John Morrell & Co. v. New England Fire Ins. Co.

• Decision Date: 29 April 1899
• Citation: 71 Vt. 281,44 A. 358
• Court: Vermont Supreme Court
• Parties: JOHN MORRELL & CO. v. NEW ENGLAND FIRE INS. CO.

44 A. 358

71 Vt. 281

JOHN MORRELL & CO.

v. NEW ENGLAND FIRE INS. CO.

Supreme Court of Vermont. Rutland.

April 29, 1899.

Exceptions from Rutland county court.

Action by John Morrell & Co. against the New England Fire Insurance Company. Judgment for plaintiff, and defendant excepted. 'Reversed, and judgment entered for defendant.

G. L. Rice and G. E. Lawrence, for plaintiff.

Butler & Moloney, for defendant.

TYLER, J. The statement of facts shows that the defendant, by its policy of fire insurance, insured to the amount of $1,000 certain personal property of the plaintiffs, situated in their establishment for packing and curing meats, etc., in Ottumwa, Iowa. On July 12, 1893, while the policy was in force, a fire occurred by which the plaintiffs suffered a heavy loss upon the property so insured, of which they gave the defendant due notice. Some correspondence took place between the parties upon the subject of the loss, which resulted in an adjustment of the same. On March 10, 1894, the defendant, by its secretary, wrote the plaintiffs: "We hand you drafts for loss and interest, under policy No. 27,015, with the interest on the same, and we trust that you will find the same correct. These items will be paid when due: * * * Drafts: $100, due at sight; $223, due May 10th; $224, due June 10th; $225, due July 10th; $227, due Aug. 10th." The drafts were drawn by the defendant upon itself, and made payable to the plaintiffs. On receipt, the plaintiffs used the sight draft by sending it through the banks for collection, and it was paid by the defendant. The plaintiffs immediately returned the other four drafts to the defendant by letter, saying, in substance, that they inclosed them, and requested the defendant to indorse upon each of them the following: "This note becomes due should any of the other notes of this series, numbered, respectively, 1,908, 1,909, 1,910, 1,911 not be paid at maturity." The plaintiffs further requested that the drafts be returned to them when so indorsed. The four drafts were received by the defendant after its payment of the $100 draft. The defendant did not indorse the four drafts nor return them, nor pay them to the plaintiffs, though several times requested to pay them before this suit was brought, which was on June 7, 1897, nor had the defendant withdrawn its proposition to pay the loss as stated in its letter of March 10, 1894, and as expressed in the drafts.

It was clearly competent for the parties to the contract of insurance to stipulate in respect to the time within which a suit should be brought by the insured against the defendant after a loss occurred; and take the case out of the statutory time for bringing such actions, and they did so contract by the seventh condition in the policy, which reads: "That no suit or action against this company for the recovery of any claim by virtue of this policy shall be sustainable in any court of law or equity until after full compliance by the insured with all conditions and requirements printed and written on this policy, nor unless such action shall be commenced within twelve months next after the loss shall occur; and, should any suit or action be commenced against this company after the expiration of the aforesaid twelve months, the lapse of time shall be taken and deemed as conclusive evidence against the validity of such claim, any statute of limitation to the contrary notwithstanding."

1. As the suit was not brought until more than five years had elapsed from the occurrence of the loss, and more than three years from proof thereof, the plaintiffs had lost their right of action, unless the defendant, by its conduct in adjusting the loss and giving the drafts, induced the plaintiffs to...