Brownfield v. Phoenix Ins. Co. of London

• Decision Date: 23 May 1887
• Parties: E. S. BROWNFIELD & BROTHER, Respondents, v. PHŒ NIX INSURANCE COMPANY OF LONDON, Appellant.
• Court: Kansas Court of Appeals

26 Mo.App. 390

E. S. BROWNFIELD & BROTHER, Respondents, v. PHΠNIX INSURANCE COMPANY OF LONDON, Appellant.

Court of Appeals of Missouri, Kansas City.

May 23, 1887

APPEAL from Audrain Circuit Court, HON. ELIJAH ROBINSON, Judge.

Reversed and remanded with directions.

Statement of case by the court.

This action is based on a policy of insurance, alleged to have been issued by defendant on the nineteenth day of May, 1885 to insure plaintiffs' stock of goods against loss by fire for the period of one year next thereafter. It appears, from the evidence, that Early & Booth were the local agents of the defendant company, whose principal office was at Chicago. These agents were located at the town of Centralia in Boone county. The evidence tended to show that said agents were invested with the powers of general agents for that locality and its vicinity; but with instructions from their principal respecting hazardous risks, situated in the country, and the like, to furnish applications with specifications for the company's approval.

The plaintiffs' evidence tended to prove that, on the nineteenth day of May, 1885, they applied to these agents for insurance on their stock of goods, in a store house about twelve miles distant from the town of Centralia; that they had hitherto insured other property with such agents, in other companies, and had not been in the habit of making out any applications in form; that the agents asked them to sign in this instance, an application, which they were given to understand was a matter of mere form, for the agents' use; that they signed it; and the amount of the premium was agreed upon, amounting to $17.50 that, when the matter of making payment of said premium was mentioned they told the agents, one of whom was the president of the bank, that they had the money in his bank for the purpose of paying such premium; and thereupon, the agent said, that is all right, that they could pay it at some other time, or something to that effect; that, as plaintiffs were in a hurry to go home, the agents told them they would make out the policy and send it to them by mail; and that they would be insured from that date.

On the morning of the twenty-fifth of May following the said stock of goods was destroyed by fire, about six o'clock in the morning. One of plaintiffs took a witness along with him, and by nine o'clock appeared in Centralia, and going to the bank asked for the policy of insurance. It seems that the policy of insurance had not, in fact, been made out; but one of the agents, who attended to this branch of the business, the execution of policies, sat down in his room and wrote out the policy, and handed it to plaintiff, who, thereupon, asked the agent if he had money enough in bank to pay the premium; and on being told that he had, drew a check for the amount, and handed it to the agent. After the policy was delivered over, the plaintiff informed the agents that the insured property had burned up that morning. There is some contradiction, as to what was said by the respective parties on this startling announcement, the defendant's evidence tending to show that the agents, before the policy was delivered, informed the plaintiff that they had a letter from the company requiring more evidence about the risk before it would be accepted, and that the plaintiff might take out the policy, as he seemed in a hurry, with the understanding that if the risk was not accepted the policy should be returned. This was denied by the plaintiffs. The defendant's evidence further tended to show that this risk had been declined by other companies when applied to, and that, on this account, when the plaintiffs made the application in question, on the nineteenth day of May, the agents informed them that they would have to make application in writing, to be forwarded to the company for acceptance; and that, thereupon, the plaintiffs signed the written application, read in evidence by defendant, which they at once forwarded to the company, at Chicago. The company, prior to the twenty-fifth of May, wrote to the agents for further information before the risk would be taken; and at the time of the fire the company had not approved it.

There was other evidence; but the foregoing is sufficient to fully explain the points determined in the opinion. The jury returned a verdict for the plaintiffs. From the judgment rendered thereon, the defendant has appealed.

W. W. FRY and W. O. FORRIST, for the appellant.

I. There was a fatal variance between the proof and the pleadings. Plaintiffs' action was to enforce the collection of the policy. They secured a verdict on a prior verbal contract claimed to have been completely executed May 19, 1885, brought out by the proof alone. Smith v. Shell, 82 Mo. 215; Henning v. Ins. Co., 47 Mo. 425; Davis v. Randolph, 3 Mo.App. 454; Hubbard v. Railroad, 63 Mo. 68.

