SUPREME COURT SHOULD NOT HAVE SEARCHED THE RECORD TO AWARD SUMMARY JUDGMENT ON A GROUND NOT RAISED BY THE PARTIES, HOWEVER, FAILURE TO TIMELY NOTIFY UMBRELLA INSURER OF THE CLAIM WARRANTED SUMMARY JUDGMENT (SECOND DEPT).

The Second Department determined Supreme Court should not have searched the record to award summary judgment on a ground not raised by the parties in this car accident case. However, the Second Department determined summary judgment was properly granted to the umbrella insurer (RLI) on the ground that the owner of the leased car (CFC) did not timely notify RLI of the claim:

The Supreme Court erred in essentially searching the record and granting relief based upon arguments that were not raised … . “A motion for summary judgment on one claim or defense does not provide a basis for searching the record and granting summary judgment on an unrelated claim or defense'” … . …

RLI established, prima facie, its entitlement to judgment as a matter of law dismissing the complaint insofar as asserted against it based upon CFC's failure to provide timely notice of the occurrence and suit. “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'” … . This rule applies to excess carriers as well as primary carriers … . “[A] justifiable lack of knowledge of insurance coverage may excuse a delay in reporting an occurrence”… . To establish a valid excuse due to the insured's alleged ignorance of insurance coverage, the insured has the burden of proving “a justifiable lack of knowledge of insurance coverage” and “reasonably diligent efforts to ascertain whether coverage existed” upon receiving information “which would have prompted any person of ordinary prudence to consult either an attorney or an insurance broker” … . Here, in support of its motion, RLI submitted evidence that counsel for … CFC in the underlying action performed an investigation and learned the detailed information regarding the umbrella policy in March 2005. Such knowledge is imputed to CFC … . As such, RLI established that RLI was given no notice of the accident or lawsuit until August 2006, and CFC did not provide notice until … June 2010. Daimler Chrysler Ins. Co. v Keller, 2018 NY Slip Op 05999, Second Dept 9-12-18

INSURANCE LAW (SUPREME COURT SHOULD NOT HAVE SEARCHED THE RECORD TO AWARD SUMMARY JUDGMENT ON A GROUND NOT RAISED BY THE PARTIES, HOWEVER, FAILURE TO TIMELY NOTIFY UMBRELLA INSURER OF THE CLAIM WARRANTED SUMMARY JUDGMENT (SECOND DEPT))/CIVIL PROCEDURE (SUPREME COURT SHOULD NOT HAVE SEARCHED THE RECORD TO AWARD SUMMARY JUDGMENT ON A GROUND NOT RAISED BY THE PARTIES, HOWEVER, FAILURE TO TIMELY NOTIFY UMBRELLA INSURER OF THE CLAIM WARRANTED SUMMARY JUDGMENT (SECOND DEPT))/TRAFFIC ACCIDENTS (INSURANCE LAW, SUPREME COURT SHOULD NOT HAVE SEARCHED THE RECORD TO AWARD SUMMARY JUDGMENT ON A GROUND NOT RAISED BY THE PARTIES, HOWEVER, FAILURE TO TIMELY NOTIFY UMBRELLA INSURER OF THE CLAIM WARRANTED SUMMARY JUDGMENT (SECOND DEPT))