Cray v. Hartford Fire Ins.

| U.S. Circuit Court for the District of Connecticut | Apr 15, 1848

NELSON, Circuit Justice.

1. The fourteenth condition of the policy, providing that no action shall be sustained against the company founded thereon, unless brought within the term of twelve months after the cause of action shall have accrued, affords, in our judgment, a conclusive answer to the bill of complaint. The bringing of the suit within this period is made a condition subsequent to the right of the insured to recover the loss. The policy was entered into and the risk assumed with express reference to this among other conditions; all which must, therefore, be regarded in expounding the rights and obligations of the parties under the contract. It stands upon the footing of the other conditions to be found therein; such as giving notice of the loss, delivering a particular account of the same, properly verified, producing books of account, &c. It is not against law, nor repugnant, nor impossible, and may be vex’y material to the rights and interests of the party in whose favor it is made. IVe have been referred to no statute or principle of the common law forbidding such a condition. Originally, there was no limitation to actions. Blackmore v. Tidderley, 2 Ld. Iiaym. 1099; People v. Gilbert, 18 Johns. 228; Perham v. Raynal, 2 Bing. 300; Wilk. Lim. 2 et seq. The act of 21 Jac. I. (1023) the first general statute on the subject, provided that suits should be brought within six years after the cause of action had accrued, “and not after.” But there is nothing in this act forbidding a limitation short of this period, by the stipulation of the parties. It only prohibits the suit after the six years. The common law gave to the party an indefinite time to bring an action. The act simply limited the time to the given period. There might be some force in the argument, that an agreement to extend the time beyond the statutory limit was against law and void, but there is none as respects a limitation short of it. Even in the former case it has been held, notwithstanding the positive terms of the act, namely, that suits should be brought within six years and not after, that the benefit of the provision may be waived by the act of the parties. Wilk. Lim. 52, 53, and cases there cited. This may be done during the running of the statute, or after the limitation has attached. Why not, then, by a stipulation in the contract itself? And, why may not the limitation be restrained in the same way? We cannot doubt that, before St. 21 Jac. I. it was competent for the parties, by a clause in their contract, to limit the time within which, in case of a breach, an action should be brought As the period was then indefinite, there could be no limit, unless it was thus fixed. There is nothing in the act, necessarily or by fair construction, taking away this right The case of an agreement to refer to arbitration is not analogous. That is deemed inoperative on the ground of an attempt to oust the jurisdiction of the courts. Kill v. Hollister, 1 Wils. 129; Half hide v. Fenning, 2 Brown, Ch. 336; Wats. Arb. 4, 7, 8. And even that case was at first a matter of contradictory decision. The same may be said of the case referred to of an agreement that a distress for a rent-charge shall be irreplevisable. It is an attempt to take away all remedy for a right that is regarded as incident to the distress, and Inseparable from it. Co. Litt. 145b, 282b; Brac. lib. 4, p. 233a. 233b. These observations are also applicable to the case of an agreement that a mortgage shall be irredeemable. In the case before us there is no attempt to oust the jurisdiction of the courts or to take from the party his appropriate remedy. The condition simply requires vigilance in the pursuit of the remedy, beyond the requirement of the law. The jurisdiction of the court to administer justice in the given case is not interfered with.

[NOTE. See Case No. 3,374.]

2. But the true ground, we are inclined to think, upon which the clause rests and is maintainable, is, that by the contract of the parties, the right to indemnity in case of loss, and the liability of the company therefor, do not become absolute, unless the remedy is sought within the year. The stipulation goes to the right as well as to the remedy. Indeed the time within which the remedy is to be enforced is prescribed for the purpose of reaching and regulating the rights of the insured under the contract. Although the condition is subsequent, it is, if lawful, as operative and binding as a condition precedent; and that it is lawful, as well as a very essential part of the contract, we cannot doubt. The clause contemplates a loss about which a controversy may arise between the insured and the company, and in respect to which the right to indemnity may be denied. The object was not to foreclose it and prevent a resort to the proper tribunal; but to compel a speedy resort, and a termination of the controversy, while the facts were fresh in the recollection .of the parties and witnesses, and the proofs accessible. While It is not perceived to be at all injurious to the rights of the insured, it is manifestly beneficial to the company, who stand on the defensive and are obliged to await the movements of the adversary party. We are of opinion, therefore, that the plea is a good answer to the bill.

After this decision the hill was amended, by setting out reasons for the delay in bringing the suit, and -the case was re argued, but the reasons were held insufficient. Meantime the plaintiff died, and no receiver having been appointed in his place, the case has proceeded no further.