Respondent's demand for uninsured motorist arbitration against petitioner, Metlife Auto & Home (Metlife) arose from a car accident precipitated by a hit-and-run driver on September 8, 2006. The unidentified vehicle struck an automobile belonging to a driver insured with GEICO which in turn struck respondent's automobile, causing her to suffer bodily injury. The demand for uninsured arbitration was made on July 3, 2007.

Immediately thereafter, Metlife timely petitioned for a stay of arbitration pursuant to CPLR §7503 on the grounds that prior to any scheduled arbitration respondent must comply with [*2]all conditions and/or obligations pursuant to the terms of the insurance contract, including certain disclosure regarding the September 8, 2006 accident and injuries claimed.

Before a decision was rendered, the parties stipulated to the relevant disclosure and, consequently, Metlife's application was denied as moot on September 7, 2007.

It is uncontested that at some point during the disclosure period Metlife learned for the first time that in January 2007 respondent had settled with the identified driver insured by GEICO to the limit of GEICO's policy. The Court has not been provided with any release that may have been signed pursuant to the settlement. On November 29, 2007, Metlife disclaimed coverage regarding the hit-and-run driver under the supplementary uninsured/under insured motorist's endorsement for respondent's failure to comply with certain policy exclusions by settling with GEICO's insured without Metlife's knowledge or consent and against its subrogation rights.

When arbitration of a claim is subject to conditions precedent, the existence of such conditions are an issue for the Court to determine (Rosenbaum v. American Surety Company, 11 NY2d 310). Here, the Court is asked to determine whether respondent's admitted failure to notify her insurance company of the settlement with the tortfeasor for the policy limit affects her SUM coverage for the uninsured tortfeasor.

Condition 10 states that if a settlement with a negligent party for their policy limits is reached, a release may be executed with such party after 30 days actual written notice to Metlife.

This condition is not limited to a formal lawsuit, which requires separate notice and written consent (Exclussion1 and Condition 4). Nor does it change the SUM limit being reduced by monies received by respondent from a carrier representing a negligent party, in this case to $75,000.00, whether or not petitioner receives a formal written notice (Condition 6).

The last paragraph of Condition 10 is "An insured shall not otherwise settle with any negligent party, without our written consent, such that our rights would be impaired." In reading Condition 10 and applying it to the instant matter of the settlement of a claim (as opposed to a lawsuit ) to the policy limit admittedly without written notice, the only time it could be considered an exclusion under the SUM endorsement is if petitioner's rights would be impaired, such as under Condition 13, the right of subrogation against GEICO's insured.

Since the Courts are also empowered to consider whether an insured complied with the [*3]conditions of the endorsement (see Aetna Casualty & Surety Company v. Cochrane, 64 NY2d 796), a hearing is necessary to determine if respondent in any way impaired petitioner's rights when the claim was settled with GEICO without written notice to petitioner.

Respondent's argument that petitioner's second application to stay arbitration was untimely since it was not brought within 20 days of the demand (see CPLR §7503(c) is unavailing.

The question of concealment per se is irrelevant to the undersigned's determination. Since the 20-day rule for bringing the application is considered in the nature of a strict statute of limitations (see Metropolitan Property and Liability Insurance Company v. Hancock, 183 AD3d 831), the Court determines the first petition which was timely filed is the operative one for limitation purposes.

CPLR §103(b) provides that procedure for actions and special proceedings shall be the same under the CPLR. There is no reason under these facts why the statutory provision relating to or affecting statutes of limitations should not also apply to a petition to stay arbitration under Article 75 (cf. Lauratex Textile Corp. v. Gorin, 37 AD2d 540).

One such statute is CPLR §205(a) that allows a subsequent action if brought within six months to relate back to the initial action if it was terminated for reasons other than by a voluntary discontinuance, a final judgment on the merits or other reasons not applicable here.

It is uncontested here that petitioner did not learn about the GEICO settlement until the first petition was withdrawn when respondent agreed to disclosure. Petitioner's withdrawal of the first petition was not a voluntary discontinuance within the meaning of CPLR §3217 as to the issues presented herein. That petition also included a general request for an order directing respondent to complete all conditions and/or obligations as forth with within Metlife's policy. Certainly, the Court did not anticipate such a situation as the instant one in its decision and order of September 7, 2007 which acknowledged the stipulation of withdrawal with regards to the disclosure issue (CPLR §3117(b)).

Under these circumstances the "discontinuance" was without prejudice (CPLR §3217(c)) and was not based on the merits. Since the so-called second petition was based upon the same transaction or occurrence, the Court concludes it is timely brought within the meaning of CPLR §205(a) and §7503(c).

Accordingly, this matter is referred to the Calendar Control Part for a hearing on the issue of whether petitioner's rights were preserved at the settlement to be held on MARCH 12, 2008. The petitioner shall file and serve a note of issue, together with receipt of payment, upon the [*4]Calendar Clerk of this Court within twenty (20) days of the date of entry of this order. The directive with respect to a hearing is subject to the right of the Justice presiding in CCP 2 to refer the matter to a Justice, Judicial Hearing Officer, or a Court Attorney/Referee, as he or she deems appropriate.

The failure of petitioner to file a note of issue will be deemed an abandonment of its claim and the petition will be dismissed with prejudice without further order of the Court.

Dated: January 29, 2008/s/ John M. Galasso......................................J.S.C.