Opinion
62836.
Decided June 30, 2008.
Burke Burke, Patrick J. Burke, Esq., of Counsel, Attorneys for Plaintiffs.
Hurwitz Fine, P.C., Steven E. Peiper, Esq., of Counsel, Attorneys for Defendant, Unitrin.
The Defendant ("Unitrin") has moved pursuant to CPLR § 3211(1) for an order dismissing the Plaintiffs' Complaint in its entirety, or in the alternative, for an order dismissing the Plaintiffs' allegations of bad faith. The Plaintiffs' ("VanAcker") have opposed the motion. (The remaining Defendants are not parties to this motion.)
In its moving papers, Unitrin maintains that the Van Ackers' Complaint must be dismissed as untimely, based on the express language in the insurance policy which provides on Page Four of Endorsement AK 4003 (03 02) in part as follows:
SECTION I — CONDITIONS
Condition 8. Suit Against Us is deleted and replaced by the following:
8. Suit Against US. No action can be brought unless the policy provisions have been complied with and the action is started within two years of the date of loss. (emphasis added)
Further, Unitrin maintains that, even if the Court finds that commencement of the action was timely, the Court should dismiss the Plaintiffs' allegations that Unitrin failed to negotiate this matter in "good faith".
The action arises from a fire which occurred at the Van Acker residence located at 9191 Ridge Road, Huron, New York on December 10, 2003. The residence was insured by Unitrin (d/b/a Kemper Auto and Home). After some months of negotiations, Kemper presented the Van Ackers with a loss appraisal in the amount of $243,258.98, by letter dated October 25, 2004 from Louis M. Sziter, a Kemper general adjuster. The Plaintiffs then retained the services of their own appraiser, who appraised the Plaintiffs' loss at $299,492.28.
On December 15, 2004, the parties signed an agreement for submission on the appraisals to an umpire. The issue of the replacement cost was resolved in April 2005, but the parties continued to disagree as to the contents replacement coverage, as well as additional costs claimed by the Van Ackers. The Plaintiffs moved back into the residence in November 2005, with the contents issue still unresolved.
Since the two year statue of limitations provided by the insurance police was due to expire on December 10, 2005, the Plaintiffs orally requested an extension of time for commencement of the action from Mr. Sziter. They confirmed their request by an e-mail sent on December 7, 2005. In a return e-mail dated December 13, 2005, Mr. Sziter agreed to a "one-time extension to March 1, 2006." Mr. Sziter's e-mail further stated in part that "we do not intend to waive or prejudice any rights under the policy. . . ." Nevertheless, there were subsequent e-mails between the parties during the month of March, including one from Mr. Sziter to the Van Ackers, dated March 10, 2006 (after the date of the expiration of the extension), which indicated that he had had a "health issue" arise, and that he been unable to finish looking over some paperwork. On April 11, 2006, Mr. Sziter sent another e-mail to the Plaintiffs, in which he re-affirmed the March 1, 2006 extension. The Van Ackers commenced the instant action on August 21, 2007.
Unitrin maintains that the December 13, 2005 e-mail from Mr. Sziter clearly indicates that he agreed on behalf of the Defendant to a one-time extension to March 1, 2006, and that no waiver of any of the insurer's rights under the policy was intended. The Court does not disagree with Unitrin's contention that the courts have found that time limits for commencement of actions as set forth in insurance policies are enforceable. However, the issue is whether those time limits can be waived by the actions of the insurer. The Van Ackers contend that such a waiver occurred, as indicated by Mr. Sziter's e-mail dated subsequent to the March 1, 2006 deadline, in which he admitted he had not been available to review certain documents. They maintain that the e-mails create a fact question as to the issue of waiver, which must await resolution at trial.
Nevertheless, the Court must find that the Plaintiffs have not met their burden of demonstrating the existence of any material triable issue of fact as to waiver or estopel. In Gilbert Frank Corporation v Federal Insurance Company, 70 NY2d 966 (1988) the Court of Appeals held as follows:
"Evidence of communication or settlement negotiations between an insured and its insurer either before or after expiration of a limitations period contained in a policy is not, without more, sufficient to prove waiver or estoppel (citations omitted). Waiver is an intentional relinquishment of a known right and should not be lightly presumed. (citations omitted). Plaintiff offers no evidence from which a clear manifestation of intent by defendant to relinquish the protection of the contractual limitations period could be reasonably inferred (citations omitted). Nor do the facts show defendant, by its conduct, otherwise lulled plaintiff into sleeping on its rights under the insurance contract. (citations omitted). Indeed, since the conduct complained of occurred subsequent to expiration of the limitations period, plaintiff could not have relied on that conduct in failing to timely commence its action" (at page 968). (emphasis added)
Based on the evidence presented by the Plaintiffs, this Court must find that the circumstances do not rise to the level of a waiver of the statute of limitations by the insurer. While there is evidence of ongoing negotiations between the parties, such negotiations, without more, do not meet the burden imposed by the Court of Appeals on the insured of demonstrating the existence of any "material triable issue of fact." The Court also notes that the Plaintiffs waited an additional four months after the April 11, 2006 e-mail to commence their action.
In view of the Court's decision regarding the untimeliness of the action, it is not necessary that the Court reach the issue as to whether the Defendant's motion to dismiss the Plaintiffs' cause of action based on bad faith should be dismissed. Were the Court to consider the issue, it would conclude that an action for punitive damages for failing to negotiate in good faith does not lie against Unitrin, in that the Plaintiffs have failed to allege the elements necessary to support a cognizable cause of action in tort which is "independent of the contract". ( New York University v. Continental Insurance, Co., 87 NY2d 3081 (1995). (See also, C-Kitchen Associates, Inc. v. Travelers Insurance Co. , 11 AD3d 961 (4th Dept, 2004)).
Therefore, the Defendant Unitrin's motion to dismiss the Plaintiffs' action as untimely is granted, and the Plaintiffs' action is hereby dismissed with prejudice.
This Decision constitutes the Order of the Court.