Johnstone v. Home Ins. Co. of New York

• Citation: 34 S.W.2d 1029
• Decision Date: 03 February 1931
• Docket Number: No. 21376.,21376.
• Parties: JOHNSTONE et ux. v. HOME INS. CO. OF NEW YORK.
• Court: Court of Appeal of Missouri (US)

34 S.W.2d 1029

JOHNSTONE et ux. v. HOME INS. CO. OF NEW YORK.

No. 21376.

St. Louis Court of Appeals. Missouri.

February 3, 1931.

Rehearing Denied February 17, 1931.

Appeal from Circuit Court, St. Louis County; Amandus Brackman, Judge.

"Not to be officially published."

Action by Robert L. Johnstone and wife against the Home Insurance Company of New York. Judgment for plaintiffs, and defendant appeals.

Reversed and remanded.

Harry C. Willson and J. H. Cunningham, Jr., both of St. Louis, for appellant.

Davis & Brownback, of St. Louis, for respondents.

HAID, P. J.

This is an action upon a fire insurance policy. The plaintiffs were the owners and occupied a one and one-half story frame house of eight rooms, including the back porch, bath, and basement, heated by furnace, at 1407 North Hanley road, in University City, St. Louis county, claimed by plaintiffs to be worth $9,000 at the time of its partial destruction by fire on September 27, 1928.

There were two policies of insurance issued by defendant upon the house, one for $3,500 and the other for $4,000. This suit is upon the former policy.

The petition is in the usual form in such cases, alleges plaintiffs' ownership of the premises, the issuance of the two policies, damage and partial destruction of the premises by the fire, resulting in a loss of $4,260.66, that plaintiffs have complied with all the provisions of the policy, and pray for the recovery of the pro rata part of the damages, which are alleged as $1,988.30, for which judgment was prayed, together with an attorney's fee and 10 per cent. on the judgment for vexatious refusal to pay.

The answer was a general denial and a plea that plaintiffs were not entitled to maintain the suit because of the provisions of the policy that, in the event of a dispute between the parties as to the amount of damages suffered, an appraisal should be had; that a dispute did arise, and defendant demanded that the loss and damage be ascertained by appraisers, as provided in the policy, and named its appraiser, but plaintiffs refused to name an appraiser, and therefore failed to comply with such provision of the policy; that the policy provided that no suit should be maintainable until after a compliance by the insured with all of the conditions of the policy.

The reply, after a special denial, pleaded a refusal by defendant to an appraisal and thereby that it waived the provisions of the policy concerning an appraisal.

The evidence disclosed, generally, that as a result of the fire all of the rooms were damaged. The front door was burned, the ceiling of a new front porch was burned or scorched, the new side walls of an extended bedroom had burned, and practically the whole floor of the reception hall, about half of the living room, the doors leading from the reception hall to plaintiffs' bedroom, and a center hall leading upstairs and to the bathroom were burned. The sliding door was burned, and the fire went up through the partition into the ceiling rafters of the first floor and into the rafters of a new roof that had been put on, and other damage was done.

One of the defendant's contentions is that the court erred in refusing to give the instruction in the nature of a demurrer to the evidence, requested by it at the close of the whole case.

This contention is based upon two grounds; the first being the alleged failure of the plaintiffs to comply with the provisions of the policy having reference to an appraisal in the event of a dispute as to the amount of damages suffered. The policy, as to the liability of the defendant, contains the following provisions:

"This company shall not be liable beyond the actual cash value of the property at the time any loss or damage occurs, and the loss or damage shall be ascertained or estimated according to such actual cash value, with proper deduction for depreciation, however caused, and shall in no event exceed what it would then cost the insured to repair or replace the same with material of like kind and quality; said ascertainment or estimate shall be made by the insured and this company, or, if they differ, then by appraisers, as hereinafter provided; and, the amount of loss or damage having been thus determined, the sum for which this company is liable pursuant to this policy shall be payable sixty days after due notice, ascertainment, estimate and satisfactory proof of the loss have been received by this company in accordance with the terms of this policy. * * *

"In the event of disagreement as to the amount of loss the same shall, as above provided, be ascertained by two competent and disinterested appraisers, the insured and this company each selecting one, and the two so chosen shall first select a competent and disinterested umpire; the appraisers together shall then estimate and appraise the loss stating separately sound value and damage, and, failing to agree, shall submit their differences to the umpire; and the award in writing of any two shall determine the amount of such loss; the parties thereto shall pay the appraiser respectively selected by them and shall bear equally the expenses of the appraisal and umpire.

