Woolfolk v. Jack Kennedy Chevrolet Co.

Decision Date04 December 1956
Docket NumberNo. 29631,29631
Citation296 S.W.2d 511
PartiesMansfield WOOLFOLK (Plaintiff), Respondent, v. JACK KENNEDY CHEVROLET COMPANY, a Corporation (Defendant), Appellant.
CourtMissouri Court of Appeals

John D. Hasler, St. Louis, for appellant.

Gerwitz & Seegers, and G. L. Seegers, St. Louis, for respondent.


This is an action for damages for breach of contract. Plaintiff recovered a verdict and judgment for $1,311. Defendant has brought the case to this court by appeal.

The facts and circumstances giving rise to the litigation grew out of the purchase by plaintiff from defendant of an automobile. Plaintiff's pleaded theory was that in connection with the purchase of the automobile, defendant agreed to procure for plaintiff, for a term of twenty-four months, collision insurance covering actual cash value of the vehicle less $50, payable to the plaintiff and to the mortgagee; that the premium of $163 charged for said policy was paid by plaintiff to defendant, of which $1.60 was later refunded to plaintiff; that defendant breached the contract in that it failed to purchase $50 deductible collision insurance; that within the period for which defendant had agreed to procure collision coverage insurance, plaintiff's automobile was involved in a collision and damaged to the extent of $1,500; that by reason of the breach of contract by defendant, plaintiff suffered damages in the amount of $1,950, which was the sum of $1,450 (damages to automobile less $50), and $500 expenses incurred in employing counsel and filing suit.

No dispute exists as to most of the pertinent facts upon which plaintiff relies. On April 22, 1954, plaintiff signed an order for the purchase of a Chevrolet automobile. Upon the face of this order, in pencil, appeared, '24 Mo. Ins.'. Thereafter an invoice, a chattel mortgage, and note were prepared by defendant. These documents are dated April 29, 1954. It is not entirely clear whether the note and chattel mortgage were signed prior to or on the date that the automobile was delivered to plaintiff, but both plaintiff and defendant's general manager testified that the invoice, a copy of the note, and chattel mortgage were mailed to plaintiff after he took possession of the automobile. The invoice shows the total 'time price' was $2,438.28. Included therein was an item for 'Ins. $163.' This document discloses that plaintiff made a cash payment of $353.56, and was allowed $500 for his old automobile, leaving a balance of $1,584.72 to be paid in twenty-four monthly installments of $66.03 each. The chattel mortgage is the only document which in any manner discloses the type of insurance that was to be procured. Appearing on the face of the chattel mortgage are these words and figures: 'Insurance payable to purchaser and mortgagee, covering $50.00 ded. $163.' The chattel mortgage also discloses that the total 'time price' was $2,438.28.

It is obvious that immediately following the closing of the transaction for the sale of the automobile, Leonard Kennon, defendant's general manager, prepared an application for insurance to Thomas F. X. Gibbons Agency. Therein plaintiff's occupation was given as 'driver and owner employed by: Marcella Cab Company'. The application also stated that the automobile was to be used for pleasure purposes. The manager of the insurance agency, upon receipt of the application, contacted Kennon for the purpose of determining definite information with respect to the use of the automobile. Kennon made further investigation and learned it was to be used for a taxicab, and accordingly informed the Gibbons Insurance Agency. Because of that fact the insurance agency refused to issue the $50 deductible collision policy covering both the owner and mortgagee, but did advise that it would issue a policy providing for single interest coverage, which would cover only the interest of the holder of the mortgage. When Kennon ascertained from the Mercantile Trust Company, purchaser of the mortgage, that it required protection of its interest, he procured a policy from the insurance agency which did provide for single interest coverage as well as other coverage not referred to or designated in the chattel mortgage. The policy was dated April 29, 1954, was effective for a period expiring on January 29, 1956, and the premium for all coverage therein provided was $161.40. Kennon was furnished with the original of the policy, as well as an abbreviated copy thereof referred to and designated as a daily report. The daily report was forwarded to plaintiff, who testified that he received it '3 or 4 days' after he took delivery of the car, and that it came from the Fidelity Fire Insurance Company, which is the company that issued the policy. Plaintiff testified that upon receipt of the daily report, he did not read any part of it, but 'put it in my box'. It is important to note that the daily report shows upon its face that collision coverage is provided in accordance with endorsement attached. There were three endorsements, the first providing for conversion, embezzlement, or secretion coverage; the second for single interest fire and theft coverage, and the third for single interest collision coverage. The latter endorsement reads in part, 'the Policy designated above is extended to insure the interest only of Mercantile Trust Company * * *'. On the 14th of May, 1954, the defendant mailed its check to plaintiff for $1.60 covering the difference in the cost of the policy procured which was $161.40, and the amount for which plaintiff was charged, being $163. Defendant's manager testified that he personally wrote a letter to plaintiff which accompanied the check, and which reads as follows:

'May 14, 1954

'Mr. Mansfield Woolfolk

4737 McMillan

St. Louis, Missouri

'Dear Mr. Woolfolk:

'Enclosed please find our check in the amount of $1.60 covering return premium on your insurance. This difference represents the difference between Class I collision insurance, which we ordered but were unable to secure, and single interest policy, which was the only coverage we were able to secure. This single interest policy covers the Mercantile Trust Co. only and does not cover you, as the owner, under Class I $50.00 deductible coverage as shown on your mortgage.

'If you are able to secure other coverage satisfactory to both you and the Mercantile Trust Co., we will be happy to cancel this single interest policy and return any amount due you (to) help cover the cost of any other policy you may secure.

'Very truly yours,

'Leonard Kennon

'Business Mgr.'

Plaintiff readily admitted receiving and cashing the check, but denied receiving the original of the letter, carbon copy of which was produced by Kennon. He stated, however, that there was a letter accompanying the check which merely advised him that there was an overcharge of $1.60 for insurance.

At no time after plaintiff received the daily report did he raise any objection to the type of insurance that had been procured, and nothing of an unusual nature transpired until July 31, 1955, when plaintiff's automobile, having a value according to his testimony of $1,500, was demolished in a collision. On the next day plaintiff called at defendant's place of business to report the collision and to request the defendant to repair or replace his automobile. It was then for the first time, according to plaintiff's testimony, that he learned that the policy that had been procured for him did not provide for $50 deductible collision coverage covering him as well as the mortgagee.

Plaintiff bottoms his case upon the theory that there was a valid contract between the parties under which plaintiff paid for and the defendant agreed to procure a policy of insurance covering plaintiff as well as the holder of the mortgage, and providing for $50 deductible insurance; that there was a breach of said contract by defendant resulting in damages to plaintiff. The defendant's position was: (1) There was no meeting of the minds, hence no contract obligating defendant to procure the insurance; (2) if there was a contract, plaintiff accepted defendant's performance in full satisfaction of his rights thereunder.


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