II. The court erred in refusing to admit in evidence the letters and telegram offered by defendant. It was a material question as to whether defendant accepted plaintiffs' application. A part of the correspondence had been admitted on that question, and defendant was entitled to the entire correspondence. 1 Greenl. on Evid. 201. (a ) The letters were also admissible as a part of the res gestae. Ins. Co. v. De Wolf, 8 Pick. (Mass.) 56. (b ) These letters between the agents and defendant were the same as if between the parties to the suit, as Early & Booth, in this correspondence, were agents of plaintiffs. Ins. Co. v. Ins. Co., 8 Mo.App. 408; Lee v. Smith, 84 Mo. 309.

III. Plaintiffs' first instruction, wherein it provides that, if the agents, " as such had, authority to make contracts of insurance, receive premiums, and issue policies for defendant," submitted to the jury questions of law, and was therein erroneous. It left it with the jury to determine what were " contracts of insurance," and the meaning of " receive premiums and issue policies." Dyer v. Brannock, 2 Mo.App. 432.

IV. Instructions which are not predicated on the pleadings and evidence, or which ignore an issue or a material fact in the case, are erroneous. Crews v. Lackland, 67 Mo. 619; Bank v. Murdock, 62 Mo. 70; Raysdon v. Trumbo, 52 Mo. 38. (a ) Plaintiffs' first instruction charged the jury that, if the agents " had authority to make contracts of insurance, receive premiums and issue policies for the defendant," etc., then find for plaintiffs. This authority they did have in " non-hazardous risks," and it was a question of fact for the jury, whether they had this authority in plaintiffs' case, which was a " ‘ hazardous risk," without first obtaining from defendant the acceptance of an application. Plaintiffs had signed an application to defendant for insurance, thereby admitting that the risk was hazardous, and the transaction was merely a request for insurance. Under this state of facts, had the agents authority to bind the company, before the application was accepted, was a material question of fact wholly taken from the jury by plaintiffs' said instruction. (b ) Again, this instruction further provides that, if said agents, on May 19, " agreed with plaintiffs to insure their said stock of goods," etc., then plaintiffs were entitled to recover, ignoring the real issue as to whether the alleged contract was conditional or not. Had the agents authority to bind the defendant in this case, it being a hazardous risk? Was the contract conditional? Was the application accepted? were the issues of fact raised by the proof, and contested in the case, and these issues were studiously ignored by plaintiffs' instructions. The jury might have found all the facts presented in this in struction to have been true, and yet, in fact, plaintiffs, under the proof and pleadings, were not entitled to recover. This instruction was made prominent by plaintiffs' third instruction, which refers to it, and makes it a part of the third. There was a conflict of testimony, and the instructions should have presented all the material facts and issues raised, thereby, to the jury.

V. The two instructions offered by defendant, and refused by the court, correctly presented the issue, whether plaintiffs' application had been accepted, and the court erred in refusing them. And the addition to defendant's instruction, by the court, is subject to the same objection as the first clause of plaintiffs' first instruction.

VI. The last clause of defendant's seventh instruction reads as follows: " Unless the jury believe, from the evidence, that said agents of defendant, Early & Booth, had authority to make contracts of insurance and issue policies, without first obtaining from defendant the acceptance of application; " while plaintiffs' first instruction directs the jury that, if the agents " had authority to make contracts of insurance, receive premiums, and issue policies, for the defendant," then, in either case, defendant was bound. These two instructions are contradictory. Plaintiffs' said first instruction was made conspicuously prominent, and was obviously erroneous, and the jury was misled by it, and returned a verdict in accordance with it.

MACFARLANE & TRIMBLE, for the respondents.

I. There was no variance between the proof and the pleadings. The suit was on a contract of insurance, as evidenced by the policy. A judgment was sought and secured on the policy alone. The policy being delivered after the negotiations were completed, related back to the time of such completion, and was proper evidence of the contract. May on Insurance, sects. 43, 44; Lightbody v. Ins Co., 23 Wend. 18; Baldwin v. Ins. Co., 56 Mo. 151; Keim v. Ins. Co., 42 Mo. 38. The case of Lightbody v. Ins. Co. (supra ) is, in many particulars, like the one at bar. The fact that the plaintiffs proved, in chief, the...