The North Carolina Court of Appeals recently held that whether an insured mailed a policy premium is an issue for the jury to decide. Country Cafaye, Inc. v. Travelers Cas. Ins. Co. of America, 2014 WL 4557533 (N.C. App. Sept. 16, 2014) (unpublished).
The insurer issued a policy to the insured for the insured’s restaurant. Although the insured purportedly signed a check for the premium and placed the check in the mail, the insurer never received it. After not receiving the premium, the insurer sent a notice of cancellation. Less than two weeks after the policy was cancelled, there was a fire at the restaurant. The insured submitted a claim to the insurer, and the insurer denied it. The insured sued, claiming that the insurer breached its contract by failing to pay the claim. The trial court granted summary judgment in favor of the insurer, and the insured appealed.
Reversing, the Court of Appeals noted that the insured had established prima facie that the premium was received by the insurer by presenting the check stub and affidavits from two witnesses averring that the premium had been sent. The court explained that under North Carolina law, evidence of non-receipt of a letter by the addressee is “some evidence” that the letter was not mailed, raising a question of fact for the trier of fact as to whether the check was ever received. Therefore, under these circumstances, where the insured claimed to have sent the policy premium but the insurer claimed never to have received it, the appellate court found that the trial court erred in granting summary judgment for the insurer and remanded the case for a jury to determine whether the premium had been paid.