Suit Limitation Period
Davied Zvi Van Der Velde v. New York Property Insurance Underwriting Association, 2019-11557 (App. Div. 2d Dept., May 18, 2022)
Plaintiff sued New York Property Insurance Underwriting Association (“NYPIUA”) for coverage of water damage to premises. Since the suit had begun several years after the expiration of the two-year suit limitation period of plaintiff’s policy, NYPIUA moved for summary judgment pursuant to CPLR 3211(a)(5), showing that the suit limitation period had expired. The court below granted summary judgment.
On his appeal to the Appellate Division, plaintiff maintained that the wrongful denial of coverage waived any further rights under the policy, such as the suit limitation period, allowing plaintiff to sue within the statutory six year statute of limitations for contracts. The Appellate Division affirmed the denial below, holding, “In opposition, the plaintiff contended that the contractual limitations period was unenforceable because the defendant waived its right to demand compliance with that provision when it repudiated liability and refused to pay the plaintiff’s claims on other grounds. The plaintiff’s contention is without merit.” The court went on to discuss that while waiver can be found in other situations, such as making demands of plaintiff after a denial, the assertion of the suit limitation period did not constitute such a waiver. It held that, “The contractual limitations period operates as a defense to an action and it thereby limits a party’s right to enforce the policy.”
The court’s decision reaffirms the right of insurers to shorten the statutory limitations period and further, that waiver of the shortened period must be clearly demonstrated to avoid that period.
Per curium decision (Panel: Iannacci, Miller, Zayas, Dowling).
The decision can be read here.