Aetna Ins. Co. of Hartford, Conn. v. Licking Valley Milling Co.

• Decision Date: 13 May 1927
• Docket Number: No. 4750.,4750.
• Citation: 19 F.2d 177
• Parties: ?TNA INS. CO. OF HARTFORD, CONN., v. LICKING VALLEY MILLING CO.
• Court: U.S. Court of Appeals — Sixth Circuit

19 F.2d 177 (1927)

?TNA INS. CO. OF HARTFORD, CONN., v. LICKING VALLEY MILLING CO.

No. 4750.

Circuit Court of Appeals, Sixth Circuit.

May 13, 1927.

Joseph S. Laurent, of Louisville, Ky. (Robert G. Gordon, of Louisville, Ky., on the brief), for plaintiff in error.

Robert C. Simmons, of Covington, Ky. (Shelley D. Rouse and Wm. A. Price, both of Covington, Ky., and L. P. Fryer, of Butler, Ky., on the brief), for defendant in error.

Before DENISON, MOORMAN, and KNAPPEN, Circuit Judges.

KNAPPEN, Circuit Judge.

This writ is to review a judgment for defendant in error (plaintiff below) upon an alleged policy of fire insurance on plaintiff's mill, machinery, grain, etc., therein.

1. On the threshold we are met with the suggestion, in the brief of plaintiff in error on the merits, that the bill of exceptions be stricken from the record or disregarded because the assignment of errors was not filed "at or before the settling of the bill of exceptions," as directed by the first paragraph of our rule 10, entitled "Bills of Exceptions." We are disposed to treat the nonobservance of this provision as not invalidating the bill of exceptions, for the reason, if for no other, that the bill seems to have been settled without objection on that score, and was included by stipulation of counsel in the list of papers which "should constitute the entire record on writ of error."

2. At the conclusion of trial by jury each party (without reservation) asked the court for direction of verdict in its favor upon all of the issues. The court was thus empowered to pass upon the facts necessary to decision, and this court is bound to accept the fact conclusions of the trial court, so far as supported by any substantial testimony. Beuttell v. Magone, 157 U. S. 154, 15 S. Ct. 566, 39 L. Ed. 654; Williams v. Vreeland, 250 U. S. 295, 298, 39 S. Ct. 438, 63 L. Ed. 989, 3 A. L. R. 1038; Minahan v. Gd. Trunk Western Ry. Co. (C. C. A. 6) 138 F. 37, 41; Thomas-Bonner Co. v. Hooven, etc., Co. (C. C. A. 6) 284 F. at page 392. Judgment was entered for plaintiff for the amount of the loss.

3. Coming to the merits: Plaintiff was the owner of the mill in question, located at Boyd, Ky. It desired $5,000 insurance on the mill building, etc., $5,000 on engine, boilers, machinery, etc., and $2,000 on grain and seeds and had agreed to place the insurance with one Bennett, an insurance agent at Boyd, who had no agency for defendant. Bennett made application for the insurance by telephone to one Stone, defendant's agent at Cynthiana, who as defendant's representative took applications for, wrote and countersigned policies (blanks for which were provided him with the signature of the president already stamped or printed on them). Thereupon Stone, on September 11, 1923, wrote in favor of plaintiff a uniform standard fire insurance policy for $12,000 upon the property in question, divided as applied for, for a term of six months next ensuing, on a stated premium therefor of $193.20, sending (in connection with his daily report) one copy to defendant and another to the actuarial bureau at Louisville. The fire occurred January 26, 1924.

Defendant denies that the policy written by Stone ever became operative. The premium was not in fact paid or tendered before the fire, but it was tendered by plaintiff and refused by defendant after the fire. Until that time the original policy had apparently remained in Stone's possession. After the fire defendant furnished plaintiff blank proofs of loss, together with copy of the policy which Stone had written.

Defendant contends that, as matter of law, no valid written contract of insurance was made for lack of delivery and no valid oral contract for lack of agreement as to (a) the company in which the insurance was to be placed; (b) the duration of the risk; (c) the amount of the premium; and (d) the subject of credit to plaintiff for the premium.

