RKT Wins Framed Issue Hearing Negating Geico's Disclaimer of Coverage

RKT attorney David Gould defeated GEICO at a Framed Issue Hearing on August 28, 2009 before Justice Peter H. Mayer in the Supreme Court Suffolk County, NYCM v. BERNHARD GEIGER v. GEICO AND RAMON SANCHEZ, Index Number 28269/08.

On May 16, 2007, Respondent Bernhard Geiger was involved in a two-car accident on May 6, 2007, in Queens County with Ramon Sanchez, who insured by GEICO on the date of loss.  GEICO was not apprised of the accident until 34 days after the accident.  After learning of the accident GEICO hired an investigator who left several telephone messages at Sanchez’s home.  They also went to Sanchez’s residence with no success in reaching him.  On February 28, 2008, 9½ months after first learning of the accident, GEICO issued a retroactive disclaimer of coverage stating that they could not secure Sanchez’s cooperation in defense of the matter. 

Respondent Geiger’s attorney then filed a Demand for Arbitration for Uninsured Motorist/SUM benefits for personal injuries sustained in the accident.  David Gould filed a Petition to Stay the Arbitration on behalf of NYCM.  At the Framed Issue Hearing the claims examiner for GEICO testified that early in their investigation they learned that Sanchez changed his address yet the company admittedly did not attempt to locate him at this new address until 5 months later.

Justice Mayer, referring to the case of  Thrasher v. United States Liability Ins. Co., 19 N.Y.2d 159 (1976) held that the burden is placed upon GEICO to show that their insured failed to cooperate and is "a heavy one".  In his opinion GEICO’s retroactive disclaimer of coverage for non cooperation was invalid because the company had not acted "diligently"and also failed to undertake "reasonable efforts in trying to obtain the insured’s cooperation".   NYCM’s Petition to Stay the Arbitration was therefore granted and Geiger is now free to pursue his tort remedies as against Sanchez.