Ayres v. American Mut. Ins. Co.
| Decision Date | 13 November 1963 |
| Citation | 199 A.2d 739,203 Pa.Super. 252 |
| Parties | Horace AYRES v. AMERICAN MUTUAL INSURANCE COMPANY, Inc., Appellant. |
| Court | Pennsylvania Superior Court |
Sheldon Tabb, Philadelphia, for appellant.
Herbert L. Olivieri, Martin B. Pitkow, Olivieri & Pitkow, Philadelphia, for appellee.
Before RHODES, P. J., and ERVIN, WRIGHT, WOODSIDE, WATKINS, MONTGOMERY and FLOOD, JJ.
Viewing the evidence in a light favorable to the plaintiff and giving him the benefit of all reasonable inferences therefrom, as we are required to do since he is the holder of the decision, the facts may be stated as follows. In May of 1960 plaintiff-appellee purchased a truck in used condition for $4,000 from F. W. Emmett, Sr. and thereafter improved and equipped it to the extent of $1,800 to $2,000. On May 26, 1960 appellee secured a loan of $4,310.59, for the purpose of buying a truck, through the personal credit department of the Fidelity-Philadelphia Trust Company on a note signed by himself and his wife. At that time or thereafter he delivered to the bank the titles to two trucks, one of which now concerns us, under two security agreements which are not in evidence. The bank marked on the titles the word 'Encumbrance,' and according to the testimony of the bank's assistant manager this was done 'For the sole purpose so that he would not be able to borrow any money from any other establishment for the truck' (R.113a). The bank expressly waived insurance on the truck by stamping 'Insurance Waived' on the folder. This was done '* * * because of the good credit record of Mr. Ayres and also the equity he has in his property, and there is no need to have anything to hold any more security on' (R.114a). Had it been a loan based upon the purchase of an automobile the bank would have insisted on insurance and held it. The bank is claiming no interest in the proceeds of this policy and did not register any encumbrance with the Pennsylvania Bureau of Motor Vehicles or have the certification of any encumbrance noted by the bureau on the titles.
The issuance of the policy was admitted by defendant, and it does contain an exclusionary clause against encumbrances. However, since we are led to the conclusion that no encumbrance existed, we need not review the other facts involving the waiver of such provision by defendant. Whether an encumbrance did or did not exist was for the trial judge since in the absence of the security agreement previously referred to the evidence was entirely oral. However, we have previously ruled on a similar situation in Zaffuto v. Northern Ins. Co. of N. Y., 109 Pa.Super. 376, 167 A. 298, wherein we held that unpaid purchase money on the sale of a car is not a lien or mortgage within a similar provision of a policy which must be construed most strongly against the insurer. The fact that the certificate of title may denominate such unpaid purchase money an 'encumbrance' does not make it so, if, in fact, the sale is a straight one on credit. The same reasoning applies here. If Judge REIMEL found the loan to be a personal one, the bank having held the two titles merely to prevent the debtors from becoming indebted to someone else, and claiming no right to the trucks or the proceeds of insurance on them, which is a reasonable inference to be taken from his decision, then this appellant, in the position of having the policy construed most strongly against it, cannot successfully contend that the loan was such as was covered by its exclusionary clause.
Appellant's position in the present case is weaker than the Zaffuto case, supra. Therein the encumbrance was noted on the certificate of title by the Highway Department in accordance with statutory regulations. In the present case the Vehicle Code procedure was not followed, the bank merely writing the word 'Encumbrance' on the title. Consequently, there was no lien established in the bank's favor in the manner set forth in Mellon National Bank & Trust Company v. Cabin, 177 Pa.Super. 417, 110 A.2d 888, viz., having a lien noted on the certificate of title by the Bureau of Motor Vehicles following an oral pledge of an automobile without delivery of its possession.
We must also reject appellant's other contention that judgment should be in its favor because of appellee's failure to file a proof of loss in compliance with terms of the policy. Although the policy provided for a proof of loss to be filed within sixty days, and none was filed, the question remains whether this requirement was waived by the insurer. The facts on that feature of the case are as follows. On October 18, 1961, the day after the fire, appellee, by telephone, notified Richard H. Breen, appellant's claims manager, of his loss. The value of the truck and its equipment were discussed at this time. Mrs. Slater, an employe of the insurer, took an accident report from Mr. Ayres and a series of conversations followed between Mr. Breen and Mr. Ayres, some in person and some by telephone. Settlement of the claim was discussed, the insured demanding $5,300, the insurer offering $800 less salvage. Mr. Post, an adjuster for insurer, also discussed the matter with appellee and on October 25, 1961 wrote him as follows: Mr. Post inspected the truck and the insurer had an estimator from the Gerard Auto Body Company examine the truck and render to it a report of its condition and value. This report was rendered November 20, 1961. Although insurer had forms for proof of loss, it never tendered one to insured or demanded one from him. If the insurer's offer of $800 had been accepted, the insurer would have made out a proof of loss of claimant before issuing a check to him in payment.
From the above facts it clearly appears that the insurer was fully and promptly informed as to the loss, made an appraisal of same and negotiated settlement without offering its form of proof of loss or without advising the insured that one was required, although admitting that it would have prepared one for claimant had its offer of settlement been accepted. Under these circumstances we are led to the conclusion that the lower court was not in error in finding that the provision of the policy requiring a formal proof of loss had been waived. A waiver may be inferred from any act evidencing a recognition of liability. Cara v. Newark Fire Ins. Co., 312 Pa. 489, 167 A. 356; Fedas v. Insurance Company of State of Pennsylvania, 300 Pa. 555, 151 A. 285; Karp v. Fidelity-Phenix Fire Insurance Company, 134 Pa.Super. 514, 4 A.2d 529.
Melnick v. American Casualty Company of Reading, 192 Pa.Super. 116, 159 A.2d 744, cited by appellant, is readily distinguishable since in that case no notice of any kind was given within the period provided by the policy. The same is true of Stoyer v. Franklin Fire Insurance Co., 114 Pa.Super. 555, 174 A. 628; no notice of any kind was given within the proscribed period.
There remains the final question as to the excessiveness of the verdict. The policy covered a truck (stated value $6,000) being used for dispensing 'Softie Ice Cream.' Appellee had purchased it in May, 1960, in a used condition, for $4,000; had improved it with equipment and labor totaling $2,000; and had used it only three months in 1960, and from April until Labor Day, 1961, when the weather permitted, for total mileage of less than 7,000 miles. His opinion of its value when destroyed was a minimum of $6,500. Under this evidence we cannot charge the trial judge with error in awarding $4,435 for its total destruction.
Judgment affirmed.
This matter is before us again following the allowance of a petition ex parte appellant for reargument. Our previous consideration of the case is reflected in our opinion filed November 13, 1963. Our decision following that opinion affirmed the verdict for the appellee because, as we viewed the record, there was insufficient evidence to establish that an encumbrance had existed. The case was tried in the lower court before Hon. THEODORE L. REIMEL, without a jury, who rendered the...
To continue reading
Request your trial