Ball v. Allstate Ins. Co.

• Decision Date: 30 March 1993
• Citation: 611 N.E.2d 750,595 N.Y.S.2d 711,81 N.Y.2d 22
• Parties: , 611 N.E.2d 750 Michael A. BALL et al., Appellants, v. ALLSTATE INSURANCE COMPANY, Respondent, et al., Defendant.
• Court: New York Court of Appeals Court of Appeals

Page 711

595 N.Y.S.2d 711

81 N.Y.2d 22, 611 N.E.2d 750

Michael A. BALL et al., Appellants, v. ALLSTATE INSURANCE COMPANY, Respondent, et al., Defendant.

Court of Appeals of New York.

March 30, 1993.

Weg and Myers, P.C., New York City (Dennis T. D'Antonio aNd myrLE L. horvitz, of counsel), for appellants.

Feldman & Rudy, Westbury (Stuart D. Markowitz, of counsel), for respondent.

OPINION OF THE COURT

PER CURIAM.

Insurance Law § 3407 provides that the failure to furnish proofs of loss as specified in a contract of insurance shall not result in a forfeiture or diminution of a claim unless the insurer gives the insured written notice that it requires proofs of loss. It further provides:

"If the insured shall furnish proofs of loss within sixty days after the receipt of such notice and such form or forms, or within any longer period of time specified in such notice, such insured shall be deemed to have complied with the provisions of such contract of insurance relating to the time within which proofs of loss are required" ( § 3407[a]; emphasis added).

The issue presented by this appeal is whether the requirement of the statute is satisfied when an insured places proofs of loss in the mail within 60 days but they are not received by the insurer until after the 60 days has expired. We hold that proofs of loss are "furnish[ed]," within the meaning of the statute, when they are placed in the mail, not when they are received by the insurer.

After plaintiffs sustained a loss exceeding $128,000 when their home was burglarized, they turned to their insurer, defendant Allstate Insurance Company, for indemnification. On March 13, 1989, they received, by certified mail, a written demand for proofs of loss from Allstate's counsel. In compliance with Insurance Law § 3407, plaintiffs were asked "to furnish the completed and executed Sworn Statement in Proof of Loss to this law firm within sixty (60) days after * * * receipt of this notice." On May 10, 58 days after receipt of the written demand, plaintiffs executed the proofs of loss and mailed them to Allstate's counsel by certified mail. They allege that this mailing complied with the statutory requirement that proofs be "furnish[ed]" within 60 days.

The proofs were not received by Allstate, however, until May 16, 64 days after receipt of the written demand. Thus, Allstate contends that plaintiffs failed to fulfill the statutory requirements because the proofs of loss must be received, rather than mailed, within the statutory period. Allstate relies on Peabody v. Satterlee, 166 N.Y. 174, 59 N.E. 818 in which this Court determined that where a policy provision required the insured to "render" proofs of loss within 60 days, mailing on the 60th day was insufficient to comply with the policy provision (Peabody v. Satterlee, 166 N.Y., at 179, 59 N.E. 818, supra). Peabody was decided in 1901, before the Insurance Law was recodified and section 3407 (formerly § 172) added. Thus, the decision not only addressed a different term ("render" rather than "furnish") but also interpreted a contract, not a remedial statutory provision. We are called upon to determine whether its holding must control our interpretation of the statute.

Generally, statutory language is to be construed according to its most obvious and natural meaning (see, McKinney's Cons. Laws of N.Y., Book 1, Statutes § 94). The term "furnish", meaning "to provide" or to "supply with" (Webster's Third International Dictionary 923), does not unambiguously indicate whether deposit in the mail suffices (but see, Auto-Owners Ins. Co. v. Gallup, 191 Mich.App. 181, 477 N.W.2d 463, 464 [provision requiring proofs of loss to be "render(ed)" in 60 days satisfied if placed in mail within that period]. Thus, we must look beyond the language, to the purpose the Legislature sought to accomplish when it enacted the statute (see, Wiley v. Solvay Process Co., 215 N.Y. 584, 109 N.E. 606).

Manifestly, the Legislature acted to protect insureds from unknowing forfeitures. By requiring that insurance claimants be alerted to their duty to furnish proofs of loss and extending the time period in which to comply, the Legislature sought to "protect 'the insured from the consequences of * * *...