New York City Hous. Auth. v Tower Ins. Co. of N.Y., 2011 NY Slip Op 01732 [82 AD3d 507]

March 10, 2011

Appellate Division, First Department

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Law Office of Max W. Gershweir, New York (Joshua L. Seltzer of counsel), for appellant.

Wilson Elser Moskowitz Edelman & Dicker LLP, New York (Patrick J. Lawless of counsel), for respondent.

Order, Supreme Court, New York County (Marylin G. Diamond, J.), entered April 13, 2010, which granted plaintiff’s motion for summary judgment declaring that defendant has a duty to defend and indemnify it in an underlying personal injury action and denied defendant’s cross motion for summary judgment declaring that it has no such duty, unanimously reversed, on the law, without costs, plaintiff’s motion denied, the cross motion granted, and it is declared that defendant has no duty to defend or indemnify plaintiff in the underlying action.

The record demonstrates that upon receiving an untimely notice of the claim from plaintiff, defendant issued a formal disclaimer that was timely under the circumstances. Defendant’s delay in issuing the disclaimer was justified, as the timeliness of the disclaimer is measured from the time that the insurer first learns of the grounds for disclaimer ( see A.J. McNulty & Co. v Lloyds of London , 306 AD2d 211, 212 [2003]). “An insurer is not required to disclaim on timeliness grounds before conducting a prompt, reasonable investigation into other possible grounds for disclaimer; in fact, a ‘reasonable investigation is preferable to piecemeal disclaimers’ ” ( DiGuglielmo v Travelers Prop. Cas. , 6 AD3d 344 , 346 [2004], lv denied 3 NY3d 608 [2004], quoting 2540 Assoc. v Assicurazioni Generali , 271 AD2d 282, 284 [2000]). Accordingly, before issuing its disclaimer, it was reasonable for defendant to investigate whether plaintiff had contemporaneous knowledge of the incident, and whether plaintiff was actually [*2] insured via a written contract with its contractors, which was not apparent from the face of the notice of claim or the letter transmitted by plaintiff. Concur—Saxe, J.P., Friedman, Acosta, DeGrasse and Richter, JJ..