Nurney v. Fireman's Fund Ins. Co.

• Citation: 30 N.W. 350,63 Mich. 633
• Parties: NURNEY v. FIREMAN'S FUND INS. CO.
• Decision Date: 17 November 1886
• Court: Supreme Court of Michigan

30 N.W. 350

63 Mich. 633

NURNEY v. FIREMAN'S FUND INS. CO.

Supreme Court of Michigan

November 17, 1886

Error to Iosco.

Henry & Cornville and Atkinson & Vance, for plaintiff and appellant.

Hanchett & Stark, for defendant.

SHERWOOD J.

This action was brought to recover the amount of a loss by fire sustained by the plaintiff,, under a policy of insurance issued to him by the defendant, upon a drug-store, and the stock of drugs therein, situate in the village of Oscoda, in the county of Iosco. The policy was made on the twenty-fifth day of July, 1884, and to continue in force one year thereafter. The fire which destroyed the property occurred on the twenty-seventh day of October, 1884, and the next day an appraisal was made, which showed the loss to be about $3,000 while the insurance upon the stock and store amounted to but $1,200. The plaintiff's books, invoices and papers were lost by the fire. The defendants were properly notified of the loss, and the defendant's agent came to Oscoda several times to adjust the loss, but failed for the reason, as the company claims, that the plaintiff did not furnish their agent with the proper invoices and other papers from which he could correctly ascertain the loss. Plaintiff claimed, however, his invoices and papers being lost in the fire, he furnished the company with the best proofs of loss he could under the circumstances, and after repeated negotiations the parties failed to come to any adjustment of the case, and the plaintiff brought this suit to recover for the loss, to the amount of his policy, on the twenty-fourth day of April, 1885.

This clause appears in the body of the policy, viz.: "This policy is made and accepted in reference to the foregoing and following terms and conditions, which are hereby declared to be a part of this contract, and are to be used and resorted to in order to determine the rights and obligation of the parties thereto." The policy further provides that in case differences shall arise concerning the amount of any loss or damage by fire, after proof thereof has been received in due form by the company, the matter shall, at the written request of either party, be submitted to the judgment of two competent persons, to be mutually appointed by the assured and the company, who, in case of disagreement, shall choose a third, whose award in writing, signed by any two of them, under oath, and submitted in detail, shall be binding on the parties as to the amount of such loss and damage, but shall not decide the liability of the company. It further provides as follows: "It is furthermore hereby expressly provided and mutually agreed that no suit or action against this company, for the recovery of any claim by virtue of this policy, shall be sustainable in any court of law or chancery until after an award shall have been obtained fixing the amount of such claim in the manner above provided."

Upon the trial the plaintiff gave evidence tending to show his loss by fire of the insured property, and of the value of the property destroyed; of giving notice and proof of loss to the defendant, and of the disagreement of the parties as to the amount of the loss. It further appeared, without dispute, that no request was made by either party for an arbitration to determine the amount of the loss. In submitting the cause to the jury the court instructed them that the plaintiff could not maintain his suit until the amount of his loss had first been determined by arbitration, or he had given notice to the defendant of his desire to have the same so determined, and that the defendant had neglected or refused to comply with the request; and thereupon further instructed the jury to return their verdict for the defendant. To this instruction the plaintiff excepted, and this exception raises the only question in the case for our consideration.

I think the exception is well taken, and the court erred in giving the instruction. It was held by this court, in Callinan v. Port Huron & N.W. Ry. Co., 27 N.W. 718, that an agreement to arbitrate will not bar an action based upon the same grievance. See, also, McGunn v. Hanlin, 29 Mich. 480; Oakwood Retreat Ass'n v. Rathbone, 26 N.W. 742; Morse, Arb. 77. The agreement that "no suit shall be brought on this policy until arbitration had and award made," must be read in connection with the clause of the policy providing for the submission and arbitration, in giving it the proper construction.

It will be noticed, by a careful...