R. O. COLLIER, Appellant,
GENERAL EXCHANGE INSURANCE CORPORATION, a Corporation, Appellee
APPEAL from a judgment of the Superior Court of the County of Cochise. H. K. Mangum, Judge. Judgment reversed.
Messrs. Beumler and Beumler, for Appellant.
Mr. Henry S. Stevens, for Appellee.
This is an appeal from a judgment of the superior court of Cochise County. The case was submitted to the court on an agreed statement of facts, which we summarize as follows:
[58 Ariz. 123] In 1937 one William B. Urquhart purchased from the Southern Arizona Auto Company, called the dealer, a new automobile on a conditional sales contract, and at the same time secured the usual insurance policy which auto dealers require when a car is sold under such a contract. The policy expressly insured the dealer, its assignee General Motors Acceptance Corporation, called the GMAC, and Urquhart, as their interest appeared. In May, 1938, Urquhart sold the car to R. O. Collier, plaintiff herein. The latter was unable to pay for the car and arranged with friends named Crow to loan him the full amount necessary to pay off the original conditional sales contract and to pay Urquhart for his equity, taking a similar agreement with plaintiff for the full amount which they had thus advanced to clear the car. Possession of the car was delivered to plaintiff on May 30, 1938, at which time Urquhart assigned to him the insurance policy, which still had some time to run. Mrs. Crow, who from that time on acted as agent of plaintiff, wrote to the GMAC on June 23d, notifying it of the situation and that the insurance policy had been assigned by Urquhart. This letter was received by the GMAC on June 24th, and on June 27th it replied as follows:
"We are indeed sorry that we are also unable to make an assignment of Mr. Urquhart's insurance policy to Mr. R. O. Collier as you requested. The policy will, of course, remain in effect for the original length of the contract but is effective only for the original purchaser and while the car is in his possession. If Mr. Urquhart would prefer to forward his policy to us and secure other insurance for your protection we will be glad to cancel the GEIC policy and forward to him the unearned portion of the premium. If he desires to have us handle it in this manner, would you please have forward -- his policy and we will take care of it."
[58 Ariz. 124] On June 28th Mrs. Crow replied in this language:
"I have the GEIC policy number PX-20412 and written on the face of the policy is the following: 'Tucson, Arizona, May 30, 1938. I Hereby Assign This Insurance Contained in Policy No. PX-20412 on Oldsmobile Sedan Motor Number F772144 to the Purchaser.' Signed, William B. Urquhart. It would seem that that is enough authority to pay the rebate to Mr. Collier. It is the desire of Mr. Collier and myself and we were informed by the General Motors representative that the insurance could be transferred. If this cannot be done please advise the amount of the rebate as of May 30, 1938, as that was the date Mr. Urquhart relinquished the car to the purchaser."
This letter was referred to defendant herein, which had issued the insurance policy, called the insurer, and it for the first time learned of the assignment referred to in the letter of June 28th. Thereafter the GMAC on July 5th advised Mrs. Crow as follows:
"We do not know what representative informed you that the insurance policy could be transferred to another person, and we are indeed sorry to inform you that this cannot be done. The only possible way it could be transferred would be by a regular transfer of equity, and as this account is
paid in full this would not be possible. The writer called the General Exchange Insurance Corporation, and they informed us that with the assignment which Mr. Urquhart wrote on the face of the insurance policy, they would be able to forward the unearned premium direct to you. They will not, however, quote the amount of the premium which would be returned until the policy is in their possession. It would then, of course, be figured on the date on which they received it. If you wish to forward this policy to us, we will in turn ...