Opinion
Index No. 652998/2023 Motion Seq. No. 001
12-20-2023
COUNTRY-WIDE INSURANCE COMPANY a/s/o SAINTANO J. CLERGE, Petitioner, v. GEICO GENERAL INSURANCE COMPANY, Respondent.
Unpublished Opinion
MOTION DATE 08/21/2023
PRESENT: HON. SHAHABUDDEEN ABID ALLY Justice
DECISION + ORDER ON MOTION
SHAHABUDDEEN ABID ALLY A.J.S.C.
The following e-filed documents, listed by NYSCEF document number (Motion 001) 1-10 were read on this motion to/for VACATE - DECISION/ORDER/JUDGMENT/AWARD
Petitioner moves pursuant to CPLR § 7511 for an order vacating the award issued in an Arbitration Forums Inc. arbitration proceeding between the parties. Respondent has neither opposed nor otherwise appeared in this proceeding. Upon consideration of the above cited papers and without opposition, the petition is granted.
Background
On or about June 9, 2022. a motor vehicle accident occurred between a vehicle driven by respondent's insured, Carmen Tejada, and a vehicle driven by Sainatano J. Clerge. Plaintiff avers that on the date of the accident, Clerge's vehicle, a yellow bus. was owned by Pioneer Transportation Corporation ("Pioneer") and insured by Old Republic Insurance Company, which is supported by the annexed DMV record (exhibit A, NYSCEF No. 3). Clerge himself was insured by petitioner on four other vehicles, none of which were the yellow bus involved in the June 9 accident (Affidavit of Melissa Scanlon, policy declarations page).
Respondent commenced an arbitration against petitioner on or about February 27, 2022 seeking reimbursement for payments made to its insured. On January 5, 2022 and again on February 28, 2022 respondent sent Intercompany Reimbursement Notifications to petitioner, which listed Clerge as petitioner's insured (exhibit B, NYSCEF No. 4).
At the arbitration, arbitrator Agnes Neiger found 50% liability on respondent and 50% liability on petitioner, who was listed as insurer for Pioneer (exhibit D. NYSCEF No. 6). Upon receipt of the award, and having apparently been unaware of being listed as Pioneer's insurer, petitioner undertook to search its records for claims by or on behalf of Pioneer (Affidavit of Melissa Scanlon). The search revealed that there was no contract for insurance between petitioner and Pioneer (id.). Petitioner commenced the instant proceeding on June 22, 2023.
Discussion
"It is well settled that a court may vacate an arbitration award only if it violates a strong public policy, is irrational, or clearly exceeds a specifically enumerated limitation on the arbitrator's power" (Matter of Falzone [New York Cent Mut Fire Ins Co], 15 N.Y.3d 530, 534 [2010]). Such enumerated limitations are set forth in CPLR § 7511. which provides that an arbitration award may be vacated upon a finding that the rights of a party were prejudiced by (1) corruption, fraud, or misconduct in procuring the award; (2) the partiality of an arbitrator; (3) the arbitrator having exceeded their power or so imperfectly executed it that a final and definite award upon the subject matter submitted was not made; or (4) failure to follow the procedures set forth in Article 75 of the CPLR (CPLR § 7511 [b][l][i]-[iv]). A party seeking to vacate an arbitration award bears a heavy burden, as "[a]n arbitration award must be upheld when the arbitrator 'offer[s] even a barely colorable justification for the outcome reached" (Wien & Malkin, LLP v Helmsley-Spear Inc., 6 N.Y.3d 471, 479 [2006] [citing Matter of Andros Compania Maritima, S.A. [Marc Rich & Co. A.G.], 579 F.2d 691. 704 [2d Cir 1978]).
Although generally an arbitration award is not reviewable for errors of fact (Colleti v Mesh, 23 A.D.2d 245 [1st Dept 1965]). an award that the contractual limits of an insurance policy were exceeded has been held to constitute an excess of authority (State Farm Ins. Co. v Credle, 228 A.D.2d 191 [1st Dept 1996]). Additionally, a defense of lack of coverage is not precluded by a party's failure to raise it at the underlying arbitration (see Central Gen. Hosp, v Chubb Group of Ins. Cos., 90 N.Y.2d 195 [1997]).
Here, petitioner has provided documentation demonstrating that it did not have a contract for insurance for the yellow bus in volved in the June 9, 2022 accident. Based upon the Affidavit of Melissa Scanlon, a supervisor employed by petitioner, and the policy documents annexed, it appears that petitioner insured the driver but not the yellow bus. The Affidavit itself establishes that pursuant to a search conducted of petitioner's records, there was no policy in effect between petitioner and Pioneer, the registered owner of the yellow bus. Finally, the DMV documentation lists the owner of the yellow bus as Pioneer and Pioneer's insurer as Old Republic Insurance Company, an entirely different insurer. Respondent, having failed to file opposition, has not provided any evidence to controvert petitioner's showing.
Based on the foregoing, the Court finds that petitioner has met its burden and the petition is granted.
Accordingly, it is hereby:
ORDERED and ADJUDGED, that the petition is granted without opposition and the award is vacated; and it is further
ORDERED that this matter is remanded to Arbitration Forums, Inc. for a new hearing.
This constitutes the decision and order of the Court.