New York is the best state in the nation, in which to defend coverage based upon late notice given by the insured to her insurer, that an accident had occurred.  Relatively short periods of delay may support the defense.  Most important, there is no need, as in most states, to show prejudice to the interests of the insurer; and, only a few excuses, carefully limited by case law,  will operate to save coverage for the insured. 

         It has been less clear, however, whether the insured’s violation of the condition requiring her promptly to forward suit papers, will receive the same treatment.  In Brandon v. Nationwide (April 20, 2002), the insured promptly notified his carrier of an auto accident involving another vehicle with low policy limits, so as to preserve his right to claim underinsured motorists coverage benefits, should his damages so warrant.  However, the policy also required him to promptly forward the summons and complaint, in any suit the insured might bring against the other driver—which the insured failed to do.

         The Court of Appeals has now ruled, that the insurer must show how the failure to forward prejudiced the insurer in its ability to prepare its case.  The Court found that the early notice of accident had given the insurer sufficient information to investigate the facts and prepare its position. 

         Brandon involved an SUM coverage endorsement, but its reasoning is not limitable to that context.  Henceforth, in all cases of failures to forward suit papers, whether under UM/SUM endorsements, or pursuant to the policy’s liability coverage conditions, the insurer must expect to make a concrete showing of resulting prejudice to its interests. 

          Given New York’s case law affirming the importance of early notice to insurers in the “late notice” context, in which prejudice is presumed, it may be that the Court will not require a very strong showing of prejudice in the “failure to forward” context. 

CPLR Article 16 Apportionment Applies to Cases Involving
Intentional and Negligent Joint Tortfeasors

          Article 16 of the NY Civil Practice Law and Rules provides for limiting a tortfeasor’s liability for non-economic damages to his equitable share, in cases where his fault is found to be 50% or less of the total fault of all responsible parties, sued or not sued; it is an affirmative defense, and defense counsel must take care to allege it, and also to identify the parties alleged to be also responsible. 

        Until the recent decision in Chianese v. Meier (June 13, 2002), it was unclear whether the raft of statutory exceptions to Article 16 included cases where the other tortfeasor acted intentionally—as where a rapist enters an apartment building that was negligently secured, or where a county jail returns an informant to the same cell as the “informee,” where he meets a predictable fate.  The exception for “actions requiring proof of intent” has been held by some Appellate Divisions to prevent the negligent actor from claiming the Article 16 limitation in such cases.

         Now, under Chianese, the negligent party can limit his damages if found to be less than 51% responsible as compared to the intentional wrongdoer, which stands a good chance in most such cases.   The restriction respecting actions requiring proof of intent, the Court of Appeals holds, is meant to deprive the intentional wrongdoer of protection under the Article, not negligent parties.  The inability of the more guilty party to pay is of no relevance in applying Article 16.