30 Misc. 2d 503 | N.Y. Sup. Ct. | 1961
This action which seeks to recover an alleged balance of damages for fire loss is predicated upon plaintiff’s claim that, solely due to the negligence of the defendant, an insurance broker, in procuring fire policies and failing to properly describe plaintiff’s building, the insurance companies resisted payment, necessitating the bringing of lawsuits against them for collection and ultimate settlement with them for less than the losses claimed to have been incurred.
The answer admits that, at plaintiff’s request, defendant obtained the subject policies, but otherwise denies generally.
The undisputed proof disclosed that in August of 1955, at plaintiff’s request, the defendant, a domestic corporation engaged in the business of an insurance broker, procured a standard statutory fire policy with the Century Insurance Company, Limited (hereafter referred to as “Century”), in the amount of $50,000, on a house owned by plaintiff, at Laurel Hollow, Nassau County, Long Island, New York. Plaintiff had bought the property in April of 1949. This was the first
The uncontradicted evidence further established that on March 6, 1957 the building and its contents were destroyed by fire. Plaintiff submitted proofs of loss to Camden and Fireman’s, claiming losses in excess of the amount of insurance. The companies refused to pay. Thereupon plaintiff instituted actions against them, demanding damages in the sums of $15,000 and $50,000, respectively. In their answers, the carriers admitted the issuance of their policies and timely receipt of proofs of loss, but interposed general denials and affirmative defenses. Camden set up in the latter category: (1) That prior to plaintiff’s loss its policy had been effectively cancelled; (2) that plaintiff misrepresented that his premises were of brick construction; (3) that plaintiff misrepresented that his premises were not vacant and unoccupied. Fireman’s asserted an affirmative defense that plaintiff misrepresented that his premises consisted of a brick building occupied as a private dwelling.
Prior to trial, plaintiff settled the actions for $23,000 against Fireman’s and $7,500 against Camden, and released them from all liability. Thereafter he instituted the instant lawsuit against the present defendant, seeking to recover $34,500, i.e., the difference between the settlement figures and the amounts specified in the two policies. He did not apprise this defendant of his intention to prosecute a claim against it until after he had settled and released the insurance companies.
The theory of liability advanced by plaintiff is that defendant’s employee, Mr. Novak, with whom plaintiff dealt for the purpose of obtaining this insurance, had visited and seen the subject building, and knew, or should have known, that it was
Defendant denies that it placed plaintiff’s policies on a brick building or advised the insurance carriers that the premises were of brick construction; it contends that the accuracy in respect of the description of premises insured under Standard Statutory fire forms is the sole responsibility of the insurance companies and their rating bureaus; claims that the affirmative defense of misdescription entered by the insurance companies in plaintiff’s lawsuits against them was of no legal validity; asserts that plaintiff knew that the building was not brick constructed and further knew that the policies described it as brick, and, therefore, may not recover by reason of his contributory negligence; contends that the evidence as to damages is wholly insufficient; and maintains that plaintiff has been fully compensated for his loss.
At this point, directing our attention to the affirmative defenses pleaded by the carriers in their answers to plaintiff’s actions against them, we find that Camden’s contention that its policy had been effectively cancelled prior to the fire is without merit being contrary to the established proof. A letter of the Assistant Postmaster of the United States Post Office in California, dated March 8, 1957, clearly evidences that the Camden letter of notice of cancellation was delivered to plaintiff on March 2, 1957. Hence, cancellation did not become effective until March 7, 1957, a day after the fire occurred. As to the affirmative defense that plaintiff misrepresented that his premises were not vacant and unoccupied, this is negated by the specific provision of the policy as follows: “ Permission granted: (1) to be unoccupied or vacant without limit of time ”. Anent the affirmative defense of misdescription of the building as brick, we have the testimony of Mr. Novak, defendant’s soliciting broker, its then employee, who dealt with plaintiff in placing all of the policies, i.e., the Century, Camden and Fire
It is elementary that a broker is the agent of the assured, not the insurer as to all matters within the scope of his employment, and the acts or knowledge of such broker will be binding or imputed to the assured (44 C. J. S., Insurance, § 140, p. 799). Applying this maxim to the facts in the instant case, if the defendant had misdescribed the premises, his act would be binding upon plaintiff. So that, it is hardly likely that Mr. Polk would have taken such a position if the misdescription could be attributed to plaintiff through his broker, and not to the insurance companies.
The following evidence is of note on the issue relating to the description of the building. Prior to requesting any placement of insurance, plaintiff, in his supplementary letter to his application for a hearing for a reduction of the assessed valuation on the premises, described himself “as a man probably more familiar with the true condition of the property than
Although plaintiff, during trial, at first denied that he had seen any of the policies until some time after the fire, he testified in his examination before trial that he believed the policy (Century) was mailed to his house and he probably saw it. On cross-examination during trial, he admitted that, pursuant to demand for the return of the Century policy for cancellation, he had his wife return it, as he was in California on business at the time. The description of the premises in the Century is precisely identical to that given in the Fireman’s and Camden policies.
