37 Wash. 288 | Wash. | 1905
This is a suit to recover for loss by fire. The defendant, an insurance company, issued a policy of insurance to plaintiff, covering his dwelling house and personal property therein, including an organ. The written application signed by the insured stated, by way of answers to printed questions therein, that the chimneys and flues of the house were constructed of brick; that the applicant was the sole owner of the land upon which the building stood; and that none of the personal property insured was incumbered by chattel mortgage, bill of sale, pledge, or otherwise. The truth was the flues were not made of brick, the land was held by the insured under contract of purchase upon which payments had been made, and the organ was also held by him under conditional sale, the principal portion of the purchase price having been paid.
Specified assignments of error relate to the following: (1) The denial of appellant’s motion for judgment upon the pleadings; (2) the overruling of its objection to the introduction of any testimony; (3) the denial of its motion for judgment at the close of plaintiff’s testimony; (4) the instruction to the jury to the effect that appellant was bound, if its agent had knowledge of the facts at the time of the application and issuance of the policy, and if the insured had no knowledge of any limitations upon the agent’s authority. The questions raised by the above may be discussed together. On the face of the blank form of application, printed in very small type, was the following:
“The applicant agrees that each of the foregoing questions are correctly answered, and that such statements, answers and valuations are true and a warranty on his part; that the accepting of this risk and the issuing of a policy of insurance thereon is based solely upon the application, and the association shall not be hound in any respect by any act done- or statement or agreement made*292 to or by any solicitor, agent, or other person which is not contained, in this application.”
Appellant contends that the above constituted notice to respondent of the limitations upon the authority of the agent. It is urged that, inasmuch as he signed the application, he was bound to know its contents, and that he therefore had knowledge that appellant would not be bound by any statements made by him to the agent, even though truthful, if they were not contained in the application. Whatever may be said of the rule applying under similar circumstances to ordinary written contracts, it must be conceded that there is conflict of authority upon this subject, in relation to contracts made with insurance companies through the medium of agents. It is a matter of common knowledge that the business of soliciting insurance is largely done through agents at places generally remote from the location of the insuring company. The people are, as a rule, not informed concerning the technical rules governing insurance contracts. In the nature of things, they must and do rely largely upon the agents, not only because of the latter’s superior knowledge upon the subject, but, also, because they regard the agents as coming from their principals clothed with authority. Tor these reasons the cases are numerous which hold that, when an agent acts with knowledge of the facts, he is the agent of the insurer, and that his knowledge becomes, in law, that of his principal, and binds the latter when the
Appellant, however, cites authorities to the effect that, where an application contains upon its face a statement of the limitations upon the agent’s authority, the insured is thereby informed, and should be held to have knowledge, thereof. We shall not review these authorities, in view of
Appellant, however, cites Nixon v. Travelers’ Ins. Co., 25 Wash. 254, 65 Pac. 195, and argues that it departs from the former cases. We think not. The prior cases were there cited and distinguished from the one then under consideration. It was shown that the assured had actual knowledge of the limitations upon the agent’s authority to waive time for payment of the premium, for the reason, that, after time for payment of one premium installment had passed, he was required to make application direct to the company for reinstatement. Moreover, two of the judges concurred in the result of that case expressly on the ground that actual knowledge on the part of the assured was shown and that they did not intend to depart from the doctrine of the former eases. Respondent calls our attention to many cases in harmony with our own herein cited, and expressly supporting the rule that, when true answers are, in good faith, made by an assured, and false ones are written into' the application by an agent, who knows the facts, but so written without the actual knowledge of the assured, and without actual knowledge of the limitations upon the agent’s authority, such agent, in so doing, acts as the agent of the insurer, and the latter is estopped to deny its liability.
Appellant contends that the person who filled out the application was only a solicitor, and was not an agent authorized to accept insurance. The saíne point was made in Hart v. Niagara Fire Ins Co., supra, wherein it was sought, by reason of a provision in the policy to establish that no one was to be deemed an “agent” unless authorized
In the case at bar, the words in the printed application, which are relied upon as charging knowledge to the insured, are in such small type that the ordinary man would not be likely to read them, unless his attention should be especially directed to them. "While they appear not far above the signature, yet they are the least conspicuous of any printed matter upon the page, and the average man might reason therefrom that they are of the least importance. An insurance company should first set the example for its agents by making such an important subject conspicuous in its printed matter, and the temptation of the agent to conceal would thereby be lessened. Moreover, the full import of the words would doubtless not be grasped by many minds, without explanation. It is true, when an agent does not see that an applicant is fully informed as to the limitation upon the agent’s authority, and then deliberately falsifies the answers in an application, 'without the knowledge of the applicant, he of course perpetrates a fraud upon his company. Looking, however, at the relative positions of the insured and the insurer, it seems just, under such circumstances, that when the applicant has acted honestly, and has in good faith paid his money for protection by insurance) which money has been received by the insurer through the same agent, the insured ought not to be the sufferer.
Mount, C. J., Fullerton, and Dunbar, JJ., concur.
Rudkin, Root, and Crow, JJ., took no part.