Franklin Fire Ins. Co. v. Chicago Ice Co.

• Decision Date: 22 May 1872
• Citation: 36 Md. 102
• Parties: THE FRANKLIN FIRE INSURANCE COMPANY OF BALTIMORE v. THE CHICAGO ICE COMPANY.
• Court: Maryland Court of Appeals

36 Md. 102

THE FRANKLIN FIRE INSURANCE COMPANY OF BALTIMORE v. THE CHICAGO ICE COMPANY.

Court of Appeals of Maryland

May 22, 1872

APPEAL from the Superior Court of Baltimore City.

This was an action of covenant on a policy of insurance issued by the appellant to the appellees, insuring against loss or damage by fire, to the amount of twenty-five hundred dollars, from the 10th of November, 1868, to the 10th of November, 1869, "their one story frame ice house situate, detached, on the line of the Chicago and North Western Railroad, at Chrystal Lake, McHenry County Illinois." The fire occurred early on the morning of the 11th of August, 1869, and on the same day, Mr. Blake, the secretary of the appellee, gave notice of the loss to Messrs Campbell, Whitman & Wallace, the agents in Chicago of the appellant who took the insurance, and on the same day they sent the notice of the loss to the appellant. The proofs of loss were then made out by the secretary, Mr. Blake, who was inexperienced in such matters, and was not aware of the necessity to have a certificate of the nearest magistrate or notary public, as required by the following condition of the policy:

X. Persons sustaining loss or damage by fire, shall forthwith give notice thereof in writing to the Company, and as soon after as possible they shall deliver as particular an account of their loss and damage as the nature of the case will admit, signed with their own hands. And they shall accompany the same with their oath or affirmation, declaring the said account to be true and just; showing also whether any and what insurance has been made on the same property; giving a copy of the written portion of the policy of each Company what was the whole cash value of the subject insured, and their interest therein; in what general manner the building insured or containing the subject insured, and the several parts thereof, were occupied at the time of the loss, and who were the occupants of such building, and when and how the fire originated. They shall also produce a certificate, under the hand and seal of a magistrate, notary public, or commissioner of deeds most contiguous to the place of the fire, and not concerned in the loss as creditor or otherwise not related to the assured, stating that he has examined the circumstances attending the fire, loss or damage alleged, and that he is acquainted with the character and circumstances of the assured, and that he verily believes that he, she or they have, by misfortune and without fraud or evil practice, sustained loss and damage, on the subject insured, to the amount which such magistrate, notary public or commissioner of deeds may certify. * * * *

When Campbell, Whitman & Wallace, on the 11th of August, 1869, sent the notice of loss, they received in reply from the president of the appellant a letter dated the 17th of the same month, by which they were notified that the matter had been referred to Barnum & Wells as the adjusters of the appellant. Barnum & Wells declined to act, but, with the approval of the appellant, employed R. H. Lawrence as adjuster in their stead. Blake, the secretary of the appellee, made up the proofs of loss and left them with Campbell, Whitman & Wallace ten days or two weeks after the fire. No objection was made to the want of a certificate. Campbell, Whitman & Wallace, after retaining the proofs for several days, returned them to Blake, with directions to hand them to Mr. Lawrence, the adjuster. Blake delivered the proofs to Lawrence, receiving a promise to let him know if they were deficient, after he had examined them. The proofs were sent by Lawrence to the appellant, and they were received about the last of September, 1869. No notice was ever given to the appellee of any objections to the proofs furnished, on the ground of the absence of the certificate, and no objection was made, even in general terms, to the proofs, until the letter of the president of the appellant to the appellee's attorney, under date of the 28th of December, 1869. In the month of December, Mr. Smith, the president of the appellee, went to Baltimore, and there had an interview with the president of the appellant and demanded payment, which was refused, not on the ground of the insufficiency of the proofs, but because, as the appellant claimed, it was not on the risk. Mr. White, the president of the appellant, gave a different statement of the interview, but fixed the date of the meeting as early in December. Mr. Smith having been unable to obtain the amount which he claimed under the policy, applied to counsel, whereupon the following correspondence occurred between them and the president of the appellant:

BALTO., Decr. 17, 1869.

DEAR SIR: We hold for collection the claim of the Chicago Ice Company, under your Policy, No. 2396, for $2,500. We understand you have received proof of loss. If the same is insufficient or defective in any particular, we will gladly correct it upon notice.

