47 Iowa 253 | Iowa | 1877
Lead Opinion
The policy is dated December 30, 1874, and insured the plaintiff against loss by fire “from 27th of December, 1874, at 12 o’clock, noon, unto the 27th day of December, 1875, at 12 o’clock noon.” The loss occurred during the existence of ’ the policy. It does not appear on what day the application ivas made, but it asked for insurance “for one year from December 24, 1874.” The application was made to one Callender, a soliciting agent of the company. In such application, which was signed by the plaintiff, he was asked: “Is any of the property encumbered?” He answered, “None.” This was not true, as the property was then encumbered by mortgage. Among other things, the apjfiication states that it contains a “full * * • statement * * touching tho risks, the condition, situation, description, title, exposure, location and value of the property, * * * and a warranty on the part of the assured,” and the policy provides that the statements and obligations of tho assured in the application shall be deemed warranties. Tho policy also contains the following: “ Any person acting as soliciting agent or surveyor in filling out or making the application on which this insurance is based is the agent of and acts for the insured named in this policy, and not of or for this company under any circumstances or in any manner whatever.”
The president of the company testifies that Callender -belonged to a class of agents “ denominated ‘ solicitors ’,” who have power merely to solicit applications for insurance, receive premiums thereon, and forward tho same to the company. Upon these applications the company approves-or rejects the risk. If it approves, tho risk a policy is issued by the company to the applicant, and sent to him by -mail * * *. If
It is apparent from the letter of appointment and instruction furnished this class of agents by the company that they are expected to fill up the blank applications with which they are furnished. Such, we are advised, is the universal practice. Callender did so in this instance.
The plaintiff claims that at the time he signed the application he fully informed Callender of the mortgage, in response to questions asked him, but for some reason what he informed Callender was not written in the application, as he at the time supposed and believed. This is denied by Callender, but the preponderance of the evidence is with the plaintiff. There is some question made as to the amount plaintiff is entitled to recover, if he does so at all. This will be referred to hereafter; Having stated the facts, there remains for determination the questions of law presented by counsel.
■ The application was made and signed, without much doubt, on the 24th of December. It was forwarded with the premium to the company at Des Moines, more than one hundred miles from where it was made. The policy was issued on the 30th day of December, but took effect and was in force on and from the 24th of said month. Hubbard et al. v. Hartford Ins. Co., 33 Iowa, 325. When written up and fully executed the policy was sent to the assured. At least it is so inferred, because such was the usual course of business, and nothing is shown to the contrary. It could not have been received by plaintiff until-the day after it is dated. There was nothing in the application or in the intercourse between plaintiff and Callender which tended to show that plaintiff supposed or had reason to believe Callender was his agent, or that the company so regarded him. On the contrary, the plaintiff had the right to and no doubt did believe that Callender was the agent of the company. Conceding that plaintiff was bound to know the terms and conditions of the policy from the time he received it, there were some five days at least, during which the policy was in force and premium being earned, during which he had no knowledge that Callender without his consent had, by force of a contract which had been written up by the com.pany, been his agent in a past transaction, which he had the right to believe was complete in itself. The plaintiff" applied
The plaintiff, however, accepted the policy before the loss occurred, and it may be said he then knew or was bound to know that Callender had been his agent from the time he signed the application, and that he then should have repudiated the policy, or Callender from that time must be regarded as his agent from the beginning, or at least from the time when the policy was received. It must be remembered, however, the premium was in the hands of the company, and that no provision is made in the policy for its cancellation by the plaintiff, or rights reserved to him in this respect. The policy provides: “This insurance may at any time be terminated at the option of the company on giving notice to that effect * * * to the assured, * * * in which case a ratable portion of the premium for the unexpired term of the policy shall be a claim against the company, payable on the return of this policy to the company.”
If the plaintiff had notified the company of what he could have justly claimed was a false statement in this respect in the policy, and the company thereupon saw proper to exercise the option vested in it and cancel the policy, the plaintiff could be required to pay the earned premium. He would thus suffer a direct pecuniary loss through no fault of his, but, on the contrary, through the wrong of the defendant. Under the facts in this case, the insertion of the clause in question was a fraud on the plaintiff, and no one should be permitted to take advantage of his own wrong or fraud. The policy had a legal existence, and for a time at least, as we have seen, the plaintiff could have recovered if a loss had occurred, notwithstanding
We can readily see that the assured may be bound to' take notice of the conditions and covenants in a policy that affect his rights, or that ajtply to matters in existence at the time the policy is delivered, or that may occur in the future, but we know of no principle of law which requires him to diligently examine the policy for the purpose of ascertaining whether it contains false statements of fact as to a past transaction which he might well suppose was closed.
