The Third Department determined, as a matter of law, that defendant’s failure to notify the insurance carrier of a personal injury lawsuit for nearly five months justified the carrier’s denial of coverage. The court noted that defendant’s belief the lawsuit was fraudulent was not a “good-faith belief of nonliability;”
“Where a policy of liability insurance requires that notice of an occurrence be given ‘as soon as practicable,’ such notice must be accorded the carrier within a reasonable period of time. The insured’s failure to satisfy the notice requirement constitutes a failure to comply with a condition precedent which, as a matter of law, vitiates the contract” … . Although “there may be circumstances where the insured’s failure to give timely notice is excusable, . . . [t]he insured bears the burden of establishing the reasonableness of the proffered excuse” … . In this regard, the reasonableness of the insured’s excuse – although generally presenting a question of fact for a jury … – “may be determined as a matter of law where the evidence, construing all inferences in favor of the insured, establishes that the belief was unreasonable or in bad faith” … .
Here, defendant made a prima facie showing of its entitlement to judgment as a matter of law based upon plaintiff’s nearly five-month delay (August 2008 to January 2009) in notifying defendant of the underlying personal injury action …, and plaintiff failed to tender sufficient proof to raise a question of fact as to the reasonableness of such delay. Plaintiff’s personal belief that the guest’s lawsuit was fraudulent is not the equivalent of “a good-faith belief of nonliability” … . Vale…v Vermont Mutual Insurance Group, 515999, 3rd Dept 12-5-13