Case Title: Suire v. Combined Insurance Company of America

Citation: 290 So. 2d 271

Docket Number: 

State: louisiana

Court: Louisiana Supreme Court

Date: 1974-02-18T00:00:00Z

Document:
290 So. 2d 271 (1974) Rita Dore SUIRE v. COMBINED INSURANCE COMPANY OF AMERICA. No. 53941. Supreme Court of Louisiana. February 18, 1974. Stephen A. Stefanski, Edwards, Stefanski & Barousse, Crowley, for plaintiff-applicant. Paul J. Breaux, Allen & Gooch, Ltd., Lafayette, for defendant-respondent. SANDERS, Chief Justice. The plaintiff, a named beneficiary, brought this action for death benefits pursuant to the terms of an accident indemnity policy, discovered some eight years following her husband's death. The district court dismissed the action on an exception of no cause of action, because of plaintiff's failure to sue within the delay fixed by the policy. The Court of Appeal affirmed the judgment. 281 So. 2d 153. We granted certiorari, at 283 So. 2d 495, to determine whether lack of knowledge of the existence of an insurance policy can excuse the failure of a beneficiary to sue within the policy time limits. We hold that it can. The pertinent policy provisions are as follows: "(7) Proofs of loss: . . . . . . Under the foregoing provisions, the maximum delay for filing suit is four years and 90 days after the loss. Here, Mr. Suire, the insured, lost his life in an accident on September 6, 1962. It was not until 1970, eight years later, that Mrs. Suire found the policy while searching through papers and records she had only then discovered. The petition alleges that she gave immediate notice to the insurer, but the insurer refused to pay. She then filed suit on May 18, 1972. The institution of the suit, of course, was long after the time fixed in the insurance policy. In the absence of a statutory prohibition, a clause in an insurance policy fixing a reasonable time to institute suit is valid. Tracy v. Queen City Fire Ins. Co., 132 La. 610, 61 So. 687 (1913); Muse v. Heine, La.App., 189 So. 2d 40 (1966), cert. den., 249 La. 734, 190 So. 2d 241 (1966); 44 Am.Jur.2d, Insurance, § 1906, p. 842; 46 C.J.S. Insurance § 1256, p. 271. Such a time limitation will be enforced against a beneficiary, unless there is a legal basis for excusing compliance. The general rule is that the beneficiary's failure to file suit within the time limit because of ignorance of the existence of the insurance policy does not defeat recovery, when non-discovery of the policy was due to no fault of the beneficiary. Harper v. People's Industrial Life Insurance Co., La. App., 123 So. 2d 667 (1960); McElroy v. John Hancock Mut. Life Ins. Co., 88 Md. 137, 41 A. 112 (1898); 44 Am.Jur.2d, Insurance, § 1915, p. 853; Annot., 28 A.L.R. 3d 292 (1969). See also 44 Am.Jur.2d, Insurance, § 1471, pp. 339-340. The general rule is correctly stated in 44 Am.Jur.2d, Insurance, § 1915, p. 853 as follows: The Fourth Circuit Court of Appeal recognized the existence of this rule in Harper v. People's Industrial Life Insurance Co., supra, when the court noted: In at least two decisions, relating to delays in giving notice of loss to insurers, this Court has recognized the merit of the general rule. In Jackson v. State Farm Mut. Automobile Ins. Co., 211 La. 19, 29 So. 2d 177 (1946), we held: In an earlier decision, Konrad v. Union Casualty & Surety Co., 49 La.Ann. 636, 21 So. 721 (1897), this Court held that under a policy requiring immediate notice of loss, the notice was timely when given after the plaintiff gained knowledge of the policy. The Court stated: Insofar as the allegations of the petition disclose, plaintiff is a good faith claimant, who through no fault of her own discovered the existence of the policy after the policy time limit had expired. The circumstances surrounding the discovery of the policy are matters of proof at the trial. If the failure to timely discover the insurance policy was due to no fault of plaintiff, it would work an injustice to deny recovery because of the delay in filing suit. She had no knowledge of the existence of a right to benefits until she became aware of the existence of the policy. We conclude that she has alleged a cause of action. For the reasons assigned, the judgment of the Court of Appeal is reversed, the peremptory exception is overruled, and the case is remanded to the district court for further proceedings according to law and consistent with the views herein expressed. All costs in the appellate courts are assessed against the defendant, Combined Insurance Company of America. All other costs shall await the final disposition of the suit. DIXON, J., concurs.