Stone testified that he represented two companies besides defendant, that he had previously brokered one or two policies for and divided commissions with Bennett on insurance which the latter could not write in companies he represented; that he had at one time written $10,000 on the contents of the building in Hartford, but had never written any insurance upon the building; that in his conversation with Bennett the latter asked him if he could place $12,000 of insurance for plaintiff, $5,000 on building, $5,000 on machinery and $2,000 on contents; that he told Bennett that the latter knew that sort of insurance was extremely hard to place, but he would endeavor to place it for him, but for him (Bennett) not to regard it insured until he (Bennett) heard from him (Stone); that after this he had his business associate "issue" the policy, which he left in his office until he could get returns from the company as to whether the latter would accept, "as we frequently do with our customers on a hazardous risk"; that he thereupon made out his daily report, and that when defendant received copy of that report from the actuarial bureau it wired him "not to accept" the application; that he thereupon immediately called up Bennett and told him that defendant had declined the risk; and that that closed the incident. He further said that when he wrote the policy he sent no communication to the actuarial bureau or to defendant, other than his usual daily report; that he sent no letter of explanation.

On the other hand, plaintiff's business manager, who had applied to Bennett for the insurance, testified that he was in the room when Bennett went to the telephone and called up some one, adding, "I couldn't tell who it was, but he afterwards told me it was Stone;" that he heard Bennett "mention the $10,000 and the $2,000; this was all I heard in the conversation of Bennett;" that the name of the company was not mentioned (presumably this was the conversation to which Stone referred), and that "after the conversation over the 'phone he Bennett told me the insurance was in effect. I asked him about when this would go into effect, but I am not positive whether he said at noon, or the following day at noon, but it was one of the two. So I went off, assured that the insurance was on." The manager further testified that Bennett did not notify him the insurance was afterwards canceled, nor did he receive notice from any one that such cancellation had taken place; that two days after the fire he called on Stone and asked about the policy, and received the reply, "Well, you haven't got any insurance," saying further that "they had written the insurance, but that the policy was canceled in four days after he sent the policy,"¹ that he (Stone) "had told Mr. Bennett to notify us and that he Stone had put our policy in the ?tna Insurance Company." Bennett did not testify. Defendant's counsel complains that "the district court brushed aside, as not worthy of any consideration, the testimony of Mr. Stone in this case," and argues in favor of his credibility. Questions of credibility are not for our determination. The court was not bound to believe Stone's statement that he had told Bennett that defendant had declined the risk. Stone does not say he told Bennett the policy had been canceled.

Plaintiff's president testified that on the morning after the fire he asked Stone "if he wrote the insurance on the mill, and he said he did; he said he insured it and wrote the policy, but he said he got word immediately to cancel. I told him that he did not tell us anything about it; that we thought it was insured. He said he insured it and wrote the policy, but he said the company wired him to cancel it. I told him he did not notify us of any cancellation. So he said he didn't know who the owners were."² Stone, in addition to disputing certain statements of plaintiff's manager and president referred to, said he did not agree to deliver the policy, nor did he agree with any one that it was to become effective prior to the time he should hear from the company. Manifestly defendant's alleged direction that the policy be canceled could not, without notice to plaintiff, destroy an immediate effect policy such as Stone had power to issue.

The trial judge did not believe Stone's testimony that the policy was not issued to take present effect, but was to take effect only if the company, after a lapse of a week or 10 days, failed to object. The judge held that, "notwithstanding Stone's testimony to the contrary, the evidence preponderates in favor of the position that there was a previous valid oral contract of insurance pursuant to which the policy was issued," and that "it is difficult, if not impossible, to account for Stone issuing the policy and reporting its issuance to the defendant and the actuarial bureau at Louisville, on the basis that there was not a previous oral contract of insurance entered into by the communication of Stone with plaintiff through Bennett. That he did so was inconsistent with the asserted fact that he had said to Bennett that he would endeavor to place the insurance and let him know if he succeeded, and that he should not regard the property as insured until he had heard from him definitely. The defendant and the actuarial bureau did not understand that no contract of insurance had been entered into. On the contrary, they were made to understand that there had."

We think that, independently of the testimony as to Bennett's statement following his telephone conversation with Stone, there was substantial evidence tending to support the above-stated conclusion of the trial judge. The weight of the testimony is not for our consideration. Kentucky Coal Lands Co. v. Mineral Development Co. (C. C. A. 6) 295 F. 257.

The testimony as to Bennett's statement above mentioned was received against defendant's objection and exception. It would seem enough to say that the ground of the objection does not appear in the record (Pennsylvania Co. v. Whitney C. C. A. 6 169 F. 572, 575; Robinson v. Van Hooser...