Ohio Farmers' Ins. Co. v. Vogel

• Decision Date: 23 February 1906
• Docket Number: No. 20,777.,20,777.
• Citation: 166 Ind. 239,76 N.E. 977
• Parties: OHIO FARMERS' INS. CO. v. VOGEL.
• Court: Indiana Supreme Court

166 Ind. 239

76 N.E. 977

OHIO FARMERS' INS. CO.

v.VOGEL.

No. 20,777.

Supreme Court of Indiana.

Feb. 23, 1906.

Appeal from Circuit Court, Scott County; Willard New, Judge.

Action by Henry Vogel against the Ohio Farmers' Insurance Company. From a judgment in favor of plaintiff, defendant appeals. Transferred from Appellate Court (73 N. E. 612, 75 N. E. 849), under section 1337, Burns' Ann. St. 1901. Affirmed.

Guilford A. Deitch and Seba A. Barnes, for appellant. W. T. Branaman and O. H. Montgomery, for appellee.

HADLEY, J.

Appellee sued appellant to recover damages for the loss by fire of a dwelling house, insured by the latter. The policy of insurance contained a condition in these words: “This entire policy, unless otherwise provided by agreement indorsed hereon, or added thereto, shall be void if the insured now has or shall hereafter make, or procure any other contract of insurance, *** or if the buildings insured herein, or any of them, now are, or shall hereafter become vacant or unoccupied, or occupied by tenants. ***” We assume, as stated by appellant in his brief, that the second paragraph of complaint was abandoned and the trial was had upon the first paragraph, to which a demurrer was overruled. There were nine paragraphs of answer, but the controlling issue was formed on the fifth. This answer was in effect that it was provided in said policy of insurance-a copy of which is filed, etc.- that the entire policy, unless otherwise agreed to and indorsed thereon, shall be void if the building insured now is or shall hereafter become vacant or unoccupied; that after the issuance of said policy the said insured building became vacant and unoccupied, and was vacant and unoccupied at the time it was burned. It is also alleged that the vacancy and unoccupancy was without the knowledge and consent of the defendant and without an agreement indorsed on the policy, and defendant was wholly ignorant of the fact that said building was vacant and unoccupied at the time of the fire.

To this fifth paragraph of answer appellee replied in substance as follows: He admits that there was in the policy a stipulation or condition that the policy should be void if the insured building was then or should thereafter become vacant or unoccupied, or occupied by tenants, and if the hazard be increased by any means within the insured's control, unless otherwise provided by agreement indorsed on the policy. And it is further averred that the house so insured was at the time of the execution of said insurance contract occupied by a tenant, which fact was then and there fully known by defendant, and the same was insured to be occupied by a tenant and as a tenement house: that a general custom prevailed with the defendant and other insurance companies doing business in the community to grant a permit for insured buildings to be temporarily vacant and unoccupied for a period of 30 days, during changes of tenants: that the contract was entered into with full knowledge and with reference to such custom; that the insured house continued to be occupied by said tenant until 5 o'clock p.m. of the day it was destroyed, with the full knowledge and consent of the defendant, at which time the said tenant, without any order or direction from the plaintiff, and without his knowledge or consent, removed therefrom; and four hours thereafter, and before plaintiff had learned of such removal, or had had reasonable time in which to learn of it, and while he was wholly ignorant of the fact, the same was, without plaintiff's fault or knowledge, destroyed by fire, as alleged in the complaint. It is further alleged that the risk was not increased by plaintiff at any time by any manner or means. Plaintiff's demurrer to the fifth paragraph of answer was overruled, as was also the defendant's demurrer to the plaintiff's reply. Verdict and judgment for appellee. Appellant's assignment calls in question the overruling of his demurrers and of his motion for a new trial.

1. The only objection presented to the complaint is “that there is no sufficient allegation of facts to show a waiver of proofs of loss.” Relating to this subject the complaint avers “that within 60 days after said fire plaintiff notified defendant of the same and of his said loss, and defendant's agent and adjuster came and looked at the premises and investigated said loss, and thereupon refused payment of the same, and denied all liability under said policy, and thereby waived the written notice and sworn proofs of the loss provided for in said policy in case of damage or destruction of property by fire, and that the plaintiff has performed on his part all the conditions of said policy of insurance.” The principle is old and thoroughly established that, when a party repudiates a contract and denies a liability under it, the performance of conditions precedent, such as notice, demand, tender, and the like, are waived on the ground that the law will not require a thing to be done which the party entitled has excused, or given notice that it will be unavailing. This principle applies to insurance as well as other contracts. Giving effect to this doctrine, it may be considered settled in this state that when an insurance company has been notified of a loss under a policy issued by it and it sends an adjusting agent to inquire into the loss, and such agent, while engaged in or at the conclusion of such business, refuses payment and denies all liability of the company under the policy, such action by the adjuster, if within the time stipulated in the policy for the making of formal proofs of loss, will be held as a waiver of proof of loss by the company. It was said by this court in Ætna Ins. Co. v. Shryer, 85 Ind. 362: “There is much diversity of opinion as to whether an adjuster has authority to waive a preliminary proof. It would seem that the better reason is with the cases which hold that he has; for a company that sends an agent to ascertain the nature, cause, and extent of the loss and employs him in a particular line of duty, may well be deemed to have invested him with a general authority in all such matters.” See, also, Germania Fire Ins. Co. v. Pitcher, 160 Ind. 392, 64 N. E. 921, 66 N. E. 1003;Bowlus v. Phenix Ins. Co., 133 Ind. 107, 120, 32 N. E. 319, 20 L. R. A. 400;Home Ins. Co. v. Sylvester, 25 Ind. App. 207, 57 N. E. 991;German Fire Ins. Co. v. Seibert, 24 Ind. App. 279, 56 N. E. 686;Ft. Wayne Ins. Co. v. Irwin, 23 Ind. App. 53, 54 N. E. 817;Indiana Ins. Co. v. Pringle, 21 Ind. App. 559, 52 N. E. 821;Home Ins. Co. v. Boyd, 19 Ind. App. 173, 49 N. E. 285;Western Assurance Co. v. McCarty, 18 Ind. App. 454, 48 N. E. 265. The demurrer to the complaint was properly overruled.

2. The reply to the fifth paragraph of answer presents a more interesting question. It involves the construction of the vacancy clause in the policy. The contract provides: “This entire policy, unless otherwise provided by agreement indorsed hereon, *** shall be void *** if the building insured herein now is, or shall hereafter become, vacant or unoccupied, or occupied by a tenant.” The reply avers that at the time of the insurance the house was occupied by a tenant, and that the defendant knew it, and insured the house to be occupied by a tenant and as a tenement. The demurrer admits these averments to be true. Therefore to overthrow the ruling of the court we must hold that the policy was void from the moment of its execution, and that appellant, having knowingly accepted and retained appellee's money, surrendered under an honest belief that he was getting three years' valid insurance for the sum parted with, nevertheless is entitled to his judgment for cost. This is not in accordance with equity and good conscience. It remains to be seen if it is sanctioned by the law. We have this anomaly. On the one hand we have a written instrument of insurance, containing a provision that it shall be void if the house insured shall then or thereafter be occupied by a tenant; on the other, we have one party asserting, and the other admitting, that when the instrument was executed both parties knew the house was then occupied by a tenant, and in the execution of the policy both intended that the house should during the life of the policy continue to be occupied by a tenant. It is plain, therefore, that if the policy is enforced according to its terms the court will be found making a contract for the parties very different from the one they made for themselves. This...