Mr. Novak testified that when a premium billing is mailed to an assured, the policy is simultaneously sent with the billing. Plaintiff admitted that he paid the premiums upon all three policies, and stated that he received considerable mail and could not remember everything he received. Plaintiff’s disclaimer of receipt of the policies is not convincing. His claim of lack of knowledge that the building was described as brick appears to be disproved by his letter dated February 12, 1957, which acknowledged receipt of defendant’s letter dated January 29,1957, wherein it is prominently stated: “Be: Fire Insurance on Brick Building Situated at Laurel Hollow Boad, L. I.”, the subject building. It is the court’s opinion that if plaintiff was penalized to any degree by the ‘1 brick ’ ’ description, a finding is irresistible that it was with his concurrent negligence.
Having admittedly received the Century policy, the law presumes he read its provisions, and if he omitted to do so the
Aside from the issue as to where responsibility lies for the improper description of the premises as brick, the plaintiff, as an integral part of his cause of action, as an indispensable condition, as a sine qua non, must prove that recovery from his insurers was precluded or reduced solely by reason of the misdescription. The record here is barren of such proof. The attorney, Mr. Polk, testified that he had conferred and co-operated with the attorneys who appeared for Camden in plaintiff’s suit against Camden; that it was considered the affirmative defense of misdescription as brick was of doubtful validity; that the claims for prior losses occasioned by vandalism made and collected by plaintiff against all the afore-stated insurance companies, had a bearing on the legal evaluation of the merits of the defense of either misdescription or unoccupancy of the property. He stated that this was so in view of the fact that the company ‘ ‘ had received notice of the unoccupancy of the building and the type of construction in connection with the adjustment of the prior vandalism claim of August 30, 1956.” In this latter regard, it was disclosed that in September of 1956, a representative of the insurers called at the subject premises to investigate plaintiff’s claim of vandalism loss, and at the time examined the exterior of the premises. This representative was an agent of the insurance companies. He knew, or should have known, of the type of construction six months prior to the fire loss, and the knowledge he acquired or should have acquired at that time, that the building was not brick-constructed, must be deemed the knowledge of the insurance companies. It is a well-established rule that notice received or knowledge acquired by an agent engaged in his principal’s business, which should have put him on inquiry, is deemed to be notice or knowledge of his principal of material facts which the agent would have discovered had he inquired. (Bennett v. Buchan, 76 N. Y. 386; Prescott v. Le Conte, 83 App. Div. 482, affd. 178 N. Y. 585; Corrigan v. Bobbs-Merrill Co., 228 N. Y. 58; Drilling v. New York Life Ins. Co., 234 N. Y. 234.)
In view of the foregoing, the defense of misdescription was manifestly of no avail to the fire insurers. Furthermore, the said attorney stated that the answer ‘1 placed in issue the actual cash value of the insured building and the amount of plaintiff’s
In light of the foregoing, the court is persuaded that there is a complete failure of proof that the insurance companies refused payment solely because of the misdescription as brick. There is no showing of any agreement between plaintiff and the two companies as to either the legal merit or value of the affirmative defense of misrepresentation of the construction of the building; by plaintiff’s settlement with the fire insurers before notifying defendant of an intention to prosecute a claim against defendant, the latter was not given an opportunity to intervene in the action against the fire companies to establish directly the invalidity of the plea of misdescription as to construction.
Furthermore, there is no adequate showing to establish damages in excess of the amounts received by plaintiff from his fire insurers. Plaintiff admitted that prior to the fire the last time he visited the premises was in December, 1956. There was testimony by the caretaker that most of the contents claimed by the plaintiff in his proof of loss had been taken by, or removed and sent to plaintiff prior to the fire, and some had been given to him by plaintiff. Concerning money damages for the building, plaintiff in his verified application, dated May 11, 1951, for a reduction of the assessed valuation of the premises stated: “ Estimate of present values — Land $4,495 — Building $5,505 — Total $10,000”; that the building was “virtually a shell ”, having been allowed to go to rack and ruin. Although there was testimony that he had made some repairs and improvements after said application, the preponderant credible evidence demonstrated that the loss did not exceed more than the amount plaintiff paid for the building and the approximate amount of the improvements made; that the building was functionally obsolete, having long outlived its economic life; that it had actually little or no market value at the time of the
After full consideration and evaluation of all the proof, oral and documentary, and in light of all of the circumstances and reasonable inferences and probabilities presented herein, I am persuaded and am of the ultimate conclusion that plaintiff has failed to establish his cause of action by a fair preponderance of the credible evidence.
Consequently, judgment is rendered in favor of defendant, dismissing the complaint on the merits. All motions on which decision was reserved are resolved in accordance with this determination.
The foregoing constitutes the decision of the court pursuant to section 440 of the Civil Practice Act. Formal findings of fact and conclusions of law were waived. Let judgment be entered accordingly.