Schonwald v. Sun Insurance Office, Limited, Civ. No. 66-214.

• Decision Date: 07 December 1967
• Docket Number: Civ. No. 66-214.
• Citation: 276 F. Supp. 775
• Parties: Anna SCHONWALD, Plaintiff, v. SUN INSURANCE OFFICE, LIMITED, Defendant.
• Court: U.S. District Court — Western District of Oklahoma

276 F. Supp. 775

Anna SCHONWALD, Plaintiff, v. SUN INSURANCE OFFICE, LIMITED, Defendant.

Civ. No. 66-214.

United States District Court W. D. Oklahoma.

December 7, 1967.

Arnold D. Fagin, Fagin, Fagin & Fagin, Oklahoma City, Okl., for plaintiff.

Walter D. Hanson, Hanson, Fisher, Tumilty, Peterson, Melton & Tompkins, Oklahoma City, Okl., for defendant.

MEMORANDUM OPINION

DAUGHERTY, District Judge.

This is an action to recover on an insurance policy affording protection against loss of rents directly resulting from untenantability of the subject premises caused by destruction or damage by fire or other named perils.

On April 11, 1962, Dave Schonwald and the Plaintiff, Anna Schonwald, husband and wife, were the owners, as tenants in common, of real estate with building thereon situated on Main Street in Oklahoma City, Oklahoma. They had previously leased the real estate and building thereon to the Veazy Drug Company for a term expiring on May 11, 1969, for a monthly rental of $1,666.66. On April 11, 1962, Fred F. Fox & Company (Fox) of Oklahoma City, soliciting agent¹ of the Defendant, Sun Insurance Office, Limited (Sun), issued the above mentioned policy of insurance against loss of rents as to said property to the amount of $20,000.00 for a term of five years. The named insured in the policy was Dave Schonwald. At this time Fox knew that Dave Schonwald and Anna Schonwald owned the property. The policy provided that the Defendant: "* * * does insure the named insured above and legal representatives, * *". The insurance policy premium was paid for the entire five-year period.

On June 4, 1962, Dave Schonwald and Anna Schonwald conveyed said Main Street property to their children and reserved unto themselves a life estate in joint tenancy.

On April 27, 1964, Dave Schonwald died and by operation of law the entire life estate passed to Anna Schonwald.

On May 30, 1965, the building on said property was totally destroyed by fire. The parties stipulated at the trial that there was no need for any formal proof of loss in this case.

From the evidence presented to the Court, the Court finds that after the death of Dave Schonwald and before the fire on May 30, 1965, Fox was advised of the death of Dave Schonwald and that following such event the property belonged to Anna Schonwald or that she had an interest therein. This information was communicated to Mr. Fox and to one of his employees and was done within 60 days after the death of Dave Schonwald. This information came from Anna Schonwald and a son of Anna and Dave Schonwald. Fox took no action regarding the said insurance policy with reference to changing the named insured therein after receiving this information. No one requested Fox to change the named insured. The Defendant retained the premium on the insurance policy and did not attempt to return the unearned portion of said premium until June 28, 1966, which was shortly after this litigation was commenced.

The information or knowledge acquired by Fox regarding the death of Dave Schonwald and that Schonwald then had title to the insured property or an insurable interest therein, is imputable to the Defendant. Disclosures as to the actual status of title to the insured property made to a soliciting agent for an issuing insurance company is imputable to the issuing insurance company. State Mut. Ins. Co. v. Green (1915) 62 Okl. 214, 166 P. 105; American Ins. Co. v. Jueschke (1925) 110 Okl. 250, 237 P. 585; United States Fire Ins. Co. of City of New York v. L. C. Adam Mercantile Co. (1926) 117 Okl. 73, 245 P. 885; Higgins et al. v. Phoenix Ins. Co. (1935) 175 Okl. 394, 52 P.2d 735. Having this important information and continuing to recognize the insurance policy as being in force and effect (for approximately a year) constitutes a waiver of any bar to liability and estops the insurer from claiming that the insurance policy had terminated upon the death of Dave Schonwald. In Security Insurance Company of New Haven v. White, 236 F.2d 215, at page 219 (1956) the United States Court of Appeals for the Tenth Circuit said:

"The general rule having pertinent application in this case is that if an insurer with knowledge of facts which would bar liability under an issued and outstanding policy continues to recognize liability by treating the policy as being in force and effect, it waives the bar and becomes estopped to plead such facts to escape liability. Sovereign Camp W. O. W. v. Pettigrew, 98 Okl. 138, 224 P. 545; Commercial Standard Insurance Co. v. Remer, 10 Cir., 119 F.2d 66; United States Fidelity & Guaranty Co. v. Craig County Bank, 10 Cir., 227 F.2d 799."

Moreover, in the circumstances of this case and by the language of the policy involved, the Plaintiff, Anna Schonwald, is entitled to the benefits of the policy as a legal representative of Dave Schonwald. As previously stated, by the language of the policy, the Defendant insured the "insured named" and his "legal representatives." In Security Insurance Company of New Haven v. White, supra, pp. 219-220, it is held in an...