Aetna Life Insurance Co. v. American Zinc, Lead & Smelting Co.
| Decision Date | 03 March 1913 |
| Citation | 154 S.W. 827,169 Mo.App. 550 |
| Parties | AETNA LIFE INSURANCE COMPANY, Appellant, v. AMERICAN ZINC, LEAD & SMELTING Company, Respondent |
| Court | Missouri Court of Appeals |
Appeal from Jasper Circuit Court, Division Number One.--Hon. Joseph D. Perkins, Judge.
REVERSED AND REMANDED (with directions).
Spencer Grayston & Spencer for appellant.
(1) Where reformation of an instrument is prayed, the preceding agreement must be shown. Dougherty v. Dougherty, 204 Mo. 237. (2) Courts do not make agreements for the parties. Both the agreement and the mistake must be shown; and the evidence in such case must be clear and convincing. Landrum's testimony, being merely his conclusions or understanding concerning a definite and certain agreement already made and subject only to his approval, was not sufficient. Tesson v. Mut. Ins. Co., 40 Mo. 33; Sweet v. Owens, 109 Mo. 7; Moran Bolt and Nut Mfg Co., 210 Mo. 729. (3) There is no showing that the Aetna policy did not conform to the terms of the Maryland policy which the soliciting agent agreed upon, and, therefore no showing of a mutual mistake. Mutuality of the mistake must be both pleaded and proven. Meek v. Hurst, 223 Mo. 696. (4) The soliciting agent had no power to write policies or make contracts. Before the court would be authorized to reform the policy the mistake on the plaintiff's side must be traced to the officers or agents of the plaintiff company who were authorized to make contracts. Guernsey v. Ins. Co., 17 Minn. 104; Thask v. Ins. Co., 58 Mo.App. 438. (5) Any question of mutual mistake or of absence of mutual assent was removed by the retention of the policy by defendant. Am. Ins. Co. v. Neiberger, 74 Mo. 173; Steinberk v. Ins. Co., 49 Mo. 265; Birnstein v. Ins. Co., 82 N.Y. 144. (6) Courts must construe insurance contracts as they find them. Carr v Ins. Co., 100 Mo.App. 609. (7) The court should harmonize all portions of an insurance policy, when possible. It is only when there is an irreconcilable conflict between provisions that the court is called upon to determine which will prevail. Jackson v. Assurance Co., 63 N.W. (Mich.), 900, 30 L. R. A. 636. (8) Where insured cancels policy, the amount of premium to be paid for the period during which the policy was in force is governed by the contract. Ins. Co. v. Peoples F. Ins., 44 A. (N. H.) 83; Ins. Co. v. Brechesien, 35 N. E. (Ohio) 53. (9) The soliciting agent could not consent to cancellations upon terms not provided for by the policy. Rothchild v. Ins. Co., 5 Mo.App. 586. (10) Mere notice of an intention to cancel is not cancellation. Gardner v. Ins. Co., 58 Mo.App. 616; Banking Co. v. Ins. Co., 75 Mo.App. 314.
Thomas & Hackney for respondent.
(1) Counsel for plaintiff made no request of the court for a finding of facts, which request must be made before the rendition of judgment, otherwise it is too late. Hamilton v. Armstrong, 120 Mo. 597, 614. (2) If counsel for plaintiff had desired the opinion of the court as to the construction of the policy or the application of the law to the facts in evidence on any point, they should have presented an appropriate delaration of law, if they wished to have the action of the trial court reviewed. Tyler v. Laramore, 19 Mo.App. 458, and cases cited. (3) It was not necessary for the court to decree a reformation of the policy if it found in favor of the defendant on that issue before rendering judgment for the defendant. It was not even necessary for the defendant to pray for a reformation of the instrument, where the answer set up the facts entitling it to such reformation. Barlow v. Elliott, 56 Mo.App. 374, 377; Sieberling v. Tipton, 113 Mo. 381; Tapley v. Herman, 95 Mo.App. 543. (4) As to all issues in the case the judgment for defendant is presumed to be correct and it devolves upon the plaintiff to show that it is not correct. Guinan v. Donnell, 201 Mo. 201. (5) If the judgment of the trial court can be sustained on any theory, it must be affirmed. Gardner v. Robertson, 208 Mo. 605, 614. (6) The agreement between plaintiff's agent, Hirons, and the defendant's general manager, Landrum, was clearly shown by the evidence to be wholly inconsistent with the short rate cancellation feature of the policy and had the effect of waiving it, and was a good defense at law to the plaintiff's action. Fuller v. Fidelity & Cas. Co., 94 Mo.App. 495. (7) The special indorsement on the policy stood as a special written portion of the policy and prevailed over the general printed portion. 