Gray v. Germania Fire Ins. Co. of New York

• Decision Date: 01 March 1898
• Citation: 155 N.Y. 180,49 N.E. 675
• Parties: GRAY et al. v. GERMANIA FIRE INS. CO. OF CITY OF NEW YORK.
• Court: New York Court of Appeals Court of Appeals

155 N.Y. 180

49 N.E. 675

GRAY et al.

v.GERMANIA FIRE INS. CO. OF CITY OF NEW YORK.

Court of Appeals of New York.

March 1, 1898.

Appeal from supreme court, general term, Second department.

Action by C. Crozier Gray and Henderson Crozier against the Germania Fire Insurance Company of the city of New York. From a judgment of the general term in the Second department (32 N. Y. Supp. 424), affirming a judgment entered on a verdict in favor of plaintiffs, defendant appeals. Reversed.

The action was upon a policy of fire insurance for $1,000, issued by the defendant October 1, 1892, insuring the goods of the plaintiffs in their store at Haverstraw, N. Y. It was a New York standard policy, and prohibited other insurance unless the consent of the company was indorsed thereon. It also provided that none of its agents should have power to waive any of its provisions except by a written indorsement on the policy. The defendant's agent applied to the plaintiffs to insure their goods. They informed him of their intention to procure insurance to the amount of $3,000 in three different companies, and permitted him to write a policy for $1,000 in the defendant company. When the policy was delivered the agent, in answer to an inquiry of the plaintiffs, stated that it was correct. They subsequently obtained two other policies upon the property insured, one for $700 and the other for $1,000. The defendant's agent had power to issue policies and to indorse permission for other insurance. But no such indorsement was made upon the policy in suit.

Ernest Hall, for appellant.

Sidney H. Stuart, for respondents.

MARTIN, J.

The only question we are called upon to determine in this case is whether the knowledge of the defendant's agent that the plaintiffs intended to procure other insurance upon the property covered by the defendant's policy constituted a waiver of the provision therein prohibiting other insurance without the indorsement upon the policy of an agreement to that effect. The courts below have so held. This conclusion was based upon the theory that as the defendant's agent knew that the plaintiffs intended to procure other insurance when the policy in suit was issued, and delivered it with that knowledge, it constituted a waiver of its provision as to other insurance. Manifestly, this theory cannot be sustained. It is well settled in this state that where an insurance company issues a policy, with full knowledge of facts which would render it void in its inception if its provisions were insisted upon, it will be presumed that it by mistake omitted to express the fact in the policy, waived the provision, or held itself estopped from setting it up, as a contrary inference would impute to it a fraudulent intent to deliver and receive pay for an invalid instrument. Van Schoick v. Insurance Co., 68 N. Y. 434;Whited v. Insurance Co., 76 N. Y. 415;Richmond v. Insurance Co., 79 N. Y. 230;Woodruff v. Insurance Co., 83 N. Y. 133;Short v. Insurance Co., 90 N. Y. 16;Forward v. Insurance Co., 142 N. Y. 382, 37 N. E. 615;Wood v. Insurance Co., 149 N. Y. 382, 44 N. E. 80;Robbins v. Insurance Co., 149 N. Y. 477, 484,44 N. E. 159.

But it is manifest that that principle has no application to the facts in this case. When the defendant's policy was delivered neither of the other policies had been issued,...