Farr v. Travelers Indem. Co.

• Decision Date: 16 October 1975
• Citation: 375 N.Y.S.2d 229,84 Misc.2d 189
• Parties: William G. FARR and Diane B. Farr, Individually and as husband and wife, Plaintiffs, v. The TRAVELERS INDEMNITY COMPANY, Defendant.
• Court: New York Supreme Court

Page 229

375 N.Y.S.2d 229

84 Misc.2d 189

William G. FARR and Diane B. Farr, Individually and as husband and wife, Plaintiffs, v. The TRAVELERS INDEMNITY COMPANY, Defendant.

Supreme Court, Erie County.

Oct. 16, 1975.

Ronald Willig, Buffalo, for plaintiffs.

Brown, Maloney, Gallup, Roach & Busteed, Buffalo, for defendant.

ARTHUR C. AULISI, Justice.

In this action, tried before the Court without a jury, the plaintiffs seek to recover benefits under a medical payment provision of an automobile liability insurance policy issued by the defendant to the plaintiffs.

Under the pertinent provision, defendant agreed 'to pay all reasonable expenses incurred within one year from the date of accident' for necessary medical, surgical, hospital and other related services 'to or for the named insured * * * who sustains bodily injury * * * caused by accident * * * while occupying the owned automobile'. The coverage provided is limited to $5,000.00.

On September 21, 1970, the plaintiff wife, while operating the covered automobile, became involved in an accident and suffered bodily injury. As a result of the injuries sustained, she was required to undergo surgery on two separate occasions. The operation on her lower back was performed on or shortly after September 30, 1971, while the operation on her neck was performed on or shortly after June 18, 1972. It was stipulated that all services rendered for her injuries were necessary and related to the accident; that the bills for such services were reasonable; and that the total expense was in excess of the policy limits. Before action was instituted, defendant paid to the plaintiffs the sum of $572.70, for expenses incurred within the one year period, but, upon the trial, it was conceded that the billings up to September 21, 1971 amounted to $665.00. The only point of contention between the parties is whether the expenses in excess of $665.00 were 'incurred' within one year from the date of the accident.

The precise question raised has been considered by the courts in this and other States. In some jurisdictions, it has been held that a medical expense is not incurred until the medical service which gives rise to the medical expense has been performed. (See, e.g., Reliance Mut. Life Ins. Co. v. Booher, 1964, Fla.App., 166 So.2d 222, 10 A.L.R.3d 458). In other jurisdictions, the insurer has been held liable for medical services which became necessary but were not performed within the stated time period, where the insured contracted for the services of the physician before the expiration of the time period and either paid in advance (Maryland Cas. Co. v. Thomas, 289 S.W.2d 652, Texas) or became obligated to pay (Drobne v. Aetna Cas. & Sur. Co., 66 Ohio L.Abst. 1, 115 N.E.2d 589) for his services.

The courts of New York have adopted the more liberal construction of the term involved. In Whittle v. Government Employees Ins. Co., 51 Misc.2d 498, 273 N.Y.S.2d 442, the Appellate Term, 2nd Dept., held, at page 499, 273 N.Y.S.2d at p. 443, that 'the word 'incurred' * * * must be deemed to include any liability undertaken within a year of the accident for reasonable medical services necessitated as a result of the accident, irrespective of the time within which such services are completed. In Perullo v. Allstate Ins. Co., 54 Misc.2d...