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decided: December 11, 1974.


Appeal from judgment of Court of Common Pleas, Trial Division, of Philadelphia, April T., 1969, No. 6047, in case of James E. Sands v. Granite Mutual Insurance Company.


Ira P. Tiger, with him Schnader, Harrison, Segal and Lewis, for appellant.

Maurice M. Green, for appellee.

Watkins, P. J., Jacobs, Hoffman, Cercone, Price, Van der Voort, and Spaeth, JJ. Opinion by Cercone, J. Jacobs, J., concurs in the result. Watkins, P. J., dissents. Concurring Opinion by Spaeth, J.

Author: Cercone

[ 232 Pa. Super. Page 72]

This appeal arises from a judgment for the plaintiff-insured, Mr. Sands, in the amount of $10,000 after a jury trial below.

The facts of the case, though tantalizingly incomplete in the record, may be stated as follows, giving the plaintiff the benefit of all the favorable inferences and interpretations to which he, as the verdict winner, is entitled: In April of 1966, Mr. Sands came to Universal Insurance Agency in order to purchase insurance for his 1964 Chevrolet. At that time he told Universal's

[ 232 Pa. Super. Page 73]

    employee that he wanted "to be fully insured under 10-20 and 5 -- fully insured . . .,"*fn1 but expressed no preference with regard to which insurance company was selected. Universal was a broker which solicited business for several insurance companies. Since Universal had previously transacted business with plaintiff on the same automobile, and since none of the relevant circumstances affecting plaintiff's insurability had changed to the point that additional information would be required, Universal asked only that plaintiff sign the insurance application form in blank. Plaintiff was willing to let Universal fill out the form on the basis of the information they had in their file. Universal accepted a premium payment and forwarded the completed application to defendant company, Granite Mutual Insurance Company (Granite) for approval.

Unfortunately for plaintiff, Universal neither explained nor mentioned to him that the insurance application form carried a waiver of uninsured motorists coverage which read as follows:

"Uninsured Motorist Coverage has been explained and offered to me and I do [ ] do not [ ] wish to accept this coverage at this time.

"I understand that if I have not accepted Uninsured Motorist Coverage at this time, I may at any time have such coverage added to my policy only by sending written request by certified mail, with $2.00 to the home office of the company and to take effect when written endorsement is issued by an authorized representative of the company."

For reasons which remain unknown, Universal checked the "do not" box on the application. Thereafter Granite accepted coverage and plaintiff received a copy

[ 232 Pa. Super. Page 74]

    of the policy which had been typed out by Universal on forms supplied by Granite, but he did not read its contents.

In April of 1967, at plaintiff's request, the policy was renewed and plaintiff again paid the premium as charged by Universal, directly to Universal which deducted its commission and sent the balance to Granite. Once again plaintiff signed the application in blank; however, this time Universal merely filled in the preliminary language identifying Mr. Sands, his policy number and so forth. Over the body of the application Universal printed in large letters "No Change." Coverage was accepted by Granite, and the policy again was prepared and forwarded to plaintiff by Universal. Once more plaintiff did not examine it.

In March of 1968, Universal sent plaintiff what was, ostensibly, a form renewal of policy notice informing plaintiff that his current insurance policy would lapse and that Universal had a new policy to replace it and that he could come to the office to discuss it if he wished. Handwritten at the bottom of the letter was the message: "Your policy expires April 8th. Please send $47.00 to renew your policy." Ironically, the form letter closed with the warning, in bold-faced type: "Remember, When You Ride Without Auto Insurance, You Gamble All You Own." Heeding that grim caveat, plaintiff promptly called Universal to advise them that he wished to renew. He also informed them that he did not wish to pay for the insurance in $47.00 installments, but would rather pay the entire yearly premium as soon as possible. He immediately paid $100.00, and within two months paid the premiums in full. Universal, however, sent Granite neither a renewal application nor their share of plaintiff's payments.

In June of 1968, a car driven by an uninsured motorist struck a car in which plaintiff was a passenger, seriously injuring ...

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