We trust we can arrange this matter with you without suit.

Truly yours,

MARSHALL & FISHER.

Mr. WHITE, Prest. Franklin Fire Insurance Co.

BALTIMORE, Dec. 18, 1869.

Mess. MARSHALL & FISHER:

GENTLEMEN: Your note is at hand and duly considered. I have written to Chicago for a full report in regard to the loss of Chicago Ice Co., and expect to receive it in a few days, when I will call upon you.

Very truly yours, L. S. WHITE, Prest.

BALTIMORE, Dec. 28, 1869.

Mess. MARSHALL & FISHER:

GENTLEMEN: The papers sent us as "Proofs," in regard to loss of Chicago Ice Co., are not complete nor satisfactory. You will therefore please have the same properly prepared and placed in our hands, so that we can give the same proper examination and consideration.

Very truly yours, L. S. WHITE, Prest.

BALTIMORE, 29th Decem., 1869.

L. S. WHITE, Esq., Prest. Franklin F. Ins. Co.:

DEAR SIR: Yours of 28th inst. is received. In your former letter, of the 18th inst., you informed us that you had written to Chicago for a full report in regard to the loss, and expected to receive it in a few days, when you would call upon us. It seems that at the date of your first letter you made no objection to the proof of loss, nor are we aware in what respect you now object to it.

If you will indicate the particulars in which you consider the proof of loss defective, we will take measures to have all such defects cured as far as we may deem it material to do so.

We desire also to know, to save all unnecessary trouble, whether your company will pay upon being furnished with such preliminary proof as your policy requires.

Very respectfully, your obt. servts.,

MARSHALL & FISHER.

BALTIMORE, Jan. 3d, 1870.

Mess. MARSHALL & FISHER, Balto.:

GENTLEMEN: As Prest. of the Franklin Fire Ins. Co., I must insist that the Chicago Ice Co. shall furnish proper legal preliminary proofs of loss before they claim payment of this company, and I do not intend in anywise to waive the production of such preliminary proofs as required by our policy. What preliminary proofs are necessary and material, you must determine from the policy, and as lawyers you can do that better than myself.

Very truly yours, L. S. WHITE, Prest.

The following memorandum was printed on the back of the policy of insurance:

Builder's Risk.--The working of carpenters, roofers, tinsmiths, gas fitters, plumbers or other mechanics, in building, altering or repairing the premises named in this policy, will vitiate the same, unless permission for such work be endorsed in writing hereon.

Exception: The plaintiff offered three prayers, the second and third of which the Court refused; the first as follows, it granted:

1st. That if the jury shall find from the evidence that the plaintiff furnished to the agent of the defendant, in Chicago, the preliminary proofs of loss offered in evidence, and that said proofs were forwarded by said agent to the defendant, and received by the defendant on the 25th of September, 1869, and that the defendant retained said proofs of loss, and made to the plaintiff or its agents no objection thereto, nor any objection to the absence of a certificate, as required by the 10th condition of the policy, up to the time when Mr. White, president of the defendant, had the conversation with the witness Smith, testified to by said Smith in the month of December, 1869, should the jury find such conversation. And if they further find that in said conversaition the said president of the defendant refused to pay the loss under said policy, upon grounds other than the defects of said proofs of loss, or the absence of said certificate, or both, and that at the time of so refusing to pay, the said president of the defendant made to said Smith no objection to said proofs of loss, or to the absence of said certificate, then the defendant cannot now object to the sufficiency of said proofs, or the absence of said certificate, notwithstanding the jury may find that the witness White wrote the letters of December 28th, 1869, and January 3d, 1870, under the circumstances offered in evidence.

The defendant offered the following prayers:

1st. That if the jury believe the statement of the witness, James P. Smith, Jr., the president and superintendent of the plaintiff, in his deposition contained, that he kept a crew of workmen and a carpenter or two about the building in controversy the year round, and was constantly making repairs and keeping the building in thorough condition, the policy was vitiated by reason of the facts so stated under the memorandum printed on the back of said policy, and headed "Builders' Risk," and the verdict must be for the defendant.

2d. That the preliminary proof offered in evidence by the plaintiff as having been furnished to the defendant prior to the...