Insurance Co. of North America v. Forcheimer

• Decision Date: 09 April 1889
• Citation: 5 So. 870,86 Ala. 541
• Parties: INSURANCE CO. OF NORTH AMERICA v. FORCHEIMER ET AL.
• Court: Alabama Supreme Court

5 So. 870

86 Ala. 541

INSURANCE CO. OF NORTH AMERICA v. FORCHEIMER ET AL.

Supreme Court of Alabama

April 9, 1889

Appeal from city court of Mobile; W. E. CLARKE, Judge.

This action was brought by M. Forcheimer & Co., merchants and partners doing business in Mobile, Ala., against the Insurance Company of North America, a Pennsylvania corporation, to recover $10,000 insurance on "315 double bags of coffee," which had been shipped to the plaintiffs from New York on the 1st June, 1887, by steamer Vidette, and was lost with the vessel, in the Gulf of Mexico on the night of June 13th or the morning of the 14th. The defendant pleaded the general issue, and also several special pleas, denying any contract of insurance with the plaintiffs denying their right to sue on the policy claimed to have been made for their benefit with the defendant, and alleging a cancellation of that contract. By agreement in writing entered of record, the parties admitted the material facts as to which there was no dispute, waived a trial by jury, and submitted the case for decision to the decision and judgment of the court, asking for a special finding of the facts, and reserving to each party the right to appeal, as provided by the statute. Code, §§ 2743-2745. The facts thus admitted and found by the court, in which the policy of insurance, with its indorsements, the bill of lading for plaintiffs' goods, and all other documentary evidence, as are set out in full, are, in substance, as follows:

The steamer Vidette belonged to the New York & Mobile Steam-Ship Line, of Arnold & Co., who were engaged as common carriers in transporting goods between New York and Mobile and other places, and Bowring & Archibald, were their agents in New York. On January 5, 1887, said Bowring & Archibald, as such agents, took out an open policy of insurance with the defendant company, on merchandise to be forwarded by the steamer Lorenzo D. Baker, "not exceeding $75,000 at any one time;" the first clause of which, as construed by this court, was in these words: "Bowring & Archibald agents, on account of whom it may concern, to cover shipments made on and after January 5th, 1887, which the assured or their agents in Mobile, Ala., may agree to insure prior to the sailing of the vessel, and prior to known loss to property or vessel, note thereof being made by the assured or their agents, at their office, in the manifest and bill of lading, in case of loss, to be paid to them or order, do make insurance, and cause to be insured," etc. The policy was partly written and partly printed, the above italicized words being printed, and the written words being so interlined that, according to the defendant's contention, the clause should read thus: "Whom it may concern: To cover Bowring & Archibald, agents, on account of shipments made," etc. The policy contained a stipulation printed, "that this insurance shall not inure to the benefit of any carrier;" and another stipulation, also printed, "that either party is at liberty to cancel this policy at any time, on giving notice to that effect, which, however, is not to prejudice any risk then pending." The perils insured against were those "of the seas, fires, jettisons, barratry of the master and mariners, and all other perils, losses, misfortunes," etc. The policy was to continue in force for not more than one year, unless by agreement indorsed thereon. The original policy applied only to goods forwarded by the said Lorenzo D. Baker; but, by written indorsement dated January 26, 1887, it was agreed "that this policy shall cover steamer Vidette, as well as steamer L. D. Baker." Early in April, Bowring & Archibald, as agents, were succeeded by W. J. Best; and thereupon a memorandum was indorsed on the policy, dated New York, April 13, 1887, in these words: "On and after this date it is understood and agreed that this policy shall cover in the name of W. J. Best, agent, instead of Bowring & Archibald." On June 14th another indorsement was made on the policy, to the effect that it should "cover goods shipped on deck" of each of said steamers.

The plaintiffs' goods were shipped on the Vidette, and a bill of lading given, which was dated New York, June 1, 1887, signed by said Best as agent, and containing numerous exceptions from liability for losses, among which were: "Fire from any cause, on land or on water, jettison, ice, freshets, floods, weather, pirates, robbers, or thieves, acts of God or the country's enemies," etc. Stamped or indorsed on this bill of lading, by the said Best, as agent, were these words: "Insured from New York to Mobile, subject to the terms and conditions of our open policy No. 2,076, with the Insurance Company of North America, for $10,000;" but it was admitted, and was so found by the court, that the defendant had no notice or knowledge of this bill of lading, or of its contents. The defendants had furnished to Bowring & Archibald, while they were acting as agents of said carriers, "a book in which they were required to enter all risks under said policy No. 2,076, and exhibit the same to the defendant's New York agents, within seventy-two hours after the sailing of the vessel from New York with the insured goods;" and this book, with the said policy, was turned over to the said Best, as agent, when he succeeded them. The policy and the book were kept for Best by one Bascome, an insurance broker, through whom he conducted his insurance business. By the course of dealing between them Bascome made, under Best's directions, entries of the risks in this book, and made report of the same to defendant's agents in New York. On the 5th of June, 1887, Best instructed Bascome, in writing, as follows: "Please insure, under open policy issued to N.Y. to Mobile S. S. Line, as follows: Steamer Vidette, N.Y. to Mobile, Mobile cargo, $18.726; Montgomery, $10,234; Selma, $2,532," etc. In accordance with these instructions, Bascome made the necessary entries in the book, and exhibited them to the defendant's agents, by whom they were approved. In the heading of this book, or on the first page, was a memorandum signed by the defendant's attorneys and agents, in these words: "It is understood that all indorsements herein made apply to open policy No. 2,076, and are approved subject to the conditions therein expressed." The entry as to the cargo of the Vidette, dated June 6, 1887, only stated that it was "Mdse., $18,726," which included plaintiffs' said bags of coffee at a valuation of $10,000; "but neither defendant, nor its New York agents, had any knowledge or notice that said coffee was included in the merchandise so insured, nor of any of the items making up said cargo."

The plaintiffs carried an open policy of insurance with the Factors' & Traders' Mutual Insurance Company, Mobile and on receipt of the bill of lading for the coffee, June 6th, they had it included in this open policy, at a valuation of $10,000, and so informed the agent of the steam-ship company in Mobile. Said Mobile agent thereupon informed Best, the New York agent, by letter, of the fact that the plaintiffs had fully insured the coffee in Mobile, but plaintiffs denied that they ever authorized him to do so. Best received the letter on the 13th of June, and on the next day proceeded to obtain a cancellation of the risk on the coffee, as entered on the open policy with the defendant. It was admitted that everything was done by said Best and the defendant which was necessary to effect a cancellation of said policy as to the risk on the coffee, and this was done without any knowledge or notice by either of them of the loss of the vessel and cargo. It was admitted, also, that neither the steam-ship company, nor Best as agent, had any express authority from the plaintiffs to make any such cancellation, or that they agreed to any such cancellation; and plaintiffs denied that Best had any...