Pomeroy v. Rocky Mountain Ins. & Sav. Inst.

9 Colo. 295 | Colo. | 1886

Lead Opinion

Elbert, J.

Johnson was the president and general manager of the defendant company, and had charge of its home office, at Denver, with full power to write insurance and to represent the company. The company is bound by his acts in issuing the policy of insurance, in permitting its renewal and assignment, and in receiving the back dues necessary to its renewal, and the premiums thereafter becoming due. Bliss, Life Ins. § 278; Whart. Ag. § 202; Wood, Fire Ins. §§ 383, 391. His knowledge touching the condition of health of the insured must be regarded as the knowledge of the company. Story, Ag. § 140; Bliss, Life Ins. § 76 et seq.; Ang. & A. Corp. § 305; Whart. Ag. § 184.

Johnson having permitted the renewal of the policy, and its assignment, with full knowledge of Barton’s impaired health by reason of his intemperate habits, and with full knowledge that the plaintiff renewed and took an assignment of the policy as a security for advances already made, and thereafter to be made, having at the time received from the plaintiff payment of all back dues necessary to its renewal, and thereafter payment of the premiums on the policy as they became due, is to be regarded as having waived the condition respecting the impairment of health of the insured by intemperate habits. The company cannot be allowed to treat the contract as valid for the purpose of collecting dues, and as void when it comes to paying the insurance; or, as otherwise stated, “the company cannot be permitted to occupy the vantage ground of retaining the premium if the party continued in life, and repudiating it if he died. ” Insurance Co. v. McCain, 96 U. S. 84; Home Ins. Co. v. Duke, 84 Ind. 253; Brandup v. St. Paul F. & M. Ins. Co. 27 Minn. 393; Alkan v. New Hampshire Ins. Co. 53 Wis. 136; Frost v. Saratoga Mut. Ins. Co. 5 Denio, 154; American Cent. Ins. Co. v. McLanathan, 11 Kan. 533; Miller v. Mutual Ben. Life Ins. Co. 31 Iowa, 216; Williams v. Niagara Fire Ins. Co. 50 Iowa, 561; Bevin v. Connecticut Mut. Life Ins. Co. 23 Conn. 244; Home Mut. F. Ins. Co. v. Garfield, 60 Ill. 124; Reaper City Ins. Co. v. Jones, 62 Ill. 458; Lycoming Ins. Co. v. Barringer, 73 Ill. 230; Peoria M. & F. Ins. Co. v. Hall, 12 Mich. 202; Short v. Home Ins. Co. 90 N. Y. 16; Bennett v. North B. Ins. Co. 81 N. Y. 273; Whited v. Germania F. Ins. Co. 76 N. Y. 415; Buckbee v. United States Ins. Co. 18 Barb. 541; Putnam v. Commonwealth Ins. Co. 18 Blatchf. 368 (U. S. C. C.); Bliss, Life Ins. § 278 et seq., and cases there cited; Wood, Fire Ins. “Waiver,” ch. 20; “Estoppel,” ch. 21, and cases there cited.

If thei’e was collusion between the plaintiff and Johnson, the president, to defraud the defendant company, it is matter of defense, to be pleaded.

. While it appears from the complaint, generally, that, the defendant company is a mutual company, we are not prepared to admit the proposition that that fact necessarily takes the case without the operation of any of the rules which we have stated. Theoretically, the insured in mutual companies are members of the company, but immunity from the above rules would not follow from that relation alone. The charter and by-laws of the company are not before us, nor are we advised that they prescribe any form of policy or limitation upon the powers and duties of the general officers and agents of the company that would exempt the company from liability in this case. As the record stands, the question made by counsel in this behalf is not fairly presented, and we intimate no opinion respecting it.

The court erred in sustaining the demurrer to the complaint. The judgment must be reversed, and the case remanded.

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Dissenting Opinion

Helm, J.

(dissenting). Construing the averments of the complaint filed in this case, under established principles of law and rules of pleading, I am of the opinion that plaintiff ought not to recover upon them. To my mind the complaint must be regarded as showing that when plaintiff procured the renewal of the policy he had knowledge of Barton’s impaired physical condition, and that such impairment was the result of intemperance. Having been in no way deceived, misled or imposed upon, he cannot be heard to say that he was ignorant of the clause in the policy avoiding the contract upon this ground. The legal inference from the averment made on the subject is that the death of Barton, ten weeks after the policy was renewed, resulted from Barton’s impaired health and intemperate habits, existing at the time of such renewal.

If these conclusions be legitimately drawn, they show an attempt on the part of plaintiff to indemnify himself through a policy of insurance which he must be held to have known ought not to issue. The fact that Johnson had knowledge of the assured’s impaired physical condition, coupled with the principle that insurance companies are bound by the knowledge of their officers and agents, does not answer my objection. Assuming that no distinction should be made between the mutual and the old line companies in this respect, I do not believe that Johnson’s knowledge amounted to a waiver of the condition in question. In the first place this is not a case where the waiver of a condition in the contract subsequent to its execution is claimed to have occurred. On the contrary, reliance is placed upon the proposition that the condition, though inserted by the parties, was waived at the inception of the contract. And, secondly, the doctrine of waiver, predicated upon the knowledge of offi.cers or agents, is recognized for the purpose of protecting innocent third persons dealing with insurance companies. It ought to have no application where the other contracting party is acting in bad faith. The law does not wholly ignore the rights and interests of innocent members and stockholders in these corporations; and I take it that, if an officer or agent and an outside party conspire to perpetrate a fraud upon the company, the courts will not lend their aid to its consummation. The fraud appearing in this case upon the face of the complaint, it was unnecessary, in my judgment, to plead it by answer. The demurrer sufficiently presented the issue. I do not say that, in fact, plaintiff actually intended to perpetrate a fraud upon the company. He may have been ignorant of the intemperance clause in the policy, as he asserts. He may also have been ignorant of the fact that insurance companies do not knowingly accept risks upon parties who are so low with disease that death is only a question of a few days or weeks at the utmost. What I assert is that the law, under the facts disclosed by his complaint, does not permit him to plead or rely upon his ignorance in these respects.

For the foregoing reasons I feel constrained to dissent from the conclusion reached by a majority of the court.

I think the judgment of the district court should be affirmed.

Beversed.