Appeal from the United States District Court
for the Eastern District of Michigan at Detroit.
No. 2:16-cv-11536—Nancy G. Edmunds, District Judge.
Argued: November 29, 2017
Decided and Filed: December 22, 2017
Before: GILMAN, SUTTON, and STRANCH, Circuit Judges.
RONALD LEE GILMAN, Circuit Judge. Over four years after Palmer Park Square,
LLC incurred an insured loss, it brought a claim against Scottsdale Insurance Company for
“penalty interest” allegedly due on the untimely payment of the loss by Scottsdale. The district
court held that the penalty-interest claim arose “under the policy” and was thus barred by the
policy’s two-year limitations provision. It further held that a statutory provision providing for
the tolling of limitations provisions in insurance contracts did not apply to policies issued by
surplus-lines insurers like Scottsdale. As a result, summary judgment was granted in
Scottsdale’s favor. For the reasons set forth below, we REVERSE the judgment of the district
court and REMAND the case for further proceedings consistent with this opinion.