Laurence Appell Et Al. v. Liberty Mutual Insurance Company Et Al‪.‬

The findings of fact contained or implicit in the opinion-decision of the Special Term, insofar as they may be inconsistent herewith, are reversed, and new findings are made as indicated herein. Contrary to the finding of the Special Term, we find that plaintiffs failed to give notice of the accident to the McConneys' insurer, Liberty Mutual Insurance Company, ""as soon as was reasonably possible."" We find there was unexplained delay by plaintiffs in giving such notice to the defendant Liberty; and we hold that such delay constituted a breach of the conditions of the policy (Deso v. London & Lancashire Ind. Co. of America, 3 N.Y.2d 127; Nelli v. National Sur. Corp., 34 Misc. 2d 976; Allstate Ins. Co. v. Manger, 30 Misc. 2d 326). However, we also find and hold that such delay was waived by Liberty's original disclaimer which was based primarily upon the ground of the McConneys' non-co-operation in violation of the terms of the policy, without mention of plaintiffs' delay in giving it notice of the accident (Brink v. Hanover Fire Ins. Co., 80 N. Y. 108; Shapiro v. Employers Liab. Assur. Corp., 139 Misc. 454). There is another substantial ground for holding the defendant Liberty liable to the plaintiffs in this action. When a claim is asserted under the statute (Insurance Law, § 167) against an insurer, the insurer, if it does not intend to honor the claim, is duty bound to disclaim as soon as reasonably possible. Upon the facts here, we find that Liberty, the insurer, failed to give such timely notice of disclaimer, in that it unreasonably delayed in giving such notice for two months after its receipt of a copy of the summons and complaint which the plaintiffs had served upon its assured, the McConneys. Such unreasonable delay on the part of the insurer in disclaiming prejudiced the plaintiffs and is sufficient to estop the insurer from now asserting its non-liability under the statute (Merchant Mut. Cas. Co.