32 Misc. 2d 1052 | N.Y. Sup. Ct. | 1962
Motor Vehicle Accident Indemnification Corporation seeks to vacate a demand for arbitration of a claim, filed against it by Sylvia Mossman and Erie Mossman, who, having the status of insured, persons, have duly served their demand for arbitration under the standard automobile accident indemnification indorsement on their own liability insurance policy.
The accident giving rise to the claim occurred on May 8, 1960 and involved a motor vehicle owned and operated by one Edwards Burrell which was covered by a liability insurance
At the outset, it must be noted that the claimants are insured persons as defined in subdivision i of section 601 of the Insurance Law and are pursuing their remedies, not as “ qualified persons ” under article 17-A of the Insurance Law, but under the standard automobile accident indemnification indorsement on their own insurance policy. No copy of this indorsement is submitted with the papers, but the court, having reviewed a number of these indorsements, notes that many of them contain no reference whatsoever to insured motor vehicles where the insurer disclaims liability or denies coverage. Notwithstanding this omission, however, subdivision 2-a of section 167 provides in pertinent part as follows: “No policy insuring against loss resulting from liability imposed by law for bodily injury * * * shall be issued * * * unless it contains a provision whereby the insurer agrees that there will be paid to the insured, as defined in such provision, by the Motor Vehicle Indemnification Corporation, * * * all sums * * * which the insured or his legal representative shall be entitled to recover as damages from an owner or operator of * * * an insured motor vehicle where the insurer disclaims liability or denies coverage * * *. Any such policy which does not contain the aforesaid provision shall be construed as if such condition were embodied therein.” (Emphasis supplied.)
Accordingly, the indorsement on these claimants’ policy will be read as binding the M. V. A. I. C. to pay damages legally recoverable from the owner or operator of “an insured motor vehicle where the insurer disclaims liability or denies coverage ”.
In Matter of Motor Vehicle Acc. Indemnification Corp. v. Brown (15 A D 2d 578) the Appellate Division of the Second Department held that the question of timely notice of claim, being a condition precedent to arbitration proceedings, could not be submitted to the arbitrators, but should be passed upon
Consequently, if the facts of disclaimer were in dispute, this court Avould stay the arbitration pending a judicial determination of that fact after a hearing. However, no such question is here presented. M. V. A. I. C. concedes that Michigan Mutual did in fact disclaim under its policy issued to Mr. Burrell. What M. V. A. I. C. does claim is that Michigan Mutual had no valid reason to disclaim. This is an entirely different question and one upon which no final determination can be made by this court in this proceeding. The Michigan Mutual Liability Company is not a party to this litigation and would not be bound in any way by any determination, prima facie or otherwise, of the validity of its disclaimer.
In Matter of Motor Vehicle Acc. Indemnification Corp. (Scott) (28 Misc 2d 492 [Gulotta, J.]) and in Motor Vehicle Acc. Indemnification Corp. (Goldman) (N. Y. L. J., Dec. 5, 1961, p. 18, col. 7 [Suozzi, J.]) it was pointed out that in equity the M. V. A. I. C., and not the claimant, should bear the burden of pursuing any litigation with a disclaiming insurance company, which is a member of M. V. A. I. C., on the validity of the disclaimer. We are in accord Avith the rationale of those decisions, but respectfully disagree with so much thereof as sets down for a preliminary hearing the “prima facie” validity of the disclaimer.
Under the indorsement, as it is required to be read by subdivision 2-a of section 167 of the Insurance Law, it is enough that