Patrons Mutual Fire Insurance v. Coble

Opinion by

Orlady, J.,

The plaintiff brought suit before a justice of the peace to recover an assessment on a deposit note, the execution of which is admitted under the following state of facts: On June 12, 1894, the defendant made application for and received a policy in a local mutual fire insurance company for the term of five years, and as part of the consideration gave his deposit note for $384, in which he promised to pay “ at such times and by such installments as the board of directors of said company shall order and demand.” The assessment was regularly made on this premium note, in regard to which the defendant states : “ I got notice of the assessment in February. It would run for sixty days before requiring it to be paid. In the mean while it slipped my memory and I got no more notices about it; even when I went in to renew my policy they said nothing about it; they renewed the policy.” About the time of the expiration of the policy the defendant appeared at the office of the company to renew it; a new policy, which bore the same number as the old one but was dated June 12, 1899, was issued for a term of five years, and covered practically the same property that was enumerated in the first policy although the values were changed so as to reduce the amount from $3,200 to $3,090, and at the same time the defendant gave a new premium note for $490, which was based on an increased rate on certain items in the new policy. /

The defense to the plaintiff’s right to recover was that after the issuance of the new policy the defendant had sustained a loss, by lightning or tornado, which he desired to set off against the plaintiff’s claim and demand. This set-off is stated by him in his affidavit of defense to be $150, although on the trial it was first stated to be “ somewhere near $50.00,” and when itemized it amounted to $42.11. Four witnesses testified that at the hearing before the justice, the claim for loss under the second policy as made by the defendant was $5.00.

Under the defendant’s testimony the second policy must be treated as a renewal of the first one. He so speaks of it a number of times, to wit: “ Pie said to me my policy would expire on a certain day, to come in and they would renew it for me ; I went in on that day or the day before; I think it was $2.00 ; he had it all ready, I forgot all about it when the policy was renewed; that there was an assessment under the old policy. Even when I went in to renew my policy they said nothing about it; they renewed the policy.” It was not an independent and new contract, and the substitution of the second policy for a renewal receipt was made necessary by an order of the board of directors on account of increased rates on a certain class of property. The defendant derived an advantage from this in that he paid $1.25 for the renewal, while for a new insurance he would have been obliged to pay from $20.00 to $25.00 on' the same property. The defendant was not misled by any act of the company. He admits that the assessment on the policy of June 12, 1894, had not been paid, and under the bylaws which control both policies it is provided, in article 16, that “ whenever an assessment shall have been made upon any premium note and the same is not paid within thirty days after having been demanded by the company through its agents or collectors, protection against loss or damage by fire shall cease until such assessment is paid in full, and the directors shall retain such premium notes and collect thereon such sum or sums assessed.” He further admits that at the time the renewal policy was taken out both he and the secretary of the company overlooked the nonpayment of the assessment. Although demand has been made for it regularly he. has shown no defense to its payment nor established such a set-off as would warrant the court in submitting it to a jury.

The judgment is affirmed.