Home Indemnity Co. v. State Farm Mutual Automobile Insurance

OPINION OF THE COURT Sweeney, J. This action arises out of an automobile accident which occurred on June 13, 1970. Plaintiff seeks herein a declaratory judgment that it has no duty to defend or indemnify defendant Larson in the underlying negligence actions. The trial court found to the contrary and this appeal ensued. There is no substantial dispute about the pertinent facts. Plaintiff issued an insurance policy to Jack Larson, the father of defendant Mark Larson, in which it agreed to defend and indemnify any relative of Jack Larson operating a nonowned vehicle with permission or reasonably believed to be with permission of its owner. Defendant Larson was the operator of such a vehicle which was insured by defendant State Farm Mutual Automobile Insurance Company, when he was involved in an accident resulting in injuries to certain occupants of the vehicles on June 13, 1970. By letter dated August 14, 1970, the attorneys for one of the injured parties notified plaintiff that one of its insureds was involved in an accident and, furthermore, that a question existed as to whether its insured was operating the vehicle with permission of its owner. On October 13, 1970 plaintiff wrote its insured asking for information concerning the accident. Mark Larson and his father brought the letter to plaintiff’s agent who had sold the policy to Jack Larson and the agent made certain notations on the letter and it was then returned to plaintiff. Plaintiff took [214] no further action and after three years, as was its custom, it destroyed the file. On March 27, 1974 defendant Larson’s private counsel wrote plaintiff requesting it to undertake the defense of the actions commenced against Larson in May and October of 1972. Such request presumably instigated- the instant action. Basically it is plaintiff’s contention that it is not obligated to defend or indemnify because it was not given timely notice of the commencement of the actions in question. We disagree and are to affirm. Section 167 (subd 1, par [d]) of the Insurance Law provides that any notice required by an insurance policy be given "as soon as was reasonably possible”. It is significant that the statute does not differentiate between notice of accident and notice of suit. The policy in question required immediate forwarding to the company of every demand, notice, summons or other process received by the insured or his representatives. Concededly, plaintiff was given timely notice of the accident. A resolution of the controversy, therefore, narrows to whether the delayed notice of commencement of the actions relieves plaintiff from its contractual obligation to defend and indemnify defendant Larson. In Lauritano v American Fid. Fire Ins. Co. (3 AD2d 564, 571, affd 4 NY2d 1028), wherein the effect of a delayed notice of accident was compared to the consequences resulting from a delayed notice of suit, the court, in substance, stated that immediate notice of suit is by no means of comparable value to the carrier as prompt notice of the accident, the former being less likely to cause irremediable harm. We find no such irremediable harm in the present case. The notice of accident provided plaintiff additional information pertaining to the question of Mark Larson’s permission to drive the automobile. Such notice, in our view, afforded plaintiff ample time and opportunity to investigate the accident and the various issues. Plaintiff failed to do anything, and, consequently, should not be heard to claim prejudice in order to avoid liability. Furthermore, plaintiff had the duty to timely disclaim in writing (Insurance Law, § 167, subd 8). Considering the record in its entirety, we are of the conclusion that plaintiff has clearly failed to comply with this requirement (Allstate Ins. Co. v Gross, 27 NY2d 263). The judgment declaring that plaintiff has a duty to defend defendant Mark Larson and to indemnify him with respect to the accident of June 13, 1970 should, therefore, be affirmed. [215] The judgment should be affirmed, with costs.