Rice v. American Sec. Ins. Co.
| Decision Date | 09 December 1952 |
| Docket Number | No. 16689,16689 |
| Citation | 73 S.E.2d 683,222 S.C. 463 |
| Court | South Carolina Supreme Court |
| Parties | RICE v. AMERICAN SECURITY INS. CO. et al. |
Cooper & Gary, Columbia, for appellants.
J. W. Guest, Harold C. Seigler, Columbia, for respondent.
Respondent, a near illiterate, purchased a new automobile from a Columbia dealer on April 15, 1950, and, to secure the credit portion of the purchase price, executed a conditional sales contract (chattel mortgage) in the amount of $1,684.56, which included $424.56 'differential for time payment,' part of which was two-year insurance premium of $174. The indebtedness was payable in twenty-four monthly installments of $70.19, beginning May 15, 1950. Under date of April 17, 1950, respondent was informed by letter of Motor Investment Company, Columbia, by James Fulton, Manager, that it had purchased the conditional sales contract and instructed him to make payments at its Columbia office address or through the dealer who made the sale. Respondent was in arrears in his monthly payments from time to time but by December 2, 1950, he had made all payments through November--seven consecutive monthly installments in all. On December 21 the automobile was wrecked and a repairman testified that necessary repairs would cost $761.38.
On the day after the car was wrecked, and before respondent had reported it, a representative of the Investment Company, according to respondent's testimony, personally called on him to collect the December payment which was then slightly past due. Respondent testified that he told the representative about the wreck and the latter said, quoting, 'your insurance ain't no good on your car * * *;' further that he did not know anything that could be done about it, that it 'was one of those things.'
Action was promptly brought by respondent against the Insurance Company on the policy which included collision damage and copy of which had been furnished him, but the Investment Company retained the original policy. It filed petition to intervene as the holder of the lien of the sales contract upon which the unpaid balance was, without interest, $1,193.23, and upon the provision of the policy, as follows: 'Any loss hereunder is payable as interest may appear to the insured and Motor Investment Company, Columbia, S. C.' The petition to intervene contained the statement, quoting, 'that if the said policy of insurance was in effect at the time of the alleged loss petitioner is entitled to have the proceeds of payment,' etc. The petition was verified by James R. Fulton who described himself as Branch Manager of Motor Investment Company. The petitioner was made a defendant and its answer, verified by Fulton, contained the same equivocal claim to the effect that if the policy was in effect at the time of the loss, the Investment Company was entitled to the proceeds.
Answer of the Insurance Company, the original defendant in the action, set up claimed cancellation of the policy on September 22, 1950, whereby it was not in effect at the time of the loss. This answer was also verified by the same James Fulton, describing himself then as an agent of the defendant Insurance Company. The cancellation clause of the policy, in evidence, contained the following:
Under the facts which will be stated there was no effective cancellation for lack of refund of premium to the insured. Crotts v. Fletcher Motor Co., 219 S.C. 204, 64 S.E.2d 540; Elmore v. Middlesex Mutual Fire Ins. Co., 219 S.C. 520, 65 S.E.2d 871. There was no contention of cancellation by mutual agreement. Cf. Dill v. Lumbermen's Mutual Ins. Co., 213 S.C. 593, 50 S.E.2d 923.
The evidence developed the remarkable fact that, on the printed form of the Insurance Company, Motor Investment Company, by H. A. Mundy, requested the cancellation of the policy as of Sept. 17, 1950, because the insured was a 'bad insurance risk', and that credit of $136.60, unearned premium, be made by the Insurance Company to the account of the Investment Company, with inconsistent request on the same form that the Insurance Company forward check payable to the Investment Company and to respondent, the insured. Even more remarkable, in an envelope bearing the return name and address of Motor Investment Company, postmarked, Columbia, S. C., Sept. 11, 1950, there was sent by registered mail to respondent letter dated, Atlanta, Georgia, Sept. 11, 1950, on the letterhead and signed with the name of the Insurance Company by Herman A. Mundy, Authorized Representative, to the effect that the policy would be cancelled as of September 17th and that the unearned premium had been refunded (see infra for subsequent date of 'refund' check) to the Investment Company for the insured's account. Respondent testified, as did his wife, that this letter was received at his home by his wife but it was not given to him and that he did not receive the information or notice. Respondent's wife testified that she did not understand its contents. The testimony of both indicate that neither could have understood without assistance but that is of no importance because notice alone was clearly ineffective to cancel the insurance, as is established by the decisions which have been cited.
Produced in evidence from the file of the Investment Company was unused check of the Insurance Company dated, Atlanta, Ga., Sept. 18, 1950, for $136.60 payable to respondent and the Investment Company, which recited, in effect, that it was on account of the cancellation. The general manager of the Investment Company, Wilson Farrell, who was also an agent of the Insurance Company, testified that the check was held for disposition by respondent, but that it had not been offered or tendered to him and that the Investment Company made no effort to obtain other insurance to protect itself. When asked on cross-examination if that was not 'bad business', the witness replied that it was 'calculated risk.'
Motions for direction of verdict were made by all of the litigants which the court denied except that verdict was directed against the Insurance Company in an amount to be found by the jury and separate issue was submitted to them in the form of a question, as follows, 'Did the Motor Investment Company waive their right to collect the insurance money under their chattel mortgage?' The question was answered in the affirmative by the jury, that the Investment Company had waived its right to the insurance, and the amount found was $1,100, less $50 deductible, total $1,050.
After verdict the defendants moved for judgment non obstante veredicto or for new trial, upon which the court reduced the verdict in favor of plaintiff to the sum of $711.38, the amount of the collision damage, less $50 deductible, according to the testimony of the repairman, which was the only evidence on the subject; and judgment non obstante veredicto was awarded plaintiff in that amount against the Insurance Company defendant. The order went further and held as follows: 'It is the further judgment of this court that the defendant Motor Investment Company has waived its right to any payment under the insurance policy.'
Plaintiff and defendants had made timely motions for direction of verdict on the specific issue of waiver of the insurance by the Investment Company, the former upon the ground that the only reasonable inference from the evidence was that waiver had been established as a matter of law, and the latter of course the opposite. Instead, the court submitted the issue to the jury, as has been seen,...
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McElmurray v. American Fidelity Fire Ins. Co., 17634
...Co., 219 S.C. 204, 64 S.E.2d 540; Elmore v. Middlesex Mutual Fire Ins. Co., 219 S.C. 520, 65 S.E.2d 871, and Rice v. American Security Ins. Co., 222 S.C. 463, 73 S.E.2d 683. In the Crotts case the policy provision for cancellation required that the unearned portion of the premium should be ......