Claim Fire Insurance or Contract Breach?

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Filing a claim as fire insurance coverage or breach of contract can determine your success or failure

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The claim for compensation covered by fire insurance has a statute of limitations of two years as established in article 23 of the Insurance Contract Law. However, if it is a claim for breach of contract, will be governed by the article 1964.2 CCivil, namely, the statute of limitations will be five years. It is from the fire that this five-year limitation period begins, after verifying negligence by the construction company that had carried out the work.

The 2nd Section of the Provincial Court of Burgos has resolved one of these cases in ruling on 1 June 2020, with No Resolution 165/2020:   It upheld the appeal filed by D. José Enrique and AXA SEGUROS GENERALES SA DE SEGUROS Y REASEGUROS (onwards, AXA). Sentenced RURAL GENERAL INSURANCE, S.A., INSURANCE AND REINSURANCE, (onwards, GENERAL RURAL INSURANCE, S.A.), to pay to D. Jose Enrique 135.000 € plus the interests of the art. 20 LCS y a AXA 30.500 € plus the interests of the art. 576 LECivil, after considering that the action brought by the plaintiffs had not prescribed, revoking the sentence handed down in the first instance.

Fact background,,es,Juan Alberto and Paulina filed suit against FTA,,es,Asset Securitization Fund,,es,requesting the declaration of nullity for abusive of the floor and ceiling clauses contained in the novation contract of the mortgage loan of,,es,with the corresponding refund of amounts unduly collected,,es,The Securitization Fund Management Company,,es,Beech,,es,acting on behalf of FTA, he responded to said claim alleging that he lacked passive legitimacy since the entity had no legal personality and that it constituted only a private and open fund and that therefore the passive legitimization corresponded to BBVA as successor of Catalunya Banc that was the Company fund constituent,,es

The 30 November 2016 there was a fire in D's home. Jose Enrique. It was found that this fire was the cause of the negligence committed by CONSTRUCCIONES FERPEJO, S.L., when installing the fireplace.

The 30 January 2019, AXA y D. José Enrique filed a lawsuit against SEGUROS GENERALES RURAL, S.A., INSURANCE AND REINSURANCE. They requested that the insurance company be ordered to pay D. Jose Enrique, 200.000 € plus legal interests of art. 20 LCS y a AXA, 32.000 €, plus interest of art. 576 LECivil.

They exercised contractual liability action of art. 1101 CCivil due to negligence on the part of CONSTRUCCIONES FERPEJO, S.L., in the fulfillment of the contract of rehabilitation of the house of D. Jose Enrique, for not having installed the chimney correctly, being the cause of the fire that occurred.

Primera Instancia

The Court of First Instance No. 2 de Burgos sentenced the 17 September 2019, dismissing the lawsuit filed by AXA and D. José Enrique vs. RGA.

The Court considered that the actions taken were prescribed, after more than a year has elapsed since the incident occurred until the claim was filed (20/11/2016).

Provincial Court

By AXA and D. José Enrique filed an appeal. They alleged infringement of art. 1964 CCivil.

No prescription

For the Board, The statute of limitations exercised by the plaintiff was the one provided for in art. 1964.2 CCivil, namely, of five years. In this case, it is from the fire that the five-year statute of limitations begins, after finding negligence.

It was proven through an expert report that the cause of the fire was the lack of insulation of the chimney installed by CONSTRUCCIONES FERPEJO, S.L. The obligation to compensate was born, as the art. 1101 CCivil. This responsibility to indemnify was extended to SEGUROS GENERALES RURAL, S.A., with solidarity character, as stated in the art. 76 LCS.

The warranty period of art. 123 TRLGDCU

For the Board, the two-year term of art was not applicable. 123 TRLGDCU for the termination of the contractual liability action of art. 1101 CCivil, well in this case, a poor installation was performed, negligence in the fulfillment of the obligations of the work contract signed between CONSTRUCCIONES FERPEJO, S.L., y D. Jose Enrique.

General conditions in the policy: maximum compensation limit of twelve months

For the Board, although according to article 73 LCS, clauses limiting the rights of the insured were allowed, they are required to comply with the requirements of art. 3 LCS, must be highlighted in a special way and specifically accepted in writing.

In this case, the Chamber considered “(…) Once the General Conditions have been examined, it is not understood that either of the two requirements are met, because despite being a limiting clause, it does not stand out from the rest of the clauses, but its heading is in a size and bold identical to most of these general conditions, without its content being highlighted in any way, unlike many other clauses collected there. Therefore, not meeting those requirements, lacks validity, and they cannot be opposed to the plaintiff. "


The choice of the action to exercise determines the term. Even if the damage originates from a fire, the exercise of an action for breach of contract may allow the client to obtain compensation, being the term longer than that established in the Insurance Contract Law for damage insurance. A lawyer specialized in insurance will advise you to propose the best legal strategy.

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