Green v. Standard Fire Ins. Co. of Alabama

• Decision Date: 24 April 1981
• Citation: 398 So.2d 671
• Parties: Sylvester GREEN and Linda Green v. STANDARD FIRE INSURANCE COMPANY OF ALABAMA, a corporation. 80-18.
• Court: Alabama Supreme Court

Page 671

398 So.2d 671

Sylvester GREEN and Linda Green v. STANDARD FIRE INSURANCE COMPANY OF ALABAMA, a corporation.

80-18.

Supreme Court of Alabama.

April 24, 1981.

Rehearing Denied May 22, 1981.

Roy M. Johnson, III of Perdue, Johnson, Boone & Johnson, Birmingham, for appellants.

Tom E. Ellis of McDaniel, Hall, Parsons, Conerly, Scott & Lusk, Birmingham, for appellee.

BEATTY, Justice.

A declaratory judgment was rendered in favor of the plaintiff, Standard Fire Insurance Company of Alabama (Standard Fire), and against the defendants (the Greens), holding that Standard Fire was not obligated to pay any sum to the defendants, nor to defend any suits against them arising out of an automobile accident, because the defendants' insurance policy had been cancelled prior to the date of the accident. We affirm in part, reverse in part and remand.

On February 6, 1978 Standard Fire issued a policy of automobile comprehensive, collision and liability insurance to Sylvester and Linda Green. The policy had a expiration date of February 6, 1979. On November 14, 1978 a notice was mailed to the Greens at the proper address stating that their policy was being cancelled effective November 26, 1978. On December 6, 1978, Linda Green was involved in a car accident which would be covered by the policy if it were still in effect.

Standard Fire brought a declaratory judgment action in the Shelby County Circuit Court on February 8, 1979, claiming that it had no obligation to pay any claims to the Greens or to defend any suits against them under the cancelled policy. The Greens filed a counter-claim asserting that they were covered by the policy at the time of the accident. Ford Motor Credit Company, a lienholder on the Green's car, consented to a judgment against it in favor of the plaintiff.

At trial after the plaintiff had presented its evidence, the defendants moved for a directed verdict, which motion was denied. The defendants presented no further evidence. The trial court then rendered judgment in favor of the plaintiff, finding that Standard Fire was not obligated to pay any sum to the Greens nor to defend any suits arising out of the automobile accident in question. The defendants moved for a new trial or in the alternative for a judgment notwithstanding the verdict, both of which were denied. This appeal ensued.

Standard Fire filed a motion to strike a portion of the reply brief filed by the defendants with this Court on the ground that the reply brief contains material outside the record. In their reply brief the defendants included two documents which were not in evidence, but which they contended were examples of possible reasonable inferences of what the cancellation notice sent to the defendants and an insurance statement received by the defendants must have resembled. Although the defendants clearly stated in brief that these documents were not in evidence and thus did not attempt to deceive the Court, it is well settled in Alabama that an appellate court will not consider matters outside the record. American Benefit Life Insurance Co. v. Ussery, Ala., 373 So.2d 824 (1979). This Court is limited to a review of the record alone and "the record cannot be changed, altered or varied on appeal by statements in briefs of counsel, nor by affidavits or other evidence not appearing in the record." Cooper v. Adams, 295 Ala. 58, 322 So.2d 706 (1975). Since the evidence here was improperly submitted, the plaintiff's motion to strike is hereby granted and the proffered evidence will not be considered.

It is clear that when an insurer seeks judgment declaring that it is not required to defend in a pending lawsuit growing out of an automobile accident, the insurer has the burden of proving the allegations of its complaint. Alabama Farm Bureau Mutual Casualty Insurance Co. v. Cofield, 274 Ala. 299, 148 So.2d 226 (1962). The primary issue here is whether the plaintiff met its burden of proving that the liability portion of the insurance policy in question was effectively and legally cancelled.

Code of 1975, § 27-23-21, reads as follows:

(a) No notice of cancellation of a policy of automobile liability insurance shall be effective unless it is based on one or more of the following reasons:

(1) Nonpayment of premium;

....

(b) This section shall not apply to any policy of automobile liability insurance which has been in effect less than 60 days at the time notice of cancellation is mailed or delivered by the insurer unless it is a renewal policy.

Code of 1975, § 27-23-23, continues by stating:

No notice of cancellation of a policy to which section 27-23-21 applies shall be effective unless mailed or delivered by the insurer to the named insured at least 20 days prior to the effective date of cancellation; provided, however, that where cancellation is for nonpayment of premium, at least 10 days' notice of cancellation accompanied by the reason therefor shall be given. Unless the reason, or reasons, accompany or are included in the notice of cancellation, the notice of cancellation shall state, or be accompanied by a statement, that upon written request of the named insured, mailed or delivered to the insurer not less than 15 days prior to the effective date of cancellation, the insurer will specify the reason, or reasons, for such cancellation.

The policy in question became effective on February 6, 1978 and the cancellation notice was mailed on November 14, 1978. Thus it is clear that the policy had been in effect more than 60 days prior to the time notice of cancellation was mailed.

The defendants correctly urge that in order to prove a valid cancellation of an automobile liability insurance policy the plaintiff must prove that cancellation was based on one of the reasons listed in Code of 1975, § 27-23-21. See American Service Mutual Insurance Co. v. Grizzard, Ala.Civ.App., 356 So.2d 191 (1978). The defendants contend that the plaintiff's complaint merely stated that the policy was cancelled "at the agent's request," and that since "at the agent's request" is not a valid ground for cancellation under § 27-23-21, the plaintiff failed to show a valid reason for the cancellation. At trial, however, one Mr. Cahall, testifying for the plaintiff, stated:

Q (BY MR. TOM ELLIS) My question is: do you know the reason given to all parties who received notice of the cancellation? Do you know that? That is the first question?

A Yes, sir.

Q The next question is: what was the reason?

A Non payment of premium.

Although the attorney for the defendants then objected to the question and the objection was sustained, the general rule in Alabama is that when a question is asked of a witness calling...