Evans v. Farmers' Reliance Ins. Co. of N.J.

• Decision Date: 31 January 1933
• Docket Number: No. 183.,183.
• Parties: EVANS v. FARMERS' RELIANCE INS. CO. OF NEW JERSEY.
• Court: New Jersey Supreme Court

164 A. 258

EVANS

v. FARMERS' RELIANCE INS. CO. OF NEW JERSEY.

No. 183.

Court of Errors and Appeals of New Jersey.

Jan. 31, 1933.

Syllabus by the Court.

1. That unqualified and unexplained and undisputed statement made by the insurer to the insured, after informal notice of the fire and proof of loss, that "the insurer would not pay and that if the insured wanted the money he would have to sue for it," is a waiver of the covenant to arbitrate "in the event of disagreement as to the amount of loss," where in fact there was no dispute as to the amount of loss, and is also a waiver of further proof of notice of the fire and proof of loss.

2. A levy on personal property, under an execution on a judgment or under a tax warrant, where the insured retains the actual possession of the property and such possession is not disturbed, does not vitiate a policy of fire insurance providing that it will he void in case of a change "in the interest, title or possession of the subject of the insurance."

Appeal from Supreme Court.

Action by William C. Evans against the Farmers' Reliance Insurance Company of New Jersey. From an adverse judgment, defendant appeals.

Affirmed.

James Mercer Davis, of Camden, for appellant.

Robert J. Tait Paul, of Camden, for respondent.

TRENCHARD, J.

This is a suit upon two fire insurance policies issued by the defendant company to the plaintiff and covering personal property destroyed by fire. The trial judge, at the Camden circuit, directed a verdict for the plaintiff, and the defendant appeals from the consequent judgment.

The defendant-appellant contends that the trial judge erred in directing a verdict for the plaintiff because, as it argues, "the plaintiff's right of action had not matured," in that he did not fulfill the conditions precedent to bringing his action.

The conditions of each policy said not to have been fulfilled were, briefly: (1) Notice of loss by fire, (2) proof of loss, and (3) arbitration in the event of disagreement as to the amount of loss.

In view of the evidence, and for reasons now to be stated, we think that those conditions of the policies did not prevent the direction of a verdict for the plaintiff.

As to the notice of loss by fire: The fire occurred on August 24, 1929. The adjusters of the defendant company were at the scene of the fire on August 25, 1929; the assistant secretary of the defendant and another adjuster for the defendant were there on September 20, 1929, and at that time went over the fire loss and caused a paper to be signed by the plaintiff which recites the particular fire and the date thereof.

As to proof of loss: When the adjusters were at the scene of the fire on September 20, 1929 (according to the testimony of the assistant secretary of the defendant), they and the plaintiff "went over the items that were lost and I took his estimate of what he thought they were worth."

As to arbitration: The policies called for arbitration only if there was "disagreement as to the amount of loss." There was no dispute as to the amount of loss, and in fact the amount of loss was stipulated; the only dispute was as to the question of liability.

Now some time after the meeting between the plaintiff and the adjusters on September 20, 1929, the plaintiff called at the office of the defendant company and asked why the loss had not been paid, and was told by the secretary of the company that they would not pay and that if he wanted the money he would have to sue for it. That this statement was made was an uncontradicted and undisputed fact in the case. Later, and within the time permitted by the terms of the policy, this suit was instituted.

We think that the unqualified and unexplained and undisputed statement made by the insurer to the insured, after informal notice of the fire and proof of loss, that "the insurer would not pay and that if the insured wanted the money he would have to sue for it," was a waiver of the covenant to arbitrate "in the event of disagreement as to the amount of loss," where, in fact, as here, there was no dispute as to amount of loss, and was also a waiver of further proof of notice of the fire and proof of loss. Cheshansky v Merchants' Fire Insurance Co., 102 N. J. Law, 414, 415, 131 A. 910; Radwanski v. Scottish Union, etc., Co., 100 N. J. Law, 192, 126 A. 657; State Insurance Co. v. Maackens, 38 N. J. Law, 564.

Thus in Cheshansky v. Merchants' Fire Ins. Co., 102 N. J. Law, 414, 415, 131 A. 910, 911, it was said: "the statement by Hibbard [agent] that she [insured] should go to a lawyer and bring suit was a clear refusal to pay, and constituted a waiver of the appraisal covenant and of further proofs of loss. It informed the assured that do what she might her claims would not be recognized."

Again in Radwanski v. Scottish Union, etc., Co., 100 N. J. Law, 192, 126 A. 657, 658, it was said: "Even if it be considered that the proof of loss did not comply with the provision of the policy, the motion to nonsuit for this particular reason was properly refused. The defendant had denied any liability under the policy, and there was no proof that the denial was based upon the failure of the...