Liberty Mutual Insurance v. Clark

In an action for indemnification, the plaintiff appeals from an order of the Supreme Court, Suffolk County (Dunn, J.), entered April 19, 2001, which granted the motion of the defendants Larry Clark, Jr., and A One A Auto Co., Inc., to dismiss the complaint insofar as asserted against them pursuant to CPLR 3211 (a) (7) and (5). Ordered that the order is affirmed, with costs. On October 22, 1992, the plaintiff’s insured, Rita Cordovi, was injured as the result of an automobile accident involving her car and a vehicle owned by the defendant A One A Auto Co., Inc., and operated by the defendant Larry Clark, Jr. (hereinafter collectively referred to as the respondents). Cordovi never sued the respondents; rather, she sought arbitration against the plaintiff, seeking uninsured motorist benefits under her policy issued by the plaintiff. Despite being aware of the respondents’ identities, and that of their insurer, Nationwide Mutual Insurance Company, the plaintiff never petitioned to stay arbitration. Approximately six years later, in 1998, an arbitrator awarded Cordovi $35,000, and the plaintiff paid that amount to her. Subsequently, in April 2000, the plaintiff commenced the instant action for indemnification. The Supreme Court granted the respondents’ motion to dismiss the complaint pursuant to CPLR 3211 (a) (7) and (5). We affirm. Here, the plaintiff sought to recover an uninsured motorist benefits payment that it made to its insured six years after the accident pursuant to an arbitration award. Despite having early knowledge of the identity of the respondents and their automobile insurer, the plaintiff never sought to stay arbitration and bring them into its insured’s proceeding as additional respondents. Under these circumstances, the plaintiffs remedy was not indemnification, but rather subrogation for negligence (see Hanover Ins. Co. v Finnerty, 225 AD2d 1054; State-Wide Ins. Co. v Buffalo Ins. Co., 105 AD2d 315, 322-323). Accordingly, the Supreme Court properly dismissed the complaint, which sounded in indemnification, for failure to state a cause of action. Moreover, even if the plaintiff had asked for leave to amend its complaint to add a cause of action for subrogation, the Supreme Court properly determined that such a claim would have been barred by the statute of limitations. It is well settled that since the nature of subrogation is derivative of the underlying tort action, the cause of action accrues from the date of the accident, not the date of payment (see Matter of [443] Nationwide Mut. Ins. Co. v Motor Vehicle Acc. Indem. Corp., 190 AD2d 798, 800). Thus, since the plaintiff did not commence this action until more than six years after the accident, any claim for subrogation that it might have had was time-barred (see CPLR 214 [5]). O’Brien, J.P., Krausman, Schmidt and Cozier, JJ., concur.