113 Ind. 331 | Ind. | 1888
There are three paragraphs of the complaint, but there is no substantial difference between them. They are all based upon a contract of insurance. A single objection is made to the third paragraph, and that is, that it does not aver that the plaintiff furnished the defendant with preliminary proofs of loss. The complaint does aver, however, that the relators performed all the conditions of the contract on their part, and this is sufficient. If a plaintiff' elects, he may specifically plead a performance of the conditions, and if he does elect to do this, he is bound to specifically aver full performance; he is not, however, bound to pursue this course, for he may plead generally that he has performed all the conditions on his part, and if he does do this his complaint will be good. Home Insurance Co. v. Duke, 43 Ind. 418.
The material facts established by the evidence are these: From August, 1883, until August 22d, 1885, the appellant, a foreign insurance company, was doing business in this State. Its representative at New Castle was Robert M. Nixon. The-trustees of the Soldiers’ Orphans’ Home, the relators in this case, applied to Nixon, through one of their number, for an insurance on the building under their control. Nixon at the time represented several other companies, and in four of these obtained policies for the relators. Subsequently, one of these companies, the Home Insurance Company of New York, declined the risk, and notified Nixon to cancel the policy.
“ Five thousand dollars for three years upon their three-story brick building with slate roof, occupied as an asylum for feeble-minded children and as a soldiers’ orphans’ home, ■situated entirely detached on Soldiers’ Home Farm in Rush county, Indiana, one and a half miles south of Knightstown, Indiana. Said building is heated by steam from boilers situated sixty feet north of building and below surface of ground, and is to be lighted by gas machine, the tank for which is to be forty feet from the building and seven feet under ground. Permitted to place $25,000 additional concurrent insurance. Permitted to light the building with coal-oil lamps until gas machine is ready, if lamps are filled and trimmed by daylight only.”
On the same day he made his daily report of the risk to
“This risk begins to-day, July 24th, 1885. It dates July 12th, 1885, to make it expire (with the other insurance placed, by me) April 12th, 1887 — twenty-one even months.”
Accompanying the report was a letter, in which the number, the amount of the policy, the amount of other insurance and other information were given the company. An incomplete policy of insurance was also read in evidence, but there was no delivery of it to the relators; it was retained by Nixon with the other policies. On the daily report of Nixon the following endorsements were made at Cincinnati: “Asylum for Feeble-Minded Children. Undesirable. Cancel. Rate too low. 25 — 7—’85.”
The letter and report of Nixon were received at Cincinnati on the 25th day of July, 1885. Letters were written to Nixon July 25th, August 10th and August 20th. A cancellation mark was also placed on the policy at Cincinnati. None of these letters were answered. In each of them was a direction to Nixon to obtain a better rate or take up or cancel the policies. On the 22d of August, 1885, the company sent a special agent to New Castle to examine into the affairs of the agency at that place; the special agent discharged Nixon, took the policy in favor of relators from his possession, and sent it to Cincinnati to be cancelled. The trustee who had the management of the business of procuring insurance was notified of the refusal of the appellant to carry the risk, but this notice was not given him until after his removal from office and after the company’s agent had knowledge of that fact. No notice was given to any other trustee. The building which the contract of insurance described was
There was a waiver of objections to the proofs of loss. Where proofs are delivered to the agent of an insurance company, and he denies the validity of the contract or asserts that the policy has been cancelled, there is a waiver of objections to the proofs furnished. There is, indeed, in such cases a complete waiver of proof. Ætna Ins. Co. v. Shryer, 85 Ind. 362, and cases cited; Indiana Ins. Co. v. Capehart, 108 Ind. 270; North British, etc., Ins. Co. v. Crutchfield, 108 Ind. 518; Lebanon Mut. Ins. Co. v. Erb, 112 Pa. St. 149; King v. Hekla Fire Ins. Co., 58 Wis. 508; O’Brien v. Ohio Ins. Co., 52 Mich. 131; Tayloe v. Merchants’ Fire Ins. Co., 9 How. (U. S.) 391.
Nixon was the agent of the company, and not of the relators. This, we think, both the contracting parties must have clearly understood; at all events, there can be no doubt that the appellant treated him as its agent from the time of his employment until his final discharge. We assume as clearly proved the fact that he was the agent of the company and that he was so regarded by its officers, and we think that the evidence fully justified the inference that the relators dealt with him as the appellant’s agent. He was made the agent of the company by written appointment, and as such he acted, so that the natural inference is that the re
The authorities go so far as to hold, that a recital in the ■policy that the person who obtains the policy shall be deemed the agent of the assured is not conclusive. The cases, indeed, go beyond this, for they go to the extent of holding that an insurance broker is not to be deemed the agent of the assured merely because it is so recited. Indiana Ins. Co. v. Hartwell, 100 Ind. 566; North British, etc., Ins. Co. v. Crutchfield, 108 Ind. 518 ; Grace v. American Central Ins. Co., 109 U. S. 278; Boetcher v. Hawkeye Ins. Co., 47 Iowa, 253; Van Schoick v. Niagara Fire Ins. Co., 68 N. Y. 434; Gans v. St. Paul, etc., Ins. Co., 43 Wis. 108.
This rule rests on sound principle, for the facts, and not the recitals, establish- the relation of principal and agent. Courts will look through form to substance, and give effect to the rights of the parties as the material and real facts show them to be. Another reason for the rule is, that to permit a formal recital to control would, in many instances, enable an insurance company to commit a fraud by shutting out the truth by a mere recital.
