Justice Ellen Coin
New Hampshire Insurance (NHI) issued a policy to Kaiser Aluminum, and Clearwater Insurance (CI) reinsured portions of NHI’s policy for Kaiser. Kaiser was the subject of over 247,000 asbestos injury claims. NHI and other AIG-affiliated insurers settled with Kaiser. As payment levels reached NHI’s policy, it began to bill CI for its share of NHI’s liability, and sued when CI failed to pay. NHI moved for summary judgment on its claims for breach of contract and a declaratory judgment. CI argued the motion was premature, alleging NHI failed to give it timely notice as required, among other things. CI argued that while NHI first received notice from Kaiser referencing its policy in 1992, it failed to send notice to CI until 1997. The court noted a reinsured’s breach of a reinsurance agreement’s notice provision would excuse performance only if it was material or demonstrably prejudicial, noting prejudice was limited to economic injury. It found CI’s submissions lacked any detailed facts to support its claims of prejudice, thus CI failed to meet its burden to establish same. The court stated CI failed to produce evidence of NHI’s bad faith, nor shown through affidavits that facts essential to justify its contention may exist. Hence, CI’s affirmative defense of untimely notice was dismissed.
