Bennett v. Council Bluffs Ins. Co.

• Decision Date: 03 March 1887
• Citation: 31 N.W. 948,70 Iowa 600
• Parties: BENNETT v. COUNCIL BLUFFS INS. CO.
• Court: Iowa Supreme Court

70 Iowa 600

31 N.W. 948

BENNETT

v.COUNCIL BLUFFS INS. CO.

Supreme Court of Iowa.

March 3, 1887.

Appeal from circuit court, Dubuque county.

Action on a policy of insurance against loss or damage by fire. The defenses relied on are sufficiently stated in the opinion. Trial by jury, and judgment for the plaintiff, and the defendant appeals.Sapp & Pusey and Henderson, Hurd & Daniels, for appellant.

Utt Bros., for appellee.

SEEVERS, J.

The defendant pleaded that there was other insurance on the property destroyed, of which the defendant did not have notice, and that this fact rendered the policy void. The fact that there was such insurance is conceded. The facts are that George Salot was the defendant's agent, and that he had the authority to issue policies, and enter into contracts of insurance. Salot had in his employ a clerk who was boarding with the plaintiff. This clerk was directed by Salot to solicit the plaintiff to insure her property in the defendant's company, and, if she did so, the clerk was to have the commission to apply on his board. The clerk procured the plaintiff to sign an application, which was delivered to Salot, and he issued the policy. The application was not sent to the defendant, and at the trial it could not be found. The foregoing facts are not controverted. As the plaintiff claims, at the time or times the clerk was soliciting the plaintiff to insure in the defendant's company, he was informed that the property was insured in another company which was insolvent, and there was evidence tending to so prove. The material question is whether the defendant is bound by the knowledge of the clerk.

1. The appellant insists that Salot, as the defendant's agent in issuing policies and making contracts of insurance, was vested with large discretionary power, involving a knowledge of insurance, and the exercise of judgment in determining upon risks, and that he could not delegate such powers to another. It will be assumed, in the absence of a statute, that the weight of authority sustains the foregoing proposition. For the purposes of the case, therefore, it will be conceded. But it will be observed that Salot did pass upon the risk as stated in the application, and that he did not delegate his authority in this respect. The question, therefore, is whether he had the power to have his clerk solicit insurance, and whether the plaintiff had the right to assume that he for that purpose was the defendant's agent.

It is provided by a statute that “any person who shall hereafter solicit insurance,or procure applications therefor, shall be held to be the soliciting agent of the insurance company issuing the policy.” Miller's Code 1880, p. 299. Counsel insist that this statute cannot be construed as contemplating a person who wrongfully obtains a blank application, and, without the knowledge of the company, solicits insurance, fills up the blanks in the application, and procures it to be signed by a person desiring insurance. Clearly not, if this is all that is done. But suppose the application, so filled up and signed, is presented to the company, and it issues a policy thereon, and receives the premium. Is it not bound thereby, even if it does not know who procured the application? We think a policy so issued would be a valid contract of insurance. If material, the company was bound to know who the agent was, and, without doubt, could be compelled to pay the loss if one occurred. The statute should be construed, we think, as embracing any case where a policy has been issued upon an application; and whoever procures such application must be regarded as the soliciting agent of the company issuing the policy. It will probably be conceded...