Hahn v. National Casualty Co.
| Decision Date | 20 April 1943 |
| Docket Number | 7098 |
| Citation | 64 Idaho 684,136 P.2d 739 |
| Parties | MAUDE HAHN, Respondent, v. NATIONAL CASUALTY COMPANY, a corporation, Appellant |
| Court | Idaho Supreme Court |
INSURANCE-ORAL CONTRACT-AUTHORITY OF AGENT-EVIDENCE-STIPULATIONS.
1. Under application for accident policy providing that application shall not be binding upon the insurer until accepted either by the secretary at the home office or by an agent duly authorized to issue policies, acceptance of application, and not issuance of policy would bind insurer.
2. An insurance company is bound by the contracts of its agent whether general or special, which are within the scope of his real or apparent authority, notwithstanding that they are in violation of private limitations upon his authority of which the person dealing with him, acting in good faith, has no knowledge.
3. Where applicant definitely understood at time that application for accident policy was signed and premium paid to insurer's soliciting agent that insurance would be immediately effective for loss of life sustained as a non-fare-paying automobile passenger and applicant died some eight days later from injuries so sustained, and premium was not returned to applicant's estate until some four months after application was signed, insurer's retention of premium was indicative of its acquiescent acceptance of the application, entitling beneficiary to specific enforcement of oral insurance contract.
4. Where application entry as to number and issuance of accident policy was part of stipulation between beneficiary, who sought specific performance of alleged oral contract of insurance, and insurer, and beneficiary did not introduce evidence inconsistent with the stipulation, the entry was given full force against insurer.
5. A stipulation of facts is not necessarily binding upon the parties as to conclusions of law embraced therein, nor when the party relying thereon introduces evidence inconsistent with the stipulation.
6. Where application for accident policy was in possession of insurer or its agents after it was delivered by applicant in office of insurer's soliciting agent eight days before applicant's accidental death and according to notation upon application policy had been issued five days before applicant's death, and stipulation recited that insurer did not issue a written contract and that agent did not have authority to issue policies, agent presumably had authority to authorize issuance of policies binding insurer, where stipulation did not negative that application had been accepted or state that agent did not have authority so to bind insurer.
7. Where insurer's soliciting agent had apparent authority to accept applications and applicant for accident policy some eight days before her accidental death, had acted upon such apparent authority without notice to the contrary to her detriment, beneficiary was entitled to specific performance of the alleged oral contract notwithstanding that soliciting agent was not a general agent and did not have real authority to make oral insurance contracts for insurer.
8. Where oral statement of insurer's soliciting agent that applicant for accident policy, upon return of application and payment of premiums, would be covered for loss of life sustained as a non-fare-paying automobile passenger was not inconsistent with application term that it would be binding when approved by insurer's agent, and record, except for notation on application that policy was dated on a day before applicant was killed as such passenger, did not indicate that policy, if issued, could not have been dated back and there was no written policy, beneficiary's recovery on basis of agent's statement was not precluded by the "parol evidence rule."
Appeal from the District Court of the Sixth Judicial District, in and for the County of Bingham. Honorable Guy Stevens, Judge.
Action by Maude Hahn against the National Casualty Company for specific performance of an alleged oral contract of insurance. Judgment for plaintiff. Affirmed.
Judgment affirmed. Costs to respondent.
Milton E. Zener for appellant.
That in the absence of actual authority, either express or implied the agent of a foreign insurance company does not have or possess the power to bind a foreign insurance company by an oral contract of insurance or otherwise. (Secs. 40-901 to 40-902, I. C. A., 1932; Sec. 6, Chap. 195, Sess. Laws of Idaho, 1937; Collard v. Universal Automobile Insurance Company, 55 Idaho 506, 45 P.2d 288; 29 Am. Jur., p. 151; Cooley's Brief on Insurance, 2nd Ed., Vol. 1, p. 373.)
Oral statements made by an agent are merged into written application for insurance upon which action is based. (Banks v. Cloverleaf Casualty Company, (Mo.) 233 S.W. 86.)
Complaint must allege authority of the agent to bind principal in action on contract claimed to have been made by agent on behalf of principal. (Basinsky v. National Casualty Company, (Wash.) 209 P. 1077.)
Donald R. Good for respondent.
Secs. 40-801 and 40-902, I. C. A., 1932, were enacted for the purpose of protecting the interests of the citizens of the state of Idaho through regulation of foreign insurance corporations doing business within this state, and not as revenue producing measures, and where the agent admittedly did solicit applications for insurance, collect premiums therefor, countersign policies of insurance, deliver policies of insuranec, return premiums collected thereon, and receive accident reports for transmission to the company, such agent, under the fair and reasonable interpretation and construction of the statutes last above quoted did, by operation of law, possess authority to bind the foreign insurance company by an oral contract of insurance.
"An agent for an accident insurance corporation, who has authority to solicit insurance, take applications, and to countersign and issue policies therefor, binds the company by any waiver of any representation in the application which is within the ordinary scope of insurance business, and not known by the assured to be outside of the authority granted to the agent." (Despain v. Pacific Mut. Life Ins. Co., 106 P. 1027; White v. Gordon, 279 P. 289; Lange v. Curtin, 53 P.2d 185; Hardwick v. State Ins. Co., 26 P. 840; Madill v. Spokane Cattle Loan Co., 39 Idaho 754, 230 P. 45.)
The stipulation of facts constituting the evidentiary record herein in substance recited that Archie Kennedy, as Kennedy and Company, soliciting agent for appellant, learning that Alta Jane Hahn, deceased, contemplated taking an automobile trip with her daughter (respondent) and husband, prevailed upon the three to purchase accident insurance policies in the respective amounts of $ 1,000, advising that upon the filling out and returning of the application and payment of the respective premiums of $ 7.50 deceased would be covered by such insurance for loss of life sustained as a non-fare-paying passenger due to injuries received while riding in an automobile. The application, containing this provision: "and I further agree that this application shall not be binding upon the company until accepted either by the secretary at the home office or by an agent duly authorized to issue policies", was signed November 21, 1939, and the premium was paid on that day.
November 22, deceased was injured while riding in an automobile on the trip and died November 29. Appellant "did not issue and place in force any written contract of insurance covering the loss of life of the said Alta Jane Hahn for bodily injuries sustained while a non-fare-paying passenger in a motor vehicle, for a period of one year from and after the 21st day of November, 1939." [Emphasis mine.] ...
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