Richardson v. Brown, 291-70.

• Decision Date: 14 June 1971
• Docket Number: No. 291-70.,291-70.
• Citation: 443 F.2d 926
• Parties: Ronald K. RICHARDSON, Plaintiff-Appellant, v. Geneva BROWN, Defendant, Allstate Insurance Company, Garnishee Appellee.
• Court: U.S. Court of Appeals — Tenth Circuit

443 F.2d 926 (1971)

Ronald K. RICHARDSON, Plaintiff-Appellant, v. Geneva BROWN, Defendant Allstate Insurance Company, Garnishee Appellee.

No. 291-70.

United States Court of Appeals, Tenth Circuit.

June 14, 1971.

Michael C. Stewart, Oklahoma City, Okl. (Rinehart, Cooper & Stewart, Oklahoma City, Okl., on the brief), for plaintiff-appellant.

Kenneth N. McKinney, Oklahoma City, Okl., for garnishee-appellee.

Before BREITENSTEIN, HILL, and SETH, Circuit Judges.

BREITENSTEIN, Circuit Judge.

Plaintiff-appellant Richardson recovered a $17,000 default judgment against Geneva Brown for injuries sustained in a January 11, 1969, Oklahoma automobile accident. In the state court proceedings Richardson garnisheed appellee Allstate Insurance Company and asserted that Allstate had insured Brown. Allstate removed the case to federal court on diversity grounds. On Allstate's motion for summary judgment, the trial court held that the policy had been cancelled before the accident and dismissed the garnishment.

On November 4, 1968, Brown applied to an Oklahoma agent of Allstate for automobile liability insurance and was given a binder to provide temporary coverage. A policy was issued to Brown on November 6. Brown claims that she never received it. On December 4, Allstate mailed to Brown a notice of policy cancellation along with a refund check. Brown asserts that she did not receive either the notice or the check.

The policy provided that the insurer may cancel by mailing to the insured "at his address shown in this policy" a notice effective not less than ten days thereafter and that "mailing of notice shall be sufficient proof of notice and the effective date and hour of cancellation stated in the notice shall become the end of the policy period."

The cancellation resulted from information received by the insurer's underwriting department and was effective December 16, 1968, more than three weeks before the accident in which Richardson was injured. In support of its summary judgment motion Allstate submitted the affidavit of one of its supervisors which said that the letter containing the cancellation notice was delivered to the post office on December 4 and that a post office receipt therefor was obtained. Attached to the affidavit is a copy of the cancellation letter and a copy of certificate of mailing signed by one Dobbs for the Dallas, Texas, postmaster and stamped December 4, 1968. The certificate shows that the letter was addressed to the insured at her policy address.

The garnishor, Richardson, argues that the only contract between the insured and the garnishee insurer was the binder because the policy was never received. The answer is that the binder coverage was limited to 30 days and expired more than a month before the accident to Richardson. Additionally, 36 O.S.1961, § 3622B, provides that no binder shall be valid beyond the issuance of the policy with respect to which it was given. The garnishor does not dispute the fact that Allstate issued the policy.

The effect of the cancellation clause is attacked on the ground that it was never agreed to by the insured. Reliance is had on 15 O.S.1961, § 138, which provides that a contract in writing takes effect upon delivery to the party in whose favor it is made. Here an application was signed, a premium paid, and a binder issued. The insurer accepted the application and executed the policy. This is enough. Delivery of the policy is not essential to its enforceability. See Central Life Ins. Soc. of the United States v. Pyburn, 97 Okl. 141, 222 P. 683, 685. Moreover, if the policy never became effective, the garnishment fails.

We recognize the rule that an enforceable contract requires a meeting of the minds on the essential elements of the contract. See Massachusetts Bonding & Ins. Co. v. R. E. Parsons Electric Co., 8 Cir., 61 F.2d 264, 268. There is no evidence that the insured would have rejected the policy if, after receipt, she had read and was unwilling to accept the cancellation clause. There is no intimation that the method of giving notice of cancellation was an essential element of the contract, and there is no claim of fraud or other misconduct on the part of the insurer. Cf. Perez v. Fort Worth Mut. Benev. Ass'n., Tex.Ct. Civ.App., 291 S.W. 574. The effort of the garnishor, not the insured, to eliminate the cancellation provisions and thus rewrite the policy to meet his desires does not impress us.

The main thrust of the garnishor's argument is that the insured's affidavit of non-receipt of cancellation notice creates a factual issue which may not be resolved on a motion for summary judgment. The theory is that the post office certificate creates a presumption of mailing which is rebutted by the insured's affidavit of non-receipt which in...