Hayward v. Nat'l Ins. Co. of Hannibal

• Decision Date: 31 March 1873
• Citation: 52 Mo. 181
• Parties: JOHN T. K. HAYWARD, Assignee of John A. Lennon, Appellant, v. NATIONAL INSURANCE COMPANY OF HANNIBAL, Respondent.
• Court: Missouri Supreme Court

52 Mo. 181

JOHN T. K. HAYWARD, Assignee of John A. Lennon, Appellant,

v.NATIONAL INSURANCE COMPANY OF HANNIBAL, Respondent.

Supreme Court of Missouri.

March Term, 1873.

Appeal from Hannibal Court of Common Pleas.

Arthur B Wilson, Hatch & Hatch, for Appellant, cited: Horwitz vs. Equitable Mut. Ins. Co., 40 Mo., 557; Franklin vs. Altantic Fire Ins. Co., 42 Mo., 460; Combs vs. Hannibal Savings and Ins. Co., 43 Mo., 151; Viele vs. Germania Ins. Co., 26 Iowa, 54, 55; Walsh vs. The Ætna Life Ins. Co., 30 Iowa, 142, 145; Van Bories, et al., vs. United Life, Fire and Marine Ins. Co.; Am. Law Reg. N. S., Nov. 1871, p. 680.

The instructions are contradictory and the judgment should be reversed. (Schneer vs. Lemp, 17 Mo., 142; Crole vs. Thomas, 17 Mo., 329; Wood vs. St. Bt. Fleetwood, 19 Mo., 529.)

Geo. H. Shields and Thos. H. Bacon, for Respondent.

There is no evidence to support the instruction as to notice to Eby as agent, and corporations are not charged with knowledge by their agents, unless it was obtained in the course of their official and usual duties as such agents. (Mechanics Bank vs. Schaumburg, et al., 38 Mo., 228; Gen. Ins. Co. vs. United States Ins. Co., 10 Md., 517-527; Story on Agency, § 140, § 140 b.; Ang. Corp., § 30 b.; Farrel Foundry vs. Dart, 26 Conn., 376-382; Weisser vs. Dennison, 10 N. Y., 68-77; McCormick vs. Wheeler, 36 Ill., 114-121; Keenan vs. Dubuque Mut. Ins. Co., 13 Iowa, 375-82; Forbes vs. Agawam Mut. Ins. Co., 9 Cush., 470-473; Ayres vs. Hartford Fire Ins. Co., 17 Iowa, 176-187; Bank U. S. vs. Davis, 2 Hill, 451-461; Franc vs. Woods, Tamlyn Rep., 172-176; Paley on Agency, p. 261, 3 Am. Ed., 1847; 1 Parsons on Contracts, p. 74, 5th Ed.; Blumenthal vs. Brainard, 38 Vt., 402-409; Mellen vs. Hamilton Fire Ins. Co., 17 N. Y., 609; Schenck vs. Mercer Co., Mut. Ins., Co., 4 Zab., 447-454; Sykes vs. Perry Co. Mut. Ins. Co., 34 Penn. St., 79.)

What constitutes notice? (Worcester vs. Hartford Ins. Co., 11 Cush., 265; Hale vs. Mechanics Ins. Co., 6 Gray, 169; Fulton Bank vs. New York and Sharon Coal Co., 4 Paige 127; Washington Bank vs. Lewis, 22 Pick., 24-31; Bank of Pittsburg vs. Whitehead, 10 Watts, 397-402; Tibbetts vs. Hamilton Ins. Co., 3 Allen, 569; Sykes vs. Perry County Ins. Co., 34 Penn. St., 79; Obermeyer vs. Globe Mut. Ins. Co., 43 Mo., 576-579; Northup vs. Mississippi Valley Ins. Co., 74 Mo., 440.)

The principal is bound by notice obtained by his agent in the discharge of his duties within the scope of his agency, but not by mere knowledge by the agent, no matter how obtained. (Viele vs. Germania Ins. Co., 26 Iowa, 9; Walsh vs. Ætna Life Ins. Co., 30 Iowa, 142; Ex parte Carbis in re, Croggon, 4 Deacon and Chitty, 354; Perry on Trusts, 1st Ed., p. 195, § 222; Hill on Trustees, 2d Am., p. 232, side 165; 1st Parsons on Contracts, p. 75; Angell on Corporations, Last Ed., p. 312 to 316; Adams' Equity, p. 322, side 157; 1 Story's Eq. In., 10th Ed., p. 398, § 408; Story on Agency, 7th Ed. p. 161, § 140 c.; Bigelow Life Ins. Index “Agent” Vol. 2.)

VORIES, Judge, delivered the opinion of the court.

This action was brought on a policy of insurance, charged to have been executed by the defendant to John A. Lennon (plaintiff's assignee), on the 23d day of July, 1868, and by which the defendant “in consideration of the sum of twenty-one dollars paid by the said Lennon to defendant, did undertake to and did insure the said John A. Lennon for the period of six months from the date of said policy against loss or damage by fire to the amount of three thousand dollars, on his stock of merchant tailor's goods, consisting,” &c.

