163 Ky. 596 | Ky. Ct. App. | 1915
Affirming.
The appellee, Employers’ Indemnity Company, brought this suit in the Clark Circuit Court against the appellant, Big Bun Coal Company, to recover from it the sum which it alleged the appellant owed it, as premium upon a policy of indemnity insurance, which it had, theretofore, issued to the appellant, and was accepted by it. By the contract relied upon, the appellee insured the appellant for the period of one year from September 30th, 1911, against loss or expense arising or resulting from claims against the appellant for damages on account of bodily injuries, including death at any time resulting therefrom, and accidents suffered by any employe or employes, by reason of the operation of the trade or business in which appellant was engaged. It was, also, provided in the policy, that if any suit was brought against the appellant to enforce a claim for damages on account of any accident covered by the policy, the appellant would immediately give notice to the appellee, and appellee undertook, at its own cost, to defend against such proceedings, in the name and on the behalf of the appellant, or to settle the same. The appellant agreed that it would not settle any claim, except at its own cost, nor incur any expense, nor interfere in the negotiations of a settlement of any legal proceedings against it, without the consent of the appellee, except that at the time of an injury, the appellant might provide such immediate surgical relief as was imperative, and any reasonable expense so incurred, the appellee agreed to pay. There were other undertakings provided for in the policy of insurance on the part of the appellant and appellee, which are not necessary for the purposes of this opinion, to be mentioned. The policy, however, provided that it might be cancelled at any time, by either of the parties, upon written notice to the other party, stating when, thereafter, the cancelladon should become effective, and that the date of the cancellation should be the end of the policy period. If the policy should be cancelled at the request of the appellant, the amount to be paid as a premium by appellant, should he the compensation for the full original policy period to the date of cancellation, and the earned premium calculated at the customary short rates, in accordance with a table printed on the policy. The estimated premium
There does not seem to be any doubt, that the amount for which judgment was given was correct, according to the terms of the policy.' The policy provides, that the premium shall be based upon the entire compensation, whether for salaries, wages, piece work, overtime, or allowances earned by the employes of appellant, during the period of the policy. The cancellation was at the request of the appellant, and under that state of case, the earned premium was the compensation for the full original policy period, to be calculated upon the basis of the compensation to the date of cancellation, and the earned premium calculated at the customary short rates, in accordance with the table printed on the policy. This clearly means that the earned premium is forty per centum of what the entire premium for the full year would have been, computed upon the basis of compensation to the date of cancellation.
As to the second ground of defense, it becomes necessary to determine, whether the obligation on the part of the appellee to reimburse the appellant for moneys paid for surgical relief for employes, is a condition precedent to the obligation of the appellant to pay the premium on the policy, or whether it is not. The covenants in contracts, where both the parties make promises of performance, are of two classes. They are called independent and dependent promises. In the case at bar, if the payment of the premium is dependent upon the reimbursement of the moneys paid by appellant for imperative surgical relief, then the failure to make such reimbursements would be a defense to a recovery of the premium. An independent covenant is where a covenant
Applying the principles, supra, and the rules held in the cases above mentioned, to the contract of insurance relied, upon in the case at bar, it will be observed, that the time provided in the policy for the payment of the estimated premiums, is upon the date of the policy, and not after the expiration of the policy. The parties could not then, when making the contract, have contemplated, that the payment of the premium sued for, depended upon the reimbursement to the appellant of money paid for surgical relief, during the continuance of the policy. The appellant relied upon the covenant of appellee to make the reimbursement, and must now rely upon that covenant. This covenant to make the reimbursement goes only to a part of the consideration on both sides, and a breach of it may be compensated in damages. The appellant received the benefit of the contract in the insurance received during the continuance of the contract. After appellee had failed to make the reimbursements complained of in the answer, the appellant continued to enjoy the benefit of the contract for nearly three months thereafter, and made the cancellation, at last, in accordance with the terms of the contract, and never repudiated it. At the time appellant demanded of appellee to make the reimbursement, it then owed appellee the estimated premium on the policy. The promise to pay the premium was not a covenant by the appellant, conditioned or dependent upon the reimbursement by the appellee of the moneys paid for imperative surgical relief, and the failure of appellee to make the reimbursement, did not discharge the contract, as far as appellant was concerned. It could have plead the sums paid for the surgery, as a counterclaim, but it did not do so.
It is, therefore, ordered that the judgment appealed from be affirmed.