Opinion ID: 414040
Heading Depth: 2
Heading Rank: 3

Heading: Coinsurance.

Text: 46 The Fire Carriers' policies required that SJLP maintain insurance of ninety percent of the actual cash value of the insured property at the time of the risk. The clauses provide that in the event SJLP's coverage falls below ninety percent, SJLP must, as a coinsurer, bear that proportion of the loss to the extent of the deficit. 47 Initially, SJLP asserts that the Fire Carriers' appeal from the district court's denial of their motion for a judgment n.o.v. on the coinsurance issue should be dismissed for lack of jurisdiction. We do not agree. Although it is true that an order denying a judgment n.o.v. is generally nonappealable, it is well-settled that the technical requirements for a notice of appeal need not be mechanically applied where the lack of compliance does not mislead or prejudice the appellee. For example, in Foman v. Davis, 371 U.S. 178, 83 S.Ct. 227, 9 L.Ed.2d 222 (1962), the Supreme Court treated a notice of appeal from denials of motions to vacate judgment and to amend the complaint as a notice of appeal from the original judgment in order to satisfy the then-existing requirements of Rule 73 of the Federal Rules of Civil Procedure. The Court found that the appellant had made manifest his intention to seek review and challenge both the dismissal of his earlier complaint as well as the denial of his motions, and that his inept attempt to appeal from the judgment did not prejudice the appellee. Id. at 181, 83 S.Ct. at 229. Moreover, the Court found that to deny the appeal on such a technical basis would thwart the purpose and spirit of the Federal Rules of Civil Procedure. Id. For the same reasons, we decline to avoid a decision on the merits on the basis of such mere technicalities. Id. See also Bankers Trust Co. v. Mallis, 435 U.S. 381, 387, 98 S.Ct. 1117, 1121, 55 L.Ed.2d 357 (1978) (Second Circuit did not err in taking jurisdiction despite absence of required separate document setting forth district court judgment). 48 The Fire Carriers contended at trial that any amount recovered by SJLP against the Fire Carriers would have to be reduced in accordance with the ninety-percent coinsurance clause. The Fire Carriers argued that SJLP's coverage had fallen below the required ninety percent of the actual cash value of the property because, in submitting its estimated property values for the years 1972, 1973, and 1974, SJLP failed to upgrade its property values. Testimony at trial, therefore, focused on the manner in which SJLP had valued its property for the years in question. 49 At the close of all the evidence, SJLP orally moved for a directed verdict on the coinsurance issue. SJLP argued that the Fire Carriers had not complied with the Missouri statutory prerequisites to enforcing a coinsurance clause, and therefore could not raise coinsurance as a defense. The trial court granted SJLP's motion without further comment. 50 The Fire Carriers argue on appeal that they complied with the Missouri filing requirements for coinsurance, that they produced ample evidence of their compliance at trial, and that the coinsurance issue should have gone to the jury. 7 We disagree. 51 Missouri law imposes two requirements upon insurance companies before enforcing a coinsurance clause: (1) the insurer must give a reduction in premiums; and (2) the insurer must file its coinsurance credits, or, rates, with the Missouri Superintendent of Insurance (Director). 8 Mo.Ann.Stat. Sec. 379.160 (Vernon 1968); Templeton v. Insurance Co. of North America of Pa., 201 S.W.2d 784, 789 (Mo.App.1947). If the insurer does not meet these two requirements, the coinsurance clause is void. Id. Under Missouri law, the coinsurance defense is an affirmative defense. The insurance company, if it desires to bring itself within the provisions of the statute allowing coinsurance where it files its rates with the superintendent of insurance   , has the burden of establishing that it has so filed its rates. Newcomer v. Standard Fire Insurance Company, 165 F.Supp. 672, 677 (E.D.Mo.1958); see Foster v. Aetna Life Ins. Co., 352 Mo. 166, 176 S.W.2d 482, 485 (1943) (burden upon insurer to prove affirmative defense of release from liability); Turner v. National Benevolent Society, 224 Mo.App. 463, 28 S.W.2d 125, 126 (1939) (reliance by insurer on exception provided in policy is affirmative defense with burden on insurer). 52 The Fire Carriers filed their coinsurance rates with the Insurance Service Office of Missouri (ISO), a licensed independent rating organization of which the Fire Carriers are members. Relying on Mo.Ann.Stat. Sec. 379.321(1) (Vernon Supp.1981), the Fire Carriers argue that they demonstrated compliance with the statute by establishing that they filed their coinsurance rates with the ISO. Section 379.321(1) provides that an insurer may satisfy the requirements of filing with the Director by filing with a licensed rating organization. 9 The last sentence of section 379.321(1), however, states that in order to substitute effectively the rating organization for the Director as the proper recipient of the filings, the rating organization must, in turn, file those rates with the Director within ten days after its subscribers' rates become effective. 10 53 The Fire Carriers produced no evidence at trial that the ISO is authorized by the Director to receive filings in the Director's stead. Indeed, the Fire Carriers did not mention section 379.321(1) at trial. Nor did they show that the ISO filed its rates with the Director within the requisite ten-day period under the statute. The Fire Carriers argue, rather, that filing with a rating organization is extremely common; that the ISO is a reputable organization; and that, presumably, the ISO always files subscribers' rates with the Director. 54 We have found no authority for the proposition that an insurance company is entitled to a presumption of compliance with the filing requirements of Mo.Ann.Stat. Sec. 379.160 merely by showing that the company filed its rates with an independent rating organization. It is immaterial that the Fire Carriers might easily have proved compliance with the statute. Equally irrelevant is the Fire Carriers' argument that SJLP did not contest the validity of the coinsurance clause until the evidence had all been presented. Neither argument relieves the Fire Carriers' burden of establishing that it filed its rates with the Director. 55 Accordingly, we hold that the district court properly dismissed the affirmative defense of coinsurance. 56