Phoenix Insurance v. Hunter

Mayes, J., delivered the opinion of the court. On December 20, 1907, one Patton, an agent of the Phenix Insurance Company, issued a policy of insurance to J. W. Hunter in the sum of $500, of which sum $250 covered the storehouse and the remaining $250 a stock of merchandise owned by the insured and located in the store. Hunter lived about nine miles from the town of Shubuta, and there conducted a little store in the house on which the policy was taken out. The policy covered a period of one year, expiring on December 20, 1908, at noon. The premium on the policy, being $20.90,. was duly paid by the insured, and was transmitted to the insurance company, domiciled in Atlanta, Gaq by the local agent. Soon after the company was notified of the insurance, the assistant general agent wrote to the local agent at Shubuta the following letter: “Atlanta, December 26, 1907. Mr. W. H. Patton, Agent, Shubuta, Miss.' — Dear Sir: Policy Nx 33,396, J. W. Hunter. We are in receipt of daily report of the above policy, covering one store building and stock of merchandise of' assured, nine miles from Shubuta. As this store is located in the country, it comes under our prohibition, and we will have to ask that you cancel and return the policy. Tours truly, I. T. Stoekdell, Asst. Geni. Agent:” Immediately upon receipt of this letter by the local agent, and on December 28 following, the local agent wrote the following letter to Hunter, viz.: “Shubuta, Miss., Dec. 28, 1907. Mr. J. W. Hunter — Dear Sir: The enclosed letter is explanatory. Please return policy to me. I enclose check for premium paid. Yours truly, W. H. Patton.” It will be seen from tiie above that the local agent immediately wrote to Hunter, inclosing the letter received from the general office in Atlanta, also inclosing cheek on Shubuta Bank for premium, and canceling the policy and requesting the return of same. Hun [764] ter lived on a free delivery route, and received the letter of Patton and all inclosures, including check, on December 31 following. Hunter made no reply to the correspondence, and retained the check without any objection of any kind. In the policy of insurance is to be found the following condition : “This policy shall be canceled at any time at the request of the insured, or by the company by giving five days’ notice of such cancellation. If this policy shall be cancelled as hereinbefore provided, or become void, or cease, the premium having been actually paid, the unearned portion shall be returned on surrender of this policy,” etc. After the receipt of the letter and the retention of the cheek from December 31 until January 7 and more than five days after the notice was given, the storehouse and stock of goods was burned on January 6, 1908. On January 7, and the next day after the burning, Hunter went to the town of Shubuta and consulted his attorney, whereupon the check was tendered back to the local agent, and the following letter written to the insurance company, v iz.: “Shubuta, Miss., Jan. 7, 1908. Phenix Insurance Company, Brooklyn, N. Y. — Dear Sirs: You are hereby notified that my storehouse and stock of goods, covered by your policy' No. 33,396, was burned last night, January 6th, 1908. Yours very truly, J. W. Hunter.” This letter seems to have been duly registered and receipted for by the insurance company. The insurance company denied any liability under the policy, claiming that the policy had been canceled on December 31, and that the cancellation became effective on January 5, 1908, whereupon suit was brought on the policy resulting in a judgment in favor of Hunter, from which this appeal is prosecuted. The action of the insurance company in this case was more than a mere expression of an intention to cancel this policy. It was an actual cancellation, in so far as they could effect it. Under the conditions of the policy no cancellation could be effective until five days after the receipt of the notice by Hunter, but when the five days passed the policy stood canceled. [765] The action of Hunter in retaining this check for the full period of five days without objection operated as a waiver of any right he may have had to object on the ground that the actual money for the premium paid by him was not tendered when the notice of cancellation was given. If it be conceded that before cancellation it was the duty of the company to tender the actual money for the unearned premium, Hunter’s action in retaining this check, without any objection, and not returning it within a reasonable time, and notifying the agent that he demanded the money instead of a check, necessarily constituted a waiver: Had he done so, it would have enabled the insurance company to effectuate its cancellation by. delivering to him the actual money within the five days, and thus effectuating the cancellation within that time; and not having done so, and waiting-until after the loss occurred, he cannot now make the objection that there was no tender of the premium. There is no liability under this policy on the part of the insurance company on the facts of the case. Reversed and remanded.