Hahn v. Guardian Assurance Co.

• Decision Date: 28 March 1893
• Citation: 32 P. 683,23 Or. 576
• Parties: HAHN v. GUARDIAN ASSUR. CO.
• Court: Oregon Supreme Court

32 P. 683

23 Or. 576

HAHN v. GUARDIAN ASSUR. CO.

Supreme Court of Oregon

March 28, 1893

Appeal from circuit court, Multnomah county; E.D. Shattuck, Judge.

Action by George W. Hahn against the Guardian Assurance Company. There was a judgment for plaintiff, and defendant appeals. Reversed.

Joseph Simon, for appellant.

Geo. H Williams, for respondent.

LORD C.J.

This is an action brought to recover the sum of $1,000 upon a policy of fire insurance issued by the defendant to the plaintiff upon his two-story frame building situated in Ellensburgh, in the state of Washington. The verdict and judgment were for the plaintiff. The facts show that on the 10th day of December, 1888, the plaintiff insured with the defendant, through its agent, Henry Ackerman, the above premises, against loss or damage by fire, for the period of one year, and that defendant issued to the plaintiff its policy of insurance upon the same, for which he duly paid the premium therefor at the rate of 10 per cent or $100; that on the 4th day of July, 1889, a general conflagration occurred in Ellensburgh, which destroyed a large portion of the town, including the building so insured and owned by the plaintiff; that at the time the said building was insured, and the policy issued, it was occupied for the purposes of a general merchandise store, and so continued to be occupied until some time during the month of April preceding the fire, when the character of the occupation of the building was changed from a general merchandise store to a variety theater; that, a few days after the fire, W.L Chalmers, an adjuster, went to Ellensburgh, in the employ of several companies, including the defendant, to adjust and settle their losses, but that he refused to adjust the loss of plaintiff's building, on account of the change in its occupancy. The defendant refused to pay the loss, and denied liability therefor, mainly upon three grounds: First. That Mr. Ackerman, the agent at Portland, was a special agent, with limited powers, and with no authority outside of Multnomah county, state of Oregon. Second. That there had been a change in the character of the occupation of the building, which increased the hazard and avoided the policy, by its express terms. Third. That there had been a failure to furnish the proofs of loss required by the terms of the policy.

The conditions of the policy issued to plaintiff, relied upon to defeat the recovery, are as follows: "This entire policy *** shall be void if the hazard be increased *** by any change *** in the possession of the subject of insurance," etc. "*** If fire occur the insured shall give immediate notice of any loss thereby, in writing, to this company, and, within sixty days after the fire, unless such time is extended in writing by this company, shall render a statement to the company, signed and sworn to by said insured, *** as to the time and origin of the fire; the interest of the insured, and of all others, in the property; the cash value of each item thereof, and the amount of loss thereon; all incumbrances thereon," etc. The testimony for the plaintiff shows that Ackerman represented himself to be the agent of the defendant, and solicited the insurance of plaintiff's property; that he negotiated the insurance of his property in the state of Washington with Ackerman, and with no other person; that he left the matter of the insurance wholly with Ackerman, and left for New York, supposing that he had full authority to act as agent for the company in the state of Washington, and without knowledge or information of any limitation on his powers; that he received the policy from Ackerman, and paid him the premium for it. Upon the part of the defendant, the record discloses that it accepted the risk, issued the policy, received the premium without objection, and treated the policy as valid until after the fire. Upon this state of the case the plaintiff contends that the defendant, by its conduct, held Ackerman out as its duly-accredited agent, and he was justified in assuming that he had full authority to effect the insurance. The defendant, by its testimony, sought to limit the authority of Ackerman to that of a local agent, whose jurisdiction was confined to Multnomah county, and, consequently, that he had no authority to write policies or take risks on buildings in the state of Washington, nor to speak for or bind the company in relation to any risk outside of his territory. Upon the issue thus presented, relative to Mr. Ackerman's powers as agent in the premises, the decision rested with the jury, under proper instructions from the court. As the jury found a general verdict for the plaintiff, it must be conceded that Ackerman's authority as agent is established, unless the facts and circumstances to sustain the plaintiff's side of the issue are insufficient for that purpose. The acts of an agent, performed within the scope of his real or apparent authority, are binding upon his principal. It is enough if, under all the circumstances, he had apparent authority in the matter, although in fact his authority was limited. "Persons dealing with them in that capacity," says Mr. Wood, "are not bound to go beyond the apparent authority conferred upon them, and inquire whether they are in fact authorized to do a particular act for the company. It is enough if the act is within the scope of their apparent power, and beyond this third persons are not bound to make inquiry." 2 Wood, Ins. § 408. In Hardwick v. Insurance Co., 20 Or. 547, 26 P. 840, Bean, J., says: "Where insurance companies deal with the community through a local agency, persons having transactions with the company are entitled to assume, in the absence of knowledge as to the agent's authority, that the acts and declarations of the agent are as valid as if they proceeded directly from the company." In Insurance Co. v. Spiers, 87 Ky. 297, 8 S.W.Rep. 453, the court says: "As to third parties, the agent should, in the absence of notice to the contrary, be regarded as possessing all the powers his occupation fairly imports to the public. Under this rule an agent who solicits the insurance, takes the application, receives the premium, and delivers the policy, may, in our opinion, by his conduct or acts, bind his company, *** in the absence of knowledge upon the part of the assured that his powers in this respect have been restricted." The assured has the right to rely upon the agent's apparent authority, and, unless the circumstances are such as to put him upon inquiry, he is not bound to inquire as to his special powers. Nor can the authority of an agent be questioned, when the acts of the company have been such as to amount to a recognition of his agency. Swan v. Insurance Co., 52 Miss. 704. And Mr. Wood says: "Where an agent is authorized to take risks in one place, it is presumed that he had authority to take them anywhere, and a risk taken by him outside of his real jurisdiction will be binding upon the company." Wood, Ins. § 529; Lightbody v. Insurance Co., 23 Wend. 18; Insurance Co. v. Maguire, 51 Ill. 342. In the light of these principles of the law, assuming the testimony for the plaintiff to be true, the jury was authorized to find that Ackerman was a general agent, and empowered to effect insurance upon property located in the state of Washington. There was nothing in the circumstances, as indicated by the testimony, to excite inquiry as to the extent of his agency. He did not inform the plaintiff that his jurisdiction was confined to Multnomah county, Or., nor that his application must be forwarded to the general agent at San Francisco, for his approval. He represented himself as the agent of the company, and solicited the insurance of the property located in the state of Washington. He assumed to act with the full authority of an unrestricted agency. By his conduct the plaintiff was led to believe that he was vested with full powers to act for the company, and bind it by his engagements, and on this account he put the whole matter of insuring his property in the agent's hands, and left for other parts of the country, to which his business called him. He dealt wholly with Ackerman. He paid the premium to him, and the company received it, and issued the policy, and sent it to him, who delivered it to the plaintiff. By his acts, coupled with the acts of the company, the jury, who were to decide as to the extent of his agency, were authorized to find that Ackerman was vested with the powers of a general agent.

The next assignments of error relate to the competency and admissibility of certain expert testimony, sought to be introduced by the defendant, which was disallowed by the court. The defendant claims that it...