Delaware Ins. Co. v. Pennsylvania Fire Ins. Co.

• Decision Date: 17 August 1906
• Citation: 55 S.E. 330,126 Ga. 380
• Parties: DELAWARE INS. CO. v. PENNSYLVANIA FIRE INS. CO.
• Court: Georgia Supreme Court

55 S.E. 330

126 Ga. 380

DELAWARE INS. CO. v. PENNSYLVANIA FIRE INS. CO.

Supreme Court of Georgia

August 17, 1906

Syllabus by the Court.

Where a suit is brought for damages growing out of a breach of a contract required to be in writing by the statute of frauds the petition is not demurrable on the ground that it does not state whether the contract was in writing or not.

But where a proceeding is brought for the purpose of reforming a written contract, the instrument which is sought to be reformed should be set forth in the petition, or attached thereto as an exhibit, so that from it and the allegations it may clearly appear that it does not conform to the real contract made by the parties. The petition should also show the particular mistake, or the fraud and mistake complained of, and how it occurred.

Where a petition seeks to reform a written instrument as a contract between the parties, and also to enforce it, the allegations must be sufficient for both purposes.

Under the statute of this state a contract of fire insurance must be in writing and signed by the insurer, or some person authorized to sign for it.

The usual and proper place for the signature is at the end of the matter which it attests. But, in strict law, it will suffice if, with the intent to constitute a signing, it is inserted in the writing at another place.

Where a petition alleged that the defendant insurance company reinsured the plaintiff company in a certain amount upon a risk which the latter had taken; that a copy of the written contract of reinsurance was attached as an exhibit to the petition; that the defendant executed and delivered to the plaintiff such paper as and for a written contract of insurance, and that it was so received by the plaintiff and the premium due thereon paid; and where the paper so exhibited commenced with the name of the defendant and its general agent, and proceeded "do reinsure" the plaintiff, etc., the allegation was sufficient to withstand a ground of demurer to the effect that it did not appear that the paper was signed.

Where it was alleged that an insurance company reinsured its risks with another company, and notified the insured that if policies of the insurer should require approval of transfers or other indorsements, the insurer should make report to the reinsuring company; and that, in pursuance of this application was made to the reinsuring company for a vacancy permit, which was granted and signed by the reinsuring company, containing the words, "attached to and forming part of policy No. 4264 of the Delaware Insurance Co." (the insurer), this was an acknowledgment of the policy of the number stated, and the signature to such permit would supply the lack of signing that policy, if it was unsigned. But a permit in the terms mentioned was not sufficient to operate as an acknowledgment of or signature to another paper, if it did not appear to be the policy referred to.

A plea of estoppel in pais, which did not allege that the defendant has misled the plaintiff, or that the latter had relied on any representation or conduct on the part of the former, and had changed its status or done or omitted to do anything by reason of any such representations or conduct, but merely alleged that if the defendant had claimed that the contract of insurance had expired, the plaintiff would have been informed of the claim, and could have either caused the contract of insurance to be duly corrected, or in case of dispute or delay concerning it could have protected itself by other insurance, was demurrable.

Error from Superior Court, Fulton County; J. T. Pendleton, Judge.

Action by the Pennsylvania Fire Insurance Company against the Delaware Insurance Company. Defendant's demurrers to the complaint were overruled, and it brings error. Reversed.

Plaintiff insurance company reinsured its risk with defendant company and notified the insured that, if policies of insurance should require approval of tranfers or other indorsements the insured should make report to the reinsuring company. In pursuance of this application was made to the reinsuring company for a vacancy permit, which was granted and signed by the reinsuring company, with the words "attached to and forming part of policy No. 4264 of the D. [plaintiff] Insurance Co." Held, that this permit was an acknowledgment of the policy of the number stated, and the signature to such permit would supply the lack of signing that policy.

