Court Opinion

ID: 9599042
Source: CourtListenerOpinion
Date Created: 2023-08-22 01:13:58.634676+00
Date Added: 2024-06-11T18:01:43.866407
License: Public Domain

HOLOHAN, Chief Justice
dissenting:
Although professing not to rewrite the insurance contract, the court proceeds to do just that. I note my dissent to such action.
The one-year limitation clause in the policy at issue is common throughout the insurance industry. The cases upholding the validity of similar provisions are legion. A number of jurisdictions, without benefit of statutory authority, have held such limitation provisions to be enforceable. See An-not., 6 A.L.R.3d 1197, 1210-11 (1966).
The court acknowledges that there are reasonable grounds for requiring a shorter limitation period for bringing property damage claims on insurance contracts. Whether this court concedes the point is not very important because the legislature has recognized the fact by specifically authorizing property insurance policies to contain a shorter period of limitation than that provided for other contract claims. A.R.S. § 20-1115.
The majority, citing Planet Construction Corp. v. Board of Education, supra, contend that the legislative action does not raise the insurance claim limitation clause to the dignity of a statute of limitation. It should be noted that the case relied upon is rarely cited for the foregoing proposition. The important fact is that the legislative policy has been clearly set forth, and absent such policy statement by the legislature, it is debatable whether such a clause would be enforceable in Arizona. Cf. Ross v. Ross, supra. The statute, A.R.S. § 20-1115, removes all doubt on the issue by specifically allowing an insurance contract to provide for a shorter period than the general statute of limitation within which action must be brought on a property insurance claim.
The court’s decision today, for all practical purposes, frustrates the legislative policy by eliminating the shorter period of limitation in the insurance contract. The new clause written for the parties by the majority translates into a statement that the one-year limitation will not be enforced if a court thinks that the enforcement of the period of limitation would be unjust. This standard, or non-standard, is advanced by the court as a “rule consistent with the modern-day business methods of the insurance industry.”
The present decision destroys what I view as the public policy of this state. The rule fashioned today so severely limits the legislative-approved limitation clause that it virtually repeals it.