Bales v. General Insurance Co., of America

• Decision Date: 29 June 1933
• Docket Number: 5947
• Citation: 24 P.2d 57,53 Idaho 327
• Parties: LONNIE BALES, Respondent, v. GENERAL INSURANCE COMPANY OF AMERICA, Appellant
• Court: Idaho Supreme Court

24 P.2d 57

53 Idaho 327

LONNIE BALES, Respondent, v. GENERAL INSURANCE COMPANY OF AMERICA, Appellant

No. 5947

Supreme Court of Idaho

June 29, 1933

INSURANCE-RENEWAL OF POLICY-AGREEMENT-FAILURE TO EXECUTE-INSURANCE AGENT-SCOPE OF AUTHORITY-APPEAL AND ERROR-FILING OF TRANSCRIPT-DELAY-MOTION TO DISMISS.

1. Delay in making proper service of transcript held not to warrant dismissing appeal, where there was no showing that respondent's rights had been prejudiced.

2. Agreement for renewal of fire policy held not void for indefiniteness as to identity of insurer, though selection was left to agent when original policy was obtained.

3. Agreement for renewal of fire policy on grain held not void for want of mutuality notwithstanding insured's right to terminate agreement by selling grain.

4. Agreement to renew fire policy in insured's grain to cover portion which insured owned at time of renewal held not void for failure to identify property insured.

5. In action for damages based on failure of defendant insurer's agent to execute agreement to renew fire policy, it was presumed that renewal policy would be for same amount, same period and for same premium as policy which expired.

6. Evidence held sufficient to show existence of completed contract in praesenti for renewal of fire policy, in insured's action against insurer for agent's negligent failure to execute agreement to renew.

7. Insurance agent, in preparing and executing policy, acts as agent of insurer.

8. Insurance agent's failure to perform contract with insured for renewal of fire policy held attributable to insurer, rendering insurer liable for resulting damages to insured.

9. Agreement to renew fire policy held within scope of insurance agent's apparent authority.

10. Neither oral agreement of agent with insured for renewal of fire policy at its expiration date nor testimony establishing such agreement is within parol evidence rule as varying written contract.

APPEAL from the District Court of the Tenth Judicial District, for Idaho County. Hon. Miles S. Johnson, Judge.

Action for damages. Judgment for plaintiff. Motion to dismiss appeal denied. Judgment affirmed.

Judgment affirmed. Costs awarded to respondent. Petition for rehearing withdrawn.

Cox Martin & Ware, for Appellant.

Respondent pleaded that appellant was to insure his oats as long as the same were owned by appellant. In other words, appellant retained the right to terminate the relationship at will if the oats were consumed or otherwise disposed of. The purported contract thus lacks mutuality. (Bridges v. St Paul Fire & Marine Ins. Co., 102 Neb. 316, 167 N.W. 64 L. R. A. 1918D, 1199; Houser v. Hobart, 22 Idaho 735, 127 P. 997, 43 L. R. A., N. S., 410; O. A. Olin Co. v. Lambach, 35 Idaho 767, 209 P. 277, 44 A. L. R. 354; Clement v. Producers' Refining Co., (Tex. Civ. App.) 270 S.W. 206, 277 S.W. 634.)

Respondent must prove all of the essentials of an enforceable written contract of insurance, namely: (1) definite parties, (2) definite property, (3) definite coverage, (4) definite premium, (5) a completed contract in praesenti, (6) final agreement, that is, no essential left to be completed by later negotiations. Respondent having failed to meet these several requirements, the judgment should be reversed. (Ostrander on Insurance, p. 39; 2 Clement on Fire Insurance, p. 499; Bridges v. St. Paul Fire & Marine Ins. Co., supra; Springfield Fire & Marine Ins. Co. v. Hubbs-Johnson Motor Co., (Tex. Com. App.) 42 S.W.2d 248.)

Respondent proved that Chace was his agent. Chace therefore, could not bind appellant. (Dohlin v. Dwelling House Mutual Ins. Co., 122 Neb. 47, 238 N.W. 921; Arispe Mercantile Co. v. Queen's Ins. Co., 141 Iowa 607, 120 N.W. 122, 133 Am. St. 180.)

Appellant is not prejudiced by reason of failure to serve clerk's transcript within time and, therefore, appeal is not properly dismissible. (Five Point Garage v. Purdum, 50 Idaho 43, 193 P. 319; Clayton v. Barnes, 52 Idaho 418, 16 P.2d 1056; Nielson v. Board of County Commrs., 40 Idaho 481, 234 P. 686.)

