McCluer v. Home Ins. Co. of New York

• Decision Date: 08 May 1888
• Parties: M. L. MCCLUER, Appellant, v. HOME INSURANCE COMPANY OF NEW YORK, Respondent.
• Court: Missouri Court of Appeals

31 Mo.App. 62

M. L. MCCLUER, Appellant, v. HOME INSURANCE COMPANY OF NEW YORK, Respondent.

Court of Appeals of Missouri, St. Louis.

May 8, 1888

Appeal from the Greene Circuit Court, HON. JAMES R. VAUGHAN, Judge.

Reversed and remanded.

GOODE & CRAVENS, for the appellant: There are two classes of cases in which the doctrine of waiver of forfeiture incurred by default in the payment of premiums has been considered: (1) Where the contract provides that upon default in the payment the whole of the premium shall be deemed due and earned. In these cases the acceptance by the company of a past-due premium after loss has occurred, does not waive the forfeiture; and this for the very obvious reason that it is taking no more than it is entitled to, because by express agreement the premium is all earned. (2) Where the contract does not contain this provision. In these cases the courts have invariably held the forfeiture waived by acceptance of the premium after loss. Williams v. Ins. Co., 19 Mich. 451; Joliffe v. Ins. Co., 39 Wis. 111. The case at bar falls in the second class, but is a little stronger even than most of that class. For not only is there no provision that upon default in payment the whole premium shall be considered earned, but a clear provision that it shall not be. If an insurance company receives and retains payment of a past-due premium with knowledge that a loss has occurred, it is estopped to claim any forfeiture which may be provided for in the policy for a default, unless it also provides that in the event of such default the entire premium for the whole time the policy is to run, shall be considered earned. Joliffe v. Ins. Co., 39 Wis. 111; Smith v. Ins. Co., 13 N.W. 355; Ins. Co. v. Lansing, 20 N.W. 22; Cohen v. Ins. Co., 3 S.W. 296; Wing v. Harvey, 22 Eng. Law and Eq. 140; Berwick Co. v Ins. Co., 52 Me. 336; Bennicke v. Ins. Co., 15 Otto 355; Ins. Co. v. Robertson, 59 Ill. 123; Ins. Co. v. Maguire, 51 Ill. 342; Benton v. Ins. Co., 25 Conn. 542; Goit v. Ins. Co., 25 Barb. 189; Ins. Co. v. Berrien, 40 Mich. 147; Ins. Co. v. Geraldine, 31 Mo. 30; Sims v. Ins Co., 47 Mo. 54; Froelich v. Ins. Co., 47 Mo 406; Baldwin v. Ins. Co., 56 Mo. 151; Schmidt v. Ins. Co., 2 Mo.App. 339. Defendant sent the plaintiff a notice after default, demanding payment, and said nothing about having declared a forfeiture, but rather intimated the reverse. Any provision for forfeiture, whether it be on account of nonpayment of premiums or some other cause, may be and will be waived by the acceptance of the premium after knowledge of the cause of forfeitures. Combs v. Ins. Co., 43 Mo. 148; Miner v. Ins. Co., 27 Wis. 693; Franklin v. Ins. Co., 42 Mo. 456; Keeler v. Ins. Co., 16 Wis. 523; Ins. Co. v. Hall, 12 Mich. 214; Campbell v. Ins. Co., 27 N.H. 35; Marshall v. Ins. Co., 27 N.H. 157; Masters v. Ins. Co., 11 Barb. 624; Phoenix v. Ins. Co., 120 U.S. 183; Ins. Co. v. Woolf, 95 U.S. 326; Frost v. Ins. Co., 5 Denio 154; Hodson v. Ins. Co., 97 Mass. 144. The premium note was part of the contract. Ins. Co. v. Story, 41 Mich. 385. The acceptance of the premium; the retention of it; the adjustment of the loss; sending the draft notifying plaintiff to call for his money, and all the circumstances of this case conclusively show that the defendant, instead of insisting on a forfeiture (which must be done to make it good), completely waived it. Pechner v. Ins. Co., 65 N.Y. 195; Reynolds v. Ins. Co., 47 N.Y. 559; Blake v. Ins. Co., 12 Gray 265; Hall v. Ins. Co., 6 Gray 185; Ins. Co. v. Throop, 22 Mich. 146; Frost v. Ins. Co., 5 Denio 155; Keenan v. Ins. Co., 13 Ia. 375.

