Black v. Winneshiek Insurance

Cole, J. This is an action upon a policy of insurance. The only defense set up and relied on in the answer is, that the action was not brought within twelve months after the loss occurred, according to the terms of the policy. It appears that the loss occurred on the 17th of October, 1869, and that the complaint was served on the 7th of November, 1870. It is stated in the complaint, and not in any way controverted, that the amount of loss sustained by the fire was adjusted between the assured and the company on the 6th of November, 1869, when the parties entered into an agreement in writing by which the assured agreed to accept the amount adjusted and determined in full payment of his loss, and the company promised to pay that amount on the 6th of February, 1870, unless the assured should be notified by the company before that time, either personally or by letter, of its intention to contest its liability under the policy for the loss. The company gave no notice of any kind of its intention to contest its liability upon the policy. Excluding from the computation the period from November 6, 1869, to February 6, 1870, it is apparent that the action was brought within the limitation specified in the policy. And the question is, should not that time be excluded in the computation? We are very clear in the opinion that it should be. On the adjustment of the loss, the company agreed to pay, and the assured agreed to receive, three fourths of the amount insured, on the 6th of February, 1870, unless it notified the assured of its intention to contest its liability. I cannot see why this was not a valid agreement, made upon a sufficient consideration. But, suppose it was not. Every principle of honesty and fair dealing requires that the limitation should not run during the time mentioned in the agreement, in as much as the company failed to notify the assured that it intended to contest 77 its liability upon the policy. He bad a right to assume that the company would either pay the amount adjusted and agreed to be paid on the 6th of February, or notify him that it did not intend to pay, and that he would be driven to his legal remedy. And this time during which he was induced by the act of the company to delay bringing suit, should not be considered any part of the twelve months to which his action was limited. This point was so decided in the case of Killips v. Putnam Fire Insurance Co., 28 Wis., 472; and the decision rests upon the clearest and firmest principles of law and morality. It was there said by Mr. Justice Lyon, that the time lost by the plaintiff, without any fault on his part but through the fault of the defendant, should be added to the time within which the parties in the first instance contracted that the action should be commenced, and that the plaintiff is not barred until such additional time has expired. That case is decisive of the one before us. By the Court.- — -The judgment of the circuit courtis affirmed.