Lees v. Middlesex Ins. Co.

• Citation: 594 A.2d 952,219 Conn. 644
• Decision Date: 23 July 1991
• Docket Number: No. 14153,14153
• Court: Supreme Court of Connecticut
• Parties: Marion LEES v. MIDDLESEX INSURANCE COMPANY.

Page 952

594 A.2d 952

219 Conn. 644

Marion LEES v. MIDDLESEX INSURANCE COMPANY.

No. 14153.

Supreme Court of Connecticut.

Argued April 30, 1991.

Decided July 23, 1991.

John T. Bochanis, with whom, on the brief, was Thomas J. Weihing, Bridgeport, for appellant (plaintiff).

John B. Farley, with whom, on the brief, were John W. Lemega and Daniel P. Scapellati, Hartford, for appellee (defendant).

Before PETERS, C.J., and SHEA, CALLAHAN, BORDEN and F.X. HENNESSY, JJ.

BORDEN, Associate Justice.

The certified issue in this appeal is whether the Appellate Court correctly concluded that the claims of the plaintiff, Marion Lees, under the Connecticut Unfair Insurance Practices Act (CUIPA); General Statutes (Rev. to 1981) § 38-60 et seq. ¹ ; and the Connecticut Unfair Trade Practices Act (CUTPA); General Statutes § 42-110a et seq. ² ; are barred by the one year limit of General Statutes (Rev. to 1981) § 38-98 ³ for a suit on a fire insurance policy. We conclude that the plaintiff's claims are not barred and accordingly reverse the decision of the Appellate Court.

The plaintiff brought this action against the defendant, Middlesex Insurance Company, for alleged violations of CUIPA and CUTPA and for breach of contract. The defendant moved to strike the plaintiff's CUIPA and CUTPA claims. The trial court, Berdon, J., denied the motion. ⁴ The defendant next moved for summary judgment alleging that the plaintiff's suit was barred by the one year suit limitation provision in the insurance contract. ⁵ The trial court, Thompson, J., granted the defendant's motion for summary judgment. The plaintiff appealed to the Appellate Court, which affirmed the trial court decision. Lees v. Middlesex Ins. Co., 23 Conn.App. 814, 581 A.2d 287 (1990). We granted the plaintiff's petition for certification to appeal limited to the above stated issue.

The trial court found the following facts for purposes of the summary judgment. On May 9, 1982, a fire destroyed the home of the plaintiff. At the time of the loss, the plaintiff's home was insured by the defendant. On August 9, 1982, the plaintiff filed two proof of loss statements with the defendant, one for loss of the dwelling and the other for loss of the contents of the dwelling. By letter dated August 16, 1982, the defendant rejected both proofs of loss as being "excessive and premature." On November 1, 1982, the defendant paid the plaintiff's claim for loss of the dwelling but, without explanation, made no payment on the claim for loss of the contents. There was no further communication between the parties until August 23, 1983, when the plaintiff made a written inquiry requesting an explanation for the denial of her loss of contents claim.

On August 16, 1985, the plaintiff instituted this suit by way of a three count complaint alleging that the defendant had: (1) breached the insurance contract; (2) engaged in unfair insurance practices in violation of CUIPA; see footnote 1, supra; and (3) engaged in unfair trade practices in violation of CUTPA. See footnote 2, supra. The defendant moved for summary judgment alleging that the one year suit limitation provision in the insurance contract barred the plaintiff's suit.

The trial court rendered summary judgment in favor of the defendant on all three counts. ⁶ With respect to the second and third counts, the court held that "since the CUIPA and CUTPA claims necessarily arise from the relationship between the parties created by the insurance contract, they, too, are subject to the policy provision requiring the institution of suit within one year [as a matter of law]." The Appellate Court affirmed the judgment of the trial court. Lees v. Middlesex Ins. Co., supra.

The plaintiff claims that the trial court was incorrect as a matter of law in granting summary judgment on the second and third counts because the CUIPA and CUTPA claims alleged in those counts are not actions "on this policy" but are independent statutory tort actions and, therefore, the one year suit limitation provision in § 38-98 does not apply. The defendant claims that: (1) the trial court was correct in granting summary judgment because all claims by an insured against an insurer, regardless of their nature, are governed by the one year suit limitation provision of § 38-98; and (2) even if the plaintiff's CUIPA and CUTPA claims are not governed by the one year suit limitation of § 38-98, that limitation nevertheless controls unless the plaintiff has advanced a viable CUIPA or CUTPA claim. We agree with the plaintiff that her CUIPA and CUTPA claims are not subject to the one year suit limitation of § 38-98.