"This company shall not be held to have waived any provision or condition of this policy or any forfeiture thereof by any requirement, act or proceeding on its part relating to the appraisal or to any examination herein provided for; and the loss shall not become payable until sixty days after the notice, ascertainment, estimate and satisfactory proof of the loss herein required have been received by this company, including an award by appraisers when appraisal has been required. * * *

"No suit or action on this policy, for the recovery of any claim, shall be sustainable in any court of law or equity until after full compliance by the insured with all the foregoing requirements."

The pertinent evidence for plaintiffs on this question is: Mr. Johnstone testified that W. P. Morgan was the agent of the defendant at Clayton, Missouri; that Mr. Johnstone received at his office a telephone call concerning the fire at his home and immediately proceeded there and found that the fire had been extinguished and the firemen were just preparing to clean up the débris; that while he was there Mr. Morgan appeared and told Mr. Johnstone he would be bothered with a lot of public adjusters, but to keep away from them, that they would charge him 10 per cent. to make an adjustment on the loss, and that Mr. Morgan would take care of it himself, that the insurance company would take care of all the fire loss and rebuild the house just the same as it was before the fire, that Mr. Johnstone would not have anything to worry about; that Mr. Martin, an adjuster for the defendant, came out that afternoon and suggested that a contractor be procured to find out how much it would cost to put the house back in shape; Mr. Morgan suggested the Jones boys, and asked Mr. Johnstone whether that was all right, and, upon the latter answering in the affirmative, Mr. Morgan turned to Mr. Martin and told him he would get the Jones boys, that they were neighbors who had known them for years; the next afternoon Mr. Martin suggested that Mr. Johnstone had better get some other contractors to figure on the house, that "we won't have just a one-sided view of it"; that Mr. Johnstone then called up a Mr. Struckhoff and his wife called up a Mr. Dudeck; that a few days following the fire he asked Mr. Morgan whether he had received the bid of the Jones boys, and he answered in the negative; that about a week after the fire he asked Mr. Morgan if he had the bid of the Jones boys, and he replied that he had; that Mr. Johnstone asked Mr. Morgan how much they had bid on the work, and Mr. Morgan told him to get bids from the contractors and turn them in to the insurance company and he would turn in his bid from the Jones boys to the insurance company; that, when Mr. Johnstone received the bids from Struckhoff and Dudeck, he took them to Mr. Martin in the office at the Western Adjustment Bureau, and the latter then called Mr. Morgan concerning the bid of the Jones boys, which Mr. Martin understood over the telephone to be about $3,300; that Mr. Martin informed him the bids ran considerably higher than he estimated when he was out there, and informed Mr. Johnstone that he was having their own contractor, a Mr. Humphries, make a bid; that Mr. Humphries was called and told where to go and what to do, and Mr. Humphries was handed the bids of Messrs. Struckhoff and Dudeck; that on the following Wednesday morning he saw Mr. Martin again, was told that the latter had Mr. Humphries' bid which was about $2,100; that Mr. Johnstone examined Mr. Humphries' bid and called attention to what he conceived to be discrepancies in material, which it is unnecessary to recite; that he asked Mr. Martin to go out with him and check over the items in the Humphries bid, and Mr. Martin replied "he would not go out with me because they employed Humphries to do that. I said: `Well, what are you going to do? The discrepancies are so glaring, the matter certainly ought to be looked into.' He said, `Well, we will guarantee that Humphries will do the job for that amount of money.' I said, `Well'—oh, he said. `We will guarantee Humphries will do it for that amount of money; we will settle on that basis.' I said: `Mr. Martin, I can't settle on that basis. There isn't enough material in there.' He said: `Well, we have had Humphries on these jobs before. We know what he can do. We will settle on that basis.' I said, `Mr. Martin, I don't see where I can settle with you on that basis. Your policy says in there you can settle with the policyholder or you can replace.' I said: `You go ahead and hire Humphries or anybody else you want and let them go ahead and do it; you settle on that basis. Hire Humphries to do it. I don't want to hire a contractor. I would rather get out of that work.' He said: `No. We don't do that. We...