Opinion ID: 1708888
Heading Depth: 1
Heading Rank: 4

Heading: vanguard

Text: Nunley thought he had a fire insurance policy with Independent Fire. Merrill knew that he did not. Nunley made no request of Merrill to secure other insurance. Ordinarily, a policy of insurance issued after a loss is not a valid policy. Asher v. Old Colony Insurance Co., 240 Miss. 166, 126 So.2d 255 (1961); Scottish Union National Insurance Co. v. Warren-Gee Lumber Co., 118 Miss. 740, 80 So. 9 (1918). This Court has held, however, that where at the time of an application for insurance there has been a loss but neither the applicant nor the insurer knew of this fact a recovery may be had on a policy subsequently issued, which was antedated so as to include the time at which the loss occurred. State Farm Mut. Auto. Ins. Co. v. Calhoun, 236 Miss. 851, 112 So.2d 366 (1959). Yet, such a rule presupposes there was a contract, a meeting of the minds of the parties. There was no meeting of the minds of the parties in this case. Nunley made no application for insurance on April 2, 1984. The Indiana Supreme Court faced a similar case to this in Celina Mutual Casualty Co. v. Baldridge, 213 Ind. 198, 10 N.E.2d 904 (1937). On July 19, 1930, Baldridge thought he had insurance on his car with a company called American States Insurance Company (which later cancelled the policy for nonpayment of premium, although he had paid the local agent). After his car was damaged, the local agent, a Mrs. Brishaber, informed Baldridge that she had insured him on July 19 with Celina Mutual Casualty Company. The Indiana Supreme Court had this to say: [I]t is sufficient that on July 19th, when Mrs. Brishaber says she undertook to cancel his policy and procure him a new one in the appellant company, she had no authority to act for him, and he had no knowledge of her action, ... To create a contract of insurance there must be an agreement between the insurer and the insured. There must be a meeting of the minds... . There was no contract made on July 19th, because appellee had not authorized or requested the issuance of insurance, and had no knowledge that a contract with appellant was contemplated... . An agent of an insurance company has no authority to insure property already destroyed; and a policy written and intended as a substitute for a subsisting policy in another company, but not delivered, and of which the assured has no knowledge until after the property is destroyed by fire is not a valid contract of insurance. [Citations omitted] A direction authorizing an insurance agent to procure a policy of insurance is exhausted by the procuring of one policy, and confers no authority to afterwards cancel and procure other or different policies. [Citations omitted] In Clark v. Insurance Co. of North America (1896) 89 Me. 26, 34, 36, 35 A. 1008, 1011, 35 L.R.A. 276, it is said: The contract of insurance is to be tested by the principles applicable to the making of contracts in general. The terms of the contract must have been agreed upon. This necessarily implies the action of two minds, of two contracting parties. If it is incomplete in any material particular, or the assent of either party is wanting, it is of no binding force.    In this case, the action of the agent in the transaction relative to the attempted change of risk to the defendant company was entirely ex parte. If we assume that he was acting with authority from the company, it was then no more than a proposition which had not been made known to the plaintiff. To give it validity required his knowledge and his consent. At the time of the loss, knowledge had not been conveyed to him, and his acceptance had not been given. The rights and liabilities of the parties are to be determined by their legal status at the time of the loss. It is inconceivable that the defendant company can be held liable for indemnity against loss when no contract for indemnity existed at the time the loss occurred.       It seems clear that there never was a contract between the appellant and the appellee, or ever a thought of such a contract, except in the mind of the local agent, until after the property to be insured was destroyed. There can be no contract without knowledge of the contracting parties... . 10 N.E.2d at 906-907. See also Alliance Ins. Co. v. Continental Gin Co., 285 S.W. 257 (1926). We do not have the question before us of whether Merrill has any rights against Vanguard. Also, Nunley's cause of action against Merrill remains unaffected by this decision, the circuit court having rendered a Rule 54(b) final judgment only as to Independent Fire and Vanguard. Rule 54(b) Mississippi Rules of Civil Procedure. We do hold no insurance contract of any kind was ever entered into as between Nunley and Vanguard. The judgment of the circuit court is accordingly affirmed. AFFIRMED. WALKER, C.J., ROY NOBLE LEE, P.J., and DAN M. LEE, PRATHER, ROBERTSON, SULLIVAN, ANDERSON, and GRIFFIN, JJ., concur.