Case Results
Gordon & Silber Obtains Summary Judgement Dismissing State of New York's Indemnification Claim On Grounds of Late Notice in Case Involving a Claim of Permanent Disability — October 2007.
Type of Case: Premises Liability. Alleged negligent maintenance of bathroom.
Venue: Claims of Claims, State of New York
Background Facts: In this general liability case, the Court of Claims asserted jurisdiction over the State of New York's claim for indemnification over our client, based on the court's jurisdiction to issue declaratory judgements with respect to the State's claims for insurance coverage. Here, our client had agreed to buy the State insurance, but decided instead to self-insure. In a case of first impression, the court decided to exercise jurisdiction over our client based on its status as a self-insurer. Although the court found it had subject matter jurisdiction over the claim, it nevertheless granted our motion and dismissed the action on the grounds the State failed to provide timely notice of the claim to our client as required by the contract.
Plaintiff made several arguments to excuse its failure to provide notice within the required 30 days. The State argued that 1) our client could not show prejudice; 2) a defectively served notice of claim and summons and complaint in Supreme Court did not trigger the obligation to notify; 3) out client's rejection was itself late and defective pursuant to the insurance law §3420(d); 4) the State's notice was given within a reasonable period of time; and 5) the State was not a party to the contract only a beneficiary and thus, the notice requirement did not apply to it.
Our Strategy: We argued that notwithstanding the Court of Claims exercise of jurisdiction over our client as a self-insurer, our client was not an insurance company, and thus, the statutory and common law pertaining to insurance carriers did not apply. Rather, the law of contracts controlled. Accordingly, our client was not subject to the time limitations with regard to serving disclaimers pursuant to Insurance Law §3420(d). Similarly, prejudice was not relevant since prejudice was not a requirement in the contract, nor was it generally required in the context of an insurance policy. Further, since the notification provision had a specific 30 day requirement, as opposed to the requirement in insurance policies, that notice be given “as soon as reasonably possible”, the State could not claim that its six-month delay satisfied the contractual requirement. With regard to the argument that the State was not a party to the contract, but only a beneficiary, we argued that regardless, the indemnification was conditioned on timely notice — that the contract did not provide for who provided the notice, only that it be given within the specified time frame. Finally, we argued that the regardless of the jurisdictional defect in the original complaint, the fact that plaintiff filed any complaint was irrefutable evidence of a claim that would have triggered the State's obligation to provide notice under the contract.
Result: The Court of Claims granted our client summary judgment after discussing and rejecting all 5 of the State's arguments set forth above.
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