Am. Cent. Ins. Co. v. Dist. Court, Ramsey Cnty., Second Judicial Dist.
| Decision Date | 08 May 1914 |
| Citation | 125 Minn. 374,147 N.W. 242 |
| Parties | AMERICAN CENT. INS. CO. et al. v. DISTRICT COURT, RAMSEY COUNTY, SECOND JUDICIAL DIST. |
| Court | Minnesota Supreme Court |
Certiorari by the American Central Insurance Company and others to review the action of the district court, Ramsey county, Second judicial district, in denying an application of insurers to appoint an umpire to act in making an appraisement of goods damaged by fire. Action of district court affirmed.
Where an insurance policy contains the provision as to appraising losses thereunder required by chapter 421, Laws of 1913 (Gen. St. 1913, s 3318), and an appraisal is initiated pursuant thereto, if one party refuses to recognize the appraiser appointed by the other upon the ground that he is incompetent, the burden is upon such party to show that such appraiser is in fact incompetent.
In proceedings to appraise losses, taken under the act of 1913 (Laws 1913, c. 421 [Gen. St. 1913, s 3318]), the parties are entitled to be heard and to present evidence as in common-law arbitrations, and the competency of the appraisers is to be determined by the rules applied in determining the competency of common-law arbitrators.
While it is desirable that appraisers be familiar with the matters and things which they are called upon to appraise, the mere fact that they are not experts in the line of business to which such matters pertain is not alone and in itself sufficient to sustain a charge of incompetency. Todd & Kerr, of St. Paul, for petitioners.
O'Brien, Young & Stone, of St. Paul, for respondent.
A stock of clothing and men's furnishing goods belonging to the Knox-Burchard Mercantile Company, of St. Paul, and insured under policies containing the provision as to appraising losses required by chapter 421, Laws of 1913 (Gen. St. 1913, § 3318), was damaged by fire on February 9, 1914. The insurers and the insured disagreed as to the amount of the loss. The policy provides that in such an event the loss shall ‘be ascertained by two competent disinterested and impartial appraisers'; one to be selected by the insurer and the other by the insured. The two appraisers chosen by the parties are to select an umpire; but, if they fail to agree upon the umpire within five days, he may be appointed by the presiding judge of the district court upon the application of either party. The policy further provides that, if either party fails to select an appraiser within the time prescribed, the other appraiser and the umpire may act as the board of appraisers. The insurers demanded an appraisal in accordance with the terms of the policy, and designated C. S. Silk as the person appointed by them to make the same. Thereafter, and within the specified time, the insured designated George R. O'Reilly, a practicing attorney residing in St. Paul, as the person appointed by the insured to make such appraisal. The insurers, claiming that O'Reilly was not competent to act as an appraiser, refused to recognize him as such; and, upon the theory that his appointment was a nullity, applied to the district court, as soon as sufficient time had elapsed to permit them to do so, for the appointment of an umpire to act in conjunction with Silk in making the appraisement. At the hearing the case was submitted to the court upon an agreed statement of facts, and the claim that O'Reilly was incompetent as an appraiser is based wholly upon the facts stated in the following excerpt from the stipulation: ‘That this application for the appointment of an umpire to act with said C. S. Silk in appraising the said loss suffered by said assured is based solely on the claim that said George R. O'Reilly is not a competent person to act as an appraiser, because he is an attorney at law, and never has been a dealer in men's clothing or furnishings, and on the further claim that, being thus incompetent, the appointment of said George R. O'Reilly was a nullity, and amounted to a failure on the part of the assured to select an appraiser.’ The district court denied the application of the insurers, and they brought the matter before this court by writ of certiorari.
[1] Unless it appears that O'Reilly was not eligible for the position of appraiser, the action of the district court was correct. The contention that he was not eligible is based solely upon the ground that ‘he is an attorney at law, and never has been a dealer in men's clothing or furnishings.’ The insurers in effect assert that a person, to be competent as an appraiser, must possess expert knowledge concerning the matter which he is called upon to appraise and determine, and that an appointment of a person as appraiser who lacks such expert knowledge may be ignored and treated as a nullity. It is perhaps true that, if one party designates as an appraiser a person who is not eligible for that position, the other party may decline to recognize him as such, but, if he do so, he assumes the burden of showing that such appointee is, in fact, ineligible.
[2] It has long been common for fire insurance policies to contain a provision that the amount of loss shall be ascertained by an appraisement to be made as provided in the policy. Similar provisions are frequently found in other forms of contract. Notwithstanding the different wording of such agreements as found in different contracts, the appraisements made thereunder have generally been considered as in the nature...
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