In this case analysed, the Court upholds the contested judgement declaring the non-existence of prescription of the action brought, because, in accordance with the jurisprudential doctrine that it establishes, ‘the initial day for the computation of the two year prescription period, established in art. 23 LCS for damage insurance with respect to the insured party’s claim against his insurer, in the cases in which there has been a judicial claim, is that of the notification of the decision that determines the finality of the condemnatory judgement, as from that moment the action can be exercised effectively and with full knowledge of the scope of the obligation to compensate’.
In summary, the case was as follows: on 29 April 1998, the worker XXX suffered injuries when a mobile scaffolding fell on the building site where he was working as an employee of the company XXXX, which had been subcontracted by XXXX, the latter having been subcontracted in turn by XXX S.A., which was in charge of the construction of the building where the events occurred. As a result, an ordinary lawsuit No 289/2001 was brought before Madrid Court of First Instance No 26, in which the defendant was Eama S.A., which was summoned on 6 June 2001.
In the case addressed by the judgement, the insured requested in the first instance that a judgement be handed down upholding the claim in full and ordering the defendant XXXX to pay all the liabilities of the company XXX S.A. arising from the proceedings brought by Mr XXXX, before the Court of First Instance No. 26, in ordinary proceedings 289/2001, in all its instances before the Provincial Court and the Supreme Court, and which at the date of filing of this claim amount to 241. 241,265.50 euros (235,570.15 euros from enforcement 786/2005
and 5,695.37 euros from enforcement 2138/2009), as well as the costs of LEGAL DEFENCE which EAMA S.A. has been obliged to pay to date and until the final conclusion of the proceedings and which, together with any other damages and/or losses which may be incurred, shall be determined at the stage of enforcement of the judgment, all of which the defendant shall be expressly ordered to pay costs’.
When the action was dismissed, the plaintiff lodged an appeal which was dismissed by ‘The Chamber, which agreed to uphold the first instance judgment in all its pronouncements.
On 8 February 2010, the insured sued XXX as civil liability insurer, requesting an order to pay all the liabilities of the company XXX S.A. arising from the proceedings brought by Mr. Imanol before Madrid Court of First Instance No. 26.
The defendant (insurer XXXX) objected, arguing, first, that the action was time-barred. Madrid Court of First Instance no. 35 handed down a judgment dated 13 November 2012 dismissing the claim, finding that the action was time-barred when the claim was filed.
The plaintiff appealed against that judgment and the Madrid Provincial Court (10th Section) handed down a judgment on 19 November 2013 upholding the judgment of first instance, with the appellant being ordered to pay the costs.
An appeal in cassation was brought before the SC against this ruling.
The sole ground of appeal refers to the infringement of Articles 23 and 73 of the Insurance Contract Act (LCS) in relation to Articles 1961 and 1969 CC.
Article 23 LCS provides that ‘actions arising from the insurance contract shall be barred within two years in the case of damage insurance and within five years in the case of personal liability insurance’.
It is not disputed that the applicable period in the present case is two years since the civil liability insurance corresponds to the first of these categories, but the appellant questions the solution established by the contested judgement regarding the setting of the ‘dies a quo’ which makes it coincide with the date on which the insured entity was notified of the claim brought against it by the injured party.
The plea was upheld and, with it, the appeal, as it is necessary to distinguish, on the one hand, the exercise within the legal term of the action derived from the insurance contract and, on the other hand, the fulfilment of the legal and contractual obligations that may correspond to the insured person with respect to the insurer in order to make him aware of the claim and of the judicial process followed to demand the civil liability of the insured person.
Article 73 LCS establishes that ‘by means of civil liability insurance, the insurer is obliged, within the limits established in the Law and in the contract, to cover the risk of the insured person’s obligation to compensate a third party for the damages caused by an event foreseen in the contract for whose consequences the insured person is civilly responsible, according to law’.
The Court has declared on some occasions that the limitation period begins to run from the moment of the finality of the judgement that condemns the insured to compensate a third party ( SSTS 210/2006, of 28 February, and 109/2013, of 8 March ), thus following the provisions of article 1969 CC, considering that it is from that moment onwards when the action can be exercised in all its fullness as the obligation to compensate and the amount of the compensation to be paid by the insured party will have been judicially determined, as an adequate interpretation of the aforementioned article 1969 CC requires that the possibility of exercising the action be effective and not a mere legal possibility, being so that only in that case the involuntary inactivity of the claimant will produce prescriptive effects.
The Judgement analysed maintains that the ‘dies a quo’ for calculating the 2 year period for the exercise of the claim against the insurer in damage insurance is the moment when the judgement is final as it is from that moment when the action can be exercised with all its fullness as the obligation to compensate and its amount to the insured is judicially determined.
The Insurance Department of Belzuz Abogados, S.L.P. recommends, in matters related to insurance, to seek the advice of lawyers specialised in this area, as it is necessary to have a deep knowledge of this area in order to obtain the best results, both in the negotiation phase and if the matter is referred to the courts.
Socio -Departamento de Seguros
España y Portugal
BELZUZ ABOGADOS SLP
