Brown v. State Automobile Ins. Ass'n of Des Moines, Iowa
| Decision Date | 03 January 1944 |
| Docket Number | No. 33515.,33515. |
| Citation | 216 Minn. 329,12 N.W.2d 712 |
| Parties | BROWN v. STATE AUTOMOBILE INS. ASS'N OF DES MOINES, IOWA. |
| Court | Minnesota Supreme Court |
Appeal from District Court, Fillmore County; Norman E. Peterson, Judge.
Action by Avis Brown, special administratrix of the estate of Carl Brown, against the State Automobile Insurance Association of Des Moines, Iowa, to recover the amount of a judgment obtained against the holder of an automobile liability policy issued by defendant. From a judgment for defendant, plaintiff appeals.
Affirmed.
C. E. Bramer, of Preston, and Meighen, Knudson & Sturtz, of Albert Lea, for appellant.
Freeman, King & Geer, of Minneapolis, and Nelson & Plunkett, of Austin, for respondent.
Plaintiff, having recovered a judgment for $8,054 against A. L. Groth for negligently causing the death of her husband while he was a passenger in Groth's automobile, sues defendant to recover the amount of the judgment, claiming that it is liable therefor under an automobile liability insurance policy indemnifying Groth against the liability resulting in the judgment.
Defendant admits the issuance of the insurance policy, but alleges that prior to the accident causing the death the insurance had automatically lapsed and terminated for nonpayment of the premium.
At the trial, plaintiff claimed that the payment of the premium according to the terms of the policy was waived by defendant's agent, Cartwright, and that in consequence of the waiver the policy was in force and effect when the accident occurred.
On May 9, 1940, Cartwright, who was connected with the D. L. Williams Agency at Rochester, solicited Groth to take a policy of insurance issued by defendant to cover his 1936 Buick automobile. Groth was unable to pay the premium, and credit was extended to him. The policy was issued by defendant at its home office on May 13, 1940. It is dated May 9, 1940, and was received by the insured some time prior to May 15.
The instrument issued by defendant and received by Groth is a long sheet of paper, which is folded in the middle. Immediately below the folding crease, defendant's name is printed in large type. Below the name are the "DECLARATIONS." At the bottom of the page is the date, May 9, 1940, and defendant's signature. Below the signature is a space for endorsements, where a farm trailer endorsement is attached.
Under the word "DECLARATIONS" the name of the insured is given as A. L. Groth. Then follow statements concerning his address, occupation, policy period, which is for one year from the date of the policy, coverages, limits of liability for each coverage, amount of premium, which is $15.50, description of the automobile, the purpose for which the automobile is to be used, and declarations to the effect that no insurer had cancelled any automobile insurance issued to the insured during the preceding year; that he is the sole owner of the automobile; that no driver's license or permit for the insured has ever been refused, cancelled, or revoked; and that the named insured is an individual.
Under item 3 of the "DECLARATIONS" are listed in parallel columns the different kinds of insurance coverage and the limits of liability for each. The blank for bodily injury liability was filled in for $10,000 for each person and for $20,000 for each accident, and the one for property damage liability for $5,000 for each accident. This item declares:
There is no insurance clause nor any insurance contract provision above the signature or anywhere else on this page.
On the back of this page and extending over the entire sheet onto the back of the last page are insurance contract provisions. These begin with a statement that the subscribers, constituting the defendant association, "DO HEREBY AGREE with the insured, named in the declarations made a part hereof, in consideration of the payment of the premium and of the statements contained in the declarations and subject to the limits of liability, exclusions, conditions and other terms of this policy:" There is no signature at the end of, or elsewhere in, this printed matter.
Under the caption "INSURING AGREEMENTS," there are provisions relating to and defining the insurance coverage for each of the classes mentioned in the "DECLARATIONS." The word "insured" is defined so as to cover not only the named insured but also certain other specified persons.
There are policy provisions to the effect that "by acceptance of this policy" the named insured agrees "that the statements in the declarations" are his agreements and representations; that "this policy" embodies all agreements existing between him and defendant or any of its agents; and that upon certain conditions, if the "named Insured" acquires ownership of another automobile to replace the one described in the policy, the insurance shall cover such automobile.
Under the caption "CONDITIONS" are 26 provisions. Section 8 thereof defines the limit of bodily injury liability "stated in the declarations." Section 26 provides:
Section 7 provides: "No notice to any agent, or knowledge possessed by any agent or by any other person shall be held to effect a waiver or change in any part of this policy nor estop the Association from asserting any right under the terms of this policy; nor shall the terms of this policy be waived or changed, except by endorsement issued to form a part hereof, signed by the Attorney in fact for the Association; provided, however, that changes may be made in the written portion of the declarations by endorsement issued to form a part hereof signed by the Attorney in fact for the Association."
On June 25, 1940, defendant mailed the insured a final notice that the premium would be due on July 9, 1940. On July 13, 1940, it mailed him a notice that the policy had terminated for nonpayment of the premium. The insured testified on direct examination that he did not receive the notices and on cross-examination that he did not know whether he had received them. On July 16 the insured bought a 1937 Buick, and defendant's agent, Cartwright, agreed with him to transfer the insurance coverage from the 1936 to the 1937 Buick.
On July 25, 1940, Cartwright tried to collect the insurance premium from the insured. According to testimony for plaintiff, the insured gave Cartwright a check for $5 to apply on the premium and agreed to pay the balance if he (the insured) "had any decent kind of a show at all at Rochester at the Fair." The show ran from August 6 to August 11, 1940. Cartwright saw the insured in Rochester immediately after the fair and tried to collect the balance of the premium from him but was informed by the insured that he would be lucky if he were able to pay certain riders who took part in his show and that he was going to have another show at Anoka in which he hoped to do better. The show at Anoka was held immediately following the fair at Rochester. Nothing further transpired between the defendant or its agents and the insured after Cartwright tried to collect the balance of the premium on the occasion mentioned. No bills were sent to Groth for the balance due. No arrangements for further extensions of time within which to pay the balance of the premium were made. The Williams agency retained the $5 but did not forward it to defendant. Consequently defendant received no part thereof.
On January 15, 1941, the insured had a collision with a train near Farmington, Minnesota, in which plaintiff's husband was killed. This accident occurred approximately eight months after the date of the policy, six months after it lapsed, according to its terms, for nonpayment of the premium, and approximately five months after the insured had his shows at Rochester and Anoka. The insured had in his pocketbook at the time of the collision a card which defendant had sent him with the policy, containing instructions concerning accidents.
After the accident the insured requested defendant to defend an action which had been brought against him by the plaintiff to recover damages for the wrongful death of her husband. Defendant disclaimed liability under the policy and refused to defend the action upon the grounds that the policy had lapsed and terminated for nonpayment of the premium and had been cancelled.
There was a directed verdict in favor of defendant. Plaintiff appeals.
Defendant contends here, as it did below, that the policy automatically lapsed and terminated on July 9, 1940, because of the insured's failure to pay the premium; that all the acts of Cartwright, claimed by plaintiff, with respect to extending credit, accepting partial payment of the...
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