Albino Linoleum & Carpet Service v. Utica Fire Insurance Company Et Al‪.‬

[33 A.D.2d 638 Page 638] Memorandum: In this action to recover under a fire insurance policy for loss by reason of business interruption resulting
from a fire in plaintiff's premises on October 15, 1964, it appears that before suit was brought defendants-respondents paid
to plaintiff-appellant its loss with respect to the building and contents, and did not deny liability for some business interruption
loss, the only question being the amount thereof. In December, 1964 plaintiff filed a proof of business interruption loss
"subject to revision" in the sum of $20,000. Defendants' agent Stratton in January, 1965 rejected it as "not supported by
evidence". In March, 1965 after a conference between plaintiff's president, its accountant and Mr. Stratton, plaintiff filed
a revised claim for $12,836. By letter of May 19, 1965 Stratton rejected this claim on the ground that plaintiff was required
by the policy to minimize loss by resumption of business, at least in part, and said, "I think this is the basic difference
of opinion with respect to the complete claim as presented". Apparently defendants had already advised plaintiff of the amount
which they thought plaintiff should receive, because Stratton concluded his letter by writing, "I believe that when this fact
is realized by you, you will understand our offer to you has been a fair representation of your claim." By letter of May 27,
1965 plaintiff resubmitted to defendants its claim in the reduced amount of $7,781. By letter of July 14, 1965 Stratton countered
that claim by offering to plaintiff the sum of $4,044, setting forth at some length the manner of its computation. Although
Stratton asserts that at no time thereafter did he indicate to plaintiff that defendants would be interested in paying more
than such offered amount, plaintiff's president avers that after receiving such offer he had many telephone conversations
with Stratton in an effort to "reconcile the difference" between the last demand and the offer, and that thereafter at Stratton's
request plaintiff wrote to Stratton on September 14, 1965 setting forth his arguments in favor of its demand; and plaintiff
asserts that Stratton agreed to discuss them with defendants and reply to plaintiff. On October 8 plaintiff sent a follow-up
letter to Stratton requesting a reply; and before and after that date, plaintiff asserts, its secretary telephoned Stratton
for a reply and he answered that he was waiting to hear from his principals, the defendants. On October 14 Stratton sent a
letter to plaintiff rejecting plaintiff's claim "as presented on September 14". This letter was received by plaintiff on October
15, the last day of the one-year period following the fire, the time limited by the policy in which to commence legal action
on a claim thereunder. Plaintiff's secretary makes affidavit that on October 18 she called Mr. Stratton on behalf of plaintiff
and advised him that plaintiff would accept defendants' offer of $4,044, and that Stratton then advised her that since one
year had expired since the date of the loss, he had closed his file on the case and defendants would pay nothing. On these
facts plaintiff instituted this action, to which [33 A.D.2d 638 Page 639]