This is an appeal from a summary judgment for a policyholder in an action for declaratory judgment that the policyholder brought to determine her insurance carrier's duty to pay benefits on an uninsured motorist claim. The summary judgment did not determine whether the carrier has a duty to pay benefits. *Page 358 Rather, it determined only that the action is not barred by a policy provision that requires any action against the carrier for payment of uninsured motorist benefits to be commenced within two years after the accident from which the claim arose.
The appellate jurisdiction of this court is limited to review of final orders and judgments. Section 3 (B)(2), Article IV, Ohio Constitution. Final orders are defined by R.C. 2505.02 to include, inter alia, "an order that affects a substantial right made in a special proceeding." A declaratory judgment action is a special proceeding pursuant to R.C. 2505.02, and, therefore, an order entered therein which affects a substantial right is final and appealable. Gen. Acc. Ins. Co. v. Ins. Co. of N. Am. (1989),44 Ohio St.3d 17, 540 N.E.2d 266. Accord Polikoff v. Adam (1993),67 Ohio St.3d 100, 616 N.E.2d 213.
A substantial right is a legal right entitled to enforcement and protection by law. In re Estate of Wyckoff (1957), 166 Ohio St. 354, 2 O.O.2d 257, 142 N.E.2d 660. According to that standard, an order that denies a bar to coverage created by a clause in a contract of insurance affects a substantial right of the insurer. Therefore, the summary judgment from which this appeal is taken is a final judgment and subject to appellate review.
Plaintiff-appellee Irene Marsh maintained a policy of automobile liability insurance with defendant-appellant State Automobile Mutual Insurance Company when Marsh's automobile was involved in a collision with an automobile driven by Monty R. Hughes on November 22, 1990. The policy provided for uninsured motorist coverage, and specified that "[w]ith respect to such coverage, no legal action or arbitration proceeding may be brought against us unless the action or proceeding is begun within two years of the date of the accident."
Marsh commenced an action against Hughes for personal injuries and property loss on November 10, 1992. On March 22, 1993, Marsh learned that Hughes was uninsured at the time of the accident. On April 7, 1993, Marsh advised State Automobile Mutual that she intended to file a claim for uninsured motorist benefits. On October 3, 1993, Marsh obtained a default judgment against Monty R. Hughes.
After negotiations to settle her claim for uninsured motorist benefits had produced no agreement, Marsh commenced this action against State Automobile Mutual on September 2, 1994, to determine coverage and alleging a breach of contract. Marsh voluntarily dismissed her complaint on December 22, 1994. The claim was refiled on December 19, 1995, pursuant to R.C. 2305.19, the one-year saving statute.
After filing its answer, State Automobile Mutual moved for summary judgment, arguing that Marsh's declaratory judgment action is barred by the two-year *Page 359 limitation period in the policy. Marsh conceded that more than two years had intervened from the November 22, 1990 accident until she commenced her action on September 2, 1994. However, Marsh argued that the two-year limitation should be subject to a discovery rule. She offered evidence in the form of an affidavit by her attorney, demonstrating that Marsh first learned that Monty R. Hughes was uninsured when her attorney received correspondence purporting to be from Hughes, and so stating, on November 22, 1993, more than two years after the date of the accident but less than two years before her declaratory judgment action was commenced.
The trial court denied State Automobile Mutual's motion for summary judgment, holding that the two-year limitation in the policy would be subject to a discovery rule. Therefore, the court held, the two-year period in which the action could be brought against State Automobile Mutual commenced to run when Marsh learned that Monty R. Hughes was uninsured. Seeing how the wind was blowing, Marsh then filed her own motion for summary judgment, asking the court to hold that the two-year limitation in the policy cannot bar her action. Marsh again relied on her attorney's affidavit.
State Automobile Mutual filed a motion contra, arguing that no discovery rule should apply. State Automobile Mutual offered no evidence to contradict Marsh's claim that she first learned that Monty R. Hughes was uninsured on November 22, 1993, though it did contend that correspondence purporting to be from Hughes that was attached to the affidavit of Marsh's attorney was "hearsay" and "simply a red herring."
The trial court granted Marsh's motion for summary judgment, holding that State Automobile Mutual could not interpose the two-year limitation to bar coverage because Marsh's action was filed less than two years after she "discovered" that Hughes was uninsured. State Automobile Mutual filed a timely notice of appeal, and now presents a single assignment of error, which states:
"The trial court erred in granting summary judgment for the appellee as the appellee's claim for uninsured motorist coverage was time barred.
"A. The trial court erred in finding that the insurance contract failed to validly establish a proper statute of limitations.
"B. The trial court erred in determining that the two-year limitation period, contained in the insurance contract commenced to run only after the appellee allegedly received notice that the tortfeasor was uninsured."
