Peloso v. Hartford Fire Insurance Co. ( 1970 )

Hall, J.

(dissenting) The standard fire insurance policy of New Jersey is not the creation of the insurer, but a contract statutorily prescribed in all its details in 1954. N. J. B. A. 17:36-5.20. The terms bind the insurer and insured alike, regardless of the latter’s state of knowledge. There is nothing incongruous or ambiguous about the provisions thereof here involved. Nothing could be plainer than the language:

No suit or action on this policy for the recovery of any claim shall be sustainable in any court of law or equity unless all the requirements of this policy shall have been complied with, and unless commenced within twelve months next after inception of the loss.

“Inception of the loss” can only mean, in the case of a fire loss, the date of the fire and not the accrnal of a cause of action. The earlier standard policy said “after the fire”. Eire insurance policies now customarily cover risks in addition to fire, such as lightning and windstorm. Thus, the change in wording, only to square with the additional coverages.

The very language of the quoted provision clearly indicates that the legislature recognized the other provisions of the policy, relative to the furnishing of proof of loss (modified in New Jersey by N. J. S. A. 17:36-6) and to the loss payment date, relied upon by the majority, and still said any action had to be commenced within a year of the loss. This means without “time out”.

When the legislature has spoken so plainly, its command should not be open to judicial change. Cf. Restaurant Enterprises, Inc. v. Sussex Mutual Insurance Co., 52 N. J. 73, 78 (1968) (dissenting opinion).

The precise question — a claim of tolling of the 12 month period by reason of the proof of loss requirement and the 60 day span allowed the company to make payment — arose recently in New York (whose standard policy New Jersey copied) in a similar factual situation. Proc v. Home Insurance Company, 17 N. Y. 2d 239, 270 N. Y. S. 2d 412, 217 N. E. 2d 136 (1966). There Judge Euld reached the result I urge as the only proper one here, saying:

The argument not only disregards the plain meaning of the policy language but ignores both its history and the intention of those who wrote it. The Legislature, in enacting section 168 of the Insurance Law, gave careful attention to the very problem presented by this case. Considering the manner in which the phrasing evolved over the years, there cannot be any doubt that the period of limitations was meant to run from the date of the fire, even though a cause of action against the insurer had not then accrued. The court will not subvert this clearly expressed legislative design — and rewrite nearly 90 years of history ■ — ■ by deriving from the less specific terms of another provision (CPLR 204, subd. [a]) just the opposite- intention and meaning.

Nor do we perceive anything unfair in reaching the result we do. If conduct or action on the part of the insurer is responsible for the insured’s failure to comply in time with the conditions precedent, injustice is avoided and adequate relief assured, without doing violence to the plain language used by the Legislature, by resort to traditional principles of waiver and estoppel. (270 N. Y. S. 2d at 415, 217 N. E. 2d at 139).

Ho such equities are even suggested in this case.

I would affirm the judgment of the Appellate Division.

For reversal and remandment — Chief Justice Weintraub and Justices Jacobs, Francis, Proctor, Schettino and Haneman — 6.

For affirmance — Justice Hall — 1.