Milton Ice Co. v. Travelers Indem. Co.

• Decision Date: 31 January 1947
• Citation: 71 N.E.2d 232,320 Mass. 719
• Parties: MILTON ICE CO., Inc., v. TRAVELERS INDEMNITY CO.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

320 Mass. 719

71 N.E.2d 232

MILTON ICE CO., Inc.,

v.TRAVELERS INDEMNITY CO.

Supreme Judicial Court of Massachusetts, Norfolk.

Jan. 31, 1947.

Exceptions from Superior Court, Norfolk County; Broadhurst, Judge.

Action on burglary insurance policy by Milton Ice Company, Inc., against the Travelers Indemnity Company. The case was tried to a judge of the Superior Court, who made findings of fact and found for the plaintiff, and the defendant brings exceptions.

Exceptions sustained, and judgment for the defendant.

Before FIELD, C. J., and LUMMUS, RONAN, WILKINS, and SPALDING, JJ.

T. M. Vinson, of Winchester, and R. F. Turner, of Milton, for plaintiff.

W. I. Badger, Jr., and J. J. Sullivan, both of Boston, for defendant.

SPALDING, Justice.

This is an action of contract upon a policy of burglary insurance issued by the defendant to the plaintiff. The case was tried to a judge of the Superior Court, who made detailed findings of fact and found for the plaintiff.

One of the conditions of the policy was that ‘Affirmative proof of loss under oath in such detail as required by and upon such forms as are provided by the company shall be furnished to the company within sixty days from the date of the discovery of the loss.’ The loss was discovered on the morning of December 30, 1943. The judge found, as he was obliged to on the evidence, that no proof of loss was furnished to the company by the plaintiff as required by the provision of the policy quoted above. But he found that the defendant ‘waived its right to receive from the plaintiff sworn proof of loss.’ The defendant contended that there was no evidence to warrant a finding of waiver, and duly excepted to the judge's denial of requests for rulings raising that issue. ¹ The only evidence bearing on the issue of waiver was a letter from the defendant to the plaintiff dated April 29, 1944 (approximately two months after the expiration of the period in which proof of loss was required to be filed), which was as follows: ‘On February 10, 1944, we received notice of a loss of money under the policy in caption and reported to have occurred at the Hyde Park Ice Company, Inc., 35 Walnut Street, Hyde Park, Mass., on or about December 29, 1943. Our investigation disclosed that the missing funds were the property of the Hyde Park Ice Company, Inc., for whom we have no insurance. Hence, it is with regret that we must advise you that the loss is not covered under your policy BF-505169 and it is respectfully declined.'

It is established law that the failure to file the required proofs of loss within the time limited bars recovery unless the failure is excused or has been waived. Paulauskas v. Fireman's Fund Ins. Co., 254 Mass. 1, 149 N.E. 668;Holich v. Globe & Rutgers Fire Ins. Co., 272 Mass. 587, 589, 172 N.E. 799;Ray v. Fidelity & Deposit Co., 275 Mass. 184, 175 N.E. 636;Jackson & Co. Inc. v. Great American Indemnity Co., 282 Mass. 337, 339, 185 N.E. 359; Goldman v. Commercial Travellers Eastern Accident Association, 302 Mass. 74, 80, 18 N.E.2d 373. It is also the law that a denial of liability by an insurance company not predicated on the failure to furnish proofs is a waiver of any objection on that ground. Shapiro v. Security Ins. Co., 256 Mass. 358, 366, 152 N.E. 370;Vasaris v. National Liberty Ins. Co., 272 Mass. 62, 66, 172 N.E. 99;Jackson & Co. Inc. v. Great American Indemnity Co., 282 Mass. 337, 342, 185 N.E. 359;Fuller v. Home Indemnity Co., 318 Mass. 37, 43, 60 N.E.2d 1. Evidently the trial judge relying on this principle, concluded that the letter of April 29 constituted a waiver. But this rule is subject to the qualification that the denial of liability on other grounds must occur within the period allowed for filing proofs of loss. Shapiro v. Security Ins. Co., 256 Mass. 358, 366-367, 152 N.E. 370;Friedman v. Orient Ins. Co., 278 Mass. 596, 600, 180 N.E. 617;Jackson & Co. Inc. v. Great American Indemnity Co., 282 Mass. 337, 344, 185 N.E. 359;Sheehan v. Commercial Travelers' Mutual Accident Association, 283 Mass. 543, 551, 552, 186 N.E. 627, 88 A.L.R. 975. There are numerous decisions in other jurisdictions to the same effect.² And there are good reasons for so holding.

The doctrine that a denial of liability on other grounds precludes an insurer from relying on a failure to furnish proofs, although commonly called waiver, is based on principles of estoppel. See Blake v. Exchange Mutual Ins. Co., 12 Gray, 265, 271-272;Graves v. Washington Marine Ins. Co., 12 Allen, 391, 394;Sheehan v. Commercial Travelers' Mutual Accident Association, 283 Mass. 543, 551, 186 N.E. 627, 88 A.L.R. 975;National City Bank v. National Security Co., 6 Cir., 58 F.2d 7, 10;Underwood v. Farmers' Joint Stock Ins. Co., 57 N.Y. 500, 506;Matthews v. Capital Fire Ins. Co., 115 Wis. 272, 275, 91 N.W. 675. The estoppel arises from the fact that the insurer by denying liability on other grounds has led the assured into believing that performance of the condition as to proofs will not be required. But where the denial of liability takes place after the expiration of the period for filing proofs, it cannot be said that the assured has been induced to forego steps to prevent a default under the policy, for the default has already occurred. Consequently, there is no basis for an estoppel. See Salonen v. Paanenen, 320 Mass. 568, 71 N.E.2d 227. As we said in Friedman v. Orient Ins. Co., 278 Mass. 596, at page 600, 180 N.E. 617, 618, ‘Neither the defendant's failure to reply earlier nor its letter denying...