Hamilton v. Aurora Fire Ins. Co.

• Decision Date: 29 January 1884
• Parties: F. W. HAMILTON ET AL., Respondents, v. AURORA FIRE INSURANCE COMPANY ET AL., Appellants.
• Court: Missouri Court of Appeals

15 Mo.App. 59

F. W. HAMILTON ET AL., Respondents,

v.AURORA FIRE INSURANCE COMPANY ET AL., Appellants.

St. Louis Court of Appeals, Missouri.

Jan. 29, 1884.

APPEAL from the St. Louis Circuit Court, THAYER, J.

Reversed and remanded.

BROWN & YOUNG, for the appellant.

NOBLE & ORRICK, for the respondent.

LEWIS, P. J., delivered the opinion of the court.

This is a consolidation of two actions upon policies of insurance against loss by fire. One policy, for $1,500, was issued by the Aurora Fire and Marine Insurance Company, of Cincinnati, and the other, for $2,500, was issued by the Home Insurance Company, of Columbus, Ohio, both being upon a stock of goods owned by the plaintiffs, who were merchants residing in Deadwood, Dakota. By stipulation of counsel the two causes were heard by the same jury, upon the same testimony, and one transcript brings them both before this court, on appeal. Plaintiffs recovered the full amounts claimed, on both policies. The issues were substantially the same in the two cases, and, for greater clearness, we will here consider them as if the controversy concerned but one company.

The policy sued on contains this stipulation: “If the assured shall have, or hereafter make, any other insurance on the property herein insured, or any part thereof, without notice to and consent of this company in writing hereon, this policy shall be null and void.” The defence relied on is that, notwithstanding this condition, the plaintiffs, at various times after the date of the policy, made additional insurance on the same property in other companies, without any notice to, or consent of the defendant. The plaintiffs meet this with an averment that due notice was given to, and the condition waived by the defendant, through its agent duly authorized for that purpose. The testimony and the instructions appearing in the record narrow the controversy down to the inquiry, whether the person referred to was such an authorized agent of the insurer, as would make the notice to him a compliance with the condition in the policy, and therefore binding on the defendant?

J. B. Bennett, residing in St. Louis, was a general agent of the defendant, having authority to write, countersign, and issue policies, and to appoint local agents. L. C. Miller, a resident of Deadwood, was engaged in the business of procuring insurance in a number of companies for persons who made their applications through him. Whatever may have been the scope of his agency for other companies, it distinctly appears that he had no authority to issue a policy in the name of the defendant. His practice was, to prepare the application, containing a description of the property to be insured, with all the representations, proposals, and guaranties required for the insurer's acceptance, and to forward the same to Bennett, at St. Louis, who would determine in what company, of those represented by him, the insurance should be effected, issue a policy accordingly, and transmit it to Miller for delivery to the insured, and for collection of the premium; from which Miller would deduct a certain commission, remitting thereupon the remainder to Bennett. Such was the course pursued in the present instance. It was shown that the subsequent and additional insurance in other companies was also obtained by the plaintiffs through the agency of Miller. But it did not appear that Bennett had any connection with those other companies, or that there was any communication with him in regard to the additional insurance.

In order to show the character of Miller's agency, and that his knowledge of the additional insurance was the knowledge of the defendant, there was introduced in evidence several written and printed communications from Bennett to Miller. One of these is a circular signed by Bennett, setting forth the resources and business facilities of his principal, the defendant, with its purpose of “prudently extending its agency business,” and closing with the words: “Herewith you have blank for agency application.” This has no date. Three others were dated June 11, 1880. One was as follows:--

“J. B. BENNETT, GENERAL AGENT,

)

NO. 11 INSURANCE BUILDING,

)

SIXTH AND LOCUST STREETS,

)

ST. LOUIS, MISSOURI, June 11, 1880.

)

Mr. L. C. Miller, Esq., Deadwood, D. T.:

DEAR SIR--We are in receipt of your application for the agency of the Home, of Ohio. Our supplies are being prepared, and as soon as finished we will be ready to appoint our agents. Until then we will issue policies here, allowing you the usual commission of 15 per cent. We have facilities for placing lines in first-class companies, and are prepared to accommodate you to any extent, and will be pleased at all times to hear from you.

Yours truly,

J. B. BENNETT, G. Agent.”

Another, similarly headed and signed, was the following:--

“DEAR SIR--We transact business upon sound and enduring principles, pay fair losses promptly and pleasantly, appreciate and second the efforts of our agents heartily, and ask proper concert on their part, so as to promote the best interests of all concerned in the agency now intrusted to your care; therefore, compliance with the following instructions and rules is confidently expected.” Then follow requirements as to monthly reports, risks, rates, etc.

A third, having the same heading and signature, was as follows:--

“ L. C. Miller, Esq., Dakota Territory:

Should you need any surplus lines of insurance placed, or have any desirable business you want insured in solid companies, at fair rates, please send me application with the written form of policy, and I will promptly send you policies for same, allowing you customary commissions. An extensive experience of over thirty years enables me to so appreciate the growing requirements of this business to agents and others concerned, as to frequently render just the assistance needed in promoting desirable insurance transactions in a satisfactory manner. If you avail yourself freely of this offer you can make it a valuable auxiliary to your agency, by securing better lines and controlling more custom with less competition, labor, and responsibility to yourself. Soliciting your orders, I remain, yours truly.”

The circuit court instructed to the effect that these communications, together with proof that Bennett, as general agent for the defendant, sent them to Miller; that Miller applied to Bennett for an agency; that Miller, with the knowledge of Bennett, solicited insurances, made and forwarded applications to Bennett, received the policies and delivered them to parties assured, collecting the premiums and retaining therefrom a commission for his services, constituted Miller, in law, an agent of the defendant for the transaction of its business at Deadwood; and if, while continuing so to transact such business, Miller had knowledge of the additional insurances made subsequently to the issuing of the policy sued on, then such additional insurances constituted no defence against this action.

It is manifest on the face of the papers above copied, that Miller had no authority to execute a contract of insurance that would be binding on the defendant company, and that no such authority in him was supposed to exist, by any of the parties. Bennett informs Miller that the company is not yet ready to appoint agents. This is nothing less than a distinct refusal to make the desired appointment at that time. The references to Miller's agency, and the instructions applicable to that position, all bear the same date; and the reasonable inference is, that Bennett meant only to enable Miller to prepare himself with the requisite information in advance, for a proper discharge of his duties as agent, when he should thereafter be appointed. “Until then,” it is emphatically noted, the policies will be issued only from Bennett's...