Opinion
March 12, 1974.
Editorial Note:
This case has been marked 'not for publication' by the court.
Page 138
Holley, Boatright & Villano, George Alan Holley, Roger D. Witt, Wheat Ridge, for third-party plaintiffs-appellants.
Robert W. Hansen, Warren B. Bosch, Denver, for third-party defendants-appellees.
SILVERSTEIN, Chief Judge.
This is an appeal from a judgment which dismissed a third-party complaint filed by appellants, the Ramseys, against their insurance agent, Wheeler, for breach of contract and negligence. We affirm.
The facts giving rise to this action are that Wheeler had sold the Ramseys a one-year term mobile homeowners liability policy which expired on January 10, 1970. In June 1970 a mudslide occurred which damaged the property of Mr. and Mrs. Burns, who claimed the Ramseys were in part responsible for the damage. They sued the Ramseys, who notified Wheeler and the insurance company of the claim. Wheeler advised the Ramseys that they were not covered because the insurance had lapsed. The Ramseys then filed a third party complaint against Wheeler, alleging an implied contract between the agent and the insured to notify the insured of the expiration of the policy, and that the failure to so notify them constituted a breach of contract and negligence.
It is undisputed that there was no written contract between the parties relative to notification, that no notice was given, that Wheeler normally did so notify his insureds of expiration of their policies, and that the Burns claim would have been covered had the policy been in force.
A trial was held to the court on the issues raised by the third-party complaint, following which the court granted Wheeler's motion to dismiss. Thereafter a jury trial was held on the Burns' claim against the Ramseys, which resulted in a verdict and judgment in favor of the Ramseys. In this appeal the Ramseys seek recovery of their attorneys fees and costs expended in the defense of the Burns action, to which they would have been entitled under the policy.
In Walters v. Edwards, 212 So.2d 749 (La.App.), a case involving a casualty insurance policy having a one year term, the court said: 'As a general rule the jurisprudence is uniform that term insurance . . . carries no obligation on the part of the agent to renew the policy . . ..' Accord, Gibson v. R. O. 'Bill' Williams Ins. Co., 398 S.W.2d 408, (Tex.Civ.App.); Luther v. Coal Operators Casualty Co., 379 Pa. 113, 108 A.2d 691. Further, on substantial evidence, the trial court found that there was no express or implied contract between the parties that Wheeler would or should renew the policy on its expiration. Thus, there could be no breach on contract by Wheeler.
As to Wheeler's alleged negligence in failing to provide an expiration notice, in Kapahua v. Hawaiian Insurance & Guaranty Co., 50 Haw. 644, 447 P.2d 669, it is stated:
"No duty rests upon the insurer to notify the insured of the time when a premium falls due, unless such notice be required by statutory enactment or by agreement of the parties or unless, according to some courts, the insurer has by custom or course of dealing With the particular insured led him to believe that a notice of premium due will be sent.' Vance on Insurance, sec. 55 (3d ed. 1951).' (emphasis supplied)
In the instant case the evidence, though conflicting, did not establish a course of dealing between the parties which could properly have led the Ramseys to believe that notice of termination of the policy would be sent. Mr. Ramsey had been in the insurance business until he sold his agency to Wheeler, and thereafter continued to act as a part-time agent for Wheeler. Further there had been no previous renewals of the policy and Ramsey knew that the policy had a one year term, and knew its expiration date. The burden was on the Ramseys 'to see about the renewal of their insurance.' Walter v. Edwards, Supra. In the absence of any demonstrated course of dealing, the controlling law is as stated in Kapahua, supra: 'Since the insured is charged with knowledge of the stated expiration date, neither the insurer nor its agent has a legal duty to give notice of expiration or to renew the policy automatically.'
There being no duty on the agent to give notice of expiration, failure to give notice was not negligence. See Arapahoe Land Title, Inc. v. Contract Financing, Ltd., 28 Colo.App. 393, 472 P.2d 754.
Judgment affirmed.
SMITH and RULAND, JJ, concur.