Imperial Premium Finance, Inc. v. Northland Ins. Co., No. WD

• Decision Date: 13 July 1993
• Docket Number: No. WD
• Citation: 861 S.W.2d 596
• Parties: IMPERIAL PREMIUM FINANCE, INC., Appellant, v. NORTHLAND INSURANCE CO., et al., Respondent, and Midwestern General Agency, Respondent. 46789.
• Court: Missouri Court of Appeals

Page 596

861 S.W.2d 596

IMPERIAL PREMIUM FINANCE, INC., Appellant, v. NORTHLAND INSURANCE CO., et al., Respondent, and Midwestern General Agency, Respondent.

No. WD 46789.

Missouri Court of Appeals,

Western District.

July 13, 1993.

Motion for Rehearing and/or Transfer to

Supreme Court Denied Aug. 31, 1993.

Application to Transfer Denied Oct. 26, 1993.

Kip D. Richards, Kansas City, for appellant.

Jeffrey A. Burns and Patrick Lysaught, Kansas City, for Northland Ins. Co.

Robert Ernest Gould and William L. Carr, Kansas City, for Midwestern General Agency.

Before SMART, P.J., and SHANGLER and FENNER, JJ.

SHANGLER, Judge.

The plaintiff Imperial Premium Finance, Inc. brought suit against the defendants Northland Insurance Co. and Midwestern General Agency to recover a gross unearned premium due under a financed insurance contract. Count I of the petition pleads the theory of recovery that the failure of the defendants to return the unearned premium was a violation of § 364.135, RSMo 1986, and constituted negligence per se. Count II is a pleading for punitive damages.

The plaintiff IPF moved for partial summary judgment on Count I of the petition against the defendant Northland on the ground that, under the pleadings and evidentiary materials in support of the motion, the violation of § 364.135 by Northland--and hence the negligence per se of the defendant was proven as a matter of law. The response by Northland in opposition to the IPF motion for partial summary judgment rests on the premise that § 364.135 did not apply to the transaction between IPF and Northland, and hence the violation of the statute was not the proximate cause of any injury to IPF.

The defendant Northland moved separately for summary judgment on the same ground given in response to the IPF motion for partial summary judgment and, most essentially, that in fact IPF did not finance the insured's premium, so § 364.135 did not apply to the transaction as a matter of law. The defendant Midwestern also moved for summary judgment, and also on the ground that § 364.135 did not apply to the transaction, but for separate reasons. The disparate motions were supported by evidentiary materials.

The trial court denied the motion of plaintiff IPF for summary judgment and granted the motions of the defendants Northland and Midwestern, and entered summary judgment against the petition. The plaintiff IPF appeals the order of summary judgment.

The integral transaction that gives rise to the essential legal issue that the appeal presents is best understood in terms of the roles and functions of the several actors.

The plaintiff IPF is a premium finance company within the definition of § 364.100(4). ¹ IPF entered into an agreement with Trans Com Marketing, Inc. whereby Trans Com became a producing agent for IPF. IPF provided Trans Com with a supply of pre-numbered drafts to be used for funding loans on behalf of IPF and authorized the Trans Com president, vice-president and treasurer to sign drafts and disburse the IPF funds as loans for the premium payments. Trans Com also had a limited producer's agreement with the defendant Midwestern General Agency. In June 1988, Trans Com requested IPF to finance the annual premium for a policy to be produced by Trans Com and/or Midwestern on behalf of Trans Com's client, Ultimate Transportation, Inc. IPF agreed to finance the premium and Midwestern, acting as general agent of Northland Insurance Company, procured the policy from Northland. The premium finance agreement was executed by IPF, Trans Com and Ultimate Transportation on June 30, 1988. The annual premium due under the terms of the policy was $39,248, and IPF agreed to finance $29,436 of that amount. The agreement required Ultimate Transportation to pay IPF $31,002.32 by eight monthly installments with the first installment due before July 30, 1988. The first installment was not received when due and IPF canceled the policy. IPF notified the defendants Midwestern and Northland of the cancellation. On October 3, 1988, IPF formally requested Midwestern and/or Northland to return the gross unearned premium due under the policy directly to IPF. The defendants Midwestern and Northland steadfastly deny that any part of the original premium was ever paid to them.

IPF asserts on appeal that the trial court erred in denying its motion for partial summary judgment against the defendants Northland and Midwestern, and in sustaining the motion for summary judgment by the defendants against IPF because as to its claim for negligence per se, there was no genuine issue of material fact and so IPF was entitled to judgment as a matter of law. This composite point asserts as premise: "the undisputed facts of this case irrefutably show that Northland violated § 364.135 and was thereby negligent per se when it failed and refused to return the $32,262.00 unearned premium at issue in this case to IPF."

Section 364.135 provides:

Whenever a financed insurance contract is canceled, the insurer shall return whatever gross unearned premiums are due under the insurance contract directly to the premium finance company for the account of the insured or insureds as soon as reasonably possible, but in no event later than sixty days after the effective date of cancellation. In the event that the crediting of return premiums to the account of the insured results in a surplus over the amount due from the insured, the premium finance company shall refund such excess to the insured, provided that no such refund shall be required if it amounts to less than one dollar.

The right to summary judgment is established "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue of material fact and that the moving party is entitled to a judgment as a matter of law." Rule 74.04(c). The summary judgment procedure, therefore, "is designed to permit the trial court to enter judgment, without delay, where the moving party has demonstrated, on the basis of facts as to which there is no genuine dispute, a right to judgment as a matter of law." ITT Commercial Fin. Corp. v. Mid-America Marine Supply Co., 854 S.W.2d 371, at 376 (Mo. banc 1993). The legal right to judgment for the claimant IPF, as movant under Rule 74.04(a) and (c), depends as an antecedent matter upon whether § 364.135 invests a new civil cause of action in favor of a premium finance company and, if so, whether the movant established that there is no genuine issue as to the material facts that make up the substantive cause of action upon which the claimant has the burden of persuasion at trial. The statute that IPF invokes as the source for right of redress from defendants Northland and Midwestern creates a criminal offense. Section 364.160 of the enactment provides: "Any premium finance company willfully and knowingly violating the provisions of sections 364.100 to 364.160 [the Premium Finance Companies law] shall be guilty of a class A...