Greenwood Ice & Coal Co. v. Georgia Home Ins. Co.

• Decision Date: 14 January 1895
• Citation: 72 Miss. 46,17 So. 83
• Parties: GREENWOOD ICE & COAL CO. v. GEORGIA HOME INSURANCE CO
• Court: Mississippi Supreme Court

17 So. 83

72 Miss. 46

GREENWOOD ICE & COAL CO. v. GEORGIA HOME INSURANCE CO

Supreme Court of Mississippi

January 14, 1895

FROM the circuit court of Leflore county, HON. R. W. WILLIAMSON Judge.

This is an action by appellant against appellee to recover on a policy of fire insurance. W. A. Drennan was the local agent for several insurance companies, including appellee, the Georgia Home Insurance Company. He was also a stockholder director, and vice president of the Greenwood Ice & Coal Company. On February 14, 1893, he issued four policies aggregating $ 12,000, on the buildings and machinery of the appellant company, one of these being the policy sued on.

The property insured had originally belonged to the Leflore Ice &amp Coal Company, which became insolvent, and the property was sold under foreclosure proceedings, and acquired by certain persons, who organized the Greenwood Ice & Coal Company, in which company Drennan was the owner of five shares of stock. He was elected vice president, and was also one of the directors, and seems to have participated in their meetings but never had anything to do with the active control or management of the business, and received no salary. The premiums on the policy issued by Drennan were paid by money in his hands, as agent, derived from the unearned premiums on the canceled policies in favor of the Leflore Ice & Coal Company.

On the day after the policies were written, and before they passed out of the possession of Drennan, the property insured was burned, and, during the fire, one Keesler, the secretary and treasurer of the Ice & Coal Company, called on Drennan for the policies, and Drennan immediately turned them over to him.

A few days after the fire, one Kimball, the adjuster of appellee, went to Greenwood and remained there two days investigating the loss, and, while there, suggested the propriety of an arbitration, and produced and signed an agreement therefor, and it was signed also by the officers of appellant and the adjuster of the other companies. The nature of this agreement, which was dated February 23, 1893, is stated in the opinion of the court. After signing this agreement, Kimball called on the secretary and treasurer of the appellant company to furnish him with a list of its stockholders and officers, which was done. This statement showed Drennan to be its vice president and one of its stockholders. Kimball left on the same day, taking with him this statement. He visited several other towns, and, on the sixth of March, wrote a letter from Meridian, Miss. withdrawing from the agreement for an appraisement. He testifies that, in revoking the agreement, he acted, in part, on information from the home office of the company, to the effect that the daily report of Drennan, showing the issuance Of this policy, had been received at the home office three or four days after the fire, and in the same mail with the notice of loss. Notwithstanding this action of Kimball, the appraisers, who had been selected, proceeded to make their award. The company, however, refused to pay, and denied all liability, whereupon this suit was brought. In view of the opinion, it is not necessary to set out the pleadings, or to make any further statement of facts. There was a peremptory instruction for defendant, judgment accordingly, and plaintiff appeals.

Affirmed.

Rush & Gardner, for appellant.

The defense that Drennan was incapacitated to act, on account of his interest in the plaintiff corporation, cannot be made, in view of the action of Kimball, which estops the company from setting up the defense. The arbitration was had at the suggestion of Kimball. On the question of estoppel, see Rivara v. Insurance Co., 62 Miss. 720; 2 Wood on Fire Insurance, § 526; 36 Wis. 67.

It was the duty of the defendant, on learning this policy had been issued and a loss had occurred, to act at once, either by repudiating the agency of Drennan, or acknowledging its liability.

We think it an open question whether Drennan's acts as agent of the defendant were voidable, under the evidence in the case. See 48 Wis. 420.

Calhoun & Green, for appellee.

In view of the dual relation of Drennan, the policy was voidable at the election of the insurer. 1 Biddle on Insurance, § 497; Story on Agency, 239; Ostrander on Insurance, 97-100; 11 Am. & Eng. Enc. L., 335; 1 Ib., 380; Insurance Co. v. Myers, 55 Miss. 479.

The submission to arbitration cannot estop the insurance company. It distinctly stipulates that it does not waive any rights. Kimball, on learning the facts as to Drennan's relation to the appellant company, promptly wrote withdrawing from the agreement. There was not the semblance of acquiescence on its part. See Insurance Association v. Matthews, 65 Miss. 301.

Miller, Smith & Hirsh, on the same side.

A policy issued by the agent to himself is voidable. Insurance Co. v. Insurance Co., 14 N.Y. 85; 6 Pick 198; Story on Agency, § 211; Pailey...