Olson v. Norwegian Mut. Ins. Ass'n

• Decision Date: 08 February 1966
• Docket Number: No. 51961,51961
• Citation: 140 N.W.2d 91,258 Iowa 731
• Parties: Fred H. OLSON, Appellant, v. NORWEGIAN MUTUAL INSURANCE ASSOCIATION, Iowa Mutual Tornado Insurance Association, Appellees.
• Court: Iowa Supreme Court

Page 91

140 N.W.2d 91

258 Iowa 731

Fred H. OLSON, Appellant, v. NORWEGIAN MUTUAL INSURANCE ASSOCIATION, Iowa Mutual Tornado Insurance Association, Appellees.

No. 51961.

Supreme Court of Iowa.

Feb. 8, 1966.

Strand & Kiener, Decorah, for appellant.

Miller, Pearson & Gloe, Decorah, and Bradshaw, Fowler, Proctor & Fairgrave, Des Moines, for appellees.

MOORE, Justice.

This is an action at law against defendant insurance companies which had issued combined fire and windstorm policies to plaintiff's grantor on property, subsequently acquired by plaintiff, to recover for loss caused by windstorm. Plaintiff alleges the policies were extended beyond their expiration date by oral agreement or in the alternative defendants are estopped to deny there was insurance in force. At the close of plaintiff's evidence the trial court directed a verdict for defendants and entered judgment thereon. Plaintiff has appealed. We affirmed.

Plaintiff contends the evidence created a jury question on existence of an oral agreement of insurance or an estoppel against defendants to deny coverage. He also assigns error in rulings on evidence.

On May 9, 1957 defendants issued combined fire and windstorm insurance policies to Walter Strand on two sets of farm buildings. The policies bore numbers 96-1142 and 96-1143 and were for a five year term from May 9, 1957 to May 9, 1962. The original policies could not be located but by stipulation the form thereof was received in evidence.

In the summer of 1959 plaintiff purchased from Strand the farm, including the two insured sets of buildings, and took possession in March, 1960.

Plaintiff testified on direct examination as follows regarding a conversation with Hilman Sersland, then secretary of defendant Norwegian Mutual Insurance Association and defendants' agent.

'Q. Mr. Olson, did you have a conversation in the spring of 1960, with Mr. Sersland, in regard to this insurance? A. I did, yes.

'Q. And about when was that? A. It was in the spring; I suppose in April. Along in there some time. I wouldn't say exactly the date, because I wouldn't know.

'Q. April of 1960? A. Yes.

'Q. And do you recall what was said, at that time? A. Yes, I do.

'Q. And what was the conversation that you had with Mr. Sersland at that time? A. Will, I just asked him about-I told him I was the new owner of the Strand place out here. * * * I just told him that I was the owner of the Strand place; and mentioned something about the insurance. And he said, 'Well, I'll look after that.' Which he did. He notified me when the premiums were due and so on and so forth.

'Q. And was that portion the extent of your conversation? A. Yes it was, at that time.'

Following this conversation Sersland had plaintiff's name endorsed on the Strand policies and plaintiff was billed for the premiums on each policy as they became due in the spring of 1960 and 61. Two of his checks refer to the policies by number and have written on the face 'insurance on Walt Strand farm.'

In the fall of 1961 plaintiff had a small loss and contacted Sersland. He testified: 'I had the conversation with Mr. Sersland in the fall of 1961, because there was a little wind damage on the property I bought from Walter Strand. Mr. Sersland came out and looked at it. The claim I put in was paid and I was satisfied with the adjustment. I did not have a conversation with Mr. Sersland about my insurance coverage. We just talked about the insurance, rode out together to the farm on highway 52, and as to amount, talked about the coverage. He said he would let me know, like he had been.'

On redirect examination plaintiff testified: 'I only received a 4th grade education. I testified on re-cross examination that my claim was based on a policy or policies originally issued to Walter Strand. I have never seen those policies. On redirect, I said as far as I understood the agreement between myself and the insurance companies, my policies embodied the same terms as policy between Walter Strand and the companies.'

The policies originally issued to Strand expired May 9, 1962. No notice thereof was given to plaintiff. On June 17, 1962 plaintiff's property sustained substantial windstorm damage. Upon denial of his claim for that loss plaintiff brought this action. Defendants' primary contention is that no insurance was in force after May 9, 1962.

I. Plaintiff's pleadings like his testimony on redirect examination fail to clearly state his claim of an oral agreement for his insurance. In oral argument to this court plaintiff's counsel took the position an implied oral agreement for a new five year term of insurance resulted from plaintiff's conversation with Sersland in April 1960.

In Sanborn v. Maryland Casualty Co., 255 Iowa 1319, 125 N.W.2d 758, on which plaintiff heavily relies, we recognize that an oral agreement by an agent to keep insurance in force until notified otherwise by the insured followed by custom of defendant's agent of keeping insurance in force may result in an estoppel against the insurance company but we have no such facts here.

Plaintiff pleads an oral agreement. He has the burden to prove the terms thereof. Rule 344(f)5, Rules of Civil Procedure.

Giving plaintiff's evidence the most favorable construction it will reasonably bear, as required under rule 344(f)2, we find no evidence on which a jury finding of the claimed oral agreement could be based. Obviously all Sersland had in mind was the transfer of Strand's policies to plaintiff which he did and notified plaintiff when the premiums were due. Plaintiff received no policies nor does he claim he ever expected to do so. The record indicates the Strand policies were in the hands of a mortgagee. Apparently plaintiff's information concerning the insurance policies and coverage came originally from Strand.

II. Plaintiff in his written brief argues there was an oral renewal of his insurance. Again plaintiff's proof is lacking.

A binding contract or renewal must have all the essentials of a valid contract. There must be a meeting of the minds of the parties on all the essentials of the contract. 29 Am.Jur., Insurance, section 358; 44 C.J.S. Insurance § 283.

Plaintiff's testimony regarding his conversations with Sersland falls far short of creating a jury question on his claim of an oral renewal.

III. Plaintiff's argument on the question of estoppel to deny coverage is meager and not supported by evidence making his position clear.

Equitable estoppel is based upon the idea that one who has made a certain representation should not thereafter be permitted to change his position to the prejudice of one who has relied on it. In Sanborn v. Maryland Casualty Co., 255 Iowa 1319, 1327-1329, 125 N.W.2d 758, 762-764, we cite and quote our earlier cases and those from other jurisdictions which consider the principles of equitable estoppel including many involving insurance coverage. The discussion need not be repeated...