Boyd v. Cedar Rapids Ins. Co.

• Decision Date: 14 December 1886
• Citation: 30 N.W. 585,70 Iowa 325
• Parties: BOYD v. CEDAR RAPIDS INS. CO.
• Court: Iowa Supreme Court

70 Iowa 325

30 N.W. 585

BOYD

v.CEDAR RAPIDS INS. CO.

Supreme Court of Iowa.

December 14, 1886.

Appeal from district court, Page county.

Action to recover upon a policy of fire insurance. There was a trial to a jury, and verdict and judgment were rendered for the plaintiff. The defendant appeals.Deacon & Smith, for appellant.

Stockton & Keenan, for appellee.

ADAMS, C. J.

The defendant set up as a defense that the plaintiff, at the time of the loss, was in default by reason of the non-payment of his note given for the premium on the policy; and also that the plaintiff had failed to serve upon the defendant proof of the loss, as required by the policy. The two matters of defense will be considered in their order.

1. The policy provides that “the company shall not be liable for any loss or damage that may occur to the property herein mentioned while any promissory note given for the premium remains past due and unpaid.” The facts relied upon by the defendant appear to be that prior to the loss the plaintiff had given his promissory note for the premium, and that the same was past due and unpaid at the time of the loss. The plaintiff claims, however, that, notwithstanding such fact, the policy was not suspended, because the defendant had not given the notice required by the statute as a condition precedent to the exercise of its rights to declare the policy suspended. The provision of statute upon which the plaintiff relies is to be found in chapter 210 of the Acts of the Eighteenth General Assembly, and is in these words: “Within thirty days prior to, or at any time after, the maturity of any note or contract, * * * where the time of payment is fixed in the contract given for the premium on any policy of insurance, such company or association shall serve a notice in writing upon the insured that his note, or any installment thereof, is due, or to become due, * * * and that, unless payment is made within thirty days, his policy will be suspended. The company or association may state in said notice the amount which will be due on the note or contract, and also the amount necessary to pay the customary short rates, including the expense of taking the risk, up to the time the policy will be suspended, under the notice, in order to cancel the policy.”

The evidence tended to show that the defendant gave the plaintiff notice of the maturing of his note within the time provided by statute, and more than 30 days before the loss, and that the note remained unpaid at the time of the loss. It does not appear, however, that the notice contained any statement of the amount necessary to pay the customary short rate, in order to cancel the policy. But the defendant insists, in the first place, that, under the statute, it was not necessary that the notice should contain such statement; and, in the second place, that if the notice should have contained such statement, it was waived by plaintiff, because he applied for an extension of time on his note, which application was inconsistent with a desire to pay the short rate, and let his policy be canceled.

As to the necessity of such statement in the notice, it is to be observed that the statute provides that the company may state in the notice the amount necessary to pay the customary short rates, etc. The defendant insists that the provision is merely permissive, and not obligatory, as shown by the use of the word “may.” But, in our opinion, this position is not sound. The object...