Capitol Specialty Ins. Co. v. Chan & Lui, Inc.

Amendments to policy coverage amounts do not apply retroactively where the "effective date of change" is clearly and unambiguously stated within the policy.

Chan & Lui, Inc. (Chan) represents the estates of two deceased individuals and they are appealing the trial court’s granting of Capitol Specialty Ins. Co.'s (Capitol) motion for summary judgment. Capitol issued “liquor liability” coverage to the owners of a restaurant, whose patron subsequently killed the deceased in an automobile accident. The issue before the Court of Appeals is whether an amendment to the policy limits applies retroactively or prospectively. Chan argues that, because the only change applied to the amount of the coverage limits, and thus leaving the “Policy Period” unchanged, the amended limits apply retroactively to the start of the policy period. Capitol contends that the revised policy language “Effective Date of Change” on its face indicates that the amendment to policy coverage applies prospectively only. The Court held that the language of the policy amendment was clear and unambiguous, and was therefore not to be applied retroactively. Affirmed.