Osborne v. Phenix Ins. Co.

• Decision Date: 23 April 1901
• Court: Utah Supreme Court
• Parties: CELIA OSBORNE, Respondent, v. PHENIX INSURANCE COMPANY, Appellant

64 P. 1103

23 Utah 428

CELIA OSBORNE, Respondent, v. PHENIX INSURANCE COMPANY, Appellant

Supreme Court of Utah

April 23, 1901

Appeal from the Third District Court, Salt Lake County.--Hon. A. N Cherry, Judge.

Action to recover on a fire insurance policy for loss sustained from the destruction by fire of the property insured. From a judgment for plaintiff defendant appealed.

AFFIRMED.

C. O Whittemore, Esq., Pennel Cherrington, Esq., and C. S. Price Esq., for appellant.

As to the legal effect of the "other insurance" clause in the policy, the courts have been frequently called upon to construe similar provisions in fire insurance policies, and their decisions have been conflicting, but the weight of authority and the most logical opinions uphold the validity and binding effect of such provisions. Gilbert v. Phenix Ins. Co., 36 Barb. 372; Bigler v. N.Y. Central Ins. Co., 22 N.Y. 402; Barrett v. Insurance Co., 7 Cush. 175; President, Directors, etc., Worcester Bank v. Hartford Ins. Co., 11 Cush. 265; Edward Hale v. Mechanics' Mutual Fire Ins. Co., 6 Gray 169; Bennett v. Ins. Co., 27 Atlantic 641; Insurance Co. v. Heiduck, 46 N.W. 481; Hess v. Ins. Co., 11 N.Y.S. 299; Hutchinson v. Ins. Co., 21 Mo. 97; Carpenter v. Providence Washington Ins. Co., 16 Peters 495; O'Leary Bros., etc., v. Mechanics' & Bankers' Mutual Ins. Co., 62 Am. St. Rep. 555.

One of the material averments in a complaint upon a policy of this kind, which must be alleged and proven, is the value of the property at the time of the loss. Phenix Ins. Co. v. Benton, 87 Ind. 132.

Edward McGurrin, Esq., for respondent.

The appellant asks for a reversal of the judgment recovered herein upon three grounds:

The first--because its consent in writing to the additional insurance was not obtained by the insured.

The respondent testified that before the issuance to her of this policy she told the agent of the appellant that she was about to procure the additional insurance and that he offered no objection; that afterwards she told him that she had procured the additional insurance and that he then made no objection but accepted from her the premium and countersigned and delivered the policy to her.

This agent was authorized, in behalf of the appellant, to solicit contracts of insurance, fix rates, collect premiums and countersign and issue policies therefor. He was the general agent of the appellant, and notice to him was notice to his principal. Notice of the additional insurance which had been procured by the respondent having been given to appellant before the issuance of this policy, and thereafter having accepted the premium from the respondent, and issuing the policy to her, the appellant will not be heard to say that its agent had not authority to waive the condition in the policy requiring its consent to additional insurance to be first obtained in writing and it is estopped from asserting such a defense. West v. Insurance Society, 10 Utah 442.

The doctrine announced in West v. Insurance Society, supra, is in accord with every recent case upon the subject. Farmers' Ins. Co. v. Taylor, 73 Pa. St. 342; Pelkington v. Ins. Co., 55 Mo. 172; Hartford Ins. Co. v. McLemore, 26 S.W. 928; Russell v. Ins. Co., 55 Mo. 585; Hamilton v. Ins. Co., 94 Mo. 368; Planters' Ins. Co. v. Lyons, 38 Tex. 253; Insurance Co. v. McDowell, 50 Ill. 120; Sexton v. Ins. Co., 9 Barb. 191; House v. Ins. Co., 11 L. R. A. 340; 2 Wood on Insurance, secs. 382-383-430; 2 May on Insurance, sec. 370; Ostrander on Fire Insurance (2 Ed.), sec. 243.

The second ground urged by appellant is--because the complaint did not allege the actual cash value of the property at the time of its destruction.

By the terms of this policy, the respondent was insured against "loss or damage by fire," and the allegations of this complaint as to the value of the property destroyed were sufficient. Phoenix Ins. Co. v. Perkey, supra; Keeler v. Insurance Co., 16 Wis. 553-564; Jones v. Insurance Co., 55 Mo. 342; Tabor v. Goss, 11 Colo. 419; Ins. Co. v. Friedenthal, 1 Colo. App. 5; Blasingame v. Insurance Co., 75 Cal. 633; Ostrander on Fire Insurance (2 Ed.), sec. 415.

BASKIN, J. Bartch, J., and Hart, D. J., concur.

OPINION

BASKIN, J.

This is an action to recover, on a fire insurance policy, for loss sustained from the destruction by fire of the property insured.

The defendant demurred to the complaint on the ground that it does not state facts sufficient to constitute a cause of action. The defendant also objected, on the same ground, to the introduction by plaintiff of any testimony, and also raised the same question on instructions requested by it. These objections to the complaint were overruled by the trial court.

The jury returned a verdict in favor of the plaintiff for $ 500, and a judgment for that sum, and for costs, was rendered against the defendant.

The insurance policy, as an exhibit, was attached to and made a part of the complaint, and contains the following provisions, to-wit: "This company shall not be liable beyond the actual cash value of the property at the time any loss or damage occurs," and that "this entire policy, unless otherwise provided by agreement indorsed hereon or added hereto, shall be void if the insured now has or shall hereafter make or procure any other contract of insurance, whether valid or not, on property covered in whole or in part by this policy."

The complaint fails to allege in specific terms what the cash value of the property was at the time it was destroyed, but states that it consisted of household furniture, beds, bedding, carpets, family pictures and paintings, silver-plated ware, a piano, family stores and supplies, etc., and alleges that by their destruction the plaintiff sustained a loss of an amount exceeding $ 1,400.

The complaint also alleges "that at the time of the issuance of the said policy of insurance as herein recited, the plaintiff procured and had other and additional insurance covering the said property and of which fact the defendant then had actual and due notice. That, on, to-wit: May, 1899, the defendant denied all liability to the plaintiff in virtue of the terms and provisions of the said policy of insurance, stating as a reason for such denial the fact that the plaintiff had other and additional insurance upon the said property, and refused, and still refuses, to pay the plaintiff the said sum of $ 700, or any portion thereof."

This contention of the appellant is based upon two grounds to-wit: (1) The failure of the complaint to allege the cash value of the insured property at the time it was destroyed, and (2) that it appears from the complaint that at the time said policy was obtained there was another policy covering the same property, which the complaint fails to allege was, in accordance with the terms of the policy involved in this case, agreed to and the agreement indorsed thereon.

In respect to the first ground: The purpose of the clause in the policy that the "company shall not be liable beyond the actual cash value of the property at the time the loss or damage occurs," is to prevent a recovery of damages beyond the prescribed limitation. Its only legal effect is to exclude the evidence and prevent the recovery of any damages which might occur by fire, beyond that measured by the cash value of the property destroyed or injured. It does not limit the right of the plaintiff to prove and recover damages in an amount less than the actual cash value of the goods destroyed or injured; therefore, while the actual cash value at the time of the loss is the limit of the recovery, it is not one of the constituent elements of plaintiff's cause of action, and need not be alleged in the complaint. Hegard v. California Ins. Co., 11 P. 594, 597.

In that case, the complaint failed to allege any value or cash value of the property in direct terms. The...