201 A.D. 272 | N.Y. App. Div. | 1922
This is an action for damages for the breach of a contract made in writing between the parties on the 22d of June, 1914. Plaintiff is a domestic corporation engaged in business as general insurance broker. Defendant agreed to apply for and procure through the plaintiff as its agent during the period of five years from the 1st of March, 1914, fire insurance policies on the buildings and premises known as 34-42 West Fourteenth street and 33-45 West Thirteenth street, borough of Manhattan, New York, and upon the merchandise, machinery, furniture, fixtures and improvements owned by it or in its possession or control in said buildings or on said premises, and upon the rents of said buildings and premises and the use and occupancy thereof, and the use and occupancy of the business conducted therein and thereon. The policies were to be at all times in amounts equal at least to the full value of the property and specified items and at no time less than $200,000 on merchandise, machinery, furniture, fixtures and improvements, use and occupancy and commissions and profits, and $100,000 on the buildings and rents. The defendant agreed to pay the plaintiff on demand on the procurement of the policies a fixed rate per annum for the insurance for the entire period, namely, $1 per every $100 of insurance on merchandise, machinery, furniture, fixtures and improvements, use and occupancy, commissions and profits, and seventy-two and one-half cents on each $100 of insurance on buildings and rents. It was provided that the insurance should be placed with companies and individual underwriters then or thereafter authorized to do business in this State or in the States of New Jersey, Pennsylvania, Rhode Island, Massachusetts or Illinois or with such others as might be agreed upon by the parties. It was agreed that if the premises should be so used as to increase the then condition of hazard the defendant should pay the additional rate of premium caused thereby. The defendant also agreed to procure through the plaintiff as its agent such additional insurance
The other ground upon which it is claimed that the contract is void is, that it is in violation of the provisions of section 65, which was added to the Insurance Law by chapter 416 of the Laws of 1911, and amended by chapter 225 of the Laws of 1912 and by chapter 25 of the Laws of 1913, and that was its status when the contract was made. That section then provided, so far as here material, as follows: “No insurance corporation, association, partnership, Lloyds or individual underwriters authorized or permitted to do any insurance business within this State, or any officer, agent, solicitor or representative thereof, shall make any contract for such insurance, on property or risk located within this State, or against liability, casualty, accident or hazard that may rise or occur therein or agreement as to such contract, other than as plainly expressed in the policy issued or to be issued thereon; nor shall any such corporation, association, partnership, Lloyds or individual underwriters, or officer, agent, solicitor or representative thereof, directly or indirectly, in any manner whatsoever pay or allow or offer to pay or allow as inducement to such insurance, or after the insurance shall have been effected, any rebate from the premium which is specified in the policy or any special favor or advantage in the dividends or other benefit to accrue thereon, or any valuable consideration or inducement whatever, not specified in the policy or contract of insurance, or give, sell or purchase, or offer to give, sell, or purchase, as inducement to such insurance, or in connection therewith, any stock, bonds or other securities of any insurance company, or other corporation or association, or any dividends or profits accrued thereon, or anything of value whatsoever, not specified in the policy, nor shall any insurance broker, his agent or representative, or any other person, directly or indirectly, either by sharing commissions or in any manner whatsoever pay or allow
Ordinarily the validity of the contract would depend upon the law as it existed at the time it was made; but since the statutory enactments with respect to these matters are made by the Legislature in the exercise of the police power, it is possible, in view of some recent decisions, that existing contracts might be affected by subsequent legislation in the exercise of the police power. Subsequent legislation on the subject, however, made no important change. Section 65 was further amended by chapters 440 of the Laws of 1917 and 141 of the Laws of 1918, but those amendments, so far as they affect the provisions of the statute herein quoted,, were evidently enacted to clarify the phraseology of the section; and they contain no provision extending the prohibition of the statute with respect to agreements or transactions between insurance brokers and the insured, or the insurer or its employees and the insured or his representatives, and, therefore, it is not necessary to quote the amendments. I am of opinion that the contract does not violate or necessarily contemplate the violation of the statute or of any public policy of the State. It will be observed that the
Those statutory provisions were construed as applicable only to the insurer and to its officers, agents and representatives, and as not applicable to contracts between the insured and his or its own
Clarke, P. J., Dowling, Page and Merrell, JJ., concur.
Order reversed, with ten dollars costs and disbursements, and motion granted, with ten dollars costs.
Since repealed by Laws of 1922, chap. 660.— [Rep.