Smith v. Ohio Millers Mut. Fire Ins. Co.

• Decision Date: 08 April 1930
• Docket Number: 29879
• Parties: A. B. Smith and E. K. Smith, Partners, Doing Business under Firm Name of A. B. Smith Lumber Company, v. Ohio Millers Mutual Fire Insurance Company, Appellant
• Court: Missouri Supreme Court

26 S.W.2d 962

325 Mo. 51

A. B. Smith and E. K. Smith, Partners, Doing Business under Firm Name of A. B. Smith Lumber Company, v. Ohio Millers Mutual Fire Insurance Company, Appellant

No. 29879

Supreme Court of Missouri

April 8, 1930

Rehearing Overruled April 8, 1930.

Appeal from Pemiscot Circuit Court; Hon. John E. Duncan Judge.

Reversed and remanded.

Samuel A. Harper, Howell & Howell, McGugin & Evans, Hay & Flanagan and N. C. Hawkins for appellant.

(1) The premium was not paid to defendant. (a) It is undisputed that the defendant never actually received the premium. Auber Smith was the agent of the plaintiffs. All of the evidence tended to prove that he was at all times acting for and on behalf of the A. B. Smith Lumber Company in connection with the insurance in question, which facts were not known to defendant. A payment of premiums to him, therefore, did not constitute payment to defendant, and the defendant had the right to cancel the policy on account of nonpayment, and the jury should have been so directed. R. S. 1919, sec. 6317; Edwards v. Home Ins. Co., 100 Mo.App. 709; A. B Smith Lumber Co. v. Ohio Millers Ins. Co., 6 S.W.2d 920; Mercantile Mut. Ins. Co. v. Hope Ins. Co., 8 Mo.App. 408; Huggins Cracker & Candy Co. v. Peoples Ins. Co., 41 Mo.App. 530; Shutts v. Ins. Co., 159 Mo.App. 436; Briggs v. Collins, 167 S.W. 1114; Ferrar v. Western Assur. Co., 30 Cal.App. 489, 159 P. 609; Orkin v. Fire Ins. Co., 99 N. J. L. 114, 122 A. 823; Hollywood L. & Coal Co. v. Ins. Co., 80 W.Va. 604, 92 S.E. 858; Schauer v. Queen Ins. Co., 88 Wis. 561, 60 N.W. 994; Miss. Valley Ins. Co. v. Bermond, 45 Ill.App. 22; 2 Couch on Insurance, p. 1347, sec. 474. (b) The premium was not, in fact, paid to anyone. Plaintiff's evasive, contradictory and self-serving statements purporting to show payment are so far destroyed by their own indisputable documents and records in evidence that such statements amount to no evidence of payment. (c) If the statements of the witness are so absurd, repugnant to undisputed documentary evidence or physical facts, self-serving, unreasonable, evasive or delusive, and so in keeping with what might be expected from one guilty of fraud and connivance, that they could not reasonably be believed, they are not controlling and may destroy themselves, so as to render such verbal evidence no evidence in the eyes of the law, and justify their being disregarded. Payne v. Railroad Co., 136 Mo. 562; Wray v. E. L. & Water Co., 68 Mo.App. 389; Fidelity Mut. Life Ins. Co. v. Click, 93 Ark. 162; Quock Ting v. United States, 140 U.S. 417, 35 L.Ed. 501. (d) Testimony of a party or unfriendly witness cannot prevail against a course of conduct utterly at variance with it. His testimony must not be given effect against what he himself did or did not do, "disregarding the ordinary laws that govern human conduct." Atlantic Works v. Brady, 107 U.S. 203; Railroad v. Justice, 5 Higgins (Tenn. C. C. A.) 69. (e) The testimony of the Smiths attempting to show payment of the premiums to Auber Smith in November, 1920, is utterly at variance with common sense, common experience, documentary evidence in the form of a letter, a notation on the policy itself, book entries and bank accounts, and their own contradictory statements, and therefore amounts to no evidence, and brings it within the rule laid down in the cases cited. (2) Even if Auber Smith had been the agent of defendant and not of plaintiffs, he could not have accepted a credit for rent in payment of any part of the premium. Hoffman v. Mut. Life Ins. Co., 92 U.S. 161, 23 L.Ed. 539; Briggs v. Collins, 167 S.W. 1114, L. R. A. 1915A, 686; Folb v. Fireman's Ins. Co., 133 N.C. 179; Lycoming Fire Ins. Co. v. Storrs, 97 Pa. St. 354; Sullivan v. Life Ins. Co., 15 Mont. 522. (3) The premiums not having been paid, a return or tender thereof was not necessary to cancellation. Gruen v. Ins. Co., 169 Mo.App. 161; Stone v. Fire Ins. Co., 105 N.Y. 543; Hamburg-Bremen Ins. Co. v. Browning, 102 Va. 890. Defendant, therefore, had the right to cancel the policy for non-payment of premiums, as it did. (4) Even if the premium had been paid the defendant had the right to cancel the policy without returning or tendering the unearned premium at the time of cancellation. Vance on Ins., p. 494; Richards on Ins. Law (3 Ed.), sec. 288; Schwarzschild & S. Co. v. Phoenix Ins. Co., 115 F. 653, 124 F. 52; Davidson v. Ins. Co., 65 A. (N. J.) 996, 13 L. R. A. (N. S.) 884. The rules by which a policy of insurance is to be construed do not differ from those governing other mercantile contracts. May on Ins., secs. 172, 172A; Aurora Fire Ins. Co. v. Eddy, 49 Ill. 106; Hawthorne v. Ins. Co., 181 Ill.App. 88. (5) Even if Auber Smith be held to have been the agent of defendant for any purpose, the policy and all of its provisions were avoided under the law, because of Auber Smith's undisclosed relation to plaintiffs as their regular salaried employee and as their general agent in all matters, including insurance. Atlic v. Fink, 75 Mo. 100, 104; Opinion on former appeal, 6 S.W.2d 928; Fiske v. Ins. Co., 100 Mo.App. 545; Edwards v. Home Ins. Co., 100 Mo.App. 710, 48 A. L. R. 918, note; Mercantile Mut. Ins. Co. v. Hope Ins. Co., 8 Mo.App. 408; DeSteiger v. Hollington, 17 Mo.App. 382; Huggins Candy Co. v. People's Ins. Co., 41 Mo.App. 530: McClure v. Ullman, 102 Mo.App. 697; Harper v. Fidler, 105 Mo.App. 680; 22 Cyc. 1436; Evans v. Brown, 33 Okla. 323, 125 P. 469; Bunn v. Keach, 214 Ill. 259. Concealment, misrepresentation and fraud regarding an alleged premium account with Auber Smith, and fraud and false swearing in regard to the alleged payment of the premium, avoided the policy. Even in the absence of such an express provision, the policy would be void either for the undisclosed relationship of Auber Smith to plaintiffs or for fraud and concealment. Edwards v. Home Ins. Co., 100 Mo.App. 695; 32 C. J. 1269, 1270, sec. 482; 2 Couch on Ins., sec. 479, p. 1356. (6) As to the burden of proof, the court erred in giving plaintiff's instructions Nos. 6A, 14 and 15. (a) No. 6A ignores plaintiff's necessary proof as to value of property at time of fire, amount of loss, and proofs of loss as required by the policy, all of which were controverted issues in the case. 7 Cooley's Briefs on Ins. (2 Ed.) 5737, 5826; McCulloch v. Phoenix Ins. Co., 113 Mo. 606; Lumbard Inv. Co. v. Ins. Co., 62 Mo.App. 315; 26 C. J. 514, sec. 721. (b) And the burden of proof was on the plaintiffs throughout the case, but the jury were not so instructed, but, on the contrary, were told by Instructions 14 and 15 that the burden was upon the defendant. O'Connell v. Fidelity & Cas. Co., 87 A.D. 310; Bergson v. Builders Ins. Co., 38 Cal. 546. (7) The court erred in giving plaintiff's Instruction 13, and in refusing to give defendant's Instruction B, because no refund of premium was required under the cancellation clause in the policy in suit except "on demand" of the insured. May on Ins., secs. 172, 172A; Vance on Ins., 494.

