Hoover v. Hartford Fire Insurance Co.

• Decision Date: 18 December 1928
• Parties: Hoover et ux. v. Hartford Fire Insurance Company.
• Court: United States State Supreme Court — District of Kentucky

Page 88

227 Ky. 88

Hoover et ux. v. Hartford Fire Insurance Company.

Court of Appeals of Kentucky.

Decided December 18, 1928.

1. Insurance. — It is consistent with the policy of law for parties to fire insurance contract to stipulate therein that payment of any note given for a premium shall operate as a condition to continuance of the contract.

2. Insurance. — Insurer may waive stipulation in insurance contract that payment of note for premium shall operate as condition to continuance of the contract by holding the note and making unconditional demand for payment of it.

3. Insurance. — Evidence, in action by insured on fire policy, held insufficient as matter of law to show that insurer, by holding note and making unconditional demand for its payment, waived stipulation of contract that payment of note for premium should operate as condition to continuance of contract.

4. Appeal and Error. — Exclusion of testimony which would have added nothing material to evidence admitted, if erroneous, held not prejudicial.

Appeal from Hopkins Circuit Court.

THOS. E. FINLEY and J.A. JONSON for appellants.

FOX & GORDON and J.T. GOOCH for appellee.

OPINION OF THE COURT BY JUDGE WILLIS.

Affirming.

This is an action upon a contract of insurance. G. L. Hoover and wife insured their dwelling, household goods, barn, and some other property in the Hartford Fire Insurance Company for a period of five years. They paid $40.56 in cash on or before November 1, 1922, and executed an installment note to the insurance company for $162.24 for the balance of the premium, payable one-fourth on the 1st day of November in each of the ensuing four years. The installment note and insurance policy each contained a provision to the effect that the company should not be liable for any loss or damage that might occur to the insured property whilst any installment of the premium note, or any portion thereof, remained due and in default. In March, 1925, all of the insured property was destroyed by fire. The company denied liability for the loss, and this action upon the contract was instituted by the insured. At the conclusion of the evidence offered by the plaintiffs, a peremptory instruction was given the jury to find for the defendant. A new trial was requested and refused, resulting in this appeal by the plaintiffs. The defense of the insurance company was rested upon the admitted failure of the insured to pay the installments of the premium note that fell due, respectively, on November 1, 1923, and on November 1, 1924. The appellants relied upon a waiver of the suspension provisions of the note and policy by reason of an unconditional demand for payment and retention of the note by the company. The waiver was denied. The question is whether there was sufficient evidence of waiver of the conditions of the note and policy to require submission of the case to the jury.

The collection of the agreed premiums for insurance is vital to the insurance business, and it is consistent with the policy of the law to stipulate in the contract that the payment of any note given for the premium shall operate as a condition to the continuance of the contract. Morgan v. Home Insurance Co., 216 Ky. 589, 288 S.W. 321; Ray v. Commonwealth Life Ins. Co., 184 Ky. 215, 211 S. W. 736; Clifton v. Hartford Ins. Co., 203 Ky. 779, 263 S. W. 338; New England Mutual Life Ins. Co. v. Springate, 129 Ky. 627, 112 S.W. 681, 113 S.W. 824, 19 L.R.A. (N. S.) 227.

The condition, however, is for the benefit of the insurance company, and this court has held that such stipulation may be waived by the insurance company holding the note and making an unconditional demand for payment of it. Ca...