Dick v. Equitable Fire & Marine Ins. Co.

• Decision Date: 07 January 1896
• Citation: 65 N.W. 742,92 Wis. 46
• Parties: DICK ET AL. v. EQUITABLE FIRE & MARINE INS. CO. ET AL.
• Court: Wisconsin Supreme Court

92 Wis. 46

65 N.W. 742

DICK ET AL.

v.EQUITABLE FIRE & MARINE INS. CO. ET AL.

Supreme Court of Wisconsin.

Jan. 7, 1896.

Appeal from circuit court, Eau Claire county; W. F. Bailey, Judge.

Action by Frank Dick and another against the Equitable Fire & Marine Insurance Company and the Merchants' Insurance Company, to recover on a policy of fire insurance. There were judgments for plaintiffs against each of the defendants for one-half the amount of the loss and one-half the costs, and both defendants appeal. Affirmed.

The action is upon a policy of fire insurance issued by the defendants, jointly, under the name, “The Rhode Island Underwriters' Association,” to the plaintiff Dick. Dick was the owner of the property insured, and Powell held a mortgage upon it. The loss, if any, was made payable to Powell “as her mortgage interest may appear.” The policy contained a provision that it should be void “if, with the knowledge of the insured, foreclosure proceedings be commenced, or notice given of any sale of any property covered by this policy by virtue of any mortgage or trust deed.” The mortgage was foreclosed, with the knowledge of the insured. Afterwards the property insured was destroyed by fire, and notice and proofs of loss were given. An adjuster was sent to adjust the loss. He required the plaintiff to supplement his proofs of loss by what was called “a carpenter's estimate” of the loss and damage. This the plaintiff furnished at some trouble and cost. The defense to the action was that by the foreclosure proceedings the policy had become forfeited and void. This defense was met by the contention on the part of the plaintiff that the forfeiture, if any, had been waived by the defendants by requiring further proofs of loss. The contention was mainly upon the question whether there had been such waiver. The evidence was conflicting. There was a special verdict. The jury found that the defendants' local agents who issued the policy knew of the foreclosure proceedings before the loss occurred; that the adjuster knew of them before he required the carpenter's estimate; that the estimate was procured by the plaintiff, and at his expense; and that the property was totally destroyed. The plaintiff had judgment against each of the defendants for an equal one-half of the loss and one-half of the costs. Both defendants appeal. Both appeals were heard together, on one case and briefs.Doolittle & Shoemaker, for appellants.

W. P. Bartlett, for respondents.

NEWMAN, J. (after stating the facts).

It is not questioned by the plaintiffs, but is conceded, that the foreclosure proceedings rendered the policy of insurance voidable, at the option of the defendants. But it is contended by the plaintiffs that, in the exercise of that option, the defendants elected to waive the forfeiture, and to treat the policy as still valid, and so are now estopped to urge the forfeiture. It is well settled in this state that conduct on the part of insurance companies, after knowledge of the forfeiture of a policy, which assumes the policy to be still valid and in force, especially if it subjects the insured to delay or expense, is a waiver of the forfeiture, and estops the company to urge that defense to an action on the policy. Gans v. Insurance Co., 43 Wis. 108;Cannon v. Insurance Co., 53 Wis. 585, 11 N. W. 11;Oshkosh Gas-Light Co. v. Germania Fire Ins. Co., 71 Wis. 454, 37 N. W. 819;Renier v. Insurance Co., 74 Wis. 89, 42 N. W. 208. This principle of the law is not questioned by the defendant. But it denies knowledge of the foreclosure proceedings which operated the forfeiture, and urges that the evidence given on the trial is insufficient to establish that fact. But in Gans v. Insurance Co., supra, it is held that knowledge of facts which show that a condition of the policy has been broken, by the local agent who issued the policy, is imputed to the company as knowledge of the same fact. And the testimony, clearly, is sufficient to sustain the finding of the jury that the local agent had knowledge. In that case it is unimportantwhether the adjuster had actual knowledge or not.

It is also urged that the evidence is insufficient to show that the agent who was sent to investigate the loss had power to bind the company by a waiver of the forfeitures. The agent disclaims such power. He denominates himself a “special agent,” and describes himself as having only limited powers. But evidently he was sent by the defendants to investigate the circumstances and ascertain the amount of the loss. His real authority covered all that might be advantageous and appropriate in ascertaining the loss. The plaintiff was required, by the policy, to “furnish, if required, verified plans and specifications of any building, fixtures, or machinery destroyed or damaged.” Apparently, the agent sent had the power to require such plans and specifications to be furnished by the assured. The carpenter's estimate of the loss and damage was evidently such a paper. It was, at least, within the apparent scope of the agent's authority to demand such carpenter's estimate. The defendants had indued him with such apparent authority. It was, in legal effect, the demand of the defendants. They are bound by it, and by the legal consequences which flow from it, although it may have been intended that his authority should be more limited. It was expressly held in Oshkosh Gas-Light Co. v. Germania Fire Ins. Co., supra, that an adjusting agent has power to bind the company by acts in pais which operate as an estoppel to insist upon a forfeiture of the policy. See, also, Insurance Co. v. Gallatin, 48 Wis. 36, 3 N. W. 772;Alexander v. Insurance Co., 67 Wis. 422, 30 N. W. 727. While a mere local agent, as such, may have no power to bind the company by the waiver of a forfeiture, still the company may be bound by the act of any agent who is authorized to do the act which constitutes a waiver. The case is not within that provision of the policy which provides that “these companies shall not be held to have waived any provision or condition of this policy, or any forfeiture thereof, by any...