Murphy v. Great American Ins. Co.

• Decision Date: 14 June 1926
• Docket Number: No. 15554.,15554.
• Citation: 285 S.W. 772
• Parties: MURPHY v. GREAT AMERICAN INS. CO.
• Court: Missouri Court of Appeals

285 S.W. 772

MURPHY v. GREAT AMERICAN INS. CO.

No. 15554.

Kansas City Court of Appeals. Missouri.

June 14, 1926.

Rehearing Denied July 6, 1926.

Appeal from Circuit Court, Livingston County; Arch B. Davis, Judge.

Suit by Thomas Murphy against the Great American Insurance Company. Judgment for plaintiff, and defendant appeals. Affirmed.

Scott J. Miller, of Chillicothe, and Roger S. Miller, of Kansas City, for appellant.

S. L. Sheetz, of Chillicothe, for respondent.

BLAND, J.

This is a suit upon an oral contract of fire insurance. There was a verdict and judgment in favor of plaintiff in the sum of $1,160.34, and defendant has appealed.

This is the second appeal in the case. See Murphy v. Great American Insurance Co. (Mo. App.) 268 S. W. 671, where the principal facts are stated. At the former trial there was a verdict for the defendant, but this court reversed the judgment and remanded the cause on account of an erroneous instruction given on behalf of the defendant.

It is insisted that the court erred in refusing to sustain defendant's demurrer to the evidence, for the reason that it is claimed the evidence fails to show that Buster, defendant's agent, with whom the oral contract was made, had authority to enter into such a contract. The evidence disclosed that Buster was duly licensed as agent of the defendant at Wheeling, Mo., by the "superintendent of insurance, in pursuance of instructions of the defendant. Buster testified that he had no authority to write policies of insurance, but he merely took applications and forwarded them to the company, which the evidence shows was a foreign insurance company; the company, if it desired to issue the policy would forward the same to Buster, who would deliver it and collect the premiums. There is no evidence that he ever countersigned any policies. Defendant claims that Buster was merely a soliciting agent and not a recording agent, and that it is only the latter kind who has authority to write contracts of insurance.

Section 6315, R. S. 1919, reads as follows:

"Foreign companies admitted to do business in this state shall make contracts of insurance upon property or interests `therein only by lawfully constituted and licensed resident agents, who shall countersign all policies so issued. And any such insurance company who shall violate any provision of this section shall suffer a revocation of its authority by the superintendent of insurance to do business in this state, in addition to the penalty prescribed in section 6322, such revocation to be for the term of one year."

Under this statute, foreign insurance companies can make contracts of insurance "upon property or interests therein in this state only by lawfully constituted and licensed resident agents, who shall countersign all policies so issued." Defendant is therefore estopped to deny that Buster was such an agent as described in the statute; otherwise it would be making contracts in this state in violation of law. Therefore we must assume that Buster was a duly licensed resident agent of the defendant, who had authority to countersign policies (see Woolfolk v. Home Ins. Co. [Mo. App.] 202 S. W. 627, 628), and, if he was such an agent, there is no question but that he had power to make oral contracts of insurance (Sheets & Day v. Ins. Co., 153 Mo. App. 620, 135 S. W. 80; Bealmer v. Ins. Co. [Mo. App.] 193 S. W. 847; Prichard v. Ins. Co. [Mo. App.] 203 S. W. 223). We do not mean to say that a foreign fire insurance company may not have agents in this state who have authority merely to solicit applications for insurance, but such agents must conduct their business in a different manner than the way in which Buster carried on defendant's business. We have examined the case of Trask v. Ins. Co., 53 Mo. App. 625, and others cited by the defendant, and we only need to say that, if they are in point, they were decided before the passage of section 6315, R. S. 1919, which was first enacted in 1897.

There is no merit in the contention that the demurrer to the evidence should have been sustained because the evidence does not show the existence of all the elements necessary for an oral contract of insurance. There are five elements necessary to constitute such a contract: First, the subject-matter; second, the risk insured against; third, the amount; fourth, the duration of the risk; and fifth, the premium. It is not essential that all of these elements of the contract be expressly agreed upon if the intention of the parties to the contract in these particulars can be gathered from the circumstances of the case. An oral contract of insurance is binding, although the premium is not to be paid at the time of its consummation if credit is given. 1 Cooley's Briefs on the Law of Insurance, pp. 392, 393; 1 May on Insurance, p. 46; Hartford Fire Ins. Co. v. Trimble, 117 Ky. 583, 78 S. W. 462, 464. The existence of every one of these five elements was established by the evidence in this case.

It is insisted that at the time the oral contract was entered into there was no designation of the company in which the insurance should be made, and, as Buster represented several companies there was not sufficient evidence to bind the defendant. Hartford Fire Ins. Co. v. Trimble, supra, is cited in support of this contention. However, plaintiff testified that the insurance was to be in the defendant company, and there is no evidence that Buster represented any other company.

There is no merit in the contention that, because plaintiff knew the agent was to send the application to the company for its approval and acceptance, the contract was incomplete, and plaintiff cannot recover. It appears from the facts in the case that plaintiff was to be insured from November, 1921, and that the insurance should remain in effect until the application was rejected and the company had notified plaintiff thereof and not that plaintiff was merely to be insured until after the company approved and accepted the application; that this agreement was sufficient to base a claim of oral insurance is unquestioned.

"An agreement with an application for accident insurance that, in consideration of the application and the promise to pay the premium, he should be insured until the application was rejected and the company had notified him thereof, was considered sufficient to support an action in Fidelity & Casualty Co. v. Ballard & Ballard Co., 105 Ky. 253, 48 S. W. 1074, provided the agent had authority to make the agreement." 1 Cooley's Briefs on the Law of Insurance, p. 393.

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