Opinion
39642.
DECIDED SEPTEMBER 7, 1962.
Action on insurance policy. Barrow Superior Court. Before Judge Russell.
John A. Darsey, Jack S. Davidson, Davis Davidson, for plaintiff in error.
Hurt, Baird Peek, J. Corbett Peek, Jr., Dudley Cook, contra.
1. Under a provision in a policy of insurance that the policy shall be canceled at any time on request of the insured, written notice by the insured to the company's authorized agent to cancel all insurance "this date" effects a cancellation upon its receipt by the company and without any further action on the part of the company, and a loss occurring thereafter is not covered by the policy although at the time of the loss the insured had not surrendered his policy or received the return premium thereon.
2. Notice to an authorized agent is notice to his principal. An agent of an insurance company who is required to countersign insurance policies before issuance, and is authorized to make out and deliver excess premium refunds is an authorized agent of the insurer to whom notice of cancellation of a policy may be made by the insured.
DECIDED SEPTEMBER 7, 1962.
A. L. DeLaPerriere filed an action in the Superior Court of Barrow County to recover the face value of a policy of fire insurance, together with penalty and attorney fees. The policy contained the following provision: "This policy shall be canceled at any time at the request of the insured, in which case this company shall, upon demand and surrender of this policy, refund the excess of paid premium above the customary short rates for the expired time." The plaintiff had some 30 odd tenant houses on which he carried insurance written by the defendant and other insurance companies through the Charles L. McWhorter Insurance Agency. On August 11, 1959, McWhorter wrote the plaintiff with respect to three of the policies not involved in this litigation stating that two of them expired on August 14, 1959, and the third on August 30, and that the company had requested these policies not be renewed. Plaintiff then wrote McWhorter a post card dated August 14, which was a Friday, stating: "Dear Sir: Please have all the insurance I have with your companys cancell out of this date. Send me statement and refund check. Sorry but will place Ins. other Co." The testimony of the defendant was that this communication was received by the insurance agent that same day and the insured's cards were pulled; on the next morning, which was Saturday, the return premiums were figured and the check for the refund made out but not mailed because, according to an employee, they had to pick up the policies before they could cancel them. On the following Monday morning the insured called the agency and informed them that the house insured by the policy here under consideration had burned down at about 9 on Sunday night, August 16, and that he did not wish this policy canceled. On Monday, the agent, McWhorter, tendered the insured a check for the refund premiums which was refused because a premium refund was included on the policy for which this suit is brought. The plaintiff later accepted a rewritten check including all policies except this one, and thereafter mailed those policies back to the agent.
The trial resulted in a verdict in favor of the plaintiff for the face amount of the policy. The defendant, who had moved for a directed verdict, thereupon moved for a judgment notwithstanding the verdict which was granted by the trial court, and the exception here is to this judgment.
1. The plaintiff in error contends that he was entitled to revoke his cancellation of the fire insurance policy at any time before he surrendered the policy and received or had tendered to him the return premium. This argument is unsound. It is true that to be effective the notice must be received by the insurer ( Bankers Mutual Cas. Co. v. Peoples Bank of Talbotton, 127 Ga. 326 (1), 56 S.E. 429), but nothing more is required except that the notice conform to the terms of the contract of insurance. Home Ins. Co. of N.Y. v. Chattahoochee Lumber Co., 126 Ga. 334 ( 55 S.E. 11). Thus if, as a condition precedent to cancellation, it is required that the insured surrender the policy, such provision will be given effect. Interstate Life c. Co. v. Jackson, 71 Ga. App. 85 ( 30 S.E.2d 208). Where the policy requires only that it shall be canceled at any time at the request of the insured, such request by the insured to the insurance company or its authorized agent will ipso facto terminate the contract. Home Ins. Co. of N.Y. v. Loflin, 41 Ga. App. 423 (1) ( 153 S.E. 229). The right to terminate the contract at any time on request constituted a continuing offer by the company which, when accepted by the insured by exercising the right comfortable to the terms of the policy, immediately revoked the contract without any further action on the part of anyone. Northwestern Mut. Life Ins. Co. v. Joseph, 31 Ky. L.R. 714 (103 S.W. 317); Lockwood v. New York Life Ins. Co., 161 NYS 700; Manhattan Life Ins. Co. v. Allison, 100 Colo. 1 ( 64 P.2d 1265). The language of this policy does not require a surrender of the policy to effect a termination, but does provide that where the insured elects to terminate the contract "this Company shall, upon demand and surrender of this policy, refund the excess of paid premium above the customary short rates for the expired time." In such a case "where a notice to cancel a policy is given in accordance with its terms, the contract is ipso facto terminated, and the obligation of the insurance company to return the unearned premium, if any, to the insured merely creates the relationship of debtor and creditor between the company and the insured with respect to that item." State Farm Mut. Auto Ins. Co. v. Pederson, 185 Va. 941 ( 41 S.E.2d 64, 67); Gately-Haire Co. v. Niagara Fire Ins. Co., 221 N.Y. 162 ( 116 N.E. 1015, 1017, Ann. Cas. 1918C, 115); Johnson Stroud v. Rhode Island Ins. Co., 174 N.C. 201 ( 93 S.E. 735); Hicklin v. State Farm Mut. Auto. Ins. Co., 176 S.C. 504 ( 180 S.E. 666, 669); Prillaman v. Century Indem. Co., 138 F.2d 821, 823 (4 Cir.); Eicher-Woodland Co. v. Buffalo Ins. Co., 198 La. 38 ( 3 So.2d 268, 272); Camden Fire Ins. Assn. v. Jennings, (Tex.) 93 S.W.2d 530; Atlantic Fire Ins. Co. of Raleigh v. Smith, 183 Okla. 97 ( 80 P.2d 216).
2. There is no contention here that the McWhorter Insurance Company was not an authorized agent of the defendant. That it was such an agent appears generally from the facts that it was required to and did countersign all policies of insurance issued by it; that it had dealt with the plaintiff for many years, selling and delivering policies, effecting cancellations, and adjusting losses, and that in this particular case the agent himself wrote out and delivered or tendered the refund checks without any prior communication with the company. The fact of agency appears from a specific statement in the policy to this effect. The testimony of the office employee to the effect that they had to pick up the policies in order to cancel them must, in view of these facts, be interpreted as office procedure rather than any requirement of the company, because the company, under the language of this policy, would not itself have had the right to insist that surrender of the policy be made a condition precedent to its termination, nor would the situation be changed even though the agency, after receiving the notice of cancellation, took no further action whatever.
It follows that a verdict in favor of the defendant was demanded, and the trial court did not err in granting the judgment notwithstanding the verdict.
Judgment affirmed. Eberhardt and Russell, JJ., concur.