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Court preserves an insurer’s right to enforce the one-year suit limitation clause without showing any degree of prejudice from the delay.

October 1, 2019
Mail Quip, Inc. v. Allstate Ins. Co., No. 19-223, 2019 U.S. Dist. LEXIS 87923, at *1 (E.D. Pa. May 23, 2019)

The Eastern District reviewed this case in which an ink cartridge refill machine was “misappropriated” at the insured’s business. The insurer moved to dismiss breach of contract and statutory bad faith claims on the basis these counts were barred by the statute of limitations. The court addressed the question of whether an insurer is required to show prejudice to prevail on a suit limitation defense, a requirement that has only been applied to notice of loss provisions. The District Court notes that the Pennsylvania Supreme Court has not directly addressed this issue. Ultimately, the court dismissed the contract and bad faith claims as untimely. Thus, the court preserves an insurer’s right to enforce the one-year suit limitation clause without showing any degree of prejudice from the delay.

 

Case Law Alerts, 4th Quarter, October 2019

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