Judge Robert E. Payne of the United States District Court for the Eastern District of
Virginia, Richmond Division, denied a motion to dismiss based on the statute of limitations filed by property carrier First Liberty against its insured. John Rasmussen of the Insurance Recovery Law Group, PLC, defended the insured against that motion, which
addressed an issue of first impression
under Virginia insurance and procedural law.

A two-year statute applies to property insurance claims in Virginia. The insured filed a lawsuit seeking money damages and declaratory
 relief for a fire, but more than two years after it happened.
 The insured, however, had earlier filed and nonsuited an action to
appoint an appraisal umpire in Hanover Circuit Court.  And she refiled the damages claim within six months of that nonsuit.

First Liberty filed a motion to dismiss and argued, among other 
things, that because the first action seeking an umpire sought a different remedy 
than the later suit for damages, the Virginia 
tolling statute did not apply.  The 
district court rejected that “different remedies” test, and instead
 applied the “same operative facts” test used by the Fourth Circuit in 
Hatfill v. New York Times Co., 416
F.3d 320 (4th Cir. 2005).

In doing
 so, the court held that the insured’s (1) right of action to an umpire and (2) 
rights of action to damages and declaratory relief both arose from the same
cause of action and operative facts – her claim for insurance after a fire.

This issue
 has received significant attention recently, after a Virginia Circuit Court 
judge did not apply the tolling statute to a second suit because it sought a 
different amount of damages.  As noted
 above, this decision rejected that approach.

decision allows the insureds’ several hundred thousand dollar claim for lost
 personal property to go forward.

Click here to see a copy of the opinion.