16 Cal. App. 2d 76 | Cal. Ct. App. | 1936
This action was brought by plaintiff against defendants to recover upon a binder or cover obligation issued by the Liberty Bell Insurance Company, reinsuring a part of plaintiff’s liability under a policy of insurance which it had issued to the Holly Sugar Company. The Guardian Fire Assurance Corporation took over the Liberty Bell Insurance Company’s liabilities and obligations, and agreed to insure risks subsequently written by it; and later the American Equitable Assurance Company of New York assumed the liabilities and obligations of both of these companies. Upon the trial of the ease judgment went in favor of plaintiff, from which the defendants have appealed.
The appeal is brought up on a bill of exceptions, which contains agreed stipulations of facts. From these stipulations the following appears: Edward Brown & Sons were the agents of respondent in California, and W. H. Ticknor was the agent of the Liberty Bell Insurance Company. On November 15, 1929, respondent insured Holly Sugar Company
Under these facts the question for determination is whether or not appellants are liable to respondent for their proportion of the loss in the Tracy fire. The said extension or covering clause as issued by the Liberty Bell Insurance Company to respondent was as follows: “12-1-30 WJM 60 Kept covered thirty days from expiration pending renewal WJM 10-3-30”, and was endorsed on the back of said certificate No. 213. A covering note is a contract of present insurance. (Law v. Northern Assur. Co., 165 Cal. 394, 402 [132 Pac. 590] ; Jones v. International Indemnity Co., 39 Cal. App. 706 [179 Pac. 692]; Kerr v. Union Marine Ins. Co., 124 Fed. 835.)
Appellants contend that there was no consideration for this “keep covered” contract. The law seems to be well settled that a “binder” contract or “keep covered” contract need not express any consideration, there being an implied agreement to pay the usual premium. (Couch on Insurance,
Appellants contend that respondent had completed its reinsurance schedule in which the Liberty Bell Insurance Company was not included, and had decided not to use the “kept covered” agreement of said company; that therefore respondent by its failure to apply to said company for reinsurance had abandoned it. None of these facts were communicated to appellants, and the subsequent cancellation of the reinsurance of the Liverpool & London & Globe Insurance Company caused it to reconsider the matter. We are of the opinion that this did not amount to an abandonment.
Appellants also contend that the “kept covered” 60 clause, which stated “Kept covered thirty days from expiration pending renewal”, meant that the coverage should cease to have effect immediately upon renewal of the policy. If it was intended that the cover note should have that construction, it would have read as follows: “Kept covered 60 days or until renewal was decided.” It is evident that the sixty-day extension was desired by respondent to enable it
There is no evidence of waiver upon the part of respondent; nor is it estopped by any acts committed by it.
The judgment is affirmed.
Knight, Acting P. J., and Cashin, J., concurred.
A petition for a rehearing of this cause was denied by the District Court of Appeal on September 11, 1936, and an application by appellants, to have the cause heard in the Supreme Court, after judgment in the District Court of Appeal, was denied by the Supreme Court on October 8, 1936.