Court Opinion

ID: 9746983
Source: CourtListenerOpinion
Date Created: 2023-08-27 14:49:46.014178+00
Date Added: 2024-06-11T07:25:19.023918
License: Public Domain

Barney, J.,
Concurring. I am in full accord with the result reached in this case. This concurrence is advanced only to suggest my concern about the present state of our law about notice provisions in insurance policies. There is no doubt but that there is and must be a duty imposed on a policyholder to do his best to post his insurer concerning potential liability involving his insurer as soon as he can reasonably do so.
It is also quite apparent that, in cases like the present, courts tend to view the facts and test the reasonableness of policyholders who fail to give what might otherwise be immediate notice in a way that avoids making the defense of lack of notice operate to discharge the insurer. United States Fidelity & Guaranty Co. v. Giroux, 129 Vt. 155, 161, 274 A.2d 487 (1971). See also United States Fidelity & Guaranty Co. v. Gable, 125 Vt. 519, 523, 220 A.2d 165 (1966). Houran v. Preferred Accident Insurance Co., 109 Vt. 258, 195 A. 253 (1938), and Nelson v. Travelers Insurance Co., 113 Vt. 86, 30 A.2d 75 (1943), treat the notice provision of the policy as a *350condition precedent to performance by the insurer, irrespective of any showing of prejudice. Subsequent courts, in cases such as United States Fidelity & Guaranty Co. v. Gable, supra, have been driven to resolve the presence of prejudice under the heading of reasonableness. Stonewall Insurance Co. v. Moorby, 130 Vt. 562, 298 A.2d 826 (1972).
Since treating the requirement of notice as a condition precedent can lead to the loss of all policy protection, without any examination as to its actual effect on the insurer’s ability to defend, I would favor reexamination of the holdings of Houran v. Preferred Accident Insurance Co., supra, and Nelson v. Travelers Insurance, Co., supra. At the very least, it would seem that the measure of loss of insurance coverage ought not to outrun the demonstrated prejudice to the insurer, rather than leaving it as an all or nothing proposition as it now is. The present penalty now so far outreaches the purposes of the provision as to leave insureds subject to the withdrawal of protection for trivial reasons. This is an in-, vidious kind of forfeiture that can be damaging to both an unwary insured and an innocent injured.