Appeal from the Circuit Court of Livingston County; the Hon.
R. BURNELL PHILLIPS, Judge, presiding. Affirmed in part, reversed
The defendants, Kentucky Insurance Agency, Inc., an insurance broker, and Lloyds of London appeal from a judgment in favor of plaintiff, William L. Corrigan, in the sum of $4,000 on a horse mortality insurance policy. The case was tried by the court without a jury. Defendants contend that the judgment is against the manifest weight of the evidence.
On June 13, 1966, plaintiff and one Gallivan representing Kentucky, had a telephone conversation concerning insurance on horses and under date of June 16, 1966, defendant insurance agency wrote a "cover note" or binder on Lloyd's form insuring horse, "Alifan," for $4,000, at a premium of $280, and horse, "Bred Red," for $2,000, at a premium of $140. Kentucky sent application forms to plaintiff who executed and returned them June 18, 1966. On June 20, 1966, the broker wrote plaintiff:
"Thank you for your order for horse Mortality Insurance. We have put the insurance in force subject to receipt of veterinary's certificate stipulating the horses are sound.
"If you have not done so, please have a veterinary examine the horses and mail one of the blue certificates we sent you to us. I shall appreciate it very much if you will advise me of the name of the veterinary and his address."
On June 24, 1966, Kentucky received the certificate of Robert G. Kern, veterinary at Cahokia Downs, certifying that "Alifan" and "Bred Red" were sound. He also stated on the certificate, "Swamp Fever has been diagnosed on the track."
Several phone conversations took place between June 16, 1966, and July 15, 1966, as to why the insurance certificates had not been delivered. Gerald Gallivan, treasurer of Kentucky, states that he first advised plaintiff:
". . . that we would not insure the animals. He called me several times and wanted to know why I had not sent him evidence of insurance, and I told him why. I told him we had not received a satisfactory veterinary certificate, and therefore there was no insurance in force. I did not mention the Swamp Fever to him in that conversation because we had not received any veterinary certificate up to June 24th. Mr. Corrigan called me on June 23rd. Between June 24, 1966 and July 15, 1966, I had a conversation with Mr. Corrigan and communicated to him that the horse Alifan was not insurable."
Plaintiff testified to a phone conversation sometime between June 15 and June 25th, 1966, in which he said Gallivan told him "not to worry and the horse was alright." Richard Trainor, who was employed in some capacity by plaintiff, testified to listening to three telephone conversations between plaintiff and Gallivan, the last one being on July 6, 1966, in which Gallivan told plaintiff the horses were insured. He stated that Swamp Fever was never mentioned.
On July 15, 1966, plaintiff wrote Gallivan:
"Due to no written confirmation of Horse insurance we have made other arrangements."
On July 18, 1966, Gallivan wrote plaintiff a letter including the following:
"We were sorry to receive your letter today saying that you had placed your insurance elsewhere. We were trying hard to correctly underwrite the business so that there would be no question in the event of loss."
Plaintiff testified that he had not ever seen Gallivan's letter of July 18, 1966, prior to the trial. He also testified that after he wrote the letter of July 15, 1966, regarding getting insurance elsewhere, he talked ...