In re the Arbitration between Carlos & Motor Vehicle Accident Indemnification Corp. 24 A.D.2d 747

Order, entered on February 1, 1965, granting respondent MVAlC’s motion for a permanent stay of arbitration, unanimously reversed, on the law and on the facts, with $30 costs and disbursements to claimant-appellant, and the motion denied. This is an arbitration proceeding instituted against MVAIC, pursuant to subdivision 2-a of section 167 of the Insurance Law. Claimant, a passenger, had been injured following a collision between the automobile in which she was riding and a truck. The claim against MVAIC was predicated on claimant’s receipt of a written denial of liability from the insurer of the truck owner which stated that the truck was being operated without the insured’s permission or consent at the time of the accident. MVAIC argued that the denial of liability by the insurer was not a “ disclaimer ” within the meaning of the Insurance Law (§ 167, subd. 8). Upon MVAlC’s application to vacate the demand for arbitration, Special Term ordered a preliminary jury trial of whether the truck had been operated without the owner’s consent or permission. The jury returned a special verdict answering this question in the negative and Special Term entered an order permanently staying the arbitration. On similar operative facts this court, in a carefully reasoned opinion, ruled as a matter of law that such a denial of liability by the insurer constituted a disclaimer within the meaning of the statute (Matter of Rivera [MV AIC], 22 A D 2d 201). In that case Mr. Justice Steuer, on behalf of the court, observed that the insurer’s letter purported to assert only that its insured had a good defense, but that in effect the letter was a disclaimer on the ground of denial of coverage of the accident (pp. 203-204). For that reason, it was concluded that the letter was a disclaimer within the meaning of the statute. So, in this case, the insurer’s letter spoke purportedly on behalf of its insured and stated that he had a good defense, but the effect too was a denial of coverage of the accident in suit. Consequently, no triable issue remained to refer to the jury and staying the arbitration was error. Concur — Breitel, J. P., Rabin, Eager, Steuer and Witmer, JJ.