1 May on Ins. (3 Ed.), sec. 177. (8) If the policy is open to two constructions, one favorable to the insured and one not, if the insured has acted on the favorable construction, courts will take his view of the contract. Matthews v. M. W. A., 236 Mo. 326. (9) If a doubt exists as to the construction of an insurance policy this doubt must be resolved in favor of the insured although intended otherwise by the insurer. LaForce v. Ins. Co., 43 Mo.App. 518; Hale v. Springfield F. & M. Co., 46 Mo.App. 508; Casner v. Casualty Co., 116 Mo.App. 361; Matthews v. M. W. A., 236 Mo. 326; 1 May on Ins. (3 Ed.), sec. 175. (10) Laches cannot be imputed to the defendant. The defendant accepted the policy under the belief that it conformed to his contract of insurance; and, giving it the construction placed upon the policy by the defendant, the policy did conform to the agreement. In such case, a court of equity will reform the instrument, if reformation be necessary, notwithstanding the delay before the request for reformation. 16 Am. & Eng. Ency. Law (2 Ed.), pp. 869, 870; Ins. Co. v. Hearne, 20 Wall. (U.S.) 494; 2 May on Ins. (3 Ed.), sec. 566. (11) It was a fraud on the part of the plaintiff when intrusted with the issuance of the policy to so couch the policy in terms contrary to and not expressive of the terms of the agreement; and wherever there is a showing of surprise, misrepresentation or other form of fraud, it is unnecessary to show a mutual mistake. Meek v. Hearst, 223 Mo. 696.
Robertson, P. J., not sitting.
--This suit is for a balance upon a premium for liability insurance written by the plaintiff and covering defendant's mining operations in Jasper county. The policy in question is dated December 30, 1909, and was cancelled by the defendant on May 2, 1910.
The rate of the premium was four per cent of the amount of wages expended by the defendant to its employees, provided the policy was not cancelled by the assured before the end of the policy period for one year, during which the policy would otherwise remain in force. The policy contained a provision for cancellation by either party, but if cancelled by the assured the premium would be considerably greater than four per cent of the wages paid during the time the policy had run. The policy contained what is termed a "short rate" table, showing the amount to be paid provided the policy is cancelled before expiration.
The policy was continued in force one hundred and twenty-two days and according to the short rate table the premium for one hundred and twenty-two days is fifty and two-thirds per cent of the annual premium. The petition recites and the evidence shows that the defendant paid the premium for the period the policy was in force at the regular rate of four per cent, which will hereafter be denominated the "long rate," meaning thereby the rate which would be paid in case the policy continued for the full policy period. The petition alleges and the defendant concedes that it did not pay the premium for the time the policy was in force at the short rate, and that if plaintiff is entitled to collect the premium according to the short rate table, it is entitled to recover the sum of $ 2985.07, which represents the difference between the short rate and the long rate for the period of 122 days, during which the policy was in force.
The defenses disclosed by the answer are: (1) That the real agreement between the parties was that plaintiff would insure defendant from month to month and that a special provision was inserted in the policy, giving or intending to give the defendant the right to cancel the policy at any time at the long rate and exempting it from the short rate provisions of the policy; (2) that if the special provision inserted in the policy did not have this effect, then the court should reform the contract so as to express the real agreement of the parties; (3) that defendant had paid and plaintiff received the premium at the long rate for the time during which the policy was in effect and this was a settlement of the amount due; (4) that plaintiff had itself threatened to cancel the policy and that this gave the defendant the right to do so, without being subject to the short rate provision.
The court after hearing the evidence held that the plaintiff was not entitled to collect at the short rate; but that the payments made by the defendant, by reason of an error in the calculation, was $ 20 less than the amount of premium earned at the long rate and, the parties having agreed as to the amount of this error, entered judgment for plaintiff in the sum of $ 20.
The finding and judgment of the court does not clearly indicate on what ground the court denied the plaintiff the right to recover on the short rate basis. It will be necessary therefore for this court to determine whether or not the judgment can be sustained on any theory presented by the pleadings and evidence.
I. It is first necessary to determine whether the policy contract as written permits the assured to cancel the policy without paying the short rate premium.
The construction of contracts of insurance are not materially different from other contracts. [Renshaw v. Insurance Co., 103 Mo. 595, 600, 15...
To continue reading
Request your trial