Eagle Furniture Manufacturers, LLC v. Nautilus Insurance Company
2023-CA-0501
| Ky. Ct. App. | Feb 14, 2025Background
- Eagle Furniture Manufacturers obtained a commercial general liability policy from Nautilus Insurance and financed it through IPFS Corporation, a premium finance company.
- Eagle missed its payment due December 11, 2020. IPFS sent a "notice of intent to cancel" and later a "notice of cancellation" in accordance with KRS 304.30-110.
- The evidence showed that required cancellation notices were mailed to Eagle's designated address; Eagle contended it did not receive them before cancellation took effect.
- After the policy was cancelled effective January 2, 2021, Eagle suffered a loss two days later and then tried to pay the missed premium. IPFS refused the late payment and Nautilus denied coverage.
- Eagle sued IPFS and Nautilus for alleged wrongful cancellation, breach of contract, and statutory/unfair practices claims. The court granted summary judgment for defendants; Eagle appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Was the insurance policy cancellation effective? | Eagle argued actual notice was required, which it did not receive before cancellation. | IPFS & Nautilus argued the statute only requires mailing, not actual receipt, of notice. | Mailing the statutory notice is sufficient; actual notice not required. |
| Did IPFS breach the premium finance agreement/statute? | IPFS failed to give proper notice under KRS 304.30-110. | Notices were properly mailed as required; no breach. | No breach; IPFS complied with statutory mailing requirements. |
| Did Nautilus breach the insurance contract? | Nautilus wrongfully cancelled the policy in violation of law. | Nautilus acted on IPFS’s valid power-of-attorney; only IPFS cancelled. | No breach; Nautilus acted within rights and contract. |
| Was summary judgment premature? | No discovery taken before summary judgment. | Parties had nearly a year; plaintiff never requested more discovery or continuance. | Not premature; sufficient time and opportunity provided. |
Key Cases Cited
- Coomer v. CSX Transp. Inc., 319 S.W.3d 366 (Ky. 2010) (standard of review on appeal of summary judgment)
- Blankenship v. Collier, 302 S.W.3d 665 (Ky. 2010) (de novo review of summary judgment)
- Steelvest, Inc. v. Scansteel Serv. Ctr., Inc., 807 S.W.2d 476 (Ky. 1991) (standards for summary judgment motions)
- Pence Mortg. Co. v. Stokes, 559 S.W.2d 500 (Ky. App. 1977) (mailing notice satisfies insurance cancellation requirement)