Interinsurance Exchange v. Harmon

COLLINS, J. pro tem.

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This matter reaches this court via certification by the Appellate Department of the Superior Court of Los Angeles County pursuant to rule 63(a) and (c), California Rules of Court.

The single issue is whether a three-year or a one-year period of limitation governs an insurer’s subrogation claim

[760]

against an uninsured motorist whose negligence resulted in damage to an insured who was compensated therefor by his insurer.

On February 10, 1967, an action was commenced in the Municipal Court of Los Angeles Judicial District by Inter-insurance Exchange of the Automobile Club of Southern California (appellant, hereinafter called Exchange) and its insured, Opal Hunt, against Earl Harmon (respondent) and others. By way of subrogation, the Exchange sought recovery of the amount it had paid to its insured for bodily injuries sustained in an automobile accident on April 2, 1965, and allegedly caused by Harmon’s negligence in the operation of his uninsured vehicle; and paid in accordance with the "Uninsured Motorist Coverage” endorsement contained in the Exchange’s liability policy issued to Hunt. Hunt sought recovery directly of the amount of damages to her automobile allegedly caused by Harmon’s negligence.

Harmon pleaded as affirmative defenses to both claims both one-year (Code Civ. Proc., § 340) and the two-year (Code Civ. Proc., § 339) periods of limitation, and the provisions of Insurance Code, section 11580.2, subdivisions (a) through (h).

The trial court denied recovery on the Exchange’s claims, on the stated ground that it was barred by the one-year period of limitation provided in hoth section 11580.2, subdivision (h), of the Insurance Code and section 340, subdivision 3, of the Code of Civil Procedure. Recovery was allowed on the Hunt claim for property damage on the ground that it was governed by section 338, subdivision 3, of the Code of Civil Procedure-.

On appeal, the appellate department affirmed the judgment in favor of Hunt, but reversed the judgment against the Exchange, pointing out in its opinion that an insured’s subrogation claim is governed by Insurance Code, section 11580.2, subdivision (f), a three-year period of limitations which was added to subdivision (f) by the Legislature in 1963 (effective August 20,1963)