Hahn Automotive Warehouse, Inc. v. American Zurich Insurance, 18 N.Y.3d 765

Hahn Automotive Warehouse, Inc. insured by Zurich for period 1992–2003 under multiple policy types, including retrospective premium, adjustable deductible, deductible, and claim services contracts.
Zurich discovered unbilled claim deductibles and allocated loss adjustment expenses in 2005 for 1995–1996 policies and sent three invoices in 2005–2006 seeking payment.
Hahn challenged whether Zurich’s six-year contract statute of limitations ran from when Zurich possessed the right to demand payment or from later invoicing.
Lower courts held accrual occurred when Zurich had the right to demand payment, not when invoices were issued, and that earlier debts may be time-barred.
The Court of Appeals affirmed the accrual-at-right-to-demand rule for these insurance contracts, rejecting an accrual-upon-demand interpretation proposed by the dissent.
The decision discusses the interplay of retrospective premium adjustments, billing timelines, and the effect of contract terms on accrual of breach claims.

Issue	Plaintiff's Argument	Defendant's Argument	Held
When do Zurich’s breach claims accrue for retrospective/adjustable insurance arrangements?	Hahn argues accrual occurs when payment is refused or invoiced.	Zurich contends accrual starts when Zurich has right to demand payment.	Accrual begins when Zurich has the right to demand payment.
Does the accrual rule apply uniformly to all policy categories (retrospective, deductible, claim services)?	All sums owed under various categories accrue at the same point.	Different categories may adjust accrual based on their contract terms.	Yes, accrual applies based on the right to demand payment under the contracts.
Is the accrual-upon-demand rule appropriate for retrospective premium agreements?	Dissent argues for accrual only on demand after invoices.	Majority rejects accrual-upon-demand; argues earlier right to demand suffices.	Accrual upon the right to demand payment, not upon invoicing, governs retrospective premiums.
Does condition-precedent language in Kassner constrain accrual here?	Dissent argues payment accrues only after Zurich’s demand conditioned by predicates.	Contracts lack unambiguous condition-precedent language tying accrual to Zurich’s own demand.	No unconditional condition-precedent requiring Zurich’s demand; accrual not delayed by lack of demand language.

Minskoff Grant Realty & Mgt. Corp. v 211 Mgr. Corp., 71 AD3d 843 (2d Dept 2010) (accrual when the creditor possesses a legal right to demand payment)
Kuo v Wall St. Mtge. Bankers, Ltd., 65 AD3d 1089 (2d Dept 2009) (accrual for contract-based payment claims upon right to demand)
Swift v New York Med. Coll., 25 AD3d 686 (2d Dept 2006) (accrual upon right to payment for asserted sums)
Kingsley Arms, Inc. v Copake-Taconic Hills Cent. School Dist., 9 AD3d 696 (3d Dept 2004) (accrual when creditor has right to demand payment)
Albany Specialties v Shenendehowa Cent. School Dist., 307 AD2d 514 (3d Dept 2003) (accrual tied to right to payment in contract context)
Aetna Life & Cas. Co. v Nelson, 67 NY2d 169 (1986) (general accrual principles for contract actions)
John J. Kassner & Co. v City of New York, 46 NY2d 544 (1979) (condition precedent concepts relevant to accrual timing)
Town of Brookhaven v MIC Prop. & Cas. Ins. Corp., 245 AD2d 365 (2d Dept 1997) (warns against prolonging statute via failure to demand)
State of New York v City of Binghamton, 72 AD2d 870 (3d Dept 1979) (statute accrual context in public entity decisions)