Allstate Ins. Co. v. Dougherty

• Decision Date: 10 January 1967
• Docket Number: No. 66--291,66--291
• Citation: Allstate Ins. Co. v. Dougherty, 197 So.2d 563 (Fla. App. 1967)
• Parties: ALLSTATE INSURANCE COMPANY, a foreign corporation authorized to do business in the State of Florida, Appellant, v. Mary Lou DOUGHERTY, Appellee.
• Court: Florida District Court of Appeals

Page 563

197 So.2d 563

ALLSTATE INSURANCE COMPANY, a foreign corporation authorized to do business in the State of Florida, Appellant, v. Mary Lou DOUGHERTY, Appellee.

No. 66--291.

District Court of Appeal of Florida, Third District.

Jan. 10, 1967.

Rehearing Denied May 1, 1967.

Goodman & Petersen, Richard M. Gale, Miami, for appellant.

Fuller & Brumer, Kenneth L. Ryskamp, Miami, for appellee.

Before PEARSON and SWANN, JJ., and NATHAN, RAYMOND G., Associate Judge.

PEARSON, Judge.

Allstate Insurance Company appeals a final decree in a declaratory decree action. The action was brought by Mary Lou Dougherty who claimed to be a policyholder of the Insurance Company. She brought a complaint for declaratory decree alleging that it was brought for the purpose of determining an actual controversy involving an insurance contract between the parties. She recited a course of declings with the Insurance Company and alleged that the Insurance Company denied the existence of a policy insuring her. She further alleged that she had been involved in an automobile accident which she had reported. Her prayer was that the court render a decree declaring the policy to be in existence, and that the court assess damages against the defendant for its refusal to extend coverage.

Upon the trial of the cause, two basic issues of fact were developed. They were: (1) whether or not the plaintiff paid the preminum due upon the policy before its cancellation, and (2) whether or not the plaintiff's policy was cancelled prior to the accident.

After the trial of the cause, the chancellor specifically found against the plaintiff, appellee, upon the issue of payment. ¹

Upon the second issue of fact, the chancellor stated in the final decree as follows:

'3. That the defense claimed by the Defendant, ALLSTATE INSURANCE COMPANY, based upon cancellation of the insurance policy, be, and the same is hereby denied, in view of the testimony and the Exhibits presented at the final hearing.

'4. That the payment of the additional premium was made after the accident date, but that the correspondence between the Defendant and the Plaintiff is found to have misled the Plaintiff, MARY LOU DOUGHERTY, into believing that she had certain credit for past years with the Defendant, ALLSTATE INSURANCE COMPANY.' ²

The essence of the chancellor's finding upon the second issue is that the Company was equitably estopped to assert the cancellation. This position is based upon the letter written to Mrs. Dougherty at the time that she received a newer and less expensive policy. Mrs. Dougherty had been insured under Allstate's 'Standard Illustrator' policy. That policy showed joint ownership of the insured automobile by Mrs. Dougherty and her mother, Mary B. Henkle. The same type of policy was renewed on the anniversary date on December 28, 1962, and a premium notice for $45.30 was mailed to plaintiff. This premium was not paid.

The plaintiff advised the defendant's agent at the end of year 1962 that she was the sole owner of the insured automobile. As a result of being a sole owner and a 'safe driver', the plaintiff was eligible for the defendant's 'Crusader' policy, which would result in plaintiff receiving a discount from the base rate.

The defendant, on February 13, 1963, at the plaintiff's request, mailed her a 'Crusader' policy replacing the old policy. This new policy was issued to cover the period January 24, 1963, to December 28, 1963. She was advised by a letter from the defendant that any credit for the cancellation of the Standard Illustrator policy would be applied to the new Crusader policy.

The plaintiff was billed for $94.40 when the new (Crusader) Policy was issued.

Subsequent to forwarding the Crusader policy to the plaintiff, the defendant sent a notice of cancellation for nonpayment of premium to the plaintiff. The notice was mailed on March 1, 1963, and was to become effective March 14, 1963. The plaintiff has had the same mailing address for 20 years, and the notice of cancellation, bearing said address, was delivered to the post office. Plaintiff testified that she never received the notice of cancellation.

Approximately three months after the notice of cancellation was mailed, the plaintiff was involved in an automobile accident, which occurred between four and four-thirty P.M. on June 4, 1963. At 6:30 P.M. on the same date, a payment of $45.30 was made by check on behalf of the plaintiff to the defendant.

Since the court held that the plaintiff policyholder was excused from the effects of the cancellation by the confusion created by a reference to a credit, we set forth in full the letter of February 13, 1963, from the insurance company to Mrs. Dougherty:

'As you know, the policy covering your 1954 Oldsmobile was issued jointly in your name and Mary B. Henkle. When there is joint ownership of a vehicle it is necessary that we issue our Standard Illustrator policy for it. However, since you have advised that the name of Mary B. Henkle should no longer be on the policy, it was possible for us to cancel the Standard Illustrator policy and issue the Allstate Crusader policy for this vehicle. The policy has been issued for the period January 24, 1963, to December 28, 1963. I am enclosing a copy of the policy for you. Any credit for the cancellation of the Standard Illustrator policy will be applied to the new Crusader policy. The Crusader policy has been written on a short-term basis in order that you could retain your old effective date of December 28.

'Please let us know if there is further question.

'cordially,

/s/ B. Pringle

Customer Service Division'

The Crusader policy contains a clause which provides that the policy may be cancelled by the company by mailing to the insured, at the address shown in the policy, written notice stating when, not less than ten days thereafter, such cancellation shall be effected....