I

The standard for appellate review of a trial court's decision to grant a motion for summary judgment is well established. "Practice Book § 384 provides that summary judgment 'shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.' " Zichichi v. Middlesex Memorial Hospital, 204 Conn. 399, 402, 528 A.2d 805 (1987); see also Gurliacci v. Mayer, 218 Conn. 531, 562, 590 A.2d 914 (1991). The issue, therefore, is whether the Appellate Court properly determined that judgment for the defendant was required as a matter of law because the plaintiff's CUIPA and CUTPA claims were barred by the one year suit limitation of § 38-98 for a suit on the policy.

Construction of a statute is a question of law for the court. Griffin Hospital v. Commission on Hospitals & Health Care, 200 Conn. 489, 496, 512 A.2d 199, appeal dismissed, 479 U.S. 1023, 107 S.Ct. 781, 93 L.Ed.2d 819 (1986). In every case involving the construction of a statute, our starting point must be the language employed by the legislature. King v. Board of Education, 203 Conn. 324, 332, 524 A.2d 1131 (1987). Section § 38-98 requires the standard fire insurance policy form to contain the following provision: "No suit or action on this policy for the recovery of any claim shall be sustainable ... unless commenced within 12 months next after inception of the loss." (Emphasis added.) To determine whether the plaintiff's CUIPA and CUTPA claims are governed by the one year limitation of § 38-98, we must first determine if the plaintiff's CUIPA and CUTPA claims are actions "on this policy" as required by the statute. We conclude that they are not.

The plaintiff claims that her CUIPA and CUTPA claims are not actions "on [the] policy." The plaintiff contends that if § 38-98 were interpreted to include all suits against the insurer, the words "on this policy" would be superfluous. By contrast, the defendant's claim is essentially that § 38-98 should be interpreted to provide that any cause of action brought by an insured against her insurer is governed by the one year suit limitation in the statute. In support of its claim, the defendant relies on a line of cases that have held that any form of action, including tort actions, growing out of the contractual relationship, constitutes an action on the policy and, therefore, is governed by the limitation provision in the insurance contract. ⁷ See Barrow Development Co. v. Fulton Ins. Co., 418 F.2d 316 (9th Cir.1969); Hawley Enterprises, Inc. v. Reliance Ins. Co., 621 F.Supp. 190 (D.Conn.1985); Zieba v. Middlesex Mutual Assurance Co., 549 F.Supp. 1318 (D.Conn.1982); ⁸ Modern Carpet Industries, Inc. v. Factory Ins. Assn., 125 Ga.App. 150, 186 S.E.2d 586 (1971); Zehner v. MFA Ins. Co., 451 N.E.2d 65 (Ind.App.1983).

In the construction of a statute, no word should be treated as superfluous or insignificant. O'Brien Properties, Inc. v. Rodriguez, 215 Conn. 367, 372-73, 576 A.2d 469 (1990). The statute states only that an action "on this policy" must be brought within one year. The defendant's interpretation of the statute, however, would in effect broaden the language to provide that any suit or action against an insurer must be brought within one year. Such an interpretation would render the words "on this policy" superfluous because all actions between the respective parties, whether "on [the] policy" or not, would be subject to the one year limitation provision. Had the legislature intended all actions between an insurer and an insured to be subject to the one year provision it could have explicitly so provided. We ordinarily decline to read into statutes provisions not clearly stated; Local 218 Steam Fitters Welfare Fund v. Cobra Pipe Supply & Coil Co., 207 Conn. 639, 645, 541 A.2d 869 (1988); and we see no compelling reason to do so in this case.

Furthermore, the phrase "on this policy" strongly suggests that it was not intended to encompass CUIPA and CUTPA claims because that phrase and those claims ordinarily involve different factual inquiries, and because the duties ordinarily associated with them derive from different sources. In an action on an insurance policy, the conduct giving rise to the insurer's liability is a failure to pay out the policy proceeds when the insurer is contractually bound to do so. The factual inquiry focuses on the nature of the loss, the coverage of the policy and whether the parties have complied with all of the terms of the policy. In a CUIPA and CUTPA claim, however, the insurer's liability is ordinarily based on its conduct in settling or failing to settle the insured's claim and on its claims settlement policies in general. The factual inquiry focuses, not on the nature of the loss and the terms of the insurance contract, but on the conduct of the insurer. Furthermore, in an action "on [the] policy," the insurer's duty to comply with the policy provisions stems from the private insurance agreement and is contractual in nature. In a CUIPA and CUTPA claim, the insurer's duty stems not from the private insurance agreement but from a duty imposed by statute.

We note further that General Statutes § 42-110g(f) ⁹ provides for a three year statute of limitations for bringing a...