Posey County Fire Ass'n v. Hogan

• Decision Date: 17 April 1906
• Docket Number: No. 5,631.,5,631.
• Citation: 77 N.E. 670,37 Ind.App. 573
• Parties: POSEY COUNTY FIRE ASS'N v. HOGAN.
• Court: Indiana Appellate Court

37 Ind.App. 573

77 N.E. 670

POSEY COUNTY FIRE ASS'N

v.HOGAN.

No. 5,631.

Appellate Court of Indiana, Division No. 2.

April 17, 1906.

Appeal from Circuit Court, Posey County; Alex Gilchrist, Special Judge.

Action by Zillah Hogan against the Posey County Fire Association. From a judgment for plaintiff, defendant appeals. Affirmed.

D. O. Barker, Geo. F. Zimmerman, and Fred P. Leonard, for appellant. G. V. Menzies and H. F. Clements, for appellee.

WILEY, J.

Action by appellee against appellant upon a breach of an alleged oral contract for insurance. Complaint in two paragraphs, to each of which a demurrer was overruled. Answer in denial. Trial by jury. Verdict and judgment for appellee. Motion for new trial overruled. Overruling the demurrer to each paragraph of complaint, and the motion for a new trial, are assigned as errors.

The first paragraph of complaint avers that appellant is a corporation organized and doing business as an insurance company under and by virtue of the laws of this state; that on the 29th day of November, 1901, appellee applied to appellant for insurance against loss by fire or lightning on a two-story frame dwelling house, etc., describing its location; that it was the property of appellee, and that she applied for insurance thereon in the sum of $800; that appellant, in consideration of appellee paying any amount assessed against her, in proportion to the amount of insurance on said property, for the benefit of any member of the association who should sustain a loss by fire or lightning, agreed to insure appellee from 12 o'clock noon on the 9th of November, 1901, to 12 o'clock noon on the 9th day of November, 1906, and to execute and deliver to appellee, within a reasonable time, its written policy of insurance therefor “in the usual form of policy issued by it”; that on the 17th of January, 1902, said property, which belonged to appellee, and was of the value of $800, was totally destroyed by fire, to her loss, etc. It is also averred that, though demanded so to do, appellant neglected and refused, and still neglects and refuses, to execute said policy in writing, pursuant to said agreement. It is also averred that appellee performed all the conditions of said contract to be performed by her, and before the commencementof this action notified appellant of the loss. A copy of the form of insurance in use by appellant is filed as an exhibit with this paragraph. There is no substantial difference between the two paragraphs, and it therefore is unnecessary to refer to the remaining one. The objections urged to the complaint are that neither paragraph alleges a payment of the premium, or an agreement to pay, or any definite understanding in regard to credit, or a waiver of the premium.

It has been long settled that an oral contract for insurance is valid. Commercial Mutual Marine Ins. Co. v. Union Mutual Ins. Co., 19 How. (U. S.) 318, 15 L. Ed. 636;Franklin Ins. Co. v. Colt, 20 Wall. (U. S.) 560, 22 L. Ed. 423;Potter v. Phœnix Ins. Co. (C. C.) 63 Fed. 382;Eames v. Home Ins. Co., 94 U. S. 621, 24 L. Ed. 298;Relief Fire Ins. Co. v. Shaw, 94 U. S. 574, 24 L. Ed. 291;New England, etc., Ins. Co. v. Robinson, 25 Ind. 536; 16 Am. & Eng. Ency. of Law, 852, and authorities there cited. In the volume last cited, at page 849, it is said: “The agreement of the parties must include all the elements and terms essential to the existence of the contract. If the parties have not agreed on the subject of insurance, the limit and duration of the risk, the perils insured against, the amount to be paid in the event of a loss, the rate of a premium, or upon any other element or term which may be peculiar to the particular contract, whatever may have been the negotiations or propositions passing between them, these have not reached the form and obligation of a subsisting contract. In other words, the negotiations must leave nothing open for future determination, but must attain the condition of a definite and complete agreement, binding the insured to pay the premium though the loss does not happen, as well as binding the insurer to pay the amount if the loss does happen.” In support of the text just quoted numerous authorities are cited, to which we refer, without exhibiting them here. In May on Insurance the rule is declared to be that a parol contract of insurance must have all the requisites of a written contract, to wit, subject-matter, the risks insured against, the amount insured, the duration of the risk, and the premium of insurance, and that a want of any of these facts is fatal. May on Insurance, § 27. Another author states the rule to be that no averment should be omitted from the complaint upon which plaintiff bases his claim, or by means of the proof of which it is necessary for him to recover. Joyce on Ins. § 3503. See, also, Trask v. German Ins. Co., 58 Mo. App. 431;Perry v. Phœnix Assur. Co. (C. C.) 8 Fed. 643. Ostrander on Fire Insurance, § 415, states the rule to be that a complaint upon a contract of insurance should set forth the insurance, payment of premium, interest in the property insured, loss, and in what manner it occurred, performance of the conditions, or facts which would excuse performance, etc. It is also declared to be the rule that the premium must either be actually paid, or exist as a valid debt against the insured, in order to make the contract complete and enforceable. Ostrander on Fire Ins. p. 27, § 8; Sanford v. Trust Fire Ins. Co., 11 Paige (N. Y.) 547.

Recurring to the complaint, we find that the contract sued upon rests upon the following elements: (1) Appellee's application for insurance; (2) description of the property to be insured; (3) title of the property in appellee; (4) the amount of insurance applied for; (5) the agreement of appellant to insure appellee's property for a fixed and definite period, in consideration of her paying any amount assessed against her, in proportion to the amount of her insurance on said property, for the benefit of any member of said association who should sustain a loss by fire; (6) appellant's agreement to deliver to appellee, within a reasonable time, its written policy of insurance in the usual form of policy issued by it; (7) the loss of the property by fire during the term of the insurance period; (8) appellee's demand and appellant's refusal to issue its policy in writing, pursuant to said agreement; and (9) performance on the part of appellee of all the conditions of said contract to be performed by her, and notice to appellant of the loss. The copy of the form of insurance in use by appellant, which is filed as an exhibit to the first paragraph, lends no aid to it, because it is not the foundation of the action. The facts which we have above enumerated, as they appear in each paragraph of the complaint, constitute a valid contract of insurance, unless it be the absence of a definite allegation as to the premium which appellee was to pay. We think it clear from the complaint that appellant is a mutual company, and while it is not specifically averred that members holding policies therein are assessed in case of loss, yet we may assume that this is true, in view of the allegation that appellant agreed to insure appellee's property in consideration of her paying “any amount assessed against her in proportion to the amount of her insurance on said property, for the benefit of any member of said association who should sustain a loss by fire,” etc. In view of the above stipulation, and the averment that appellee performed all the conditions...