Keil Motor Co. v. Royal Insurance Co., Ltd., of Liverpool, England
| Decision Date | 22 September 1933 |
| Citation | 36 Del. 24,171 A. 201 |
| Court | Delaware Superior Court |
| Parties | KEIL MOTOR COMPANY, a corporation of the State of Delaware, v. ROYAL INSURANCE COMPANY, LIMITED, OF LIVERPOOL, ENGLAND |
Superior Court for New Castle County, Action of Assumpsit on insurance policy, No. 146, March Term, 1932.
Case removed to this court from the Court of Common Pleas, and heard on special demurrers to special replications filed by the plaintiff company to the defendant's pleas.
The plaintiff company sought to recover from the defendant $ 814.00 on a policy of insurance issued and delivered to it by the said defendant. The plaintiff's declaration not only set out the policy declared on but, also, in part alleged that such policy, by its terms, indemnified the plaintiff from any loss occasioned by the destruction of a certain automobile owned by one Sarah M. Turner; that the automobile in question was totally destroyed by fire on or about December 16, 1929; that at the time of such loss the said Sarah M. Turner owed the plaintiff $ 819.00 upon notes originally given for the purchase price of the automobile in question, none of which said notes were thirty days overdue at the time of the fire; that the plaintiff made an exhaustive attempt to collect said notes from the said Sarah M. Turner and finally procured judgment on them against her in the Court of Common Pleas for New Castle County; that a writ of fieri facias was subsequently issued upon said judgment against the said Sarah M. Turner, and a return of nulla bona was made thereon; that the plaintiff had performed all the conditions to be performed by it, according to the terms of the policy, or the defendant had waived the performance of such conditions, but that the defendant company had failed to pay the amount due on its said policy.
The policy declared on consisted, in part, of a printed form and in part, of a typewritten rider attached thereto, the material provisions of both of which will appear in the opinion of the court.
The special pleas, the special replications [1] thereto, including the material statements in the letter of the defendant to the Keil Motor Company of May 8, 1930, attached to and composing a part of each of the replications, as well as the special demurrers to such replications, will, also, sufficiently appear in the opinion of the court and in the note attached hereto.
The demurrer to the amended replication to the fourth plea and to the first replication to the fifth plea are overruled. The demurrer to the second replication to the fifth plea is sustained.
W Thomas Knowles and Samuel F. Keil for plaintiff.
James M. Malloy for defendant.
OPINION
It appears from the pleadings that the automobile covered by the policy sued on was destroyed by fire on December 16, 1929; that the proof of loss was filed by the plaintiff company some time after May 8, 1930, and that suit was brought against the defendant in this action on December 18, 1930.
The defendant's fourth and fifth pleas respectively allege as defenses to the plaintiff's action on the policy:
1. That its proof of loss was not filed with the defendant company within ten days after it became aware of the "loss or damage to said automobile, which impaired the interest of the assured" therein, as was provided by such policy.
2. That its action was not brought "within twelve months next after the happening of the loss," as was, also, provided by the policy.
The amended replication to the fourth plea alleges that the defendant waived the defense therein set forth:
1. By statements made by its agent to the plaintiff's representative, both before and after the expiration of the time prescribed by the policy for filing the proof of loss.
2. By the letter of the defendant company of May 8, 1930, a copy of which was sent by it to the plaintiff and which was, also, attached to that replication.
The defendant company demurred to this replication because:
1. It did not allege that the agent of the company therein referred to had the authority to waive any of the provisions of the policy.
2. That the statements in the letter of May 8, 1930, could not be construed to operate as a waiver of the condition of the policy relating to the filing of the plaintiff's proof of loss.
3. That in any event such letter could not amount to anything more than an implied waiver of the condition of the policy, and that such a waiver, after the expiration of the time prescribed for filing the proof of loss, would not be a sufficient reply to the defendant's plea because to operate as a waiver it must necessarily be based on the elements of estoppel.
Both of the replications to the fifth plea are, also, based on the letter of May 8, 1930, which is referred to in and made a part of them. In these replications the plaintiff alleges, in substance, that the clause of the policy referred to in the defendant's plea cannot prevent the plaintiff from recovering on such policy because:
1. The defendant company led the plaintiff to believe that if suit was promptly docketed against Sarah M. Turner, the owner of the automobile destroyed, and that if the plaintiff was unable to collect anything from her, that its claim against the defendant would be promptly paid; that suit was docketed accordingly but due to necessary delays judgment was not rendered against the said Sarah M. Turner until December 5, 1930, and that it was not until shortly before December 18, 1930, when suit was brought on the policy, that the plaintiff learned that nothing could be collected on that judgment. The replication, in question, then further alleges that the year, "allowed by the insurance company was unreasonable in the light of the demands made by the defendant corporation."