The agent of the appellant had authority to make the contract upon which this action is founded. He represented the corporation and did its business at the place where his agency was located. Either he was its agent or else it had no representative ; but it did have a representative, so that he was its agent; and, as he was its agent, he acted for the corporation as long as he kept within the scope of his ostensible authority. It is immaterial what private instructions the -corporation may have given him, provided they were not brought to the knowledge of the assured. The rule that private instructions do not bind a party dealing with an agent unless he has notice of them applies to contracts of insurance as well as to other contracts. Hartford Fire Ins. Co. v. Farrish, 73 Ill. 166 ; Equitable Life Assurance Co. v. Brobst, 18
Nixon was an agent of a foreign corporation, and as such its only authorized representative within the territory over which he Avas given authority. Within that territory, his acts, so long as they were within the general scope of his agency, were those of his principal. Campbell v. National Life Ins. Co., supra.
Upon the principles asserted by us and established by the authorities we have cited, it is clear that Nixon had general authority to make contracts of insurance, and this authority extended to parol as avcII as Avritten contracts. This position is amply fortified by authority. Our own cases sustain it. New England, etc., Ins. Co. v. Robinson, 25 Ind. 536; American Horse Ins. Co. v. Patterson, 28 Ind. 17; American Ins. Co. v. McWhorter, 78 Ind. 136. The cases else where are in line with our own. Putnam v. Home Ins. Co., supra; Sanborn v. Fireman’s Ins. Co., 16 Gray, 448; Goldwater v. Liverpool, etc., Ins. Co., 39 Hun, 176; Schomer v. Hekla Fire Ins. Co., 50 Wis. 575 ; Humphrey v. Hartford. Fire Ins. Co., 15 Blatch. 504; Cohen v. Continental Fire Ins. Co., 67 Tex. 325; Ellis v. Albany, etc., Ins. Co., 50 N. Y. 402; Post v. Ætna Ins. Co., 43 Barb. 351.
There was a valid parol contract of insurance. Nixon, as the representative of the foreign corporation, made the contract. He was, as we have seen, clothed with ostensible authority to make such contracts, and the assured was not bound to inquire, into the exact extent of that authority. He had authority to make the contract, and the risk began at the time stipulated, although the policy Avas not delivered to the assured. New England, etc., Ins. Co. v. Robinson, supra ; American Horse Ins. Co. v. Patterson, supra; American Ins. Co. v. McWhorter, supra; Kelly v. Commonwealth Ins. Co.,
We do not regard the case of Diver v. London, etc., Ins. Co., 17 Ins. L. J. 156, as in point, oven if well decided, for there the terms of the contract were not all agreed upon, while here the terms of the agreement, so far at least as the agent had authority to contract, were fully agreed upon, and all things finally settled, except, perhaps, the formal approval and execution of the policy. But we are not to be understood as approving the decision in the case cited; we pass it, however, with the additional remark that it is difficult, if not impossible, to reconcile it with the decision in the case of Cooke v. Ætna Ins. Co., 7 Daly, 555.
Wo have no doubt that the counsel for the appellant are right in affirming, that it is essential to the contract of insurance that there should be a meeting of the minds of the contracting parties upon all the elements of the contract. This is but the application of a rudimental principle to a particular instance. But we can not assent to counsel's proposition that, in this instance, there was no meeting of' minds. If Nixon was the agent of the corporation, then his acts were the acts of the corporation. Of this there can be no doubt, for an agent invested with authority to act for his principal acts as the principal in exercising that authority. If Nixon agreed to the contract as the appellant's authorized agent, then, in legal contemplation, the appellant agreed to it. That Nixon was the agent of the company we have already shown, and that he did agree to the terms of the contract, and in the fullest extent, is very clear. We conclude upon this point that there was a meeting of minds and. that the parol contract was complete in all its parts.
It is probably true that the appellant might rightfully have repudiated the contract made by its agent. If, however, this be granted, it will not here avail the appellant. To make such a right available, the insurer must, in such a. case as this, notify the assured of the cancellation of the con
On the 24th day of July the parol contract was made; on that day it was entered on the company’s record, a report •of the contract and its terms was forwarded to the chief officers at Cincinnati, and that report showed that the risk began on the 24th day of July. On the 25th the officers at Cincinnati wrote the company’s agent to cancel the risk or obtain a higher rate. They at that time, therefore, recognized his authority to make the contract, and, without denying the contract, directed a cancellation or an increase in the premium. To this letter the agent made no reply. On the 10th of August they again wrote, but they received no answer. Again they wrote, and that letter, like its predecessors, passed unanswered. A few days after the last letter was written, August* 22d, 1885, the company sent a special agent to New Castle to examine the affairs of the agency at that place; he discharged Nixon, took from his possession the policy made out for the relators, and returned it to the office .at Cincinnati for cancellation.
No notice was at any time given the assured of the action taken by the company or of the agent’s disobedience of instructions. With knowledge of all these material facts, the •officers of the company remained silent. Not a word of warning was given the assured. On the plainest principles ■of justice, the company was bound to give the assured notice ■of the repudiation of the contract. Facts were before its officers which clearly informed them what the agent had done,
Upon many of the questions presented by the record the decision in Ellis v. Albany, etc., Ins. Co., 50 N. Y. 402, bears strongly, and, upon some of them, decisively, but we here quote from it to a single point. Among other things the court there
We do no more, after all, than apply a settled principle to .a particular instance. We adjudge that the appellant was under a duty to speak, and that silence was a wrong. One under no duty to speak may be silent and be safe; but one under a duty to speak is silent at his peril. This principle is almost as old as the law itself, and has ever occupied a conspicuous position in jurisprudence. It is equitable in itself and just in its operation. The appellant has chosen to be silent when justice required speech, and it must abide the consequences.
Judgment affirmed.