This is an action to rocever on a policy of fire insurance.
Amоng other things, the complaint alleged that on October 2, 1918, plaintiff made a written application for insurance to defendant’s agent Mattson and paid him the premium therefor. Mattson accepted thе application and agreed with plaintiff that the insurance should be in force as of that date and that a policy would be subsequently delivered.
The answer admitted that Mattson was defendant’s agent, ‘but alleged that his authority was limited to receiving written applications for insurance, which were' subject to defendant’s approval at its home office in Minneapolis.
■ The case was tried without a jury. The court found that on October 2 Mattson took plaintiff’s application for the insurance of his property for three years from that date, received and receipted for the premium, and stated to plaintiff that the insurance then went into effect; that plaintiff believed and relied on the 'statement; that plaintiff had a meager knowledge of the English language and was unable to understand the contents of the applicаtion unless interpreted to him; that Mattson did not disclose to plaintiff that there ivas a statement in the application that it was subject to the approval of defendant’s secretary
If the finding respecting Mattson’s authority is sustained, the motion was properly denied, otherwise it should have been granted. At the time in question Mattson was cashier of a bank at Kettle River in this state and also had a fire insurance agency, representing defendant and five other companies. Defendant wrote insurance on farm risks. The other companies did not. Plaintiff’s property consisted of farm buildings. Mattson had received printed instructions from defendant. They could not be found. Asked what they were, he answered:
“The custom was just to fill out the application and mail it to the cоmpany for their consideration and acceptance, and if accepted, why, we would get the policy; if not, we would get the application back with a letter why it was rejected or refused.”
Asked whether he had authority from the defendant to place insurance on farm risks forthwith, he answered:
“No, sir, no authority whatever except insurance which was written on application.”
He also testified that, if аn application was accepted, the policy would usually be dated back to the date of the application; that he mailed plaintiff’s application to defendant on the day he took it, but retained the money paid as the premium; that he was to keep the policy for plaintiff if one was issued; that no policy was issued, but the application was returned to him with a letter dated Octobеr 9, 1918, rejecting the risk. In this letter defendant said:
“We cannot write this business any more and would ask you not to send us any coverage on log buildings as our reinsurance company positively refuse to carry same. We are sorry we are in this position and will do anything we can to make up for it in every way.”
Plaintiff’s buildings were partly of logs. The letter indicates that Mattson had no previous information that defendant would not insure
Defendant’s superintendent of agencies testified that all policies issued usually bore the same date as the аpplication. In response to questions put by the court he admitted that, if a loss occurred after an agent took an application and before the policy was issued, defendant would not be bound to pay it, although the premium was applied to cover insurance during the interim.
One of plaintiff’s witnesses testified that in 1916 he had applied to Mattson for insurance on farm property and obtained a pоlicy issued by defendant bearing the same date as the application; that he told this to the plaintiff and advised him to go to Mattson for insurance.
In a memorandum following the findings, the learned triabjudge said this is a border-linе case, that probably his decision was not in harmony with Morse v. St. Paul F. & M. Ins. Co.
Plaintiff refers also to Kausal v. Minn. F. Mut. F. Ins. Assn.
We may not close our eyes to the fact that the local agent of an insurance company is the medium through whom the business of making insurance contracts is usually carried on. Such agents frequently make
An insurance agent’s powers are prima facie coextensive with the business entrusted to his care and will not be narrowed by limitаtions not communicated to those with whom he deals, Insurance Co. v. Wilkinson,
Did such authority carry with it, by implication, power to make a binding preliminary contract of insurance covering the interval between the date 'of the 'application and the date when defendant accepted or rejected it? If he could not bind defendant by such a contract, it might consider and pass on an application at its leisure and apply part of the premium towards paying for insurance during a period when the applicant had no protection. To charge an applicant for insurance for a term beginning with the date of the application, although the insurance did not go into effect until the -policy was issued, would be manifestly unjust. We will not presumе that defendant intentionally dealt so unfairly with its patrons. Its habitual practice of dating its policies back indicates an intention to protect applicants from the time their applications were taken. The contract Mattson made with plaintiff was directly connected with and essential to the transaction of the business in hand. It served substantially the same purpose as a 'binding slip. If a policy was issued, it would, оf course, supersede the preliminary contract. Until it was issued or the application was rejected and the ap
In Greenwich Ins. Co. v. Waterman,
We are of the opinion that defendant’s practice in dating policies furnished a sufficient basis for a finding that Mattson had authority to enter into a preliminary verbal contract for present insurance, binding upon defendant until plaintiff was notified that his application had bеen rejected. It is not important whether we call his authority apparent or implied. Apparent authority is not actual authority. Implied authority is actual authority circumstantially proved. It is the authority which the principal intended his agent to possess. It includes all such things as are directly connected with and essential to the business in hand. Dispatch Printing Co. v. National Bank of Commerce,
We are not concerned with the correctness of the court’s classification of Mattson’s authority. The question is whether there was evidence to support a finding that there was authority. For the reasons indicated, we are satisfied that there was such evidence, and therefore the order denying a new trial is affirmed.