47 Ga. App. 12 | Ga. Ct. App. | 1933
(After stating the foregoing facts.)
The first contention of the plaintiff is that the negotiations with the surety were for a settlement of the claim, and that they constituted a waiver of the contractual limitation contained in the bond sued on, and that the surety was thereby estopped from urging the same in the present action. This limitation was “that any suit or action to recover against the surety on account of loss hereunder shall be brought before the expiration of twelve months from the discovery of the loss.” Where in a fidelity bond there is a stipulation that suit must be brought within a specified^time after the discovery of the loss under the bond, the stipulation, if reasonable, is binding upon the obligee therein, and such suit must be brought within the time designated. Third National Bank v. American Bonding Co., 145 Ga. 126 (88 S. E. 585). However, such stipulations in reference to the time in which suit must be brought on a fidelity bond are for the benefit of the company and may be waived by it. Stanley v. Sterling &c. Ins. Co., 12 Ga. App. 475, 477 (77 S. E. 664). See 7 Cooley’s Briefs on Insurance (2d ed.), 6848. This court has approved this rule: “It is a universal rule that, where the insurer, by its acts in negotiating for a settlement, has led the policy holder to believe that he will be paid without suit, the insurer can not take advantage of a provision in the policy which requires the action to be brought in a certain time.” Stanley v. Sterling &c. Ins. Co., supra. The second headnote in that ease is as follows: “Where an insurer, by negotiating for a settlement
The defendant contends that there must be a promise to pay in order to constitute a waiver by a surety of the above stipulation in the bond. It will be noted from the rule laid down and adopted in the Stanley case, supra, that such is not the case, but that such negotiations for a settlement as have led the obligee to believe that the claim under the bond would be paid by the surety without a suit will constitute a waiver of such stipulation and the surety can not take advantage thereof in a suit to recover the loss. See McDaniel v. German-American Ins. Co., 134 Ga. 189 (67 S. E. 668); American Ins. Co. v. McVickers, 135 Ga. 118 (68 S. E. 1026); Metropolitan Life Ins. Co. v. Caudle, 122 Ga. 608 (2) (50 S. E. 337).
Manifestly, under the facts of this case as shown by the petition, the plaintiff was justified in believing that the surety was not insisting upon its compliance with the above stipulation in the policy, and that a settlement of the claim would be made. The loss was discovered on August 28, 1926. On August 2, 1927, the claim department of the surety stated that if the plaintiff desired prompt payment, it would have to localize its records or furnish conclusive proof of loss, otherwise the matter would have to be adjusted upon the advices of the principal in the bond. On August 9, 1927, the plaintiff wrote to the defendant that it thought the audit furnished by it to the defendant was sufficient, as it was prepared by a competent auditor, and that it did not understand what further proof the claim department could want. On August 30, 1927, after the expiration of the twelve months period, the surety wrote to the plaintiff that it was taking the matter up with the principal in order to get further light on the question. It enclosed therein a letter from its claim department to the effect that the audit of the plaintiff could not be accepted as conclusive proof, that under the terms of the suretyship agreement, the surety had the right to make a personal investigation of the records of the obligee, and that if the plaintiff refused to localize its records, it would be deprived of this right. Thereafter, on October 28, 1927, the defendant wrote to the plaintiff that the claim department was still working on the case. Thereafter, in January 1928, the plaintiff localized its records and
The defendant contends that the petition shows that the shortage was a civil liability by an employee, and that such a shortage was not covered by the bond. In Massachusetts Bonding &c. Co. v. Raskin, 43 Ga. App. 582 (159 S. E. 778), it was held that a civil liability for shortage by an employee is not covered by a bond covering fraud, dishonesty, larceny, embezzlement, misappropriation, wilful abstraction or wilful misapplication. The defendant bases this contention on the fact that the plaintiff had attached to its petition, as one of a series of letters showing the negotiations between it and the defendant looking toward a settlement, a letter from the principal in the bond to the defendant and sent by the defendant to the plaintiff, to the effect that he did not owe the plaintiff anything, that the plaintiff owed him money and he applied plaintiff’s money to the extinguishment of the debt due him. The petition specifically charges that-the principal in the bond, while acting as an officer and employee of the plaintiff, “did fraudulently misappropriate, wilfully misapply and embezzle three thousand dollars” belonging to the plaintiff. In these circumstances, we do not think that this contention of the defendant is well taken.
The defendant contends that if it was estopped to plead the time limitations, the estoppel was removed when the plaintiff was notified that the defendant denied liability, and that upon receipt of such notice the plaintiff then had a reasonable time within which to commence his action. In support of this it cites Gilbert v. Globe & Rutgers Fire Ins. Co., 91 Ore. 59 (174 Pac. 1161, 3 A. L. R.
It is further urged that as the plaintiff did not comply with the terms of the bond by submitting proof of loss within three months, the suit should have been dismissed on general demurrer. The petition alleges that the plaintiff did not file a proof of loss until January 22, 1927, and the loss occurred on August 28, 1926. Strict compliance with a provision in a fidelity bond requiring proof of loss to be submitted within a specified time may be waived by the surety, and such a waiver may be implied from conduct inconsistent with an intention on the part of the surety to insist upon compliance with the requirements of the bond in this respect, and calculated to lead the insured to believe that they will not be insisted upon. See 33 C. J. § 789, p. 79, and cases cited. On August 28, 1926, the plaintiff notified the defendant that there was a shortage in the accounts of the principal in the bond and that proper proof of loss would be forwarded within the near future. On October 21, 1926, before the expiration of the three months period, the surety wrote to the plaintiff that it had heard nothing further from it in reference to the claim, and that it would like to know whether or not there were any further developments on the claim. On October 23, 1926, the plaintiff wrote the defendant, requesting it to hold the matter in abeyance until such time as it heard from the plaintiff. The defendant did not refuse to comply with this request. Failure to demand the proof of loss within the time prescribed, when coupled with other acts calculated to lead the insured to believe that the proof need not be furnished within the prescribed time, is sufficient to show an implied waiver. See Condon v. Des-Moines Mutual Hail Asso., 120 Iowa, 80 (94 N. W. 477). Under the facts of this case we think that there was an implied waiver of the filing of the proof of loss in this case within the three' months period. The conduct of the defendant throughout the negotiations was inconsistent with such a contention as it now makes.
Judgment reversed.