Robinson v. Aetna Ins. Co.

• Citation: 30 So. 665,128 Ala. 477
• Parties: ROBINSON v. ÆTNA INS. CO.
• Decision Date: 24 May 1901
• Court: Supreme Court of Alabama

30 So. 665

128 Ala. 477

ROBINSON v. ÆTNA INS. CO.

Supreme Court of Alabama

May 24, 1901

Appeal from city court of Montgomery; A. D. Sayre, Judge.

Action by Thomas Robinson against the Ætna Insurance Company. Verdict for plaintiff. From an order granting a new trial, he appeals. Affirmed.

This was an action upon a policy of fire insurance which covered a stock of goods and store fixtures. The policy contained a clause requiring the insured to take a complete inventory of the stock on hand at least once in each calendar year otherwise rendering the policy void. It also provided that a set of books should be kept, and that such books and inventory should be kept in a fireproof safe, or in some place not exposed to a fire that would destroy the building in which the insured property was located. Before proceeding with an investigation of the loss, the adjuster of the company procured from the insured an agreement to the effect that any action taken by such adjuster in investigating the cause of the loss, and ascertaining its amount, should not waive or invalidate any of the conditions of the policy. The facts relied on by the plaintiff for a waiver occurred before the execution of said nonwaiver agreement. There were verdict and judgment for plaintiff. Subsequently upon motion of the defendant the court set aside said judgment and granted a new trial.

Gunter & Gunter, for appellant.

Thos G. Jones and Gordon McDonald, for appellee.

HARALSON J.

Counsel for plaintiff who is appellant here, state in their written brief on file, that "the only question on this appeal is, whether the court committed error in holding, that notice to the agents, Warren & Stewart, of the loss of the inventories, was notice of loss to the defendant. If it is error, of course the court was correct in awarding the new trial. On the other hand, if it is incorrect, the court should not have granted the new trial."

If Warren & Stewart were the general agents of the company, with power to transact any and all business, it is not denied that the condition of the policy in respect to the keeping of the inventories might have been waived by them. But, if they were merely local agents, with no power to adjust losses, or to do more than solicit business, make surveys of property to be insured, make rates, collect premiums and remit to the company,-in the exercise of which powers their agency was general,-they would have no right to adjust a loss, or waive any of the warranty conditions of the policy, or to receive notice upon which a waiver by the defendant might be based. In other words, insurance companies have the right to have agents with as limited authority as they choose to confer on them. This question has been repeatedly settled by the adjudications of this court, sustained by authorities elsewhere. Alabama State Mut. Assur. Co. v. Long Clothing & Shoe Co. (Ala.) 26 So. 655; Waldman v. Insurance Co., 91 Ala. 170, 174, 8 So. 666, 24 Am. St. Rep. 883; Insurance Co. v. Copeland, 90 Ala. 386, 391, 8 So. 48; Insurance Co. v. Young, 86 Ala. 424, 431, 5 So. 116, 11 Am. St. Rep. 51.

It may be said in this connection, that a general agent is one who is empowered to transact all of the business of his principal, of a particular kind in a particular way; and a special agent is one authorized to act only in a specific transaction. Mechem, Ag. § 6; Wood v. McCain, 7 Ala. 800, 42 Am. Dec. 612.

It is contended, and properly, that the authority of an agent as to those dealing with him, must be determined by the nature of his business, and is prima facie coextensive with its requirements; and that persons dealing with insurance agents acting within the apparent scope of their authority, are not bound by secret instructions from their principals, which are not brought to the knowledge of such persons. 1 May, Ins. § 126; Insurance Co. v. Morris, 105 Ala. 499, 18 So. 34; Insurance Co. v. Allen (Ala.) 30 So. 537.

Again the well-settled principle is invoked, "that conditions and duties of the assured prescribed in a policy of insurance, should be liberally construed in favor of the assured, but strictly against the insurer." Insurance Co. v. Young, 58 Ala. 476, 29 Am. Rep. 770; Insurance Co. v. Catchings, 104 Ala. 188, 16 So. 46; Tubb v. Insurance Co., 106 Ala. 651, 659, 17 So. 615; Insurance Co. v. Allen, 119, Ala. 448, 24 So. 399.

Upon such grounds, the plaintiff insists, that Warren & Stewart were the general agents of the defendant company in the particular business of soliciting insurance, making surveys of property to be insured, collecting...