If the application, payment of the premium, issuance and delivery of the policy are all consummated at the same time, or are all different parts of the same transaction, we conceive the assured should be bound by whatever statements and obligations are contained in the policy. And this may be true if it appeared he in fact knew the policy contained such a statement as the one in question.
Counsel have not cited any adjudicated case which sustains the foregoing views, nor has our own limited search enabled us to find any. With equal propriety it can be said none of the cases cited by counsel for the defendant militate against the views herein advanced. The ruling in Chase v. Hamilton Ins. Co., 20 N. Y., 53, is based on the thought that parol evidence of what was said to the agent was inadmissible, because it tended to contradict the application and policy. This case must be regarded as overruled as to this point by Rowley v. Empire Ins. Co., 36 N. Y., 550, which we do not regard as having been overruled or shaken, notwithstanding what is said in Owen v. Holland Purchase Ins. Co., 56 N. Y., 565, and Roherbach v. Germania Ins. Co., 62 N. Y., 47. In Jenkins v. Quincy Fire Ins. Co., 7 Gray, 370, the ruling is placed on the same ground as in Chase v. Hamilton Ins. Co., and the same may be said, of several other Massachusetts cases. To the same effect is Loehner v. Home Mutual Ins. Co., 17 Mo., 246. The rule announced in these cases has not been followed in this State, but the contrary doctrine adopted. Roherbach v. Germania Ins. Co., before cited, is more nearly like the one at bar than any to which our attention has been called. In
IV. The only remaining question relates to the amount of the recovery. The court found the personal property destroyed, covered by the policy, to be of the value of $487.80. We are not disposed to disturb this finding. Under the terms of the policy the plaintiff can only recover three-fourths of the above, or $865.85, and this was the conclusion of the court below. The value of the building was found to be $458.69. In our opinion the preponderance of the evidence is that the building was worth $550, and we so find. The policy provides: “And in case any of the property covered by this policy shall have any liens or incumbrances thereon, either by mortgage or otherwise, the company will not insure or pay in any event to exceed two-thirds of the amount of the interest of the assured in such property, and such interest is declared to be the difference between the actual cash value of such property and the aggregate amount of such liens and incumbrances — principal and interest.” If the amount of the mortgage had been stated in the application, the amount of the recovery would have been controlled by the foregoing provision. The company should not be prejudiced by reason of the failure in this respect.
From the record before us we are unable to determine the amount of interest due on the mortgage at the time the policy
Modified and affirmed.
Rehearing
ON REHEARING.
A rehearing was granted in this case upon the petition of defendant, and the cause has again been submitted for our consideration.
' The defendant, in the petition for rehearing, bases an objection to our former opinion upon the ground that, as counsel claim, it is mistakenly stated therein the premium was paid by plaintiff upon signing the application for insurance, and when the policy was received by plaintiff the company held the premium. It is true that the money had not been paid by plaintiff, but the company received from him when the application was made a promissory note for the amount of the premium. The policy, by express words, recognizes this note as the consideration of the contract. We cannot think plaintiff’s rights, in view of this fact, were any other or different than they would have been had the money been paid, instead of a note executed for the premium. The policy provides that in case the note is not paid at maturity the policy, from that time,
It is said that the plaintiff' could have refused to accept the policy, and the note could not, in that case, have been collected. That may be so; but it cannot be doubted that defendant actually insured plaintiff’s property from the 24th day of December until the policy was received, about a week afterward, and would have been entitled to the premiums earned during that time, if the policy had not been accepted by plaintiff. This would have been true if plaintiff had refused to accept the policy. The acceptance of this consideration by the company upon an agreement to insure the property from the 24th day of December and to issue a policy, would render defendant liable. Such an agreement is sufficiently shown by plaintiff’s application and the acceptance of the consideration for such insurance to commence on the 24th day of December. Surely defendant, after accepting the consideration and issuing a policy purporting to insure plaintiff from that date, could not deny such contract.
We conclude that the statement of the foregoing opinion as to the payment of the premium is not such an error of fact as to affect the result, and that the position assumed therein, to the effect that there was a contract of insurance upon _and before the receipt of the policy by plaintiff, is correct. We are satisfied with the conclusion of our- first opinion, and adhere to it.
Aerirhed.