92 LOPEZ v FILIPINAS COMPAÑIA DE SEGUROS
arbitrator, arbitrators, or umpire shall have made their award then the
FACTS:
1. Prior Apr 22 1959: Lopez applied with Filipinas Comapañia de
Seguros (company) for insurance of his properties against loss
or damage. The insurance involved
a. a Biederman truck tractor – P26,000
b. Winter Weils trailer- P10,000
2. The company, in connection with the application, inquired
Lopez if any company in respect of the insurance of any car or
vehicle (a) declined, cancelled or refused to renew his insurance;
(b) increased his premium on renewal
3. Lopez answered “none” even though that time, the American
Int’l Underwriters of the Philippines (AIU) had already declined
a similar application by him in respect of the same vehicles
4. Apr 22, 1959: The company issued to Lopez 2 Commercial
Vehicle Comprehensive Policies covering the 2 vehicles.
5. Aug 30, 1959: while the said policies were in force, the vehicles
figured in an accident at Bagabag, Nueva Vizcaya.
a. Resulting in the total loss of the tractor
b. Partial damage to the trailer
6. So Lopez demanded for the payment of P27,962 which is the
total amount of damages. The company rejected the claim on
April 28, 1960 because of Lopez’ alleged “concealment of a
material fact”— that another company has declined his
application
7. May 27, 1960: Lopez filed a complaint with the insurance
commissioner (IC) but because of Lopez’ refusal to the proposal
of the company to settle thru arbitration, it suggested that it be
tried in Court.
8. Sept 19, 1961: Lopez, then, filed a case in the CFI. The company
filed a motion to dismiss on the ground of prescription.
a. Since it was not filed within 12 months from its rejection
by the insurance company as stipulated under par. 9 of
the General Conditions of Commercial Vehicle
Comprehensive Policy Nos. 5598 and 5599 (general
condition) which says:
" If a claim be made and rejected and an action or suit be not commenced
within twelve months after such rejection or (in case of an arbitration
taking place as provided herein) within twelve months after the
claim shall for all purposes be deemed to have been abandoned and shall
not thereafter be recovered hereunder."
9. The court dismissed the complaint. Thus, the instant appeal.
ISSUE: Was the complaint with Office of the IC a commencement of
an “action or suit” within the meaning and intent of the general
condition? NO, the plaintiff’s complaint prescribed since the “action or
suit” with the CFI was filed some 17 months later.
RATIO:
1. Based on Jurisprudence (Moran), a provision of the Rules of
Court (Rule 2, Sec. 1), and American Jurisprudence, the terms
action and suit are synonymous. It is clear that the determinative
fact which converts a claim into an action or suit is the filing of
the same with a “court or justice”. Filed elsewhere, the claim
may not properly be categorized under either term.
2. Another reason why the appellant's recourse to the Office of the
IC could not have been an "action or suit" which could have
halted the running of the prescriptive period stipulated in the
insurance policies involved: An "action or suit" is essentially
"for the enforcement or protection of a right, or the prevention
or redress of a wrong." (Rule 2, Sec. 1, Rules of Court). There
is nothing in the Insurance Law, Act No. 2427, as amended,
nor in any of its allied Legislations, which empowers the
Insurance Commissioner to adjudicate on disputes relating to
an insurance company's liability to an insured under a policy
issued by the former to the latter. The validity of an insured's
claim under a specific policy, its amount, and all such other
matters as might involve the interpretation and construction of
the insurance policy, are issues which only a regular court of
justice may resolve and settle. Consequently, the complaint filed
by the appellant herein with the Office of the Insurance
Commission could not have been an "action or suit."
Ruling: CFI ruling affirmed.