The Pennsylvania Fire Insurance Company brought suit against the Delaware Insurance Company, alleging in brief as follows: On or about May 9, 1900, the plaintiff issued its policy of insurance, whereby it insured certain property of one Stenzel, for the term of three years from May 9, 1900, in the sum of $8,000; and on or about the same date the Delaware Insurance Company, through its agency in the city of Atlanta, reinsured the plaintiff in the sum of $2,500 upon its liability under the policy issued to Stenzel. "By error of the scrivener who drew out the writing evidencing said contract, the term of said insurance was given as one year, and the date of expiration as May 9th, 1901, although the premium charged and received was for three (3) years and the term of expiration was May 9th, 1903. *** The Delaware Insurance Company was one of the regular reinsurers of the said Pennsylvania Fire Insurance Company, and that by contract and agreement it reinsured said company at the same rates at which the said company, your petitioner, effected the original insurance upon which it was so reinsured, and that in this case the rate of insurance charged the said Stenzel for the term of three (3) years from May 9, 1900, to May 9, 1903, was ninety (90) cents per thousand [amended so as to read per hundred], and that the rate charged by said Delaware Insurance Company, and collected by it upon the twenty-five hundred ($2,500) dollars of reinsurance, was ninety cents per thousand or twenty-two and 50/100 ($22.50) dollars, which was duly paid to and received by said Delaware Insurance Company, and no part of which has been repaid."

The Delaware Insurance Company after this time ceased doing business in the state of Georgia, and made a contract with the Westchester Fire Insurance Company by which the latter reinsured the risks of the former, and the Delaware Insurance Company so notified plaintiff, and advised it, if the policies of the defendant should require approval of transfer or other indorsement, to make report thereof to the Westchester Fire Insurance Company, giving its address. In pursuance of this direction, on May 31, 1901, plaintiff notified the Westchester Fire Insurance Company of a permission for the premises of Stenzel, so insured and reinsured, to remain vacant for a period of 30 days, and on June 17, 1901, the last-named company recognized the contract of reinsurance between the plaintiff and the defendant as being in existence, and issued a vacancy permit in the following words: "Permission for premises herein named to remain vacant for a period of thirty days from date hereof. Attached to and forming part of policy No. 4264 of the Delaware Insurance Company. (Westchester). Atlanta, Ga. 6-17-01. Westchester Fire Insurance Co. Jno. H. Kelly, Asst. Sect." At the time of the application for this permission, and when it was granted, more than a year had elapsed from the date of the issuance of the policy of reinsurance, and by this action the defendant, through its authorized agent, the Westchester Fire Insurance Company, recognized the contract of insurance as having been made and effected, and as being in existence, and of full force. If, instead of making the indorsement mentioned, granting permission and recognizing the contract of insurance as being of full force and effect on June 17, 1901, the defendant had asserted that the contract was for the term of one year only, and that it had then expired, "this petitioner would have been informed of the claim of defendant, and could have either caused said contract of insurance to be duly corrected, or, in case of dispute or delay concerning the same, could have protected itself by other insurance. But that, by reason of said granting of said permission on said date, this petitioner was confirmed in the belief that said contract of insurance was for three (3) years, and was of force on said 17th day of June, 1901." On June 20th, upon receiving the vacancy permit and attaching it to the contract of insurance, plaintiff perceived that the date of expiration had been stated as May 9, 1901, and that the term was said to be for one year instead of for three years. On June 20, it notified the Westchester Company of the mistake, and that the reinsurance premium had been calculated and paid for three years, "and asked that they have the correct expiration and terms stated." The Westchester Company advised plaintiff that this matter would have to be taken up directly with the Delaware Company, and on June 24th plaintiff advised the latter company of the mistake, and asked that the necessary correction be made. Plaintiff is informed that the defendant notified the Westchester Company that the term was for three years, and that it had received the full premium, and having reinsured with the Westchester Company for the term of one year only, the defendant remitted the balance of the premium for the additional term of two years, thus recognizing the existence of the contract of insurance for three years. On June 27, 1901, the premises were destroyed by fire. The owner sued the present plaintiff upon its policy, and obtained judgment. Plaintiff also incurred certain necessary expenses in making this defense. It made proof of loss to the defendant, but the latter denied liability. It was prayed that...