Allstate Insurance v. Toussaint

In an action, inter alia, for a judgment declaring the rights and obligations of the parties under a motor vehicle insurance policy issued by the plaintiff, the plaintiff appeals from an order and judgment (one paper) of the Supreme Court, Kings County (I. Aronin, J.), dated January 27, 1989, which granted the motion of the defendant Motor Vehicle Accident Indemnification Corporation for summary judgment and declared that the policy in question covered the motor vehicle in question and that the plaintiff was required to defend and indemnify the defendants Tous 445 saint and Printemps Transportation Corp. in a personal injury action brought by the defendants Cynthia and Andreline Lors. Ordered that the order and judgment is affirmed, with costs to the respondent Motor Vehicle Accident Indemnification Corporation. The facts underlying this action are set out at length in the dissent, and are not in dispute. As our dissenting colleague concedes, collateral estoppel principles are applicable to arbitration awards (see, Matter of American Ins. Co. [Messinger— Aetna Cas. & Sur. Co.], 43 NY2d 184). This record contains nothing that would warrant a departure from this general rule. The issue the plaintiff seeks to litigate, in the context of this declaratory judgment action, is whether the vehicle in question was covered by an insurance policy it issued to Printemps Transportation Corp. at the time of the accident, is the precise issue that was decided by the arbitrator (see, Ryan v New York Tel. Co., 62 NY2d 494, 500). That decision was reached after a hearing at which the plaintiff was represented by counsel and had an opportunity to present its position (see, Clemens v Apple, 65 NY2d 746, 749). Moreover, although a "relatively small claim” was at issue in that arbitration, the plaintiff was or reasonably should have been aware that a personal injury action had been or would likely be commenced (see, Gilberg v Barbieri, 53 NY2d 285, 292). Additionally, contrary to the assertion in the dissent, by accepting the privilege of issuing motor vehicle insurance policies in this State, the plaintiff has voluntarily elected "to appear before a tribunal other than a court of law” (see, Insurance Law § 5221 [b] [6]). If the plaintiff was dissatisfied with the arbitrator’s determination, it had a judicial recourse, albeit limited, in the form of a proceeding pursuant to CPLR article 75 to vacate the arbitrator’s award, an opportunity of which the plaintiff did not avail itself. Finally, we note our disagreement with the implication in the dissent that, pursuant to the regulations promulgated with respect to an arbitration proceeding, the arbitrator’s determination is not to be given preclusive effect as to issues involving liability. The cited rule applies where there are companion cases arising out of the same accident and the issue submitted to arbitration is the fault of the drivers of the respective vehicles involved. It is not intended to deny preclusive effect to an arbitration determination concerning a disclaimer of coverage where coverage was the issue before the arbitrator (see, 11 NYCRR 65.10 [d] [5] [iii]). Brown, J. P., Kooper and Rubin, JJ., concur.