On appeal from the Superior Court, Law Division, Union County.
Antell, Shebell and Matthews. The opinion of the Court was delivered by Shebell, J.A.D.
Defendant insurance company challenges the Law Division's rejection, on motion, of its defenses to plaintiff's suit to recover for fire damage under a multi-risk policy issued by defendant. It contends there were material issues of fact as to whether the policy was in force or had been cancelled, or whether it was void because of willful concealment or misrepresentations on the part of the plaintiff or its broker. It also maintains the court erred in deciding as a matter of law that the policy provision pertaining to increased hazards did not include moral or financial hazards. Judgment was entered in plaintiff's favor in the amount of $39,778.91 from which defendant appeals.
In February of 1981 defendant issued a policy covering plaintiff's premises for damage caused by fire, as well as other "multi-perils." Coverage was obtained through the Tri-State Agency, which sent plaintiff a bill for $1,190.14 for the first year's premium. Tri-State had obtained the policy through defendant's agent, the Heffner Agency, Inc., and had guaranteed payment of the premiums. Plaintiff did not pay Tri-State's bill for the premium and the policy was cancelled by defendant at Tri-State's request effective May 5, 1981.
Tri-State also procured other insurance for the plaintiff including liability coverage of plaintiff's trucks through another insurance company. Tri-State received a check for $5,000 from plaintiff, payable to Brisco International Agency, to cover vehicle liability insurance, which Tri-State obtained through that broker.
Plaintiff's president met with another insurance broker and learned he could obtain the coverages he needed for less. On March 20, 1981 he wrote Tri-State advising he had engaged another agency to handle the company's insurance as of March 12, 1981.
Thereafter, Tri-State received a $2,137 check from Brisco representing a return of premium on the vehicle liability policy, dated May 8, 1981. Tri-State checked with defendant's agent and was told that although the multi-peril policy with defendant had been terminated it would be reinstated upon payment of premium. Tri-State used $1,190.14 of the vehicle liability return premium and had the multi-peril policy with defendant reinstated. On May 15, 1981 defendant sent to plaintiff the following: "THIS NOTICE OF CANCELLATION IS VOID. THE POLICY REMAINS IN FULL FORCE & EFFECT."
Tri-State sent a statement dated May 28, 1981 advising plaintiff the return premium had been applied to its multi-peril policy with defendant. Plaintiff objected, maintaining it had told Tri-State to cancel its policies. Tri-State maintained that while they were not instructed to reinstate the insurance, neither were they told to cancel it. Plaintiff did not obtain other replacement insurance until June 1, 1981.
On June 27, 1981 there was an explosion and fire on plaintiff's premises. Plaintiff sought to recover for the fire loss from both insurance companies. In October 1981 defendant sent plaintiff a notice cancelling the policy for "underwriting reasons"; however, that notice was subsequently recalled.
Defendant argues that Tri-State had ordered reinstatement and paid the premium without authority from plaintiff and that the policy therefore was not in effect at the time of the loss. We hold this contention to be without legal basis. A party seeking summary judgment has the burden of excluding
any reasonable doubt concerning the existence of a genuine issue of material fact. Judson v. Peoples Bank & Trust Co. of Westfield, 17 N.J. 67, 74 (1954), Garley v. Waddington, 177 N.J. Super. 173, 179 (App.Div.1981). Accepting the facts as defendant presents them and according defendant the benefit of all ...