63 Neb. 698 | Neb. | 1902
At the time of the loss by fire, hereinafter mentioned, the residence of A. A. McKim was insured against loss or damage by fire in the National Fire Insurance Company. The policy contained a clause whereby the loss, if any, should be payable to the Eastern Building & Loan Association, mortgagee, as its interest might appear. On the 8th day of February, 1895, the residence was destroyed by fire. Both the insurance company and the loan association were notified of the loss, and within a few days thereafter the adjuster of the insurance company and one W. J. Trotter, representing the loan association, and the assured, McKim, met and adjusted the loss at the agreed sum of '$435. Thereupon the adjuster drew a sight draft on the general agent of the insurance company for that amount, in favor of McKim and the association, which is as follows:
“No. 2362. ■ Gothenburg, Neb., Feb. 21, 1895.
“Pay to the order of A. A. McKim, and the Eastern Building & Loan Association, four hundred thirty-five and no-100 dollars ($435) in full satisfaction for all claims or demands for loss or damage by fire. Value received, and charge to the account of policy No. 223833 of th* National Fire Ins. Go. Theo. Gardner, Adjusts.
. “To Fred. S. James, General Agent,
“174 La Salle Street, Chicago, 111.”
The principal contention is on the question whether Mr. Trotter had authority to indorse the draft hereinbefore mentioned on behalf of the loan association. Many cases are cited in support of the doctrine that an agent, or attorney can not bind his principal by the indorsement of commercial paper without express authority. But it seems to us that in the citation of these cases counsel overlook the fact that Mr. Trotter was employed by the loan association to adjust the loss, and to collect the amount due them on the policy of insurance. His authority in that behalf, is not questioned. The so-called “draft” was nothing more than an order from one department of the insurance company to another to pay the loss in the amount agreed upon by the parties in the adjustment thereof. It was in no sense a payment, but an order for payment. It had been competent for the insurance company to pay Mr. Trotter the whole amount due the loan association in money, because, on the face of the evidence, he was, at least, ostenw -
Much stress is laid by counsel on the correspondence between Mr. Trotter and the loan association, relative to the draft in question, from which it would appear that the indorsement was unauthorized. ‘But it must be kept in mind that this took place after the loss was adjusted and the draft drawn, and after it had been made manifest that Mr. Trotter had full authority to collect the amount due the loan association on the policy of insurance. It does not appear that this correspondence was ever'brought to the notice of the insurance company, nor that it had notice of any limitation on his authority in the premises. He had ostensible authority to collect the money in the first instance. The insurance company had a right to act on his ostensible authority until it had notice of wherein such authority differed from his actual authority. The fact that, having authority to collect the insurance for the loan association, the amount due was ascertained by an agent of the company, who thereupon directed another agent of the company to pay such amount, would not alter the case so long as the insurance company had no notice that his authority in the premises had been curtailed. If we are correct in those views, payment to Mr. Trotter was payment to the plaintiff, and the court erred in directing a verdict in its favor.
It is unnecessary to discuss other questions raised by
We recommend that the judgment of the district court be reversed, and the cause remanded for further proceedings according to law.
By the Court: For the reasons stated in the foregoing opinion, the judgment of the district court is reversed and the cause remanded for further proceedings according to law.
Reversed and remanded.