Opinion ID: 900685
Heading Depth: 1
Heading Rank: 8

Heading: Timely Submittal of Proof of Loss

Text: [¶ 29.] Auto-Owners next argues that Hansen Housing failed to submit sworn proof of loss forms for damage to the building within sixty days after request by Auto-Owners, as provided in the policy. Auto-Owners contends that there was neither compliance with, nor a waiver of, this provision. The trial court held that Auto-Owners waived the requirement by its conduct. [¶ 30.] We do not agree with the trial court that Auto-Owners waived the sixty-day requirement. Waiver is a volitional relinquishment, by act or word, of a known, existing right conferred in law or contract. Harms v. Northland Ford Dealers, 1999 SD 143, ¶ 17, 602 N.W.2d 58, 62 (citation omitted). See Norwest Bank South Dakota v. Venners, 440 N.W.2d 774, 775 (S.D.1989) (To support the defense of waiver, there must be a showing of a clear, unequivocal and decisive act or acts showing an intention to relinquish the existing right.). Nonetheless, we conclude that Hansen Housing's failure to strictly comply with the policy provision will not bar recovery. [¶ 31.] Hansen Housing returned requested sworn proof of loss forms to Auto-Owners on April 19, 1993, within sixty days of their request. Auto-Owners rejected these forms because they contained deficiencies, and required that new forms be completed. This second set of forms was not returned until April of 1994. However, Auto-Owners and Hansen Housing were negotiating a settlement in November and December of 1992. As Justice Sabers recognized in City of Ft. Pierre v. United Fire and Casualty Co., 463 N.W.2d 845 (S.D.1990): The modern view of notice requirements focuses on the purpose for the requirement and realizes that it is not to provide a technical escape hatch to allow the insurance company to deny coverage. The modern view does not belittle the need for notice to the insurer, but instead puts the notice requirement in its proper perspective. The clear purpose of the notice provision is to protect the ability of the insurer to prepare a viable defense by preserving its ability fully to investigate the accident. [ Great American Ins. Co. v. C.G. Tate Constr. Co., 303 N.C. 387, 279 S.E.2d 769, 775 (1981) ]. In other words, notice requirements are included in insurance contracts to protect the insurance company's interest from being prejudiced. If delayed notification has not prejudiced the insurer's ability to defend a claim, then there is no reason to strictly enforce the notice requirement. As the court explained in [ Brakeman v. Potomac Ins. Co., 472 Pa. 66, 371 A.2d 193, 197 (1977)]: Where the insurance company's interests have not been harmed by a late notice, even in the absence of extenuating circumstances to excuse the tardiness, the reason behind the notice condition in the policy is lacking, and it follows neither logic nor fairness to relieve the insurance company of its obligation under the policy in such a situation. City of Ft. Pierre, 463 N.W.2d at 851-52 (Sabers, J., dissenting). Auto-Owners was not prejudiced by the delay in return of the proof of loss form. During the course of negotiations Auto-Owners undoubtedly became familiar with the losses Hansen Housing experienced. The purpose of the notification clause was fulfilled.