        SUPREME COURT OF THE STATE OF NEW YORK
           Appellate Division, Fourth Judicial Department

205
CA 16-00363
PRESENT: PERADOTTO, J.P., CARNI, LINDLEY, AND SCUDDER, JJ.


BN PARTNERS ASSOCIATES, LLC, LECHASE
CONSTRUCTION SERVICES, LLC, AND THE
GOLUB CORPORATION,
PLAINTIFFS-RESPONDENTS-APPELLANTS,

                    V                               MEMORANDUM AND ORDER

SELECTIVE WAY INSURANCE CO.,
DEFENDANT-APPELLANT-RESPONDENT,
AND JAG I, LLC, DEFENDANT.


HURWITZ & FINE, P.C., BUFFALO (DAN D. KOHANE OF COUNSEL), FOR
DEFENDANT-APPELLANT-RESPONDENT.

WOODS OVIATT GILMAN LLP, ROCHESTER (JENNIFER SCHAUERMAN OF COUNSEL),
FOR PLAINTIFFS-RESPONDENTS-APPELLANTS.


     Appeal and cross appeal from an order of   the Supreme Court,
Monroe County (J. Scott Odorisi, J.), entered   March 31, 2015. The
order, among other things, denied plaintiffs’   motion for summary
judgment and granted in part the cross motion   of defendant Selective
Way Insurance Co. for summary judgment.

     It is hereby ORDERED that the order so appealed from is
unanimously modified on the law by granting the cross motion of
defendant Selective Way Insurance Co. in its entirety and granting
judgment in favor of that defendant as follows:

          It is ADJUDGED and DECLARED that defendant Selective
     Way Insurance Co. is not obligated to defend and indemnify
     plaintiffs in the underlying action,

and as modified the order is affirmed without costs.

     Memorandum: Plaintiffs commenced this action seeking a
declaration that defendant Selective Way Insurance Co. (Selective) is
obligated to defend and indemnify plaintiffs in the underlying
personal injury action pursuant to a commercial general liability
insurance policy issued to defendant JAG I, LLC (JAG). The underlying
action arose when an employee of JAG was injured while working on
property owned by plaintiff BN Partners Associates, LLC (BN) and
leased to plaintiff The Golub Corporation (Golub) pursuant to a
subcontract between JAG and plaintiff LeChase Construction Services,
LLC (LeChase), the general contractor.
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                                                         CA 16-00363

     The employee commenced the underlying action against BN and
LeChase on June 16, 2011, and commenced a related action against Golub
on October 5, 2011. Thereafter, plaintiffs commenced the instant
action on November 30, 2012. Selective answered, asserting several
affirmative defenses including that plaintiffs did not timely notify
Selective of the claim or the underlying lawsuit, and that plaintiffs
failed to immediately forward copies of legal papers received in
connection with the lawsuit. Selective therefore asserted that it had
no obligation to defend or indemnify plaintiffs.

     Plaintiffs moved for, inter alia, summary judgment on their
declaratory judgment cause of action on the ground that they provided
timely notice to Selective in the form of (1) a letter that LeChase’s
insurance carrier sent to JAG, dated September 27, 2011, informing it
of the lawsuit and advising JAG to turn the matter over to its general
liability carrier, and (2) a voicemail message with JAG’s insurance
agent following up on that letter. Selective cross-moved for summary
judgment, seeking a declaration that it has no obligation to defend or
indemnify plaintiffs in the underlying lawsuit because, inter alia, it
did not receive notice of the claim or lawsuit until December 5, 2012,
when it was served in the instant matter, and that a delay of nearly
17 months after plaintiffs learned of the lawsuit is untimely as a
matter of law. Selective further argued that notice to JAG’s
insurance agent did not suffice insofar as it was not written notice
as required by the policy and was not notice to Selective’s agent.

     Supreme Court determined, inter alia, that BN and Golub did not
provide Selective with any notice of the underlying occurrence or
claim, but that there is a question of fact whether LeChase had done
so. That was error. We conclude that plaintiffs did not provide
Selective with notice of the claim or lawsuit as required under the
policy and, thus, the court should have granted that part of
Selective’s cross motion seeking a declaration that Selective had no
duty to defend or indemnify plaintiffs in the underlying action.
Furthermore, we note that the court failed to declare the rights of
the parties in connection with the duty to defend and indemnify (see
Kemper Independence Ins. Co. v Ellis, 128 AD3d 1529, 1530). We
therefore modify the order accordingly.

