WPC /t.F$mjo6xa]ؑ8톢6iL~Ѥ Ex?NP 6 Ƿ v;ele3Xџ<Հsv[qjhɡx8!~<} jP& Tq#Kp{("[F :/rUs*xgxҸ]gK CۢuVyY$?+`r OنJ?M 励$7u!k˄wvsV53֫MDZ@ KG67UׇTEYg~y%u-+%$$Ϳˊp-4Cs /=Y?:MJH!:,8g'FYHQXwP^*Ƴ&gN=| Tc4sl^3%))GldUNx % 04#! t!  ^ A M  C  m b 0 N wN4U:))cccccccccccccccccccccccccccccccccccccccccccccccccccccccccccccccccccc 0Pr D5 B AQe 0P+ 0D{("  Z6Times New Roman Regular( U$  HP LaserJet 8000 DN PS0C:\PROGRA~1\COREL\WORDPE~1\TEMPLATE\CUSTOM~1\ORDER.WPTC:\Program Files\Corel\WordPerfect Office 2000\Template\Custom WP Templates\Order.wptr1'L  C:\PROGRA~1\COREL\WORDPE~1\TEMPLATE\CUSTOM~1\CUSTOM~1\OPINION.WPTC:\Program Files\Corel\WordPerfect Office 2000\Template\Custom WP Templates\Custom WP Templates\Opinion.wpt 9 b"   _ULU   Ad FILEDXjXL  September17,1999Cecil_Crowson_,Jr.AppellateCourtClerkdA U- -(G2A"$ U!   XXX   `   0  XXhX {Z='H>,OAZ"Arial Regular3|x((3$ U!   \\\\)!dxdx dabZc[C<<CLevel 1Level 2Level 3Level 4Level 5((3$ U!   ($$   1  U!   _  XTR[A' Legal3'A' Legal3'T 8>dd8  z v` [@0,j:`  `@E ` 8ttxPX  v@ DINTHECOURTOFAPPEALSOFTENNESSEE  @)DATNASHVILLE  ` >zEDREEVES,d/b/a h     )   EDSIMPORTS,   h     )    `     h     ) p     ` Plaintiff/Appellee,    ) p _Grundy_ԀChancery    `     h     ) p No.4708  ,  VS. `     h     ) >   `     h     ) p AppealNo. P  GRANITESTATEINSURANCE  ) p 01A019807CH00379 b  COMPANY,   h     ) $t   `     h     ) ` Defendant/Appellant.    ) H @&D z>DISSENTINGOPINION  ~ >z ` Thisappealcallsintoquestionalosspayeesrighttoreceivetheproceedsofaninsurancepolicyeventhoughtheinsurer_cancelled_Ԁthepolicyafterdiscoveringthattheinsuredmadematerialmisrepresentationsinobtainingthepolicy.Thecourthasdeterminedthatthecancellationofthepolicy,whileeffectivewithregardtotheinsured,doesnotaffectthelosspayeesclaim.Idisagree.Thepolicyexpresslyreservestheinsurersrighttocancelthepolicyandalsoprovidesthatthecancellationwilldefeatthelosspayeesinterestinthepolicy. ` Thepolicyprovisionattheheartofthisdisputestates:8 ` 8 ` (#` (#Lossordamageunderthispolicyshallbepaid,asinterestmayappear,toyouandthelosspayeeshownintheDeclarationsorinthisendorsement.Thisinsurancewithrespecttotheinterestofthelosspayee,shallnotbecomeinvalidbecauseofyourfraudulentactsoromissionsunlessthelossresultsfromyourconversion,secretionorembezzlementof yourcoveredauto.However,wereservetherighttocancelthepolicyaspermittedbypolicytermsandthecancellationshallterminatethisagreementastothelosspayeesinterest.WewillgivethesameadvancenoticeofcancellationtothelosspayeeaswegivetothenamedinsuredshownintheDeclarations.   Therecanbelittledisputethatthisprovisionisa standardor unionclauseand,therefore,thatitcreatesanindependentcontractbetweenGraniteStateInsuranceCompany( GraniteState)andEdReeves,thelosspayee.SeeUnionPlanters_Natl_  :\57 Bankv.AmericanHomeAssuranceCo.,865S.W.2d907,911(Tenn.Ct.App.1993). ;69 _However,the independentcontractprincipleshouldnotbeappliedsoliterallythatitexcludestheotherprovisionsoftheinsurancepolicy.Alosspayeeclaimingunder H astandardclauseassertsitsrightssubjecttoallthetermsandconditionsofthe   insurancecontractexceptthoseexpresslywaivedbytheinsurerinthestandardclause @  itself.See4LeeR.Russ&ThomasF.Segella,CouchonInsurance65:46(3ded.  4  1995).    ` ThecourthasapparentlyconcludedthatGraniteStatemaycanceltheinsurance   contractwithregardtoMr._Nance_,theinsured,becauseheobtainedthepolicyby t misrepresentingthathehadnotbeenconvictedofanyoffenseotherthantraffic h violationswhen,infact,hehadbeenconvictedofthefeloniouspossessionof   marijuana.However,thecourthasdecidedthatGraniteStatecannotcancelthe ` separateinsurancecontractimposedbylawforMr.Reevessbenefitbecauseit T agreedthattheinsurancewouldnotbecomeinvalidwithrespecttoMr.Reevesunless  thelossresultedfromMr.Nancesconversion,secretion,orembezzlementofthe L coveredvehicle. @   ` Thecourtsconstructionoverlooksthenextsentenceofthestandardclausein 8"$ whichGraniteStateexplicitlyreservestherighttocancelthepolicyinawaythat #,& terminatesMr.Reevessinterest.ItalsooverlooksGraniteStatesrightunderTenn. % ( CodeAnn.567103(1994)todeclarethepolicyvoidabinitiobecauseofMr. $'t"* Nancesmisrepresentations.SeeMedleyv._Cimmaron_ԀIns.Co.,514S.W.2d426,428 ($, (Tenn.1974);Blandv.AllstateIns.Co.,944S.W.2d372,375(Tenn.Ct.App.1996); l*%. Milliganv.MFAMut.Ins.Co.,497S.W.2d736,739(Tenn.Ct.App.1973).The ,`'0 righttocancelorrescindthepolicy,whetherderivedfromthestatuteortheinsurance -)2 contract,existsevenwhentheinsurerdoesnotdiscoverthemisrepresentationuntil X/*4 afterthelosshasoccurred.SeeBurtonv.WolverineMut.Ins.Co.,540N.W.2d480, 0L,6 482(Mich.Ct.App.1995)(holdingthataninsurermayrescindapolicyabinitio 2-8 upondiscoveringamaterialmisrepresentationregardlessofwhetherthediscovery D4/: occursbeforeoraftertheloss). 581<  094@  ` Mr.Reevessrighttotheinsuranceproceedsisgovernedbyallthetermsofthe  policyexceptthoseexpresslywaivedbyGraniteState.Thepolicystermination T provisionauthorizesGraniteStatetorescindorcancelthepolicy ifthepolicywas H obtainedthroughmaterialmisrepresentation.GraniteStatedidnotexpresslywaive   itsrighttocancelthepolicy;tothecontrary,itexpresslyreserveditsrightto @  terminateMr.Reevessinterest.Accordingly,basedonthepolicyslanguageand  4  Tenn.CodeAnn.567103,Iwouldholdthatthecancellationofthepolicyin   accordancewithitstermsdefeatsMr.Reevessclaim__againstGraniteState. ,|   `     h      p _____________________________ t  `     h      p WILLIAMC.KOCH,JR.,JUDGE