Fiduccia v. Intercontinental Restauranteurs, Inc.Fiduccia v. Intercontinental Restauranteurs, Inc.
The opinion of the court was delivered by
This appeal requires us to determine the length of a “day” as the term is used in the cancellation provisions of the Insurance Premium Finance Company Act (the Act), N.J.S.A. 17:16D-1 to - 16. We hold that a “day” consists of twenty-four hours and not one minute as prescribed by the language of the insurance policy in question, and the coverage extended until the stroke of midnight at the end of the third day.
The facts are not in dispute. Third-party defendant Newark Insurance Company (Newark)
On March 21,1992, at approximately 10:00 p.m., plaintiff Diana Fiduceia was injured when she slipped and fell at Carina’s Italian Family Restaurant in Kinnelon. Carina’s was operated on property owned by defendant. Newark disclaimed coverage asserting that its policy was canceled effective 12:01 a.m. on March 21, some twenty-two hours before the accident occurred.
Newark relies on the provisions of N.J.S.A 17:16D-13 which provides, in relevant part:
After expiration of such 10-day period [after the filing of the Notice of Intent to Cancel], the premium finance company may thereafter request in the name of the insured, cancellation of such insurance contract or contracts by mailing to the insurer a notice of cancellation The effective date of such cancellation shall not be earlier than 3 days after the date of mailing of such notice to the insured and to the insurance agent or insurance broker.
[N.J.S.A 17:16D-13(c) (emphasis added) ].
Newark asserts that the provisions of its policy read in conformity with the statute allow cancellation at 12:01 a.m. on the third day after notice.
We have previously discussed the function and import of the notice of cancellation and the requisite three-day provision in Wright v. Rumble, 194 N.J.Super. 337,
The “notice of cancellation” is given after the insured has failed to cure the default. He already knows from the "notice of intent to cancel” that the finance*55 company may now cancel at any time. The notice of cancellation advises the insured that the finance company cancelled the policy. Its function is simply to alert the insured that he is no longer insured by the policy. Whenever he receives it, the insured can no longer prevent cancellation if the notice of intent to cancel was adequate.
In order to prevent terminating coverage before the insured has a chance to be aware of cancellation, the statute provides that “cancellation shall not be earlier than 3 days after the date of mailing of [the notice of cancellation].” This allows time for mail delivery of the notice. Thus no matter when the finance company requests the insurer to cancel, the statute establishes the effective date of cancellation as three days after the finance company mails notice of cancellation to the insured unless the insurer cancels at a later date.
[Id. at 342-43,476 A.2d 1250 ].
All parties agree that consistent with well established principles, the day in dispute is the third day — March 21,1992 — after the day of mailing — March 18, 1992. 809-811 Washington Street Associates v. Grego, 253 N.J.Super. 34, 46,
Although no reported New Jersey case has addressed the time of day that the cancellation is effective, other jurisdictions and legal commentators have spoken to the issue. Of those jurisdictions, the general rule where no time is specified in the notice is that only whole days, not fractions thereof, are considered. Conley v. Ratayzcak, 92 Ill.App.3d 29, 46 Ill.Dec. 616, 620, 414 N.E.2d 500, 504 (1981); Lowe v. O’Meara, 482 F.2d 1373, 1375 (5th Cir.1973) (holding that an attempt to cancel an insurance policy at 12:01 a.m. is of no effect because it conflicts with Louisiana law which provides that, in computation of time, only whole days, not fractions thereof, are considered.); cf. State Compensation Insurance Fund v. Building Systems, Inc.,
Even where a time is specified, some jurisdictions reject such time where the effect is to reduce the statutorily mandated
[t]he notice [ ] was untimely and thus of no effect. The notice [ ] allowed but 12 full days and one minute of the thirteenth day, as against the requirement of 13 days’ notice in case of service by mail.
[Id. 271 N.Y.S.2d at 430-31]
Accord Valley Forge Insurance Co. v. Concord Group Insurance Co.,
Similarly, in Northwestern National Casualty Company v. Thomas, 248 Ark. 989,
Finally, in Nassau Insurance Co. v. Lion Insurance Co.,
Excluding the date of mailing, this provides fourteen (14) days and one (1) minute, twenty-three (23) hours and fifty-nine (59) minutes short____ It is quite apparent, ... that fifteen days notice means fifteen times twenty-four hours.4
*57 [Id. 393 N.Y.S.2d at 283]
And see Couch on Insurance 3d, § 32:49 (West Group rev.1995) (noting that “[w]here a policy reads ‘five days from the receipt of notice,’ this means midnight of the last day, even though the policy itself runs from noon to noon, so that cancellation will take effect in five days after receipt of the notice, although noon of the fourth is specified as the expiration of the time”).
We perceive no reason why defendant should be permitted to limit the third day of the cancellation period to one minute. Yet such is, indeed, the effect of the 12:01 a.m. cancellation time. The practical impact of such limitation is apparent. A notice mailed on Friday and not reaching an insured until Monday and containing a 12:01 a.m. cancellation provision would result in the insured not receiving the notice until after the policy has been canceled. The legislative purposes for a three-day cancellation notice which we identified in Wright would be meaningless if the insurer were permitted to unilaterally reduce the time.
In a different context involving the calculation of age, we stressed the need for uniformity in calculating time periods, Patterson v. Monmouth Regional High School Bd. of Educ., 222 N.J.Super. 448, 454,
Affirmed.
Notes
Newark was improperly impleaded as Royal Insurance Company.
Plaintiff raises a factual issue as to whether Newark established that the notices were sent. For the purposes of our decision, we will assume, as did the motion judge, that the notices were sent in a timely manner.
Newark’s Notice of Cancellation indicated that the policy would be canceled on March 18, 1992. Newark concedes that this was an error and the earliest date of cancellation was March 21, 1992. The issue in dispute is not the date of cancellation but the time of cancellation.
The concept and common understanding of a "day” containing twenty-four hours is one known to both lexicographers, e.g., "day” means "the mean solar