Verdicts

Defendant denied coverage on March 10, 1997, claiming that it did not receive notice until 9 months after the malpractice action was brought. Finding that defendant could not show prejudice, the court ordered its indemnification of plaintiff. Under the circumstances, the court found no sound reason to extend New York's “no-prejudice” standard to a situation where notice of legal action served as notice of claim and where an investigation of the underlying claim could not have been launched any sooner than 21 years after the occurrence.

Insurer Must Indemnify Hospital in Suit Brought 21 Years After Child's Birth

A hospital was entitled to coverage by its insurer even though it notified the insurance company of the suit more than 9 months after it received the summons and complaint because investigation of the claim could not have been begun until many years after the alleged injury anyway. St. Charles Hospital and Rehabilitation Center v. Royal Globe Insurance Co., N.Y.L.J. 5/25/04, LEGAL_BRIEFS; Vol. 100; Pg. 17.

A March 1996 medical malpractice action was brought on behalf of a disabled girl born in March 1975. At the girl's birth, plaintiff hospital was an additional insured on a hospital malpractice liability policy issued by defendant insurer. It was self-insured when the malpractice action was brought. The hospital provided the defendant insurance company with a copy of the summons and complaint in the malpractice action on Jan.15, 1997.

Defendant denied coverage on March 10, 1997, claiming that it did not receive notice until 9 months after the malpractice action was brought. Finding that defendant could not show prejudice, the court ordered its indemnification of plaintiff. Under the circumstances, the court found no sound reason to extend New York's “no-prejudice” standard to a situation where notice of legal action served as notice of claim and where an investigation of the underlying claim could not have been launched any sooner than 21 years after the occurrence.