Matthews, Crane and Antell. The opinion of the court was delivered by Matthews, P.J.A.D.
Defendant Hartford Insurance Group (Hartford) appeals from a judgment entered in the Chancery Division holding it liable to plaintiff for coverage under an automobile insurance policy issued to plaintiff by it through defendant Don Still Agency (Agency). Hartford contends that the policy had been cancelled for nonpayment of premiums on May 22, 1974 and thus refused to pay any claim made by plaintiff which arose out of an accident which occurred on May 24, 1974. Plaintiff claims she never received the notice of cancellation required by N.J.S.A. 17:29C-8 and thus the cancellation was ineffective. She also argues that her payment of the premium to her broker, the Agency, on May 23, 1974, operated to continue coverage under the policy pursuant to the provisions of N.J.S.A. 17:22-6.2a.
The trial judge agreed with plaintiff's position and found that Hartford was liable to her under the terms of the policy issued, and awarded counsel fees and costs.
Defendant Agency failed to answer plaintiff's complaint or Hartford's crossclaim for indemnification, and defaults were entered on both the complaint and the crossclaim.
Plaintiff originally procured her policy with Hartford through the Agency in October 1972. The policy was subsequently renewed in October 1973 for an additional year. The payments for the renewal policy were to be paid in three installments.
Hartford established that on all installment payment policies certain procedures are customarily followed. A reminder
notice is mailed out to the insured 30 days prior to the installment payment due date. A copy of the reminder notice is retained in Hartford's files. If payment of the installment is not received within seven days of the due date, the installment notice is stamped unpaid and sent to the appropriate department where the insured's file is prepared for a cancellation notice. The cancellation notice indicates the name and address of the insured, the amount of time given the insured before cancellation is effective (a minimum of ten days) and the effective date of the cancellation.
The last section of the multi-copy cancellation notice is termed a certificate of mailing, which indicates that correspondence is being sent from Hartford to the named insured at the indicated address. A Hartford clerk puts the insured's copy of the cancellation notice in a window envelope. The envelope and the certificate of mailing are taken to the post-office. The postal clerk verifies, by means of a dated stamp, that the name appearing on the window envelope corresponds to the name and address on the certificate of mailing. Certificates of mailing are utilized only for cancellation notices.
Hartford claims this procedure was used when plaintiff failed to remit her second installment payment which was due January 1, 1974. A reminder notice and a cancellation notice were allegedly sent, but she denied ever receiving anything from Hartford directly. In any event, Hartford received plaintiff's second installment premium payment on February 13, 1974, 12 days before the effective date of cancellation, and her policy was reinstated.
Plaintiff denied receiving a reminder notice with respect to the final April 30, 1974 installment or the cancellation notice indicating that her policy would be cancelled for nonpayment of premium effective May 22, 1974. Instead, she stated that she received a reminder from the Agency on May 15 or 16, 1974 indicating that her payment was due on May 20 or 21. She claimed that she called the Agency indicating that she could not make payment until Friday, May 23.
Since she was not told payment could not be accepted on that date, she brought the required amount to the Agency on May 23 in cash and received a receipt for the final payment on her insurance policy. The following day she was involved in the automobile accident which Hartford ...