"plainly and unequivocally" to the date that the loss actually occurred, not to the date of discovery. Lardas, 231 A.2d at 742. Because the Pennsylvania Supreme Court has held that this language is unambiguous and refers to a "definitely established event," the clause "leaves no room for construction," Pastierik, and the discovery rule does not apply.
B. Contractual Language Differences
Plaintiff attempts to distinguish Lardas and GSA by pointing to language contained in the instant limitation on suit clause which is different from that in the clause considered in those cases. The clause contemplated in Lardas and GSA required that suit be brought within one year "after inception of the loss." The policy in the instant case, on the other hand, requires the insured to sue within one year "after the date of loss or damage." Plaintiff argues that the "word 'inception' carries with it a reference to 'beginning' irrespective of discovery." Plaintiff's Reply at 6. Since the policy at issue in the instant case does not use the term "inception," plaintiff asks the court to conclude that Lardas and GSA are inapposite, and the one-year period should run from the date of discovery.
The court is not convinced that the difference in policy language is significant. Plaintiff cites no case which makes the distinction he urges. The single case found by the court which does discuss this distinction does not support plaintiff's argument. In Ames Privilege Associates Limited Partnership v. Allendale Mutual Insurance Co., 1989 WL 145720 (D. Mass. 1989) the district court distinguished insurance policy clauses barring suits later than a specified time after "the time the loss occurred" from those which measure time from "the inception of the loss" in a case where property damage resulted from rot caused by a fungal infection which spread through the wooden frame of a house. The court held that in such a situation, "inception of the loss" refers unambiguously to the time the damage begins. However the "time the loss occurred" is ambiguous since the damage is "progressive and continuing." Id. at *2. Because the "time the loss occurred" is ambiguous in this particular factual situation, the court read the ambiguity against the insurance company and concluded that the time limit for filing suit should run from the date on which the insured could reasonably be expected to discover that a continuing occurrence was causing damage to insured property.
Unlike the "progressive and continuing" loss at issue in Ames, plaintiff's loss in the instant case occurred at a well-defined and discrete time. In this situation, "loss" is no more ambiguous than "inception of the loss" and there is no significance to the difference between the terms.
C. Alleged Bad Faith Behavior by Defendant
Count II of the complaint alleges that State Farm acted in bad faith by refusing to properly investigate and pay plaintiff's claim. Plaintiff argues that, in light of this breach of duty by State Farm, his suit is not barred by his failure to file within the time prescribed in the limitation of suit clause. State Farm disputes plaintiff's contention that the claim was denied in bad faith. This dispute of fact does not preclude summary judgment, however, for it is immaterial to our decision. Even if we assume that plaintiff's characterization of the facts is correct, his argument fails as a matter of law.
Plaintiff is correct that bad faith behavior by the insurer can prevent it from asserting the one year limitation on suit as a defense. For example the Lardas court recognized that an insurer could be estopped from asserting the suit limitation clause if it induced or persuaded the insured not to file suit within the contractually agreed period. 231 A.2d at 742. In an effort to avoid summary judgment, plaintiff points to Pini v. Allstate Insurance Co., 499 F.Supp. 1003 (E.D. Pa. 1980), aff'd without opinion, 659 F.2d 1070 (3rd Cir. 1981), where the district court stated:
Where the insurer affirmatively misleads the insured about the possibility of settlement, dissuades him from filing suit or induces him to believe that it will not enforce the limitations period, courts construe this conduct as violative of the insurer's duty of "utmost good faith and fair dealing". . . . To prevent the insurer from profiting from its own misbehavior, courts do not interpret the clause strictly. . . . Importantly, the insured must be given an opportunity to establish a fact question on this issue.
Id., 499 F.Supp. at 1004.
Although Pini is cited and quoted by plaintiff in support of his argument, the case actually commands judgment against him. In Pini, plaintiff filed suit against his insurer after the insurer refused to provide coverage for a loss. The insurer moved to dismiss because the suit was filed more than a year after the loss, in violation of the policy's one year limitation on suit clause. Plaintiff tried to avoid dismissal by claiming that the insurer's denial of coverage had been in bad faith, and that by this bad faith behavior the insurer had waived the one year limit. The court rejected plaintiff's argument, and granted the motion to dismiss, holding that it was irrelevant if the denial of claim had been in good or bad faith, since the insurer "expressed its intention not to pay within sufficient time for plaintiff to file suit." 499 F.Supp. at 1005. Thus, even if the denial had been in bad faith, plaintiff "still had sufficient time within which to comply with the terms of the policy." Id.
In the instant case, it is undisputed that State Farm rejected Toledo's claim in mid-October of 1992. See Defendant's Motion P 15; Plaintiff's Reply P 15. Thus, Toledo had approximately six months after the rejection of his claim to file this suit in a timely manner.
He "should not have sat idly watching the one-year time period elapse." Pini, 499 F.Supp. at 1005. His action is barred by the insurance contract's one year limitation on suits.
An appropriate order follows.
AND NOW, this 23rd day of November, 1992, upon consideration of defendant's motion for summary judgment and plaintiff's response thereto, it is hereby ORDERED that the motion is GRANTED. Judgment is entered for defendant and against plaintiff.
BY THE COURT:
JAMES T. GILLES