THRASHER, WHITE & MCCAMMON, for the respondent: That the action of the court was proper is, we submit, amply sustained by the authorities. 1 Greenl. on Evid. [13 Ed.] secs. 275, 276; Hotel v. Baily, 3 Mo.App. 598; Sewing Machine Co. v. Cushen, 8 Mo.App. 528; Conn v. McCullough, 14 Mo.App. 584; Ins. Co. v. Lansing, 20 N.W. 22; Ins. Co. v. Bowen, 40 Mich. 147; Ins. Co. v. Geraldin, 31 Mo. 30; Sims v. Ins. Co., 47 Mo. 54. The contract was entire. When the risk once commenced the whole premium was due. May on Ins. 302; Hines & Nichols' Ins. Dig. 460, 464; 2 Phillips on Ins. 503, 465, 467; Hendricks v. Ins. Co., 8 Johnson 1; Ins. Co. v. Tucker, 3 Cranch 357; Plath v. Ins. Ass'n, 23 Am. Rep. 691; Lee v. Ins. Co., 3 Gray 583; Garver, Adm'r, v. Ins. Co., 28 N.W. 555; Taylor v. Lowell, 3 Mass. 335; Friesmith v. Ins. Co., 10 Cush. 589; Kelley v. Ins. Co., 6 A. 740; Ins. Co. v. Klink, 65 Mo. 78. The receipt of premium by defendant did not constitute a waiver of any of the conditions of the policy. Card v. Ins. Co., 4 Mo.App. 424; Dawson v. Ins. Co., 1 Mo.App. 317; Cook v. Ins. Co., 70 Mo. 610; Rothschild v. Ins. Co., 62 Mo. 356; Harle v. Ins. Co., 32 N.W. 396. The adjustment of defendant's loss, and sending draft to agents for plaintiff, constitutes no waiver of the conditions for a suspension of the policy after default in payment of premium note. Garretson v. Ins. Co., 21 N.W. 781; Colonius v. Ins. Co., 3 Mo.App. 56; Ins. Co. v. Barnett, 73 Mo. 364. The policy was suspended during the default in payment of premium note, and revived on the payment. The defendant " has the benefit of the temporary suspension of the risk, without any rebate of premium." Hinckley v. Ins. Co., 1 N.E. 737; Holly v. Ins. Co., 11 N.E. 507; Williams v. Ins. Co., 19 Mich. 451; Harris v. Ins. Co., 5 N.W. 124; Harle v. Ins. Co., 32 N.W. 396; Russum v. Ins. Co., 1 Mo.App. 228; Moser v. Ins. Co., 2 Mo.App. 408.

OPINION

ROMBAUER P. J.

This is an action on a fire insurance policy. The trial court instructed the jury at the close of plaintiff's evidence that he could not recover, and this appeal is prosecuted by him from the judgment of the court refusing to set aside the nonsuit which he was compelled to take as a result of the instruction.

The plaintiff urges two exceptions: That the court erred in ruling out certain evidence offered by him, and also erred in withdrawing his case from the jury.

The following facts appeared by the pleadings and evidence: Plaintiff owned a farm on which stood a residence and two barns. He took a policy of insurance on these in the defendant's insurance company, July 1, 1885, for two thousand dollars, distributed as follows: twelve hundred dollars on the residence and four hundred dollars on each of the barns. The policy was to run three years. The premium was twenty-five dollars, for which the assured gave his note payable December 1, 1885. The policy contained the following provision: " It is especially agreed that this company (shall) not be liable for any loss or damage that may occur to the property herein mentioned while any promissory note or obligation for the premium remains past due and unpaid." Also the following: " This policy or any indorsement thereof of any kind shall not be valid until countersigned by Ducat & Lyon, managers of the western department * * * who alone shall have power or authority to waive or alter any of the terms and conditions of the policy."

On the twelfth of December, 1885, one of the barns burned. At that time the premium note, which was past due, was unpaid. On December 15 plaintiff notified Ducat & Lyon, general managers, of the loss, which letter was received by them on the seventeenth. December 16 he remitted to them the premium, which was received by them December 18. On the last-named day the general adjuster of the company wrote the following letter to plaintiff: " Your report of loss of one barn under No. G. F. 13,514, is received, and shall have the earliest possible attention." On December 23 Ducat & Lyon wrote the following additional letter to plaintiff:

" We have your favor December 16, with remittance of twenty-six dollars, in payment of following premium notes which please find herewith duly cancelled:

Name, M. L. McCluer,

Amount of Note $25.00

No. of Policy, G. F. 13,514, Int 1.00

$26.00"

It was also in evidence that upon the receipt of the advice of the loss the general adjuster of the company referred the same for adjustment to John G. Hubble, local adjuster, and the local adjuster thereafter adjusted the loss and made report of his adjustment to the company December 23, accompanying the same with proofs of loss, and that thereupon on December 30, the general adjuster advised the plaintiff that he had forwarded to the agents of the company in Springfield a draft for three hundred and ninety-two dollars, in payment of the loss. This draft was never delivered, as the company refused to pay the loss owing to the fact that at the date thereof plaintiff was in default of payment on his premium note.

The premium note cancelled and surrendered to plaintiff as above stated was also offered in evidence, and is as follows:

" $25.00. On or before the first day of December, 1885, for value received I promise to pay to the Home Insurance Company of New York, or order (by mail if requested), at their western farm department (Ducat & Lyon, managers), in Chicago, Illinois, twenty-five dollars in payment of the premium of policy No. G. F. 13,514 (issued by the said company at its western department office in Chicago, Illinois), and dated eighteenth day of July, 1885, with interest at the rate of seven per cent. per annum.

If this note be paid sixty days before maturity all interest shall be waived.

And it is hereby agreed that if this note be not paid at maturity said policy shall lapse and be null and void so long as this note remains over-due and unpaid, and in case the earned premium on said policy for the time it was in force be not paid within thirty days of the maturity of this note, according to customary short rates of the company, then the whole amount of this note may be declared earned, due and...