Government Emp. Ins. Co. v. Mizell

• Decision Date: 20 May 1971
• Docket Number: 2,Nos. 1,s. 1
• Citation: 36 A.D.2d 452,320 N.Y.S.2d 936
• Parties: GOVERNMENT EMPLOYEES INSURANCE COMPANY, Respondent, v. Ralph P. MIZELL et al., Defendants, and Joyce V. Swota, Lance A. Brown, Appellants. GOVERNMENT EMPLOYEES INSURANCE COMPANY, Respondent, v. UTICA MUTUAL INSURANCE COMPANY, Appellant. Action
• Court: New York Supreme Court — Appellate Division

Page 936

320 N.Y.S.2d 936

36 A.D.2d 452

GOVERNMENT EMPLOYEES INSURANCE COMPANY, Respondent, v. Ralph P. MIZELL et al., Defendants, and Joyce V. Swota, Lance A. Brown, Appellants.

GOVERNMENT EMPLOYEES INSURANCE COMPANY, Respondent, v. UTICA MUTUAL INSURANCE COMPANY, Appellant.

Action Nos. 1, 2.

Supreme Court, Appellate Division, Fourth Department.

May 20, 1971.

Johnson, Reif & Mullan, Rochester, for appellants Joyce V. Swota, Lance A. Brown and Utica Mutual Ins. Co; Thomas Farrell, Rochester, for counsel.

Culley, Marks, Corbett, Jordan, Tanenbaum & Reifstock, Rochester, for defendant Geraldine DeLucia; William Marks, Rochester, of counsel.

Winchell, Connors & Corcoran, Rochester, for respondent; Charles A. Hall, Rochester, of counsel.

Before DEL VECCHIO, J.P., and WITMER, GABRIELLI, CARDAMONE and HENRY, JJ.

OPINION

PER CURIAM:

The judgment appealed from declared that plaintiff cancelled its liability policy insuring defendant Ralph Mizell against liability before his automobile collided with an automobile owned by defendant appellant Swota and that, therefore, it did not afford insurance protection to Mizell or anyone else arising out of the accident occurring on November 22, 1965.

Plaintiff notified Mizell on October 26, 1965 this his policy was to be cancelled on November 6, 1965 for failure to pay the premium thereon. Cancellation notice must be mailed in strict accordance with the applicable statutes, must allow a set time before the effective date of cancellation, and must contain all information required by the statute. (Matter of Otterbein v. Babor & Comeau Co., 272 N.Y. 149, 5 N.E.2d 71; B. & B. Trucking, Inc. v. Home Fire & Marine Ins. Co., 125 Misc. 312, 314, 209 N.Y.S. 511, 513, affd. 216 App.Div. 710, 214 N.Y.S. 812, affd. 243 N.Y. 558, 154 N.E. 604; 3 Richard on Insurance (5th ed.), § 531, p. 1761; 30 N.Y.Jur., Insurance, § 730, pp. 79-- 80.) Literal compliance with the provisions of the policy and statutes is the rule and any ambiguity in language is strictly construed against the insurer. (29 N.Y.Jur., Insurance, § 270, p. 258; B. & B. Trucking, Inc. v. Home Fire & Marine Ins. Co., supra; National Factors, Inc. v. Waters 42 Misc.2d 822, 829, 249 N.Y.S.2d 121, 127; Monette v. Nationwide Mut. Ins. Co., Sup., 230 N.Y.S.2d 939.)

The policy was issued pursuant to the provisions of New York's Assigned Risk Plan (Insurance Law § 63) which provides in section 18--2 that the insurer may cancel the insurance by giving notice as required by law if the insured '(d) fails to pay any premium due under the policy'. Section 18--4 of the plan expressly provides that notice of cancellation shall be in conformity with the Vehicle and Traffic Law and section 19 provides that '(e)ach notice of cancellation, or denial of insurance, shall contain or be accompanied by a statement that the insured or applicant has the right to review of such action by the Governing Committee of the Plan'. The applicable section of the Vehicle and Traffic Law section 313, requires that 10 days notice be given before the cancellation becomes effective. The notice of cancellation complied with the time provision in Vehicle and Traffic Law § 313. However, the notice was defective in that it failed to comply with the express provisions of section 19 of the Assigned Risk Plan. No mention was made of insured's right to appeal. In fact, the notice implies that no such right exists where cancellation is based on the failure to pay premiums. Respondent's failure to comply strictly and literally with this express policy provision renders its attempted cancellation nugatory, and, therefore, the policy continued in effect on the date of the accident. (Teeter v. Allstate Ins. Co., 9 A.D.2d 176, 181, 192 N.Y.S.2d 610, 615, affd. 9 N.Y.2d 655, 212 N.Y.S.2d 71, 173 N.E.2d 47; Connecticut Fire Ins. Co. v. Williams, 9 A.D.2d 461, 194 N.Y.S.2d 952; Stone v. Travelers Ins. Co., 40 Misc.2d 164, 169--170, 242 N.Y.S.2d 583, 588--589.) The fact that the rules and provisions of the Assigned Risk Plan were drafted and adopted by the insurance companies themselves lends even further support to the requirement that they be complied with. (See, e.g., 29 N.Y.Jur., Insurance, § 270, p. 258.) Respondent was also required to comply with § 347 of the Vehicle and Traffic Law which provides that once an automobile policy has been issued and certified, it shall not be cancelled or terminated until at least 10 days after a notice of cancellation or termination of the insurance shall be filed in the office of the Commissioner of Motor Vehicles. Respondent's notice to the Commissioner (form FS--4) was not mailed until December 1,...