92 Va. 392 | Va. | 1895
delivered the opinion of the court.
Upon the trial of this cause, which is an action of assump
The action of the court, both in excluding evidence and in giving judgment in favor of the defendant, is assigned as error in this court.
The propriety of the rulings of the court in refusing to allow the rejected evidence to go to the jury depends upon the question whether the defendant company was affected by the knowledge of certain material facts which came to the sub-agent, or employee of the agents, of the company, through whom the insurance was effected.
The defence relied on by the defendant was that the plaintiffs, in making out their application for insurance, had stated that there was no lien and no other insurance upon the property insured, when in fact there was a deed of trust upon it for $390, and insurance in another company to the extent of $1,200 ; and that by reason of these false statements the policy was void.
The plaintiff sought to show that Robert E. Harris, through whom their insurance was effected, had full knowledge of both the deed of trust and'the other insurance upon the property, and that it was by his advice that their application did not disclose these facts, and that the defendant was estopped from relying on such facts to avoid the policy. The defendant denied that Robert E. Harris was its agent, or that it was affected by his knowledge.
The plaintiffs’ evidence showed that Thomas B. Harris & Son were the agents of the defendant company for Culpeper and its vicinity, and that they were authorized “ to receive proposals for insurance against loss or damage by fire, fix rates of premium, receive moneys, countersign, issue, and renew policies duly signed by the president and secretary,
Thomas B. Harris was called by the plaintiffs, and testified that Robert E. Harris was his son, but was not a member of the firm of Thomas B. Harris & Son, and was not at any time the agent of the defendant; that the son who was a member of his firm was at Richmond College, Ya., when the insurance of the plaintiffs was taken; that he often had more than one of his sons working for him in the insurance business; that Robert E. Harris had solicited a great deal of business for the firm of Thomas B. Harris & Son ; that he (Robert) solicited, with his knowledge, the insurance of the plaintiffs, took the applications therefor, and in pursuance thereof the two policies were issued through himself, T. B. Harris, as a member of the firm of Thomas B. Harris & Son, agents of the defendant, but that he had no knowledge of the facts and circumstances attending the soliciting and placing of the insurance, except what appeared in the application and policy of insurance, until after the loss occurred ; that the special agent and adjuster of the defendant had frequently been in his insurance office at Culpeper, Ya., and had there seen his several sons at work.
In this we are of opinion the trial court erred.
This question has been much discussed, but the better view now seems to be that the insurer is not only responsible for the acts of its general agents, but also for the acts of the clerks or employees of the agents, to whom they delegate authority to discharge their functions, within the scope of their agency.
Insurance companies know, or ought to know, when they appoint general agents, that, according to the ordinary course of business, they have clerks and other persons to assist them, and that their agents in many instances could not transact the business entrusted to them if they were required to give their personal attention to all of its details. It being necessary, therefore, and according to the usual course of business, for their agents to employ others to aid them in doing the work, it is just and reasonable that insurance companies should be held responsible not only for the acts of their agents, but also for the acts of their agents’ employees, within the scope of the agents’ authority.
It is no sufficient answer to this view to say that the insurers did not authorize their agents to delegate their authority to others. It may be that they did not do so expressly, but they appointed agents whom they knew, or ought to have known, would, according to the usage or the necessities of the business, engage the services of others in doing the work entrusted to them ; and, having this knowledge, they will be held to have impliedly authorized their agents to do what was usual or necessary in the business.
“ Generally,” says May, in his work on Insurance, “ agents of insurance companies authorized to contract for risks, receive and collect premiums, and deliver policies, may confer upon a clerk, or subordinate, authority to exercise the same powers. The service is not of such a personal nature as to come under the maxim delegatus non protest delegare. 1 May on Insurance, sec. 154 (3d ed.); also, sec. 154a.
Wood, in his work on Insurance, says : “Hot only is the insurer responsible for the acts of its agent, but also for the acts of its agent’s clerks, or aDy person to whom he delegates authority to discharge his functions for him. Of course the act must be done by some person authorized expressly or impliedly by the agent, and under such circumstances that the insurer knew, or ought to have known, that other persons would he employed by and to act for the agent.” 2 Wood on Insurance, sec. 433 (2d ed.).
It was held in the case of Bodine v. The Exchange Fire Insurance Co., &c., 51 New York 117, that an insurance agent can employ a clerk and authorize him to contract for risks, to deliver policies and renewals, to collect premiums, and to give credit therefor, and the act of the clerk in such cases is the act of the agent, and binds the company. In that case the clerk of the agent waived the pre-payment of a premium, and the company was held bound by it, although there was a condition in the policy of insurance that no insurance, whether original or continued, should be considered as binding until the premium was actually paid.
In that case a policy of insurance issued by the company required the insured to notify the company of any other insurance upon the property, and declared the policy void in case of neglect to comply with that condition.
It also provided that “ only such persons as shall hold the commission of this company shall be considered as its agents in any transaction relating to this insurance.”
The plaintiff, having obtained other insurance on the property, informed the person upon whose solicitation he made the application for the policy, and he said it was all right. That person, at whose solicitation he applied for the policy, was employed to solicit insurance by a firm who were commissioned agents of the defendant company, having authority to give permits for further insurance. He had a desk in their office, and was paid for his services by a commission on the business he procured. He testified that he worked for no one except the defendant’s agents. The plaintiff was non-suited. The court held that to be error, and said that, if he was exclusively employed by the agents of the company, he was not an ordinary insurance broker, but one of the clerks or employees of the company’s agents, and, as such, was authorized to receive notice and to consent to other insurance ; and the testimony as to his exclusive employment being contradictory, the case should have been submitted to the jury.
In a later case decided by the same court the two cases above referred to were cited with approval, and the doctrine
See Continental Ins. Co. v. Ruckman, 127 Ill. 364 ; Hartford Fire Ins. Co. v. Josey, 25 S. W. Rep. (Texas) 685 ; Duluth Nat. Bank v. Knoxville Fire Ins. Co., 85 Tenn., at page 81.
The authority conferred upon the firm of Thomas B. Harris & Son constituted them general agents of the defendant company, for it is settled that a person authorized to accept risks, to agree upon and settle the terms of insurance, and to carry them into effect by insuring and renewing policies, must be regarded as the general agent of the company. 1 May on Ins., sec. 126 (3d ed.); Manhattan Fire Ins. Co. v. Weill & Ullman, 28 Gratt. 389; The Continental Ins. Co. v. Ruckman, 127 Ill. 364.
The evidence introduced by the plaintiffs tended to prove a state of facts which entitled the plaintiffs to prove any act or declaration of Robert E. Harris, whilst engaged in negotiating with the plaintiffs in reference to their insurance, which they would have had the right to prove if the act or declara
It is unnecessary to consider in detail the several bills of exceptions taken by the plaintiffs to the action of the court in excluding evidence. It will be sufficient to say that any material evidence which tended to prove the acts or declarations of Robert E. Harris, whilst negotiating the plaintiffs’ insurance, was admissible against the defendant to the same extent that the acts or declarations of Thomas B. Harris & Son, the commissioned agents of the defendant, would have been admissible if they had negotiated the insurance in person.
Neither is it necessary to consider whether the court erred in sustaining the defendant’s demurrer to the evidence, as the judgment must be reversed, the verdict set aside, and a new trial awarded for the reasons hereinbefore stated.
Reversed.