New Orleans Ins. Ass'n v. Griffin

• Citation: 18 S.W. 505
• Court: Supreme Court of Texas
• Decision Date: 11 May 1886
• Parties: NEW ORLEANS INS. ASS'N v. GRIFFIN <I>et al.</I><SMALL><SUP>1</SUP></SMALL>

18 S.W. 505

NEW ORLEANS INS. ASS'N v. GRIFFIN et al.¹

Supreme Court of Texas.

May 11, 1886.

Appeal from district court, McLennan county; B. W. RIMES, Judge.

Action by Griffin & Shook against the New Orleans Insurance Association on a fire policy. Judgment for plaintiffs. Defendant appeals. Reversed.

Jenkins & Jenkins, for appellant. Jennings & Baker and Herring & Kelly, for appellees.

ROBERTSON, J.

A condition in a policy of insurance, requiring notice of any other insurance afterwards taken upon the same property, is to enable the company to exercise its option to continue or cancel its contract. Such condition may not be complied with by notice of an intention to obtain other insurance, because such notice does not give it the opportunity contracted for. Healey v. Insurance Co., 5 Nev. 268; Kimball v. Insurance Co., 8 Gray, 33. But a condition that other insurance shall not be obtained without the consent of the company is better fulfilled by obtaining the consent before than after the contract for additional insurance. Such a condition is satisfied by notice of an intention to take other insurance, consented to by the agent of the company. Carrugi v. Insurance Co., 40 Ga. 135. Verbal consent by the agent, with knowledge that it will be acted upon, is a waiver of the requirement that the consent shall be expressed in writing upon the policy. Id., and Insurance Co. v. Griffin, 59 Tex. 510. The condition in the policy in suit is of the character last described. If the plaintiffs gave Harrison notice of their intention to obtain other insurance, and he consented, with knowledge or notice of their purpose to act upon the verbal consent, the condition relied upon by the defendant will not avail it. Whether the policy issued by the Crescent was prior or subsequent to the one in suit, or contemporaneous with it, need not be considered. Insurance Co. v. Davison, 30 Md. 109. The last policy obtained by the plaintiffs, issued by British-American Assurance Company, December 1, 1881, was other insurance obtained after the contract with defendant, which avoided that contract by its terms, unless (interpreting the condition) the defendant's agent consented to such other insurance, and waived the written indorsement. Did the agent consent to the contract with the British Company? It was not necessary for him to be advised of the name of the company. Benjamin v. Insurance Co., 17 N. Y. 414. If he assented to any insurance to be afterwards obtained, the substance of the condition is fulfilled. No more insurance in all was obtained than the sum mentioned in both interviews with Harrison. That the property to be insured was that covered by the defendant's policy is sufficiently certain. If he consented at all, it covered the British Company's policy. No express consent was given. If there was any, it is to be inferred from what was said in two conversations. In both these conversations the plaintiffs stated that they intended to take out additional insurance when able. In both, the agent expressed his desire to write the policies. It is plain that if Reverie and Griffin knew the condition of the policy, each knew that he had not received the prescribed consent, and the plaintiffs knew that in obtaining the additional insurance they were violating the contract. To give effect to the contract on this hypothesis would annul the condition. The requirement of consent to other insurance is not arbitrary, but reasonable and proper. Through it the company reserves the right to determine how much of the risk shall be carried by the assured; the public, as well as the assurer, is interested in preventing a situation in which a fire would be profitable to the assured. Carpenter v. Insurance Co., 16 Pet. 510. The provision that the consent shall be indorsed in writing upon the policy is valid. Unless this is waived, the verbal consent is not sufficient. The substance of the clause is the consent; the indorsement will be dispensed with on proof of any facts which would make it unfair to the assured for the company to claim that the verbal consent was not sufficient. In this case, if the plaintiffs understood the condition, there was absolutely no proof of any fact justifying them in believing that any part of it would not be insisted upon. If the plaintiffs intended that Reverie should obtain the consent for them, the...