Harrison v. German-American Fire Ins. Co.

• Decision Date: 25 April 1895
• Citation: 67 F. 577
• Parties: HARRISON v. GERMAN-AMERICAN FIRE INS. CO.
• Court: U.S. District Court — Southern District of Iowa

67 F. 577

HARRISON v. GERMAN-AMERICAN FIRE INS. CO.

United States Circuit Court, S.D. Iowa, Eastern Division.

April 25, 1895

D. N Sprague and A. H. Stutsman, for plaintiff.

McVey &amp Cheshire, for defendant.

WOOLSON District Judge.

This action was commenced in the district court of Louisa county Iowa; the petition having been filed January 28, 1893. On application of defendant, the action was removed to this court. The petition exhibits two policies, of the form provided by the New York statute, against fire,-- the one covering plaintiff's dwelling house, situated in Louisa county, Iowa (amount of insurance, 2,000); the other covering also such house, with an additional insurance of $1,000, and also insurance for $800 on certain personal property therein described, and contained in said house. The petition alleges that said property was destroyed and injured by fire on October 4, 1893, and that plaintiff was thereby injured in the sum of $8,000. The petition also avers that plaintiff did not make formal proofs of loss, because of defendant having waived the same, and that, plaintiff having given to defendant immediate notice of the fire, defendant, to wit, on October 20, 1892, by its agent, agreed to arbitrate the loss and damage, and each party chose one arbitrator, but said parties did not appraise or fix the loss to plaintiff although plaintiff had been willing and anxious to have them do so. The 'amended and substituted answer,' filed herein July 5, 1894, after pleading a general denial, specifically pleads, in substance, that this action is premature, and cannot be maintained because of noncompliance by plaintiff with the arbitration clauses (hereinafter set out) of said policies, and clause as to proofs of loss, which are claimed to be by said policies made conditions precedent to institution of suit thereon, and that this action was prematurely commenced within 90 days from any attempts at proofs of loss. Plaintiff on July 5, 1894, filed his replication, denying that any arbitration was ever attempted or made under or by virtue of the terms of said policy; alleging that there was no disagreement of the parties, and no attempt to agree, as to loss, before the appraisement agreement was signed, no written demand for appraisal was made by either party, and through no fault of plaintiff, the appraisers appointed have not agreed, but have failed to appraise said loss, though plaintiff had, by written notice, requested defendant and said appraisers to proceed to the completion of said appraisement; and that plaintiff had used all reasonable efforts to have said appraisement completed and that such completion has been prevented because the appraiser selected by defendant, then unknown to plaintiff, is in some way interested in defendant's behalf, and not a disinterested person, and has absented himself from the state, and failed to communicate with the other appraiser. The cause was tried to the court July, 1894, a jury having been waived. The policies in evidence are identical in their terms and conditions, only the written portions differing, and these written portions relate to premium paid, amount and duration of insurance, and property insured.

It is conceded that, by the terms of the policy contract, plaintiff was bound to furnish proofs of loss. Defendant claims that these proofs have never been furnished. Plaintiff concedes that formal proofs were not furnished, but claims such proofs were waived by the defendant. The burden is on plaintiff to substantiate his allegation of waiver.

