Scottish Union & National Ins. Co. v. Skaggs

• Decision Date: 28 May 1917
• Docket Number: 19273
• Citation: 114 Miss. 618,75 So. 437
• Parties: SCOTTISH UNION & NATIONAL INS. CO. v. SKAGGS
• Court: Mississippi Supreme Court

75 So. 437

114 Miss. 618

SCOTTISH UNION & NATIONAL INS. CO. v. SKAGGS

No. 19273

Supreme Court of Mississippi

May 28, 1917

Division B

APPEAL from the circuit court of Jones county, HON. PAUL B. JOHNSON Judge.

Suit by W. Fred Skaggs against the Scottish Union & National Insurance Company. From a judgment for plaintiff, defendant appeals.

The facts are fully stated in the opinion of the court.

Case reversed and remanded.

McLaurin & Arminstead and Street & Street, for appellant.

The subject of the controversy in this law suit was submitted to competent appraisers, who made a valid award, and both parties are bound by it. No question of fraud in the agreement to submit to appraisers, or in the appraisement or in the finding of the appraisers enters into the controversy. It is just a plain case of one of the parties being dissatisfied with the amount of the award, and refuses to abide by it, and brings a suit, thus attempting to entirely ignore it.

On page 38 of the record will be found a letter written by Skaggs to the Insurance adjusters in which he says that he is willing to submit it to appraisers. On page 39 he writes that it is satisfactory to have appraisers adjust the claim and he names W. E. Bridges, of Laurel, "who is both competent and disinterested" to act as his appraiser. On page 40, is another letter from Skaggs to the adjusters, enclosing "signed agreement" and asking them to sign one and return to him by return mail; and he hoped that the appraisers would be "up here next Friday, March 26, so we can settle this claim." The signed agreement to arbitrate and the appointment of the appraisers and the award of the appraisers have already been referred to and appear in the record more times than necessary. We desire here to call the court's attention to the wording of the agreement for submission to appraisers to the effect that the appraisers "shall appraise and ascertain the sound value of and the loss upon the property damaged and destroyed by fire." The actual award of the appraisers "determined the sound value and the loss and damage to be as follows: Sound value three hundred forty-four dollars and twenty-five cents; loss one hundred sixty dollars and seventy-five cents. It is plain that the articles of submission and the award covered both the loss and damage.

The policy sued provides for the appointment of appraisers and the submission to them of the matters in dispute, "and the award in writing of any two shall determine the amount of such loss." But, aside from the terms of the policy, we submit that the parties had a perfect right to submit their differences to appraisers and they would each be bound by the award, in the absence of fraud, and no suit can be maintained by the insured in this case on the policy. The only suit he could maintain would be for the amount of the award. In this connection, see Jones v. Harris, 58 Miss. 293, where the court speaking through CAMPBELL, J., held that an award pleaded constituted a bar to the further prosecution of the action.

Another award was upheld by this court in Oil Co. v. Buster, 84 Miss. 91, in the face of numerous objections to it. In the recent case of Insurance Co. v. Kennington, 71 So 378, this court holds that an insured is not bound to submit to a second appraisement, where the first attempt fails, but the court strongly implies that the provision for an award contained in the policy is valid, and that the insured would be bound by the award if an agreement had been reached by the appraisers. And in the still later case of Insurance Co. v. Cowan, 71 So. 746, this court not only held that the arbitration clause in an insurance policy is valid and binding on the insured, but is valid and binding on a mortgagee, if he had notice of it.

We are unable to perceive any reason why Skaggs is not bound by the appraisement and award in this case. It may be said by appellee that the appraisers made no award of the value of the totally destroyed goods; but both the agreement of submission and the award show that they were to consider and did consider both "loss and damage."

The Alabama supreme court, in Georgia Home Insurance Co. v. Kline, 21 So. 958, considered this very point and held (quoting from the syllabus.): "An award fixing the amount of loss under a fire insurance policy, by appraisers provided for in the policy, and also acting under a written submission executed by the parties after the fire, which constituted them arbitrators, cannot be impeached in an action at law on the ground that the appraisers refused to consider, or to include in the award, the loss on so much of the property as was totally destroyed, when such loss was clearly within the submission and was covered by the terms of the award."

The Alabama court again, in Rutter & Hendrix v. Hanover Fire Insurance Co., 35 So. 37, in construing an agreement of submission similar to the one at bar, uses this language: "We think it quite clear that the terms of the agreement called for an appraisal of the property totally destroyed as well as for that partially injured. It was the duty of the arbitrators under this agreement to appraise the property totally destroyed, as well as that which was partially destroyed, unless there had been a modification of the agreement of appraisal by the parties that dispensed with such duty on the part of the arbitrators." See also Early v. Ins. Co., 140 Am. St. Rep. 750, Century Digest, paragraphs 1430-2-4-; Decennial Digest, paragraph 574; Hanover Insurance Co. v. Lewis, (Fla.), 10 So. 297, Yarbo v. Purser, 74 So. 425.

So, on the main proposition that the submission to and the award of the arbitrators is binding on all the parties to this litigation, there would seem to be no doubt, and the lower court was clearly in error in sustaining the demurrer to the special plea. It follows that appellee has no right to maintain this suit, since it is not a suit to enforce the award, and it ought to be reversed and dismissed.

W. J. Pack and Jeff Collins, for appellee.

It is the contention of appellee that any pretended agreement entered into by appellee and appellant as to the property totally destroyed by fire is an absolute nullity and cannot be enforced against appellee, since, the statute Laws of 1912, chapter 224, amending section 2592 of the Mississippi Code of 1906, referring to the kind of property insured by appellant in this case, absolutely fixes the amount of recovery of property totally destroyed by fire and shuts out any agreement tending to fix any other value than that fixed by the policy of insurance.

Appellants in their brief, state that there was an agreement to submit the entire loss both of the property partly destroyed and the property totally destroyed to arbitration and that the award complies with this submission. We cannot understand how there could be an appraisement of the value of the property which was totally destroyed. There would be nothing from which or to which the appraisers could work. The Missouri supreme court in the case of O'Keefe v. Liverpool & London Insurance Co., 140 Mo. 558, 39 L. R. A. 819, makes this apt observation about an appraisement of the value of the property totally destroyed by fire, saying, "Such an appraisement would be an anomaly." The court further says the "whole case depends upon the claim of plaintiff that the less was total. If he was right there was nothing to appraise, nothing to arbitrate." So we take the position that it never...