58 N.Y.S. 687 | N.Y. App. Div. | 1899
This action is against the underwriters of wliat is known as a Lloyd policy. These underwriters were associated under the name
It is a sufficient answer to the first point that the defect relied upon appears upon the face of the complaint, and that the objection thereto, not having been taken by demurrer, was waived. The defendants contend that there is no allegation in the complaint that each underwriter was liable only for his proportionate share of the loss. As they construe the complaint, it alleges a several liability to insure the plaintiff to the full amount of the loss, not exceeding $5,000. This is an inaccurate view of the complaint. We find there an express allegation that “in and by said policy,” the defendants “ severally agreed to pay respectively their proportionate part or share of any loss by fire to the property thereby insured, not exceeding in the aggregate the said sum of five thousand dollars ($5,000).” It is said that this provision refers, not to the proportionate part of the loss payable under the policy, but to the policy’s proportion of the total loss as between it and other insurance. This contention is entirely without merit. The provision in question had no relation to the apportionment pf the total loss among the insurers generally, but clearly to the proportionate part of each underwriter’s obligation under this particular policy. There can be no misunderstanding about this, either from the tenor of the complaint or the demand for judgment. The latter is expressly limited to each underwriter’s proportion of the loss apportioned to the present plicy.
- We may add that the objection is not sufficiently taken even by answer. If the defect did not appear upon the face of the complaint, the answer in taking the objection, should have distinctly pointed out which of the matters enumerated in section 488 of the Code of Civil Procedure was referred to. None of these matters is covered by the objection. The answer simply states that “ each of the defendants above named allege that he has been improperly united with each of the other defendants herein named.” This
It is well settled that, under section 454 of the Code of Civil Procedure, two or more persons severally liable on the same instrument for the whole amount of its obligation may be included as defendants in the same action. (Straus v. Hoadley, 23 App. Div. 360.) It was essential, therefore, to a proper presentation of this objection, that there should have been a statement in the answer to the effect that separate causes of action against each defendant for his proportionate part of the amount insured had been improperly united. There is no such statement in the answer either in terms or in substance. There is a denial that the defendants contracted jointly, or jointly and severally. This, however, is a denial of something which is not alleged. We find no affirmative allegation that the defendants contracted severally, or indeed that they contracted at all. In fact, the existence of the policy is “ignored.” It is apparent, therefore, that the objection under consideration was not taken either by demurrer or answer.
The second point is presented by an allegation in the nature of a special plea. The plea is that “ if any policy was issued to plaintiff as in said complaint alleged, it was in consideration of and under a mutual written agreement whereby it was provided that any action brought by the assured to enforce the provisions of the said policy should be brought against Beecher & Company, as attorneys in fact for and representing all of the underwriters.” It was then averred that “no action has been brought by the said plaintiff upon said policy against the said Beecher & Company as attorneys in fact, representing the said underwriters, * * * and that these defendants have never waived their rights thereunder.” The sole question then is, Was the plaintiff bound in the first instance to sue Beecher & Co. ? We have held that provisions of this nature are ordinarily binding and must be complied with. (Leiter v. Beecher, 2 App. Div. 577.) The question here, however,
It will be ■ observed that the name of Beecher & Co. does not appear in this direct connection. It is, however, elsewhere provided in the policy that wherever the phrase “1 attorneys of the underwriters ’ occurs, it shall be held to mean their attorneys in fact, to wit, Beecher & Company.” The object of this provision is quite clear. It was to avoid multiplicity of suits and to provide a convenient method of settling in one action all questions in dispute between the insured and the underwriters. To do this with justice to both parties it was essential that the persons sued should be, as the proviso stipulates, l£ the attorneys in fact, as representing all of the underwriters.” The specified firm name does not, under this provision, necessarily and under all circumstances determine who shall be sued. The essential fact on that head is the fact of present representation. Justice to the underwriters requires, as we held in Wheelock v. Chapman (34 App. Div. 464), that the action should be brought against the acting representatives of the underwriters at the time when the liability arises. The underwriters stipulate for an action, not against a fixed and unchangeable personality, but in effect against an agency over which they exercise present control"
The plea here is that Beecher & Co. should have been sued. That plea fails for the reasons assigned. There is no plea that Edwards & Co. should have been sued. We may say, however, that the evidence clearly shows that that firm also “ went out ” in July, 1895, after previously informing the underwriters that there were no funds left to pay losses, that they could no longer carry on the business, and that the original underwriters of the Indemnity Lloyds would have to take care of themselves as best they could.
Thus, when this action was commenced in April, 1896, there were no attorneys in fact representing the underwriters and no funds of any description from which to collect the loss save the individual liability of these defendants. Under these circumstances the provision became practically inoperative. It contemplated the continued existence of the agency and" was subject to the implied and underlying condition that the parties should be excused from fulfillment in case such agency had ceased to exist at the time when performance would otherwise be required.
We think, therefore, that the judgment was right and should be affirmed, with costs.
Rumsey, Ingraham and McLaughlin, JJ., concurred.
Judgment affirmed, with costs.