Allstate Ins. Co. v. Furman, 1

• Decision Date: 28 December 1981
• Docket Number: No. 1,No. 2,1,2
• Citation: 84 A.D.2d 29,445 N.Y.S.2d 236
• Parties: ALLSTATE INSURANCE COMPANY, Appellant, v. Dennis R. FURMAN, et al., Respondents. (Action) Daniel J. FURMAN, an infant etc., Respondent, v. ALLSTATE INSURANCE COMPANY, Appellant. (Action)
• Court: New York Supreme Court — Appellate Division

Page 236

445 N.Y.S.2d 236

84 A.D.2d 29

ALLSTATE INSURANCE COMPANY, Appellant, v. Dennis R. FURMAN, et al., Respondents. (Action No. 1)

Daniel J. FURMAN, an infant etc., Respondent, v. ALLSTATE INSURANCE COMPANY, Appellant. (Action No. 2)

Supreme Court, Appellate Division Second Department.

Dec. 28, 1981.

Schleider & Dupee, Goshen (George S. Hodges, Goshen, of counsel), for appellant.

Finkelstein, Mauriello, Kaplan & Levine, Newburgh (Benjamin J. Fried, Newburgh, of counsel), for respondents.

Before MOLLEN, P. J., and HOPKINS, TITONE and WEINSTEIN, JJ.

WEINSTEIN, Justice.

On February 15, 1971, four-and-one-half-year-old Daniel Furman was playing in the basement of his parents' home in Floral Park, New York. A tree stump had been placed on the basement floor, and a metal anvil was lying on the stump. Unfortunately, during the course of Daniel's activities in the basement, the anvil fell off the stump onto Daniel's left hand, seriously and permanently injuring it.

On the day in question, Daniel's parents were covered by a homeowner's insurance policy issued by Allstate Insurance Company. Soon after the accident, Daniel's mother, Kathryn Furman, telephoned the insurer to report the accident. She was told, however, that since Daniel was a member of the household, there would be no insurance coverage and, accordingly, she let the matter of insurance coverage drop. No further notice of the accident was given to Allstate for six years.

Some six years later, Daniel's maternal grandfather, Vincent Gentile, was appointed guardian ad litem, and Gentile forthwith brought an action, on Daniel's behalf, against the boy's parents to recover $100,000 for the child's injury. The suit alleged that Daniel's injury had resulted from negligent, reckless, and careless supervision by his parents. The adult Furmans forwarded a copy of the complaint to Allstate, but the insurance company disclaimed liability "because of Late Notice and for other reasons", and informed the Furmans that Allstate "withdraws from the matter entirely." Daniel, by his guardian, then brought an action for a judgment declaring that Allstate was obligated to defend and, if necessary, indemnify his parents in the underlying action. Allstate also brought an action for a declaration that it had no liability arising out of the accident in question.

Special Term consolidated the two declaratory actions. After a nonjury trial, Trial Term held against Allstate, and ordered it to defend and, if necessary, indemnify the adult Furmans in the action brought on behalf of their son. The court agreed with Allstate that the condition precedent in the policy requiring timely written notice had not been fulfilled. However, relying on Ferguson v. Nationwide Mut. Ins. Co., 61 Misc.2d 912, 307 N.Y.S.2d 347 and Government Employees Ins. Co. v. Wilson, 69 Misc.2d 1020, 332 N.Y.S.2d 338, the court held that the infant plaintiff would not be "barred" by the delay in reporting the accident prior to the appointment of his guardian ad litem. We now reverse, and grant Allstate judgment declaring that its disclaimer was sufficient and that it is not obligated to defend or indemnify the adult Furmans in the underlying action.

Our starting point, of course, must be the issue of sufficiency of the notice that was given. The policy requires that when an occurrence takes place giving rise to Allstate's obligations under the comprehensive personal liability section of its policy, "written notice shall be given by or on behalf of the insured to Allstate or any of its authorized agents as soon as practicable." Trial Term was clearly correct in ruling that this clause was not satisfied; the notice given to Allstate on the telephone shortly after the accident was insufficient because it was not written (see Warren v. Merchants Mut. Ins. Co., 27 A.D.2d 575, 276 N.Y.S.2d 275; Morgan v. Travelers Ins. Co., 8 A.D.2d 945, 190 N.Y.S.2d 768), and the written notice given six years later was not "as soon as practicable." We hold, moreover, that even under paragraph (d) of subdivision 1 of section 167 of the Insurance Law, the notice was not sufficient. The aforesaid statute provides that, in a case where it was not reasonably possible to give notice within the time prescribed by an insurance policy, notice will be sufficient if it is given "as soon as was reasonably possible" (but cf. Deso v. London & Lancashire Ind. Co. of America, 3 N.Y.2d 127, 164 N.Y.S.2d 689, 143 N.E.2d 889). However, in the instant case, not only was it possible to give notice within the prescribed time, but the notice was not given as soon as reasonably possible in any event. Daniel's parents at all times knew about the accident and injury, and yet failed to communicate this information in writing to Allstate for six years. We conclude, then, that the notice provision of the insurance policy was not satisfied. The issue therefore is whether the infant should be, in effect, penalized because of his parents' delay. Put differently, the issue is whether the notice requirement in the insurance policy is tolled on account of infancy.

Several statutes provide tolls in time periods on account of infancy. Subdivision (c) of section 608 of the Insurance Law provides that failure to meet the prescribed time limit for filing an affidavit with the Motor Vehicle Accident Indemnification Corporation, giving notice to it of a claim, may be excused if the claimant is an infant and if "it was not reasonably possible to file such affidavit within said applicable period and * * * the affidavit was filed as soon as was reasonably possible" (see Matter of Raiford v. Motor Vehicle Acc. Ind. Corp., 29 A.D.2d 883, 288 N.Y.S.2d 577; Matter of McNulty v. Motor Vehicle Acc. Ind. Corp., 51 Misc.2d 1, 272 N.Y.S.2d 514, affd. 28 A.D.2d 1209, 284 N.Y.S.2d 858). The 90-day limit for serving a notice of claim upon a municipal corporation in a tort action may be extended on account of infancy (General Municipal Law, § 50-e, subd. 5; see Matter of Beary v. City of Rye, 44 N.Y.2d 398, 406 N.Y.S.2d 9, 377 N.E.2d 453; Cohen v. Pearl Riv. Union Free School Dist., 51 N.Y.2d 256, 434 N.Y.S.2d 138, 414 N.E.2d 639; Yepez v. County of Nassau, 79 A.D.2d 1023, 435 N.Y.S.2d 51). A Statute of Limitations is tolled, in almost all cases, for the entire period of infancy (CPLR 208). Nonetheless no such explicit provision tolling the period for giving notice under an ordinary insurance policy is provided by the statute, and this circumstance led the Appellate Division, First Department, to hold that the period for giving such notice would not be tolled by infancy (see Insurance Co. of Greater N. Y. v. 156 Hamilton Realty Corp., 72 A.D.2d 403, 424 N.Y.S.2d 683). ^*

We approach this issue somewhat differently from the way in which the First...