The evidence shows that plaintiff is a citizen of the state of Iowa, and defendant is a citizen of the state of New York. The fire occurred on October 4, 1892. About October 14th, the local agent of defendant who had issued to plaintiff the policies in suit informed plaintiff that defendant's adjuster would be present on October 20th with an appraiser, and requested plaintiff to have an appraiser ready. On October 20th defendant's adjuster, Rodger Swire, came, accompanied by C. H. Turner, who was the adjuster of another company in which plaintiff held insurance. Plaintiff had made out a list of the personal property which was in his house at the time of the fire. Mr. Swire, with the associate adjuster, examined the burned premises, and also the personal property which had been saved from the fire. Of the $2,800 loss on personal property, but $800 was covered by insurance. At this examination they had a specific list of the personal property which was in the house at the time of the fire, showing the property saved and that lost, which plaintiff had furnished them. This list was used by the adjusters in their examination. Plaintiff testifies that the adjusters told him that all they wanted a list for was to know about the property which had been burned. This list appears to have been satisfactory to the adjusters at that time, as the personal property was not thereafter investigated, or included in the appraisement, nor has any difficulty or contention arisen on the trial with reference to the personal property destroyed. Some of the articles in this list did not have the prices carried out. As to these, plaintiff and the adjusters procured prices from the business houses in that community. Plaintiff claims that these facts constitute a waiver of proofs of loss, or, rather, of formal proofs or further proofs, while defendant disputes this claim. That the policy contract requires such proof, unless the same is waived by the defendant, is conceded. The office to be performed by proof of loss is to advise the defendant with regard to the fire, the property insured, and the property lost, or damaged by the fire. Such proofs are entirely for the advantage of the insurer. And the courts may well hold that anything which, when presented, is satisfactory on these points to the insurer should be equally satisfactory to the court. On this principle the decisions, with marked unanimity, hold that whenever the insured furnishes the insurer with a list or statement which is intended as proofs of loss, to provide the information for which the contract calls, and no objections are made thereto by the insurer within such reasonable time thereafter as to afford the insured opportunity to remedy or supply the defects therein, the insured has waived--or, as some courts have stated, is estopped from claiming-- more specific or complete compliance. Mere silence on the part of the insurer, where no proofs whatever are offered, does not waive the contract agreement. The doctrine of such waiver is well stated in Weidert v. Insurance Co., 19 Or. 261, 24 P. 242:

'The company must, by some act of an agent having real or apparent authority, have done or said something which induced the plaintiff to do or forbear to do something whereby he is prejudiced.'

And in Gould v. Insurance Co., 134 Pa. St. 570, 19 A. 793, the rule applying to waiver of proofs is thus stated:

'If the insured, in good faith, and within the stipulated time, does what he plainly intends as a compliance with the requirements of his policy, good faith equally requires that the company shall promptly notify him of their objections, so as to give him opportunity to obviate them; and mere silence may so lead him, to his disadvantage, to suppose the company satisfied, as of itself to be sufficient evidence of waiver by estoppel.'

No claim upon the trial was made that the adjuster Swire was not fully authorized to perform the duties he assumed. He was sent by his company to settle and adjust the loss. His letter to the local agent who had issued to plaintiff the policies of insurance sued on announces that he will attend 'to take up the losses on Mr. Harrison's property. ' As was said by Circuit Judge Lowell in Perry v. Insurance Co., 11 F. 484, with reference to an adjuster for defendant in that case, wherein the defense here interposed was set up, 'If (the adjuster) had authority to adjust and settle the loss, we think, as a matter of law, he could do so with or without proofs. ' Bearing in mind that policy conditions such as we are now considering should be most strongly construed against the insurer, and with a view to avoid forfeitures, and that no question has been raised as to the good faith of plaintiff with regard to the list furnished to the adjuster, we may note that the undisputed evidence is that plaintiff was told by the adjusters (who are shown to have acted in concert and were together), at the time this list of property was furnished to them by plaintiff, 'that all they wanted to know about was what (property) was gone. ' And thereupon, with list in hand, they made a personal examination of the property. There can be no question but that plaintiff intended the list furnished to be a compliance with the terms of the policy as to the statement of property lost, and there is no suggestion that the adjuster, or any one for the company, expressed any objection to the list, either as to incompleteness or informality of same. So far as the evidence shows, the first intimation that plaintiff had of any dissatisfaction on part of defendant with the list as being incomplete or unsatisfactory, or that defendant would insist on more formal or other proofs of loss, was on the trial of this case, in July, 1894. And there is no evidence that defendant has been in any wise prejudiced by the absence of more complete or formal proofs of loss. The list was at the time accepted by the adjusters as sufficient, and their actions and statements abundantly justified plaintiff in believing, and relying thereon, that defendant was satisfied therewith, and did not demand or desire other or further proofs. Defendant's attitude in this matter at that time is also shown by the fact that, in the...