Max Mears v. the Farmers Cooperative Fire Ins. Co

• Decision Date: 06 October 1942
• Citation: 28 A.2d 699,112 Vt. 519
• Parties: MAX MEARS v. THE FARMERS COOPERATIVE FIRE INS. CO
• Court: Vermont Supreme Court

28 A.2d 699

112 Vt. 519

MAX MEARS v. THE FARMERS COOPERATIVE FIRE INS. CO

Supreme Court of Vermont

October 6, 1942

May Term, 1942.

Fire Insurance.---1. Waiver.---2. Election not to Assert Forfeiture.---3. Inconsistent Claims.---4. Waiver of Forfeiture by Assessment.---5. Mistaken Acts do not Constitute Waiver.

1. A waiver is an intentional relinquishment of a known right by voluntary choice; the intent either being express or shown by conduct of an unequivocal character.

2. If an insurer with full knowledge of a forfeiture elects not to take advantage of it he thereby waives it and cannot assert it as a defense.

3. An insurer may not treat a policy as void for purposes of defense and at the same time treat it as valid for the purpose of collecting assessments.

4. By intentionally levying an assessment on a policy after claiming a forfeiture, an insurer thereby waives the forfeiture.

5. If after claiming a forfeiture an assessment notice is sent by mistake such notice does not constitute a waiver.

ACTION OF CONTRACT upon a fire insurance policy. Trial by jury Chittenden County Court, September Term, 1941, Hughes, J presiding. Verdict and judgment for the plaintiff; the defendant excepted.

Judgment Affirmed.

McNamara & Larrow for the plaintiff.

A Pearley Feen and Wayne C. Bosworth for the defendant.

Present: MOULTON, C. J., SHERBURNE, BUTTLES, STURTEVANT and JEFFORDS, JJ.

OPINION

SHERBURNE

This is an action upon a fire insurance policy covering farm buildings and produce therein. The defense was that the buildings stood upon ground which was not owned by the insured in fee simple in violation of a provision of the policy, and that consequently the policy was entirely void. The plaintiff made, and now makes, no claim but that the policy was void for such reason, but pleaded estoppel and waiver arising from the sending of an assessment notice after the fire and the acceptance of payment thereon. The sole question here is whether the court erred in overruling defendant's motion for a directed verdict upon these issues.

Viewing the evidence most favorably for the plaintiff it tended to show the following facts: The policy was for the term of 5 years from August 1, 1935, to August 1, 1940. The fire occurred July 12, 1940. It was investigated by Mr. Peet president of the defendant company, when the defendant first learned that the buildings had been on land not owned by the plaintiff, and shortly thereafter the plaintiff was informed that for this, and another reason not necessary to mention, the defendant did not feel justified in paying the loss. At some time prior to September 1, 1940, defendant's executive committee levied an assessment upon all outstanding insurance, and on that date a notice of an assessment upon plaintiff's policy was mailed to him at his address in Milton in the regular course of business. This was a printed notice which recited that the executive committee had ordered an annual assessment at different stated rates upon the four classes of risk and requested payment within 30 days from date to defendant's undersigned secretary, whose signature was printed at the bottom. In blanks for the purpose were written plaintiff's name and address, the number of his policy, the class of risk, and $ 10.80 the amount of assessment on the policy. The details of sending out such notices were performed by clerks in the defendant's home office in Middlebury. The plaintiff received this notice on or about its date, but did nothing about it until around July 1, 1941, when he consulted his attorneys and authorized them to pay it. Plaintiff's writ was served upon the defendant on July 10, 1941, and about two hours afterwards on the same day a law student in the office of plaintiff's attorneys entered defendant's home office where he observed two men, one doing clerical work and the other sitting at a desk. He was directed to a Miss Baldwin and went to her desk and presented the assessment notice with $ 15.00, which she took. She looked at the notice and asked "Have you seen Mr. Peet?" He answered "No, they asked me to pay this while I was in Middlebury." She then got up and went to a file and looked at a policy which she pulled out. She then looked at an entry book. He saw the name "Max Mears" and a few lines below the words "Not renewed" written in colored pencil. She then went back to her desk and said there was $ 1.08 due. She then receipted the notice and after going to another desk gave him $ 2.12 in change. Miss Baldwin did clerical work in connection with cancellations and expirations, but had no authority to receive money from those who came to pay premiums or assessments and did not have access to the cash drawer. There were two other girls in the office who sometimes took money in the absence of Mr. Peet, but they took it not as being authorized, but merely as persons to leave it with. When Mr. Peet would come in they would give it to him, and he would credit it on the books. Cash was seldom received in the office at that time of year. It usually came by mail. Mr. Peet was away on July 10, 1941. On the next day Miss Baldwin gave him the money she had received from the law student. He then had a check for the amount made out in favor of the plaintiff and turned it over to defendant's attorney, who, under date of July 12, 1941, mailed it to plaintiff's attorneys with an explanatory letter. Mr. Peet, since the sending of the assessment notice, had succeeded to the...