195 N.W. 686 | Mich. | 1923
We are unable to follow the trial judge in his reason for directing a verdict. This court has frequently held that insurance companies are estopped by their conduct under certain circumstances from claiming the benefit of forfeitures and breaches of condition when they do not put their refusal to pay on such grounds, but this court has not gone so far as to bring into being a contract of insurance by estoppel alone. In the recent case of Ruddock v. Insurance Co.,
"The doctrine of waiver and estoppel has largely been applied in cases where the insurance companies have relied on forfeitures, and the courts have held that, if the companies have led the other party, to his prejudice, to his expense, to understand that such forfeitures would not be insisted upon, then the companies would be estopped from asserting such defenses. But the doctrine of waiver and estoppel cannot be applied so as to create a liability not created by the contract, or to create a liability contrary to the express provisions of the contract which the parties made."
Upon the authority of that case we must hold that defendant was not estopped by the letter of July 1st from insisting that it had no contractual relations with plaintiff. The letter had its proper place in the case and we shall have occasion to refer to it later.
We can not, however, follow defendant's contention that the court should have directed a verdict upon the ground that it appeared undisputedly that the agent only had authority to accept applications, and that plaintiff had no right to assume that he had the authority of a general agent. In the recent case of Johnson v. Insurance Co.,
The general public transact their business with insurance companies through representatives of such companies without actual notice of any limit upon the authority of such representatives. The agent is usually clothed with at least apparent authority to transact the business in hand, i. e., the effectuating of insurance. In Tubbs v. Insurance Co.,
"The powers of the agent are prima facie coextensive with the business intrusted to his care, and will not be narrowed by limitations not communicated to the person with whom he deals."
See, also, Pollock v. Insurance Co.,
"The defendant cannot be permitted to escape liability from the acts or representations of an agent in the course of its business which he is authorized to transact, whereby a party dealing with it is induced to pay money in the belief that he will receive security in return. The agent of defendant, as we have seen, was empowered to receive payments made to defendant in the course of its business. Plaintiff could well rely upon the representations of the agent that the payment to him was the regular course to pursue in order to obtain the permit required. If the acts of defendant and its agent induced the belief on the part of plaintiff that the permit was issued upon the payment of the money to the agent, defendant is estopped to deny it."
So far as this record discloses Dr. Sanders did not inform plaintiff that defendant had limited his authority. Plaintiff could well have assumed, and probably *50 would be bound to assume, from the language of the application and the blank form of policy, that the agent was not authorized to deviate from the form of policy then in use by defendant; it was the form adopted by the company and approved by the commissioner of insurance; its conditions were not made and could not be changed by the agent; but plaintiff was not bound to know and could hardly be expected to know that the agent was without authority to bind his principal in strict accordance with the provisions and conditions of the policy. The agent was sent out with blank applications to which were attached blank receipts with perforations making them detachable, and we think the signature to these receipts might be given some significance by the jury. While there was a dotted line for the signature of the agent they purported to be and were executed in the name of the company acknowledging it (not the agent) had received the premium for the insurance. When the plaintiff, holding such a receipt, suffered a loss by theft lie promptly notified defendant, and was met by the claim that it had not received his application and would not assume liability "until we have definite proof that the application was made and put in the mail before the car was stolen." Nothing was then said about want of authority of the agent to bind defendant. We are persuaded that there was sufficient in the evidence to justify the submission to the jury of the question of whether the agent was clothed with apparent authority to act generally for defendant in perfecting insurance. While the case must be reversed for the error pointed out, a new trial must be granted. Defendant will recover costs of this court.
WIEST, C.J., and McDONALD, CLARK, BIRD, SHARPE, MOORE, and STEERE, JJ., concurred. *51