Security Ins. Co. v. Fay

• Decision Date: 18 April 1871
• Citation: 22 Mich. 467
• Court: Michigan Supreme Court
• Parties: Security Insurance Company v. Harrison S. Fay

22 Mich. 467

Security Insurance Company v. Harrison S. Fay

Supreme Court of Michigan

April 18, 1871

Heard April 13, 1871

Error to St. Joseph circuit.

The facts sufficiently appear from the opinion.

Judgment reversed and a new trial granted.

H. H Riley, for plaintiff in error.

T. C Carpenter and H. F. Severens, for defendant in error.

OPINION

Campbell, Ch. J.

Judgment was rendered against plaintiffs in error on a policy of insurance. The defense, among other things, rested on a forfeiture of the policy by failure to have certain additional insurance consented to by indorsement on the policy, and on a failure to furnish the proofs required by the terms of the policy.

In regard to the latter question, the provisions in the policy do not provide for any forfeiture on account of the failure of the insured to furnish the proofs in the formal manner required, but merely provide that the claim shall not be payable until these several steps are taken. There was evidence (though conflicting) from which the jury could have found that Betts, the agent of the company, very soon after the fire, set about examining Fay's books with him, and making an inventory, and on the arrival of the agent of another company, the books were taken off by the agents to Betts' house, and that they returned the books to Fay after examining them; and that the goods saved were removed to another place by the advice of the agents. Betts gave a different account in some important particulars, but the court, upon request of Fay's counsel, charged the jury that if Betts, immediately after the fire occurred, without waiting for a formal preliminary notice from the plaintiff, called for the books and papers of the plaintiff for the purpose of making an inventory and ascertaining the amount of goods destroyed, which request was complied with by the plaintiff, and the examination was had of such books and papers by said agent, and all that the agent required was done by the plaintiff, such fact would constitute evidence from which the jury may presume a waiver of the formal preliminary proofs, and the presence of a regular adjusting agent was not essential to make the waiver binding.

There was no reference in the policy to any separate adjusting agent, and nothing requiring the proofs to be furnished to such a person. We think the formalities, being mostly mere matters of routine beyond the ascertainment of the facts relating to the circumstances of the fire and amount of the loss, might be waived, and that the case was fairly left to the jury on that point. If they believed a part of the evidence, the course taken, inasmuch as it would, to some extent, have prevented the insured from making his formal proofs as soon as they might have been furnished otherwise, might readily have been supposed to be a waiver without proof to the contrary, and in the conflict of testimony the facts were with the jury.

Upon the main point of defense the questions involve some complexity. The insurance was for $ 3,000. The policy contained, among other clauses of forfeiture, one which declared that "if, without written consent hereon, there is any prior or subsequent insurance, this policy shall be void." This policy was dated September 17, 1866, and renewed September 17, 1867. Up to this latter date there had been no additional insurance. Both policy and renewal contained clauses declaring them invalid unless countersigned by the general agent at Chicago. The local agent's name did not appear on either of them. The policy did not declare who was to sign the consent.

On the 22d of October, 1867, Fay obtained a policy for $ 2,000 from the agent of a Detroit company. No consent was obtained in advance, and no notice given of it until December 7, 1867, when one A. G. Martin, an agent of the plaintiffs in error residing in another place, wrote upon the policy these words: "Other insurance to the amount of $ 4,000 is hereby permitted. December 7, 1867." This memorandum was not signed by any one. Martin swore he omitted the signature by mistake. There is conflicting evidence as to whether Betts was informed of this additional insurance or consent before the fire. Fay's evidence was that he informed Betts a day or two after the indorsement, and that Betts found fault with it, and said he would like to do his own indorsing, and Fay said Martin told him Betts had no right to do it. There is no further evidence on the subject of consent, but considerable on the question of agency and the power of Martin in the premises.

The questions presented on this part of the case relate largely to the effect of a supposed waiver of the requisite written consent, as well as to the presumable powers of agents to act in such matters. They can be considered together.

The first thing to be considered is the proper construction of the condition in the policy and the nature of the consent required by its terms; and then we may properly determine how, if at all, a strict compliance could be dispensed with.

The clause does not refer only to future additional insurances. It applies equally to prior insurances. Had there been any such, a consent to them was required to be written upon the policy; and in that case it would have formed a part of it. The policy was not to be valid unless countersigned by the general agent at Chicago. Upon every sound rule of construction the consent...