126 Iowa 274 | Iowa | 1904
In the year 1898 defendants Clark & Cressler were appointed agents of plaintiff fire insurance company for the town of Scranton, in Green county, with authority to issue policies. They were required to make daily reports of all policies issued, or, in case they could not be sent out on the very day, were required to send a short letter giving the principal particulars of the- risk. On August 6, 1900, they isstied a policy of insurance in the plaintiff company to Lower Bros, for the sum of $1,000, covering a stock of hardware and implements in a frame building at Scranton, at the rate of 2% per cent. Some correspondence followed the receipt of the daily report of this risk, which resulted in a letter from plaintiff to defendants which closed as follows: “ For our part we do not desire to write it at
At the conclusion of plaintiff’s evidence, defendants filed a motion for a directed verdict, which was sustained, and
It should also be stated that after the commencement of the suit, and just as the case was called for trial, defendants made the tender of $35 to the plaintiff — being.the amount of the premium claimed in the petition — ánd also offered ■ to confess judgment for that amount, with costs. Plaintiff refused to accept either the tender or the offer to confess. Nothing further was done with reference thereto until after the trial court had announced its ruling on the motion to direct, whereupon plaintiff asked to dismiss that count of its petition asking to recover the premium, but this the trial court would not permit.
If the defendants fraudulently and negligently issued the policy against the express direction of their principal, and continuously and purposely failed to make report thereof, and plaintiff, through this fraud, was compelled to pay a loss which it might have otherwise avoided, there is every reason for holding them liable not only for the premium they should have exacted, but also for the full' amount of the damages suffered by it in consequence of defendants’ willful wrong. In this respect the case is much like State Ins. Co. v. Jamison, 79 Iowa, 245. See also, Phoenix Ins. Co. v. Pratt, 36 Minn. 409 (31 N. W. Rep. 454); Kraber's Ex’s v. Union Ins. Co., 129 Pa. 8 (18 Atl. Rep. 491); Am. Cent. Co. v. Hagerty, 21 Misc. Rep. 213 (45 N. Y. Supp. 617); Sun Fire Co. v. Ermentrout, 11 Pa. Co. Ct. R. 21. The question in such a case is not merely one of premium, but •of defendants’ liability for failure to follow instructions and for fraud, where the evidence shows or tends to show that, but for such fraud and wrong, the policy would not have become binding. The fundamental duty of an agent is to follow his instructions, and subjept his will to that of his principal. If disobedience affects the manner of execution, and does not affect the result, doubtless no more than nominal damages may be recovered. But if it results in actual loss or injury to the principal, the latter may recover such damages as he can show he has sustained by reason of such disobedience. Whitney v. Mercantile Co., 104 Mass. 152 (6 Am. Rep. 207); Brown v. Arrott, 6 Watts & S. 402; Harvey v. Turner, 4 Rawle, 233. These rules form the basis of distinction between the two Iowa cases cited supra.
Defendants were not called upon to disclose their real defense, and what we have said is based solely upon plaintiff’s side of the controversy. On a retrial of the case, this thought should be remembered.
For the error in sustaining the motion to direct a verdict the judgment must be, and it is, reversed.