Ward & Reeves for respondents.

(1) This is the second appeal. The decision on the former appeal is the law of this case, and the court will not again review matters determined in the former appeal where there are no new issues and the facts are substantially the same. The rule of stare decisis applies. Bradley v Becker, 11 S.W.2d 8; Coleman v. Northwestern Ins. Co. (Mo.), 233 S.W. 187; Booth v. Scott (Mo.), 240 S.W. 217; Matthews v. Austin, 317 Mo. 1021; Anderson v. Sutton, 316 Mo. 1058; Loud v. Trust Co., 313 Mo. 552; State ex rel. v. Railroad (Mo.), 10 S.W.2d 918. (2) Plaintiff herein made a prima-facie case warranting a judgment by producing in evidence (a) the policy of insurance sued upon; (b) destruction of the property by fire; (c) the value of the insured property; (d) and plaintiffs are the owners thereof. 19 Cyc. 935; 26 C. J. 514; Hay v. Ins. Co., 207 Mo.App. 277; Bray v. Ins. Co., 238 S.W. (Mo. App.) 1095; Lafferty v. Ins. Co., 229 S.W. 750; Foster v. Ins. Co., 233 S.W. (Mo. App.) 499; Prindle v. Ins. Co., 233 S.W. (Mo. App.) 252; Godfrey v. Ins. Co., 232 S.W. (Mo. App.) 231. When the above proof is made, the defendant is never entitled to a directed verdict, and this is true notwithstanding defendant's proof on such defense as non-payment, fraud, mistake, etc., is not denied, unless, of course, such defense is admitted by plaintiff; otherwise, it is a question of fact for the jury. Keller v. Supply Co., 229 S.W. 173; Lafferty v. Ins. Co., 229 S.W. 750; Trust Co. v. Hill, 223 S.W. 434; Quisenberry v. Stewart, 219 S.W. 625; State ex rel. v. Reynolds, 277 Mo. 14; Harris v. Ins. Co., 248 Mo. 318; Bange v. Supreme Council, 179 Mo.App. 21; Troll v. Home Circle, 161 Mo.App. 719; Winn v. Modern Woodmen, 157 Mo.App. 1; Gannon v. Gas Co., 145 Mo. 502. (3) Plaintiff having undisputedly made a prima-facie case, the defendant must come forward and establish to the satisfaction of the jury one or more of its defenses such as non-payment of premium, cancellation, fraud and collusion, dual agency, etc.; and the burden of proof on each of these was and is upon the defendant. Foster v. Ins. Co., 233 S.W. (Mo. App.) 499; Lafferty v. Ins. Co., 299 S.W. 750; 26 C. J. 514, sec. 721; 19 Cyc. 935-936; McCartney v. Ins. Co., 45 Mo.App. 373; Novosel v. Ins. Co., 276 S.W. (Mo. App.) 87. Possession of the policy is presumption that the premium is paid and the burden is upon the defendant pleading non-payment of the premium to prove that the premium is not paid; and unless defendant shows this fact to the satisfaction of the jury the plaintiff should recover on that issue. Bray v. Ins. Co., 238 S.W. (Mo. App.) 1095; Lafferty v. Ins. Co., 229 S.W. 750; Foster v. Ins. Co., 233 S.W. (Mo. App.) 499. (4) The case is one for the determination of a jury and the court could neither give...