Huntington Hospital (“Huntington”) sued defendant New England Insurance Company (“New England”) for breach of contract after New England denied Huntington’s claim for coverage under an excess insurance policy issued by New England. See Huntington Hospital v. New England Reinsurance Company, No. 07-cv-4961 (2d Cir., Feb. 3, 2009). The basis for New England’s denial was that Huntington failed to provide timely notice of the claim. The U.S. District Court for the Southern District of New York granted summary judgment in New England’s favor and Huntington appealed.
The U.S. Court of Appeals for the Second Circuit affirmed the district court’s decision. The court noted that the terms of the excess policy in issue required Huntington to give New England notice “as soon as practicable” upon the occurrence of an event “reasonably likely to involve” the excess policy. The subject claim arose from an incident that occurred in 1983, which led to a medical malpractice lawsuit being filed against Huntington in 1985. Nonetheless, Huntington did not notify New England of the lawsuit until April 2000, after a second trial in the underlying action resulted in a verdict against Huntington for an amount greater than its primary insurance coverage. Accordingly, the Second Circuit held that Huntington’s notice of the claim was untimely under New York law and that its non-compliance with the “notice-of-occurrences provision” in the excess policy breached a condition precedent for coverage thereunder.
The Second Circuit further rejected the argument that Huntington’s late notice should be overlooked due to its alleged reliance on advice from counsel as to whether New England’s excess policy might be implicated by the underlying claim. The court found that any such reliance on the part of Huntington could not justify its failure to provide New England with timely notice.