Baker v. St. Paul Fire & Marine Insurance Co.

480 N.W.2d 192 (1992)

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Nature of the Case

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Facts

P purchased a homeowner's insurance policy on her residence. The premium for the policy was to be paid in four equal installments. The first three premium installments were timely paid by P. The fourth installment was due July 28, 1985. P testified that she mailed her check in the amount of $128.25 to D on July 15, 1985. She said she would typically mail her quarterly payment and the installment statement to D in D's pre-addressed envelope which accompanied the premium statement. P testified that she placed a stamp on the envelope containing her check and a portion of the statement and dropped the envelope into a mail chute in the hallway of the Livestock Exchange Building, where she worked. She stated that the mail chutes 'run down to the basement where the mailroom is.' On September 26, 1985, P's residence was damaged by fire. P was told that there was no coverage for the fire because the policy had lapsed due to nonpayment of premium. P filed this lawsuit alleging she had not received notice from D that D had not received the premium installment, nor had she received notice of D's intention to cancel her homeowner's policy. D filed a motion for summary judgment, which was denied, and the case proceeded to trial. Each of the parties moved for a directed verdict. Both motions were overruled. D produced evidence following the court's overruling of its motion for a directed verdict. On August 9, 1985, D mailed a cancellation notice to D, her mortgage holder, and her insurance agent stating that the policy would be canceled on September 1, 1985, unless the premium was paid by that date. D never received the final payment. P acknowledged that her agent and mortgage holder received the cancelation notice. P presented evidence of a postmarked cancellation notice addressed to P, and a U.S. Postal Service receipt showing that the cancellation notice was mailed. The jury gave the verdict to P and D appealed.