Insurer’s “Gift” to Extend Statute of Was Unenforceable Because it Was Issued After the Statute had Run

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Lola Molnar appealed orders of the Fayette Circuit Court – the first of which dismissed her premises liability action against the appellee, Tack House Pub, LLC, based upon limitations. In Lola Molnar v. Tack House Pub, LLC, No. 2020-CA-1417-MR, Court of Appeals of Kentucky (August 13, 2021) the Court of Appeals was asked to enforce an insurer’s letter claiming to extend the state’s statute of limitation issued months after the statute had expired.

ZALMA OPINION

The plaintiff argued that a “gift” from an insurer given three months after the statute of limitations had expired extended the limitation period. The argument, reasonably, failed because at the time the insurer made its “gift” there was no limitation period left to extend nor did its insured, the person against whom a claim had been made, did not even know about the “gift” nor did it agree to the extension of a limitation period that had already run. Insurers have great power to control a liability claim but it does not have the power to change the law or enter into a contract that takes away a right of its insured without consideration.