Non-Royalty Shoe Co. v. PhŒnix Assur. Co.

• Decision Date: 03 July 1915
• Docket Number: No. 14695.,14695.
• Citation: 178 S.W. 246
• Court: Missouri Court of Appeals
• Parties: NON-ROYALTY SHOE CO. v. PHŒNIX ASSUR. CO., LIMITED, OF LONDON, ENGLAND.

178 S.W. 246

NON-ROYALTY SHOE CO. v. PHŒNIX ASSUR. CO., LIMITED, OF LONDON, ENGLAND.

No. 14695.

St. Louis Court of Appeals. Missouri.

July 3, 1915.

Rehearing Denied July 15, 1915.

Appeal from Circuit Court, Pike County; Edgar B. Woolfolk, Judge.

"Not to be officially published."

Action by the Non-Royalty Shoe Company against the Phoenix Assurance Company, Limited, of London, England. From a judgment for plaintiff, defendant appeals. Cause certified to Supreme Court on division of opinion.

This is an action on one of eleven policies insuring the plaintiff for one year against all direct loss or damage by fire, the total amount of insurance being $28,500, the amount carried by plaintiff in the defendant company $3,000. The property insured was personal property, machinery, power appliances, etc., contained in and on the brick building occupied by plaintiff and situated in the city of St. Louis. Insurance in companies other than the defendant is permitted in the policy. Alleging the total loss of all the property insured, in the amount of at least $31,981.35, plaintiff asked judgment against defendant in the sum of $3,000 with 6 per cent. interest, and for reasonable attorney's fees, and 10 per cent. damages for vexatious refusal to pay, as provided by statute.

The answer, admitting the execution and delivery of the policy, sets up a provision in it that the 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 60 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."

It is further provided that in the event of the disagreement as to the amount of loss, it shall "as above provided," be ascertained by two competent and disinterested appraisers, each party selecting one, and the two so chosen, first selecting 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, each party paying the appraiser respectively selected by them and bearing equally the expense of the appraisal and umpire; it being further provided that "the loss shall not become payable until 60 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 where appraisal has been required," and that the insuring company shall not be liable under the policy for a greater proportion of any loss on the described property, or for loss by and expense of removal from premises endangered by fire, than the amount insured shall bear to the whole insurance. The answer, setting up these clauses in the policy, avers that after the occurrence of the fire, plaintiff and defendant entered into an agreement for submission to appraisers, the agreement dated March 24th, 1913; that under this agreement William Fay and Chester T. Drake were appointed appraisers; that they selected Fred E. Briner as umpire; that Fay and Drake qualified as appraisers and Briner as umpire and proceeded to and did estimate and appraise the loss caused by the fire, stating separately sound value and damage in conformity with the provisions of the policy, and on April 7th, 1913, made their award in writing, placing the sound value of the property at $34,732.80, and the loss and damage at $9,547.08. Claiming that this fixed the amount of the total loss, and as the total amount of insurance was $28,500, it is averred that the amount due under this policy by this defendant was $1,004.95, which sum, it is averred, defendant has always been ready and willing to pay, but that plaintiff, notwithstanding the agreement above set out, had failed and refused to receive that sum, and which sum defendant now, by its answer, again tenders.

The reply, taking issue on the amount of the loss, admits the stipulations in the policy set out, but denies that pursuant to the provisions of the policy plaintiff and defendant entered into an agreement for submission to appraisers as set forth in the answer, and alleges that under the provisions of the policy plaintiff and defendant undertook to have the loss and damage fixed as hereinafter stated and as provided in the policy. It is then averred that after the fire and loss a disagreement arose between plaintiff and defendant as to the amount of loss and that under the terms of the policy plaintiff selected Fay, a competent and disinterested person, as appraiser, to act for it, and defendant selected Drake, and these two selected Briner, as umpire, but it denies that either Drake or Briner were competent or disinterested or unbiased, alleging the contrary, specifically alleging that Briner was ignorant, inexperienced and incompetent. It further denies that either Fay or Drake or Briner, or any of them, ever correctly or fairly estimated or appraised the loss caused by the fire to the property; denies an award was made in writing on April. 7th, 1913, or at any time, and denies that by any award made, the total amount of loss caused by the fire was only 9,547.08; avers that after these appraisers and umpire had been selected and started in to investigate and appraise the loss, and after they had been at that work for some time, Fay was of the opinion, and so declared to Drake and Briner, that the sound value of the property was $35,931.65, and that the amount of loss and damage which was directly caused to the insured property by the fire was at least $28,904.72, but that defendant's appraiser Drake and the umpire Briner wrongfully, fraudulently and illegally proceeded and together pretended to come to an award in which they pretended to fix the loss at $9,547.08, which award Fay refused to sign or agree to. It is further alleged that Drake and Briner failed to take into consideration a large amount of property lost, which was of the value of $1,800 and of which the appraiser Drake and the umpire Briner were notified by Fay, but which they excluded from any award. Repeating the charges of the incompetency, unfairness and partiality of Briner and Drake and alleging, among other things, that Briner had consulted his own attorney and outside parties, and averring that in arriving at their conclusion neither Briner nor Drake ever ascertained or knew, or were able or competent to know or to find, nor did either of them ever exercise any independent judgment 07 opinion as to what loss and damage was occasioned by the fire, but that they "guessed" at the amount of loss and damage; had taken opinions thereon, secretly and privately given by parties and attorneys who were not informed in regard to the matters and who were unknown to plaintiff, and before whom plaintiff was unable to appear. Hence it is alleged that the pretended award, by reason of these facts, was wholly inadequate and insufficient to express or cover the amount of loss and damage which plaintiff suffered by reason of the fire having damaged the insured property, and that this loss was never ascertained by any competent or disinterested appraiser or umpire and was never ascertained or known by either Drake or Briner, and that by reason of these facts, and of the facts before alleged, plaintiff alleges that tile plaintiff's award is void and of no effect.

It is further averred that neither Drake nor Briner notified or permitted Fay or plaintiff to know the parties from whom they were seeking private advice and upon whose opinion they were acting in the matter, so that this plaintiff could, as it world have done, have proven by competent and disinterested parties, that the loss which was occasioned to the property was the amount stated in the petition.

The cause was tried before the court and a jury and resulted in a verdict for plaintiff, vacating the award and assessing tie damages for loss sustained on the policy in the sum of $2,829, with interest in the amount of $74.95, and attorney's fee for services in this action in the sum of $500.

Judgment following, plaintiff, interposing a motion for new trial, appealed the case to the Supreme Court, claiming that the constitutionality of the law allowing damages and attorney's fees for vexatious delay, was involved. The Supreme Court transferred the case to our court.

Reynolds & Harlan, of St. Louis, and Hostetter & Haley, of Bowling Green, for appellant. Virgil Rule, Fauntleroy, Cullen & Hay, and Barclay & Orthwein, all of St. Louis, and W. O. Gray, of Bowling Green, for respondent.

REYNOLDS, P. J. (after stating the facts as above).

I. The learned counsel for appellant repeat before us their argument against the constitutionality of section 7068, Revised Statutes 1909, as amended by the Act of March 30th, 1911 (Laws 1911, p. 282). The only change made in section 7068 by this Act of March 30th, 1911, was the inclusion of insurance companies other than fire and life. The action of the Supreme Court in declining jurisdiction is conclusive on us as to the constitutionality of the section as amended. The same may be said as to the contention that that section is contrary to the provisions of the Constitution of the United States. The determination of that question, involving the...