Weintraub v. Great Northern Insurance Company

Background

Philip and Jamila Weintraub sued Great Northern Insurance Company seeking coverage for an apparent theft from their collection of art and antiquities. The relevant Masterpiece insurance policy covered the Weintraubs’ New York City cooperative apartment and included an itemized schedule of insured collection items. Great Northern, through related insurer Chubb, denied the claim and asserted that the Weintraubs had waited too long to notify the insurer after discovering that a storage room at their country home appeared disturbed.

The policy provision on which Great Northern relied required the insureds to notify the insurer or its agent of a loss “as soon as possible.” That provision appeared on page Y-5 of the New York Policy Terms. The 2019 policy sent to the Weintraubs by mail did not include the Y-Pages, and the materially identical version posted to their online client portal also omitted them. Great Northern later produced a certified copy of the policy that included those pages, but a Chubb representative conceded that the complete policy had not been mailed to the Weintraubs or posted on their portal.

The court had previously denied Great Northern’s motion to dismiss. It held at that stage that the late-notice defense could not resolve the case because it was disputed whether the relevant policy had been delivered or made reasonably available, and because the complaint plausibly alleged that Great Northern might have abandoned or waived the defense during its investigation. The court then held a limited two-day bench trial, with the parties’ consent, focused on whether Great Northern could establish the factual basis for enforcing the late-notice provision.

Findings and legal issue

The court found that the 2019 policy repeatedly presented itself as the Weintraubs’ complete policy, while omitting the Y-Pages. Its table of contents referred generally to “Policy Terms” but did not tell the Weintraubs to consult an earlier policy, another insurance contract, or a separate document. The court found that the omission was inadvertent, but concluded that Great Northern had neither delivered the complete policy nor provided reasonable online access to it.

Great Northern argued that the table of contents incorporated the Y-Pages into the 2019 policy and that the Weintraubs had access to materially identical Y-Pages through the 2018 policy and the policy covering their country home. The court rejected those arguments. It distinguished cases enforcing undelivered coverage exclusions, which limit the scope of an insurer’s obligation, from cases involving undelivered procedural conditions that an insured must follow to make a claim. The court also found no language in the 2019 policy incorporating the 2018 policy or requiring the Weintraubs to reconstruct the 2019 policy by comparing separate insurance contracts.

Ruling

The court held that an insurer may not require strict compliance with a procedural condition for coverage when the insurer failed to provide that condition in the relevant policy or make it reasonably available. Because Great Northern did not deliver or reasonably make available the Long Policy containing the notice-of-loss provision, the court concluded that there was no contractual basis for enforcing the requirement that notice be given “as soon as possible.”

The court therefore precluded Great Northern’s late-notice defense. It did not decide whether Great Northern’s conduct during the claims investigation also amounted to an implied waiver of that defense, because the lack of a contractual basis made that issue unnecessary to resolve.

Disposition and remaining proceedings

The ruling addressed only Great Northern’s late-notice defense, not the ultimate merits of the insurance-coverage claim. The court noted that Great Northern had reserved the right to amend its coverage denial based on concealment or fraud, the failure to sue within two years under a predecessor policy, and intentional-acts or misappropriation exclusions. The court said Great Northern could seek permission to amend its answer to assert related defenses.

The court lifted the stay on discovery and directed the parties to prepare a proposed case-management plan and participate in a telephone conference with chambers. The opinion does not state a final ruling on whether the alleged theft was covered or whether the claim was fraudulent.