     It is well settled that, “[i]n determining a dispute over
insurance coverage, we first look to the language of the policy”
(Consolidated Edison Co. of N.Y. v Allstate Ins. Co., 98 NY2d 208,
221). “As with any contract, unambiguous provisions of an insurance
contract must be given their plain and ordinary meaning . . . , and
the interpretation of such provisions is a question of law for the
court” (White v Continental Cas. Co., 9 NY3d 264, 267). “If the terms
of a policy are ambiguous, however, any ambiguity must be construed in
favor of the insured and against the insurer” (id.; see
Christodoulides v First Unum Life Ins. Co., 96 AD3d 1603, 1604-1605).
Further, “[n]otice requirements are to be liberally construed in favor
of the insured, with substantial, rather than strict, compliance being
adequate” (Greenburgh Eleven Union Free Sch. Dist. v National Union
Fire Ins. Co. of Pittsburgh, PA, 304 AD2d 334, 335-336).
                                 -3-                           205
                                                         CA 16-00363

     Here, we conclude that the policy unambiguously requires an
insured to provide Selective with written notice of a claim or lawsuit
brought against an insured and to send Selective copies of any legal
papers received in connection with the claim or lawsuit. We further
conclude that Selective met its initial burden of establishing that
plaintiffs failed to provide notice of the claim or lawsuit as a
matter of law inasmuch as Selective’s employee averred that Selective
did not receive notice of the underlying lawsuit until nearly 17
months after the undisputed latest date when plaintiffs learned of the
underlying lawsuit and where plaintiffs offered no excuse for the
delay (see Anglero v George Units, LLC, 61 AD3d 564, 565; Gershow
Recycling Corp. v Transcontinental Ins. Co., 22 AD3d 460, 461-462;
Zugnoni v Travelers Ins. Cos., 179 AD2d 1033, 1033).

     Plaintiffs failed to raise a triable issue of fact in opposition
(see generally Zuckerman v City of New York, 49 NY2d 557, 562). We
reject plaintiffs’ contention that they provided Selective with
adequate notice via the voicemail message left with JAG’s insurance
agent and the letter sent to JAG informing each of the underlying
lawsuit. The inadmissible double hearsay submitted by plaintiffs with
respect to the letter is, standing alone, insufficient to defeat
Selective’s cross motion (see Raux v City of Utica, 59 AD3d 984, 985).
Inasmuch as the plain language of the policy requires that plaintiffs
“see to it that [Selective] receive[s] written notice of the claim or
‘suit’ as soon as practicable” ([emphasis added]; see Bretton v Mutual
of Omaha Ins. Co., 110 AD2d 46, 49-50, affd 66 NY2d 1020), we conclude
that a telephonic voicemail message does not constitute the requisite
notice in writing (see First City Acceptance Corp. v Gulf Ins. Co.,
245 AD2d 649, 651). We reject plaintiffs’ further contention that
JAG’s insurance agent was an agent of Selective (cf. U.S. Underwriters
Ins. Co. v Manhattan Demolition Co., 250 AD2d 600, 600-601).

     Finally, we reject plaintiffs’ contention that Selective’s
decision to afford JAG a courtesy defense raised an issue of fact with
respect to the timeliness of plaintiffs’ notice to Selective. We
conclude that Selective used the same standard in determining whether
to afford plaintiffs a defense as it did with respect to JAG (see BP
A.C. Corp. v One Beacon Ins. Group, 8 NY3d 708, 715), and that
questions concerning the reasonableness of JAG’s failure to provide
timely notice warranted the provision of a courtesy defense rather
than an outright disclaimer of the duty to defend and indemnify (see
generally Lang v Hanover Ins. Co., 3 NY3d 350, 356).

     In light of the foregoing determinations, we need not address
plaintiffs’ remaining contentions.




Entered:   March 24, 2017                       Frances E. Cafarell
                                                Clerk of the Court
