Brian K Aviles

10.7 Acceptance Peter Andrus owned an apartment building that he had insured under a fire insurance policy sold by J. C. Durick Insurance (Durick). Two months prior to the expiration of the policy, Durick notified Andrus that the building should be insured for $48,000 (or 80 percent of the buildings value), as required by the insurance company. Andrus replied that (1) he wanted insurance to match the amount of the outstanding mortgage on the building (i.e., $24,000) and (2) if Durick could not sell this insurance, he would go elsewhere. Durick sent a new insurance policy in the face amount of $48,000, with the notation that the policy was automatically accepted unless Andrus notified him to the contrary. Andrus did not reply. However, he did not pay the premiums on the policy. Durick sued Andrus to recover these premiums. Who wins? J. C. Durick Insurance v. Andrus, 139 Vt. 150, 424 A.2d 249, Web 1980 Vt. Lexis 1490 (Supreme Court of Vermont)

In the matter of J.C. Durick Insurance v. Andrus there was an agreement in place for insurance on the building. What is being questioned is the renewal period. As an offer, Durick notified Andrus that his policy would be expiring in 2 months and that the building should be insured for 80% of the value of the building which came out to $48,000, as required by the insurance company. Now this is where things get a little dicey. In Andruss reply to the notification that his policy would be expiring in two months, he then Counteroffers and states the following 2 conditions 1) he wanted insurance to match the amount of the outstanding mortgage on the building (i.e., $24,000) and (2) if Durick could not sell this insurance, he would go elsewhere.. Since a counteroffer was made at that point the original offer was null and void at that part.

Since it was communicated back to Durick at that point he had an obligation to consider this new request and not simply ignore it. Since Duricks action is to simply send a new insurance policy in an amount other than what Andrus had wanted this constituted a Rejection on the part of Durick. Rejection -Express words or conduct by the Offeree that rejects an offer. Rejection terminates the offer. (Cheeseman p.173) At this point it was made clear when Durick had sent a new policy with the wrong amount that Andrus would be shopping elsewhere. Regardless of what any other stipulation was put on the new policy. Since no new Premiums were paid to this new policy and Duricks failure to respond to the conditions set forth in the counter offer I see no fault in the actions by Andrus. I would agree with Andruss position that his counteroffer was never responded to based on his conditions he set forth. The fact

that the Insurance Company required the policy to be at 80% is irrelevant and is the reason why he had asked for a policy amount that would fit his needs and not the needs of the insurance company.