The pleadings are very lengthy and prolix, but for the purposes of a decision upon the points presented to this court for adjudication, it will only be necessary to state the following issues made by the parties and which were passed on by the court below.

The defendant in its answer, amongst other things pleaded therein, set up the following special defenses: “For a seventh defense herein, defendant says that amongst other conditions in said policy sued on, it was an express condition in said policy as to the property on which said policy was issued, that if said Lennon should have or should thereafter make any other in surance on the property thereby insured or any part thereof without the consent of the company indorsed thereon, then and in every such case the said Lennon should not be entitled to recover from the company any loss or damage which might accrue in or to the property thereby insured or any part or portion thereof, and defendant says that said Lennon did not keep said express condition, but broke the same in this: That at the time when said Lennon made his request for insurance on which said policy was issued, and at the time said policy was executed and delivered by defendant, the said Lennon had other insurance on said property than the insurance alleged in plaintiff's petition. That is to say, insurance in the_________ Insurance company of____________for the sum of three thousand dollars, without defendant's consent to said other insurance indorsed upon said policy sued on, nor did defendant ever consent to said or any other insurance. And defendant says that thereby said Lennon became not entitled to recover from defendant any loss or damage which accrued in or to said property or any part or portion thereof.”

The eighth defense set up by defendant is the same as the one above set forth except that the breach of the condition is charged to be, that said Lennon after the execution of the policy sued on, and its delivery to said Lennon, made other insurance on said property, in the sum of three thousand dollars in the “Phœnix Insurance Company of Hartford, Connecticut,” without the consent, &c.

The plaintiff in his replication to these defenses admits the condition in the policy as stated, and that said Lennon had at the time of the execution of the policy other insurance on the property insured in the sum of $3,000 as stated in the answer, but to avoid the effect of the supposed breach as stated by the defendant, the plaintiff avers, “that before and at the time of the issuing of said policy defendant well knew and was fully advised of the fact of such other insurance upon said property, and plaintiff avers that defendant at the time it issued its said policy and received the premium therefor from said Lennon, waived the condition in said policy requiring notice of other insurance to be given to it, and furthermore waived the condition of said policy requiring consent of such other insurance to be indorsed on said policy in writing, and plaintiff further avers that defendant at the time aforesaid, consented to said other additional insurance.”

To the eighth defense set up in defendant's answer as above stated, the plaintiff replied: “That he admits that after the time of the issuing of the policy sued on, to-wit: on the_____ day of _____ and at the time of the expiration of the said previous additional insurance above referred to, the said John A. Lennon with the knowledge and consent of the defendant at the time, procured in place of said previous additional insurance the same amount of insurance, to-wit: in the Phœnix Insurance Company of Hartford in the State of Connecticut, and last named insurance was in force at the time of the burning of the goods named in plaintiff's amended petition, of which facts defendant had full knowledge and was fully advised of the renewal thereof in another company, and consented thereto, and plaintiff avers that defendant at said time waived the condition in said policy sued on, set out in defendant's eighth ground of defense, requiring notice of additional insurance to be given to defendant, and then and there waived the requirements of said condition requiring defendant's consent to such additional insurance to be indorsed on said policy in writing.”

There were many other issues in addition to the above in the pleadings, but they are not brought in question in this court, so that it will only be required that I should state the substance of the evidence applicable to the foregoing issues, and the rulings of the court thereon, to give a fair understanding of the matters complained of by the appellant, and upon which he relies for a reversal of the judgment in this cause.

It appears from the evidence in the cause, that at and before the execution of the policy sued on to John A. Lennon, said Lennon was doing business in the city of Hannibal, as a merchant tailor, that his stock of goods amounted to from seven to eight thousand dollars, that one David S. Eby also resided in Hannibal and followed the business of an insurance agent, that he was agent for several insurance companies in the Eastern States as well as being agent at Hannibal for defendant.

That said Lennon had taken two policies of insurance from said Eby for three thousand dollars each, one in each of two Eastern companies for which Eby was agent, and that he had transacted the business with and procured the policies from said Eby.

That in the month of July, 1868, shortly before the making of the policy sued on, Eby told said Lennon that one of his policies of three thousand dollars was about to expire, and that he could not renew it at the same rates that he had been charg ed before. Eby testified that he was the vice president of the defendant and agent for several insurance companies, had his office in the same room with the president and secretary of defendant, that he was in the habit of taking risks for the defendant most generally in consultation with the other officers of the company; when the risks were out of the ordinary run of business, there was a general consultation; that he thought he was authorized by virtue of his position as agent to take risks generally. Haynes, the president, and Meadows the secretary of defendant were both apprized of the issue of the policy to Lennon upon which the suit is brought, before it wa issued. Eby further stated that...