A. S. Hardy, for Respondent.

In connection with agreement for renewal, the custom of dealing between the parties, the circumstances and prior policies may be looked to to ascertain the intention of the parties and to determine the parties and details of renewal insurance, and unless otherwise specified a renewal policy is presumed to be in the same company and on the same property, terms, times and conditions as the previous policy. (Orient Ins. Co. v. Wingfield, 49 Tex. Civ. App. 202, 108 S.W. 788; Shabeck v. Standard Fire Ins. Co., 46 R. I. 121, 125 A. 288; Aetna Ins. Co. v. Licking Valley Mill. Co., 19 F.2d 177; Hartford Fire Ins. Co. v. Tatum, 5 F.2d 169; American Cent. Ins. Co. v. Robinson, (Tex. Civ. App.) 219 S.W. 277; Eames v. Home Ins. Co., 94 U.S. 621, 24 L.Ed. 298; Brown v. Home Ins. Co., 82 Kan. 442, 108 P. 824; Mallette v. British American Assur. Co., 91 Md. 471, 46 A. 1005; United States F. Ins. Co. v. Fife, (Tex. Civ. App.) 6 S.W.2d 211; Southern Cas. Co. v. Flowers, (Tex. Civ. App.) 23 S.W.2d 507; Connecticut Fire Ins. Co. v. Fields, (Tex. Civ. App.) 236 S.W. 790.)

The agreement of renewal in connection with the custom of dealing between the parties and the fact that the prior policy was to be renewed and the special understanding of July, 1930, effected a completed contract, which is enforceable by an action for damages, as here. (Marysville Merc. Co. v. Home Fire Ins. Co., 21 Idaho 377, 383, 121 P. 1026; McCabe v. Aetna Ins. Co., 9 N.D. 19, 81 N.W. 426, 47 L. R. A. 641; Preferred Acc. Ins. Co v. Stone, 61 Kan. 48, 58 P. 986; King v. Hekla Fire Ins. Co., 58 Wis. 508, 17 N.W. 297.)

Chace, the local agent of the company, was appellant's agent only and not the agent of respondent, and his acts were binding on appellant. There is no dual agency. (Wilson v. German-American Ins. Co., 90 Kan. 355, 133 P. 715; Citizens State Bank v. Shawnee Fire Ins. Co., 91 Kan. 18, 137 P. 78, 49 L. R. A., N. S., 972; United States F. Ins. Co. v. Fife, supra.)

MORGAN, J. Budge, C. J., and Givens, Holden and Wernette, JJ., concur.

OPINION

MORGAN, J.

This is an action for damages based on the negligence of appellant's agent whereby he failed to execute an agreement to renew a policy of insurance on respondent's oats, which negligence and failure resulted in the grain being uninsured when it was destroyed by fire. The case was tried to the court, without a jury, and resulted in judgment for plaintiff, from which this appeal is prosecuted.

Respondent moved to dismiss the appeal because of delay in serving the transcript. Two copies of the transcript were received by counsel for appellant, who reside in Lewiston, from the clerk of the district court, on October 29, 1932, and they promptly sent one copy, by express, to respondent's counsel, who resides in Grangeville. The express company attempted to deliver the copy to respondent's counsel at his office, but found the door locked and left it near the door, in such position that one going into or coming out of the office would be sure to find it. Counsel for respondent neither admits nor denies that he received this copy, but insists that the service was so defective as to be void. When the foregoing facts were discovered by counsel for appellant, a member of that firm immediately took their copy from Lewiston to Grangeville and served it on counsel for respondent by delivering it to him, personally, January 16, 1933.

No showing is made that the rights of respondent have been in any way prejudiced by the delay, and the motion to dismiss the appeal is denied. (Clayton v. Barnes, 52 Idaho 418, 16 P.2d 1056; Idaho State Merchants' Protective Assn. v. Roche, ante, p. 115, 22 P.2d 136.

In 1928 A. C. Chace, who was cashier of Cottonwood State Bank, which had the agency for a number of insurance companies, solicited the business of insuring respondent's personal property. The conversation between Chace and respondent resulted in an agreement whereby the former was authorized to write insurance on personal property of the latter, including grain grown on his ranch near Ferdinand. In this conversation Chace promised he would renew the insurance when a policy expired, without notice or request so to do, and respondent promised he would pay the premiums on such renewals on demand. This agreement was kept and performed by the parties until December 31, 1930, and the policies written were not delivered to appellant but were retained by Chace in the bank. The policy which expired December 31, 1930, covered 158,300 pounds of oats in Vollmer-Clearwater Company warehouse, at Ferdinand, insured for and of the value of $ 1,580, together with other grain in another warehouse. Chace, through negligence, failed to renew this insurance, and April 17, 1931, the Vollmer-Clearwater Company warehouse was burned, and the oats were destroyed without insurance.

Appellant insists the parties to the agreement to renew the policy are indefinite in that the insurer was not agreed on. It is true that, at the first conversation between respondent and Chace with respect to the insurance, in 1928, which resulted in a course of business conduct whereby respondent's grain was insured by appellant, the company which was to carry the risk and receive the premium was not mentioned, and the selection of the insurer was left to Chace. From the companies the bank represented, he selected appellant as the insurer of the grain, and respondent did not know the identity of the insurer until the first policy had been written. Subsequently the oats in question were insured by a policy issued by appellant, and it was the duty of Chace, as its agent, to renew it when it expired. This leaves no uncertainty as to the identity of...