COURT
On review of submissions pursuant to section 500.11 of the Rules of the Court of Appeals ( 22 NYCRR 500.11), order reversed, with costs, defendant Brown's motion for summary judgment denied, plaintiff's motion for summary judgment granted and judgment granted declaring that plaintiffs disclaimer of coverage was proper, that it had no obligation to defend or indemnify its insured in the subject underlying action and that it is not responsible for payment of any portion of the judgment rendered therein. Defendant Brown failed to provide a valid excuse for his failure to use reasonable diligence in providing plaintiff insurer with notice of the underlying personal injury action.