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FLEET NATL. BANK v. EXPORT-IMPORT BANK OF THE UNIT

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA


June 25, 1985

FLEET NATIONAL BANK, Plaintiff
v.
EXPORT-IMPORT BANK OF THE UNITED STATES and FOREIGN CREDIT INSURANCE CORPORATION, Defendants

The opinion of the court was delivered by: HOGAN

MEMORANDUM OPINION

 The above-captioned case arises out of the refusal of the defendants to pay various claims submitted by plaintiff under export credit insurance policies issued by the defendant Foreign Credit Insurance Association ("FCIA") on behalf of the defendant Export-Import Bank of the United States ("Eximbank") and other member companies. The Court presently has before it a plethora of motions and accompanying memoranda of varying degrees of merit and significance. These matters will be considered seriatim beginning with the parties' cross-motions for summary judgment.

 DEFENDANTS' MOTION FOR SUMMARY JUDGMENT

 The insurance policies underlying the claims in the action were issued to Fleet National Bank ("Fleet") by FCIA *fn1" on behalf of Eximbank *fn2" and FCIA's member insurance companies. Fleet obtained the policies to insure against nonpayment of loans extended by Fleet to certain Guatemalan buyers for the purchase of agricultural equipment. Simply stated, the policies provide that in the event of non-payment, FCIA will make payment to the insured (Fleet) and, through subrogation, seek recovery against the foreign buyer. In each of the five counts *fn3" in the present case, FCIA refused payment under the policies because of Fleet's alleged noncompliance with the terms and conditions of recovery under the insurance contract. Defendants' arguments for summary judgment may be considered in three steps: 1) the effect of the contractual period of limitation; 2) the requirement of "shipment" as a condition precedent to coverage; and 3) the requirement that the insured maintain a policy of hull insurance as a condition precedent to coverage.

 1. The Contractual Period of Limitation

 The "Medium Term-Comprehensive Export Credit Insurance Policy" *fn4" issued to Fleet by FCIA sets forth in detail the procedural requirements and limitations for filing a claim.

 Article VI of the policy provides that proof of loss forms must be submitted to the company within "eight months from the date of default." Article IX provides that no civil action shall be commenced until ninety (90) days from the filing of the proof of loss forms. Article IX also states that:

 

No action shall lie against the Insurers or any of them unless, as a condition precedent thereto, there shall have been full compliance with all the terms of this policy, nor until 90 days after the required proofs of loss have been filed with the Insurers, nor at all unless commenced prior to the expiration of eighteen months from the date of default.

 Medium Term-Comprehensive Export Credit Insurance Policy, Exhibit 1 to Plaintiff's Statement of Material Facts as to Which There is No Genuine Issue. ("Plaintiff's Exhibit 1")

 "Default" is defined, in relevant part as "non-payment, in whole or in part, of the amount of principal or interest due on a note in accordance with the terms thereof." Article III, Medium Term-Comprehensive Export Credit Insurance Policy, Plaintiff's Exhibit 1.

 The material facts relevant to the application of this contractual provision are not in dispute. Each count of the complaint alleges that a transaction occurred in which Fleet financed the sale of certain goods. Repayment of the loans was to be made in biannual installments. Set forth below are the installment numbers and the due dates as claimed by Fleet on its proof of loss form. Count 1 (Loan to Mr. Elias Font for purchase of 20 tractors): Installment Number Due Date 1 9/9/79 2 3/9/80 3 9/9/80 4 3/9/81 5 9/9/81 6 3/9/82 7 9/9/82 8 3/9/83 9 9/9/83 10 3/9/84

19850625

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