The two-year limitation on actions on which State Automobile Mutual relies is not itself a statute of limitations. It is a contract provision that diminishes the fifteen-year statutory period during which an action on the contract otherwise must be brought pursuant to R.C. 2305.06. In place of the *Page 360 fifteen-year term, the contract adopts the two-year statutory period during which an action for personal injuries must be brought pursuant to R.C. 2305.10.
Parties to an insurance contract may agree to a term shorter than the fifteen-year period in R.C. 2305.06 in which an action on the policy must be brought. Broadview S. L. Co. v. BuckeyeUnion Ins. Co. (1982), 70 Ohio St.2d 47, 24 O.O.3d 109,434 N.E.2d 1092. Nevertheless, any policy provision to that effect must be clear and unambiguous. Lane v. Grange Mut. Cos. (1989),45 Ohio St.3d 63, 543 N.E.2d 488. Further, it may not eliminate or reduce the uninsured or underinsured motorist coverage that R.C. 3937.18 requires. State Farm Auto. Ins. Co. v. Alexander (1992), 62 Ohio St.3d 397, 583 N.E.2d 309.
In Miller v. Progressive Cas. Ins. Co. (1994), 69 Ohio St.3d 619, 635 N.E.2d 317, the Supreme Court held that a provision in a policy of uninsured/underinsured motorist coverage that required any action against the carrier for payment of uninsured/underinsured motorist benefits to be brought within one year after the date of the accident is unreasonably short and, therefore, void as against public policy. The court went on to state:
"Finally, we do not suggest that time-limitation provisions of the type at issue in this case are altogether prohibited. Consistent with our analysis, a two-year period, such as that provided for bodily injury actions in R.C. 2305.10, would be a reasonable and appropriate period of time for an insured who has suffered bodily injuries to commence an action or proceeding for payment of benefits under the uninsured or underinsured motorist provisions of an insurance policy." Id. at 624-625,635 N.E.2d at 321.
State Automobile Mutual argues that the two-year limitation period in its policy is consistent with and is based on the Supreme Court's statement in Miller. A right to coverage under the uninsured motorist provisions of a policy of automobile liability insurance accrues on the date of the injury from which the claim arose. Kraly v. Vannewkirk (1994), 69 Ohio St.3d 627,635 N.E.2d 323. However, because the tortfeasor's uninsured status is a condition precedent to such coverage, the insured cannot reasonably be required to bring an action against the carrier for payment of uninsured motorist benefits until he determines that the tortfeasor is uninsured. Id. If the time then remaining in the period allowed for such actions by the policy is unreasonably short, the limitation will be held to be void as against public policy. Miller v. Progressive Cas. Ins. Co.,supra. That rule has been applied to a period of three and one-half months remaining in a two-year contractual limitation period after the insured learned of the tortfeasor's uninsured status.Kraly v. Vannewkirk, supra.
In Kraly, the tortfeasor's insurance carrier became insolvent twenty and one half months after the date of the accident giving rise to the insureds' injuries. At *Page 361 the time of the accident, no right of action under the insureds' insurance contract had accrued, since the tortfeasor was at that time insured. Since the insureds had initially been informed that the tortfeasor was insured, they had no reason to suspect that the two-year time limitation for bringing a suit against their own insurance carrier under their uninsured motorist coverage had any application to them. It was only when the insureds learned of the tortfeasor's insurance carrier's insolvency that they were on notice that the two-year contractual limitation applied to them.
Accordingly, the Ohio Supreme Court appropriately held that where a liability insurer of a tortfeasor has been declared insolvent, a right of action of an insured injured by a tortfeasor against his insurer under the uninsured motorist provision in his automobile contract accrues on the date the insured receives "notice" of the insolvency. Kraly, 69 Ohio St.3d 627, 635 N.E.2d 323, paragraph three of the syllabus.
In the usual situation the insured has ample time to discover the insured status of the tortfeasor within the two-year contractual period. Indeed the insured will usually learn on the date of the accident or shortly thereafter whether the tortfeasor was insured under an automobile liability policy. It is unlawful to operate a motor vehicle in this state unless proof of financial responsibility is maintained. R.C. 4509.101. Proof of financial responsibility is ordinarily provided by use of financial] responsibility identification cards, which every insurer writing motor vehicle insurance in Ohio is required to provide to every policyholder. R.C. 4509.103. Discovering the insurance status of a tortfeasor is quite unlike discovering medical or legal malpractice. In the latter situation the Ohio Supreme Court has heen willing to toll the short statute of limitations period for bringing such actions while the malpractice remains undiscovered. Frysinger v. Leech (1987),32 Ohio St.3d 38, 512 N.E.2d 337.
It being undisputed that the appellee did not file her legal action against the appellant within two years of the date of the accident as required by the insurance contract, the trial court erred in granting the appellee's motion for summary judgment and in not entering summary judgment for the appellant insurance company.
The judgment of the trial court is reversed and judgment is entered in favor of the appellant, State Auto Mutual Insurance Company.
Judgment reversed.
WOLFF, J., concurs.
GRADY, J., dissents. *Page 362