Case Title: Cooperative Fire Insurance Assn. v. White Caps, Inc.

Citation: 166 Vt. 355, 694 A.2d 34

Docket Number: 

State: vermont

Court: Vermont Supreme Court

Date: 1997-03-28T00:00:00Z

Document:
Cooperative Fire Insurance Assoc. v. White Caps., Inc.  (96-258); 166 Vt. 355;
694 A.2d 34

[Filed 28-Mar-1997]

[Motion for Reargument Denied 16-Apr-1997]

       NOTICE:  This opinion is subject to motions for reargument under
  V.R.A.P. 40 as well as formal revision before publication in the Vermont
  Reports.  Readers are requested to notify the Reporter of Decisions,
  Vermont Supreme Court, 109 State Street, Montpelier, Vermont 05609-0801 of
  any errors in order that corrections may be made before this opinion goes
  to press.

                                 No. 96-258

Cooperative Fire Insurance                        Supreme Court
Association of Vermont
                                                  On Appeal from
     v.                                           Addison Superior Court

White Caps, Inc., City of Burlington              November Term, 1996
and David Stancil

Matthew I. Katz, J.

       Richard P. Foote of Conley & Foote, Middlebury, for
  plaintiff-appellant

       John T. Leddy of McNeil, Leddy & Sheahan, Burlington, for
  defendant-appellee City of Burlington

       John L. Kellner and Kevin E. Brown of Langrock Sperry & Wool,
  Middlebury, for intervenor-appellee Stancil

PRESENT:  Allen, C.J., Gibson, Dooley, Morse and Johnson, JJ.

       MORSE, J.   Traditionally, an insurer was released from its
  contractual obligations if its insured committed an unexcused breach of the
  prompt-notice provisions of the policy, regardless of whether the insurer
  was prejudiced by the delay.  Past decisions of this Court have adhered to
  this rule when the policy plainly makes notice a condition precedent to
  coverage. See Nelson v. Travelers Ins. Co., 113 Vt. 86, 98, 30 A.2d 75, 82
  (1943); Houran v. Preferred Accident Ins. Co., 109 Vt. 258, 272-74, 195 A. 253, 259-60 (1938).  During the past several decades, however, the
  traditional view has been largely supplanted, and a majority of
  jurisdictions now apply the rule that an insurer must prove it was
  prejudiced from the delay

 

  before it may be relieved of its duties.  See generally Annotation, Modern
  Status of Rules Requiring Liability Insurer to Show Prejudice to Escape
  Liability Because of Insured's Failure or Delay in Giving Notice of
  Accident or Claim, or in Forwarding Suit Papers, 32 A.L.R.4th 141, 157-59
  (1984) (collecting cases).  Although this Court has recognized the recent
  trend of decisions, see Putney School, Inc. v. Schaaf, 157 Vt. 396, 405,
  599 A.2d 322, 327 (1991), it has not heretofore had occasion to reexamine
  its earlier holdings.  But cf. Dumont v. Knapp, 131 Vt. 342, 349-50,