Taylor v. Royal Globe Insurance

VAUGHN, Judge. Plaintiffs claim against defendant under an insurance policy which requires that notice of any accident shall be given to the insurer by the insured as soon as is practicable. This is an enforceable provision of the contract and has been interpreted to mean that notice should be given as soon as the insured is capable of doing so. See the concurring opinion of Parker, J. in Muncie v. Travelers Insurance Co., 253 N.C. 74, 116 S.E. 2d 474 (1960). The court, sitting without jury, found from competent evidence that plaintiffs first gave defendant notice of loss eight months and twenty-one days after the accident occurred. There was no evidence that either plaintiff was under any disability nor was there any evidence to show that plaintiffs could not contact defendant due to any fault of defendant. The court, therefore, correctly held that plaintiffs had not complied with a condition precedent to any suit against defendant. Plaintiffs contend that the facts show waiver of the notice requirement by defendant both when it denied liability on other grounds, the contract exclusion clause, and when it investigated the accident by sending in its adjuster. The essential elements of a waiver are (1) the existence of a right, advantage or benefit; (2) knowledge of its existence; and (3) an intention to relinquish it. Davenport v. Travelers Indemnity Co., 283 N.C. 234, 195 S.E. 2d 529 (1973). The rule in North Carolina is that the denial of liability on another ground operates as waiver of the notice requirements, being regarded as a statement that payment would not be made even though policy provisions had been complied with. Davenport v. Travelers Indemnity Co., supra. However, defendant in this case presented its two grounds for denial together in the letter to plaintiffs denying coverage and continued to present them as alternatives throughout the action. At no time can defendant be *153 said to abandon the defense of failure to fulfill the conditions precedent in favor of reliance on the exclusion clause. Generally, the mere investigation of a loss by the insurer will not operate as a waiver of noncompliance with the notice provisions of a liability insurance policy. Only where circumstances lead the insured to believe that he has fulfilled his duties will he be allowed to press his claim without having complied with the policy. See 18 A.L.R. 2d 443, §§ 30-35. There was no evidence that defendant at any time promised coverage or caused plaintiffs to believe that they were in compliance with the policy. Cases of waiver under this rule generally involve situations where notice of the accident was properly given and the insured was lulled into not giving proper notice of an action against him. See 18 A.L.R. 2d, supra. Defendant clearly made the investigation under reservation of rights, and plaintiffs were not relieved thereby from their failure to give proper notice. Since the judgment is affirmed, it is not necessary to consider the questions raised by defendant’s appeal. Affirmed. Judges Britt and Parker concur.