2. That the defendant led the plaintiff to believe that no liability existed under the policy until final judgment had been rendered in the case of Keil Motor Company v. Sarah M. Turner, and that the letter of May 8, 1930, attached to that replication so states; that the defendant company, therefore, interpreted the word "loss" in the policy to mean loss as of the date when the plaintiff failed, by legal process, to collect from Sarah M. Turner; that the plaintiff accepted that interpretation of the defendant's contract, and upon being notified by the Sheriff of Kent County that Sarah M. Turner had no goods and chattels, the plaintiff immediately brought suit on the policy.
This replication further alleges that "the word 'loss' is to be construed to mean loss after failure to collect from the purchaser of the car and the endorser of the note."
Waiver has been defined by this court to be the intentional relinquishment of a known right, or such conduct as warrants an inference of such an intent (Jones v. Savin, 29 Del. 68, 6 Boyce 68, 96 A. 756; Id., 6 Boyce 180, 97 A. 591; O'Neil v. Cooles, 3 W. W. Harr. (33 Del.) 541, 140 A. 648); and, when properly alleged in the pleadings, if there is any evidence to support such an allegation, waiver is usually a question of fact for the jury to determine. Jones v. Savin, 29 Del. 68, 6 Boyce 68, 96 A. 756; Id., 6 Boyce 180, 97 A. 591; O'Neil v. Cooles, 3 W. W. Harr. (33 Del.) 541, 140 A. 648.
The clauses in the policy sued on, prescribing the time for filing the plaintiff's proof of loss and the time for bringing suit on such policy are both for the benefit of the insurance company and may, therefore, be waived by it, or by its duly authorized agent, when such waiver is properly alleged and proved. Reed v. Continental Ins. Co., 22 Del. 204, 6 Penne. 204, 65 A. 569; Emory v. Ins. Co., 23 Del. 101, 7 Penn. 102, 76 A. 230; McKenney v. Diamond State Loan Ass'n, 13 Del. 557, 8 Houst. 557, 18 A. 905; 2 May on Ins., § 488; Cooley's Briefs on Ins., §§ 6848, 6858.
The defendant company claims that waiver is necessarily based on some element of estoppel and that there can, therefore, be no implied waiver of the prescribed time for filing the plaintiff's proof of loss after that time has expired.
The distinction between waiver and estoppel, especially in insurance cases, has not always been clearly drawn by the courts, but even conceding that the rule relied on by the defendant company has been applied by some courts ( Globe Mut. L. Ins. Co. v. Wolff, 95 U.S. 326, 24 L.Ed. 387; Chandler v. John Hancock Mutual Life Ins. Co., 180 Mo. App. 394, 167 S.W. 1162; Engebretson v. Hekla Fire Ins. Co., 58 Wis. 301, 17 N.W. 5; Aronson v. Frankfort Accident & Plate Glass Ins. Co., 9 Cal. App. 473, 99 P. 537), it is apparent from Jones v. Savin, 29 Del. 68, 6 Boyce 68, 96 A. 756; Id., 6 Boyce 180, 97 A. 591, supra, that it does not apply here and that if the facts justify it, there may be a waiver of existing rights, even though no elements of estoppel are involved in the facts proved. Reed v. Continental Ins. Co., 22 Del. 204, 6 Penne. 204, 65 A. 569, cited by the defendant, is not inconsistent with this conclusion, though under the facts of that particular case some of the elements of estoppel may have existed.
It is not contended that the replication to the fourth plea is double (1 Chitty's Pl. 231, 640) and we therefore, need not consider that question; but the defendant company does contend that where waiver by an agent is relied on in the pleadings his authority in that respect must, also, be alleged. Technically speaking, perhaps, it would be more accurate to allege that the principal, by its agent, in that behalf, had waived the provisions of the policy sued on. 3 Chitty's Pl. 117, 150. It would seem, however, that the allegation in the replication that the "defendant's agent" had waived the provision of the policy, in question,...
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