Misamis Lumber v. Capital Insurance - Insurance Policy

123 Phil 1077

Facts:

>  Misamis lumber insured it’s motor car for P14T with Capital Insurance.  The policy stipulated that the insured may authorize the repair of the vehicle necessitated by damage and the liability of the insured is limited to 150.

>  Car met an accident and was repaired by Morosi Motors at a total cost of P302.27.  Misamis made a report of the accident to Capital who refused to pay the cost of the repairs.

Issue:

Whether or not the insurer is liable for the total amount of the repair.

Held: NO.

The insurance policy stipulated that if it is the insured who authorized the repair, the liability of the insurer is limited to 150.  The literal meaning of the stipulation must control, it being the actual contract, expressly and plainly provided for in the policy.