Rhode Island Underwriters' Ass'n v. Monarch

• Citation: 98 Ky. 305,32 S.W. 959
• Parties: RHODE ISLAND UNDERWRITERS' ASS'N v. MONARCH.
• Decision Date: 20 November 1895
• Court: Court of Appeals of Kentucky

32 S.W. 959

98 Ky. 305

RHODE ISLAND UNDERWRITERS' ASS'N v. MONARCH.

Court of Appeals of Kentucky.

November 20, 1895

Appeal from circuit court, Daviess county.

"To be officially reported."

Action by M. V. Monarch, for the use of the Owensboro, Falls of Rough & Green River Railroad Company, against the Rhode Island Underwriters' Association. There was a judgment for plaintiff, and defendant appeals. Affirmed.

Clay &amp Clay and Eli H. Brown, for appellant.

Sweeney Ellis & Sweeney, for appellee.

PAYNTER J.

The appellant, Rhode Island Underwriters' Association, on the 21st of November, 1892, by its general agents in Owensboro Ky. issued and delivered to M. V. Monarch a policy of fire insurance on a certain house in that city. Before the expiration of the policy, to wit, on the 17th of November 1893, the property was destroyed by fire. On the 8th of August, 1893, Monarch conveyed the property to the Owensboro, Falls of Rough & Green River Railroad Company. The policy purported to insure M. V. Monarch against loss in the sum of $900. The appellant refused to pay the amount, and this action followed. M. V. Monarch sues for the use and benefit of the Owensboro, Falls of Rough & Green River Railroad Company, alleging that he was not the owner of the property at the time of the issual and delivery of the policy, nor at the time it was destroyed by fire; that he had purchased it for the railroad company, and held it in trust for it; that the company was in possession of the property when the policy of insurance was issued and at the time it was destroyed by fire; that the agents of the appellant knew the character and extent of his interest in the property when the policy was issued, and, being in full possession of such facts, the agent of the appellant advised him to have the policy issued to him in the form in which it was prepared and delivered. The appellant denied the facts as alleged by appellee, and claimed it was exonerated from liability because of certain conditions or prohibitions in the policy. The evidence in the case establishes the fact to be that Monarch bought the property for the railroad company; that he was holding it for them; that appellant's agents knew the condition of the title to the property when they accepted the risk for their employer, and issued the policy; that they advised Monarch to so accept the policy; that it was accepted on the strength of that advice; that the railroad company paid the premium-nine dollars-for the policy; that the notice as to the character of Monarch's interest in the property was made known to appellant's agents while the negotiations for the policy were going on, Monarch at the time being the president of the railroad company; that the railroad company had possession of the property when the policy was issued, which continued until it was destroyed by fire. Among other provisions of the policy, the following appears, viz.: "This entire policy, unless provided by agreement indorsed hereon or added hereto, shall be void *** if the interest of the insured be other than unconditional and sole ownership, or if the subject of insurance has building on ground not owned by the insured in fee simple, *** or if any change other than by the death of an insured take place in the interest, title, or possession of the subject of insurance, *** by voluntary act of the insured or otherwise." Again: "This policy is made and accepted subject to the foregoing stipulations and conditions, together with such other provisions, agreements, and conditions as may be indorsed hereon or added thereto; and no officer, agent, or other representative of these companies shall have power to waive any provision or condition of the policy, except such as by the terms of this policy may be the subject of agreement indorsed hereon or added thereto, and as to such provisions and conditions no officer or agent or representative shall have such power, or be deemed or held to have waived such provisions or conditions, unless such waiver, if any, shall be written upon or attached thereto; nor shall any privilege or permission affecting the insurance under this policy exist or be claimed by the insured unless so written or attached." These are the provisions of the policy upon which appellant relies for exoneration from liability.

There is no question as to the fact that Fred W. Clark & Co., who issued the policy, were the general agents in Owensboro for the appellant, and that Fred W. Clark was the active one in securing the business for the appellant. No proof was taken by the appellant to show there were any limitations upon their agency or right to fully represent them in the transaction, except such as may appear by the terms of the policy. It is, however, contended that they had no power to waive any of the conditions in the policy. This contention results from the language in the policy which is quoted above. The question is not as to their power to make such waiver, but it is as to whether their principal is charged with notice as to the character of Monarch's interest in the property. Was notice to them notice to their principal? If it was, then the principal made a waiver of the conditions of the policy which are relied upon to defeat a recovery. The information as to the character of Monarch's holding was not acquired before the agency began or after it had ceased but during the transaction. The law presumes that the agent communicates the facts...