Aetna Casualty and Surety Company v. Federal Insurance Company of New York

Summary

The Supreme Court of Appeals of West Virginia reversed a summary judgment for Federal Insurance Company in Aetna's action to recover, as payor of a fire loss, the $2,490.50 attributable to property covered by Federal's floor-plan fire policy issued to creditor Morris Plan Savings and Loan Company. The dispositive question was whether Modern Home Appliance's delivery of a $3,812.84 payoff check to Morris Plan hours before the August 15, 1961 fire — a check later stopped before presentment — absolutely discharged the debt and terminated Morris Plan's insurable interest under Federal's policy. Applying the settled rule that a check does not constitute payment absent an express or implied agreement to that effect, the Court held the Moore and Shane affidavits created a genuine issue of material fact on that question, so neither cross-motion for summary judgment could be granted. Because the trial court never reached whether Aetna could claim contribution or whether the insurers' agreement precluded it, the Court declined to decide that nonjurisdictional question on appeal.