Skinner v. Norman

• Decision Date: 05 February 1901
• Citation: 59 N.E. 309,165 N.Y. 565
• Parties: SKINNER v. NORMAN.
• Court: New York Court of Appeals Court of Appeals

165 N.Y. 565

59 N.E. 309

SKINNER

v.NORMAN.

Court of Appeals of New York.

Feb. 5, 1901.

Appeal from supreme court, appellate division, Fourth department.

Action by Alice E. Skinner, as administratrix, etc., against Frederick Henry Norman, as treasurer of the Sun Fire Office. From a judgment of the appellate division (46 N. Y. Supp. 65) reversing a judgment for plaintiff, plaintiff appeals. Reversed.

Parker, C. J., and Gray and O'Brien, JJ., dissenting.

P. W. Cullinan, for appellant.

A. H. Sawyer, for respondent.

CULLEN, J.

This action was brought to recover on a fire insurance policy on a steamboat. The substantial defense pleaded was that at the time of the issue of the policy the property was incumbered by a chattel mortgage, no reference to which was indorsed upon or added to the policy. That the boat was so incumbered, and that notice of the incumbrance was not indorsed upon the policy, are conceded, and it is also conceded that these facts prima facie rendered the policy void. The plaintiff sought to relieve himself from a forfeiture of the policy by proof of the negotiations which took place between his agent and the defendant prior to the issue and delivery of the policy. The plaintiff sent the master of the boat, one Andrews, to effect the insurance. Andrews was not aware of the existence of the mortgage. He testified that on applying to the defendant's agent for insurance he was asked whether there were any claims against the boat. He replied that he knew of none, but, if there were any, he (the insurance agent) could find out at the custom house, or of Mr. Skinner (the plaintiff). ‘I said to him: ‘You pass his house two or three times a day. You can stop in, and see him, if you don't happen to see him on the street;’ and he said, ‘All right.’ * * * I asked him if everything was all right, and he said, ‘Yes,’ he would attend to it. So I went back. * * * The policy was not delivered to me. It was sent to Mr. Skinner's house within two or three days after.' The evidence of Wheeler, the defendant's agent, was in substantial accord with that of Andrews. He testified that he asked Andrews if there were any claims on the boat, to which the latter replied that he did not know, and that he (Wheeler) could go to Skinner (plaintiff), and find out. Wheeler further testified that afterwards he did go to the plaintiff, and that the plaintiff in substance told him there were no claims on the boat. This last statement the plaintiff denied, testifying that he did not see Wheeler until after the fire which destroyed the steamer. The policy was sent by the defendant to the plaintiff, and the premium paid. A motion to dismiss the complaint, made at the close of the evidence, was denied, and the court submitted the case to the jury under instructions that, if the defendant's agent, after his conversation with Andrews, issued the policy without making inquiry as to the existence of claims or liens on the boat, the plaintiff was entitled to recover; but, if he asked the plaintiff concerning such liens or claims, and was told of none, the defendant was entitled to a verdict. The jury having found for the plaintiff, judgment was entered in his favor. From that judgment and an order denying defendant's motion for a new trial an appeal was taken to the appellate division, which reversed the judgment and order, and granted a new trial. On an application made by the plaintiff, the order was amended so as to state that upon an examination of the facts the court decided that they sustained the verdict of the jury, but held that upon the facts as thus established as matter of law the plaintiff was not entitled to recover.

The main question presented on this appeal is very narrow. It is the settled law of this state that the agent of a fire insurance company may, by issuing a policy with knowledge of the facts, waive a condition that the policy shall be void if the property insured be incumbered, and a note of the incumbrance be not indorsed upon the policy, notwithstanding a provision in the policy that no agent of the company shall have power to waive any such condition, except by written indorsement (Wood v. Insurance Co., 149 N. Y. 382, 44 N. E. 80;Robbins v. Insurance Co., 149 N. Y. 477, 44 N. E. 159); though a different rule prevails where a change in the title or occupation of the property occurs subsequent to the issue of the policy (Quinlan v. Insurance Co., 133 N. Y. 356, 31 N. E. 31). It is, therefore, entirely clear that, had Andrews, the master of the boat, told the defendant's agent of the existence of the mortgage, the policy would have been valid despite its failure to note the existence of the incumbrance. This doctrine the learned appellate division did not gainsay; but it held that the present case did not fall within the rule, because the defendant's agent did not know that there was any mortgage on the property. The question presented, then, is whether it is not possible to waive an unknown breach of the conditions of a contract equally with one that is known, when the failure of knowledge is due to the fault of the party on whom it is sought to impose the waiver. In Kirchner v. Machine Co., 135 N. Y. 182, 31 N. E. 1104, the question arose as to the effect of a general release, and the trial court charged that the release did not cut off the plaintiff's right to recover for any injury...