Geico Indem. Ins. Co., Matter of, v Global Liberty Ins. Co. of NY, 2016 NY Slip Op 50595(U)(App. Term 2d Dept. 2016)
Geico Indemnity Insurance Company (Geico) commenced this proceeding, pursuant to CPLR 7510, to confirm an arbitration award rendered against Global Liberty Insurance Company of NY (Global) in the principal amount of $25,000. Respondent filed a cross petition to vacate the award. The record indicates that, on August 9, 2011, Michael McCrae, a pedestrian, slipped and fell in a parking lot and was subsequently struck by a motor vehicle which left the scene and which was allegedly owned by Global’s insured. On February 6, 2013, Geico, pursuant to an agreement between the parties providing for their participation in uninsured motorist arbitration, commenced inter-company arbitration against Global to recover $25,000 which Geico had paid to McCrae on his uninsured motorist claim. Global contended that it had disclaimed coverage on August 31, 2012, based upon its insured’s noncooperation and late notice. Following an arbitration hearing on April 12, 2013, the arbitrator ruled in favor of Geico, finding that Global had not sustained its disclaimer of coverage, and issued an award to Geico in the principal sum of $25,000. In an order entered July 2, 2014, from which Global appeals, the Civil Court granted Geico’s petition to confirm the arbitration award and denied Global’s cross petition to vacate the arbitration award.”
(The order was affirmed)
What bothers me about this case is that GEICO was given notice of a UM claim due to GLOBAL’s disclaimer. GEICO failed to stay the arbitration pending a framed issue hearing on the validity of Global’s non-cooperation disclaimer, and invariably admitted lack of coverage on Global’s part and picked up the UM claim.
Now, GEICO wants a second bite at the apple, subrogates against Global on the UM and the arbitrator ruled on the merits of the disclaimer. I believe that by not timely staying the UM claim, GEICO cannot litigate any coverage issues including the validity of what would have been at a FIH the Additional Respondent’s disclaimer. Very poor decision and sneaky on GEICO’s part.
