Opinion
November 28, 1967
Appeal from an order of Supreme Court, St. Lawrence County, which denied appellant's motion to dismiss the complaint pursuant to CPLR 3211 and 3212 on the ground that the complaint fails to state a cause of action, and for summary judgment dismissing the complaint. The appellant, through its agent Rollin Giffin, Jr., issued a fire insurance policy in the amount of $4,000 covering property owned by Nelson and Alice Farmer on September 21, 1961. After the purchase of the property covered by the fire policy from the Farmers by the plaintiff on May 22, 1962, the appellant, on June 14, 1962 through its same agent, issued an indorsement to the policy naming the plaintiff as owner. The policy was written for a three-year term with the expiration date being September 21, 1964. On November 18, 1964 the insured building was destroyed by fire. The complaint alleges two causes of action. The first cause of action is founded in negligence based upon an alleged oral agreement by the appellant, through its agent, to renew the policy upon expiration. The second cause of action is founded upon an alleged breach of contract based upon the alleged oral agreement. Paragraph "6" of the complaint which alleges that "at all the times hereinafter mentioned defendant Giffin was an agent of defendant Glens Falls Insurance Company" is admitted by paragraph "1" of the appellant's answer. In its moving affidavit and in its argument the appellant states that it terminated Giffin's agency on May 22, 1963; that Giffin was not an agent of the appellant on September 21, 1964, the date of expiration of the policy of insurance; that Giffin had no authority to bind the appellant on any insurance coverage or renewal of coverage subsequent to May 22, 1963; that the policy contained no agreement that it would be automatically renewed, and that the complaint fails to state a cause of action with respect to the appellant, in that it fails to state that Giffin was an agent of the appellant on the expiration date of the policy, or that he was authorized to renew the policy on its expiration. The appellant further contends that the duty to renew an insurance policy rests upon the insured, and that the agent Giffin lacked authority to bind the appellant. It is further argued that there has been no payment of the renewal premium. There is no requirement to pay a premium at the time of an oral agreement to renew an existing contract of insurance to make the agreement binding on the company, and an oral agreement by an agent of the company to renew is a contract which an agent is legally competent to make. ( Squier v. Hanover Fire Ins. Co., 162 N.Y. 552. ) It is also competent for the parties to contract by parol for the renewal of the policy and to waive the payment in cash of the premium, substituting therefor a promise to pay on demand or at a future date. ( Trustees of First Baptist Church v. Brooklyn Fire Ins. Co., 19 N.Y. 305; Audubon v. Excelsior Ins. Co., 27 N.Y. 216; Squier v. Hanover Fire Ins. Co., supra.) Having admitted in its answer that Giffin was its agent at all the times mentioned in the complaint, the only contention of the appellant remaining to be considered is the authority of the agent to bind the appellant. The scope of authority of the agent, express or implied, is a question of fact which the plaintiff is entitled to have submitted to a jury. The policy herein contained no provision limiting the agent's authority to contract for renewal and section 168 Ins. of the Insurance Law, which sets forth the standard policy provisions for a fire insurance contract, requires no such limitation. Triable issues of fact exist concerning the authority of the agent to orally agree to renew the policy 27 months prior to its expiration date. "Whether or not an insurance company has clothed its agent with apparent authority to act for it in a given matter is a question of fact for the jury where the evidence with respect to the determining facts is conflicting." (29 N.Y. Jur., Insurance, § 433, pp. 420-421; see also Biloz v. Tioga County Patrons' Fire Relief Assn., 21 N.Y.S.2d 643, affd. 260 App. Div. 976; Ray v. Canton Co-op Fire Ins. Co., 18 N.Y.S.2d 671, affd. 260 App. Div. 961, revd. on other grounds, 286 N.Y. 405.) There being questions of fact to be determined relative to the agent's authority, the matter cannot be determined in a motion for summary judgment. Order affirmed, with costs to respondent. Gibson, P.J., Herlihy, Reynolds, Staley, Jr., and Gabrielli, JJ., concur in memorandum by Staley, Jr., J.