St. Paul Fire & Marine Ins. Co. v. Mountain Park Stock Farm Co.
| Decision Date | 13 January 1909 |
| Citation | 99 P. 647,23 Okla. 79,1909 OK 12 |
| Parties | ST. PAUL FIRE & MARINE INS. CO. v. MOUNTAIN PARK STOCK FARM CO. |
| Court | Oklahoma Supreme Court |
Syllabus by the Court.
In an action on an insurance policy, the petition alleged that the insured "had fully complied with all the terms and conditions of said policy on its part." The insurance company answered that the insured had not complied with that condition requiring proof of loss within 60 days. For reply the insured admitted the allegation and by way of avoidance set forth facts sufficient to constitute a waiver. Held, that the allegations of the reply constituted a departure, that the same could not be taken advantage of by objecting to the introduction of any evidence under the pleadings, and that defendant waived the defect by failing to move to strike the reply and going to trial on the issues thus raised.
[Ed Note.-For other cases, see Pleading, Cent. Dig. §§ 371, 1388 1433; Dec. Dig. §§ 180, 412, 428. [*]]
A clause in an insurance policy, in effect providing that the insured shall within 60 days after loss make proof of same to the insurance company, and that a failure so to do within that time shall cause a forfeiture of any claim under such policy, is waived, where, after written notice of loss, the amount thereof is agreed upon after inspection of the same by an adjuster of the insurer and an agent of the insured acting pursuant to a telegram from the general agent of the former to the latter, stating: "If you and Mr. Bates can settle, go ahead, loss referred to him, I have no data."
[Ed Note.-For other cases, see Insurance, Cent. Dig. § 1406; Dec Dig. § 561. [*]]
A clause in an insurance policy, providing that "no denial of liability or other act on the part of the company shall be deemed to waive or dispense with the furnishing of such proof," being a stipulation reserved for the benefit of the insurer, can be by it, and is, waived, where such insurer, acting through the adjuster as its alter ego, after written notice of the loss, inspected the same, agreed with the insured as to the amount thereof, and promised to pay a sum certain in full settlement thereof, before the expiration of the 60 days in which to make such proof.
[Ed. Note.-For other cases, see Insurance, Cent. Dig. § 1406; Dec. Dig. § 561. [*]]
Error from District Court, Garfield County; M. C. Garber, Judge.
Action by the Mountain Park Stock Farm Company against the St. Paul Fire & Marine Insurance Company. Judgment for plaintiff, and defendant brings error. Affirmed.
On October 27, 1905, the Mountain Park Stock Farm Company, a corporation, defendant in error, plaintiff below, sued the St. Paul Fire & Marine Insurance Company, a corporation, plaintiff in error, defendant below, in the district court of Garfield county, to recover for a partial loss sustained to a growing crop of wheat on account of damage by hail, covered by an insurance policy issued by the plaintiff in error to the defendant in error. After answer filed to which there was a reply, defendant moved for judgment on the pleadings, which was overruled, and after trial to a jury which resulted in judgment for plaintiff for $110, and after motion for a new trial was filed and overruled, to which defendant excepted, the insurance company brought the case by petition in error and case-made to the Supreme Court of Oklahoma Territory, and the same is now before us for review as successor to that court.
Houston & Brooks, for plaintiff in error.
J. M. Dodson, for defendant in error.
This is a suit on an insurance policy. On May 8, 1905, the insurance company, plaintiff in error, issued to the insured company, defendant in error, a policy for $400 insuring against loss or damage by hail a certain 100-acre field of growing wheat, the property of the latter, between the 4th of May and the 15th of September, 1905. The policy provided, among other things, for written notice to the insurance company of loss within 48 hours thereafter-which was duly given. It also provided that the insured shall within 60 days after loss make proof of same to the insurance company, and that a failure so to do within that time shall cause a forfeiture of any claim under such policy. This was never done, and one of the controlling questions in the case is whether Mr. Bates, the adjuster of the insurance company, waived formal proof of loss thus required. On this point the testimony discloses: That the loss occurred May 12th. That on May 25th, after receiving the notice thereof aforesaid, the insurance company directed their said adjuster to go to the scene, which he did, preceded by a telegram from one of its general agents to the president of the insured company, which read: "If you and Mr. Bates can settle, go ahead, loss referred to him, I have no data." That on May 31st said adjuster, with Mr. Corwin, the agent of the insured company, went to the field of wheat covered by the policy with a view to determining the extent of the loss and agreeing upon the amount to be paid in settlement. That, after a close inspection of the per cent. of damage, the amount to be paid was agreed upon. That Bates then departed, and, failing to hear further from the insurance company, the insured company, at the expiration of the 60 days allowed for proof of loss, brought this suit.
While it is conceded that Bates, by virtue of his employment as adjuster, together with the special authority conferred on him by the telegram of the general agent, was clothed with sufficient authority to bind the insurance company by a waiver of that condition of the policy concerning proof of loss, it is insisted that no such waiver can be implied from the facts as stated. With this contention we cannot agree. It is undoubtedly true, as conceded, that, Bates being charged by the insurance company with the whole duty of settling the loss, he, in this respect, represented the company and, as such, had power to dispense with those stipulations contained in the policy for the benefit of the company which had reference to the mode of ascertaining the extent of the liability and limiting the right of action. Eastern R. Co. v. Relief Ins. Co., 105 Mass. 570; Kennebec Co. v. Augusta Ins. Co., 6 Gray (Mass.) 204; Gloucester Mfg. Co. v. Howard Ins. Co., 5 Gray (Mass.) 497, 66 Am. Dec. 376. Or, as said by the court in McCollum v. Insurance Co., 67 Mo.App. 66: 16 Am. Eng. Enc. of Law, on the subject of waiver, says: "Since the conditions of a policy a breach of which by the assured will give rise to a forfeiture are inserted for the benefit of the insurance company, they may be waived either pending the negotiation for the insurance or after such negotiation has been completed and during the currency of the policy, and this either before or after the forfeiture is incurred; and, since forfeitures are not favored in the law, the courts are always prompt to seize hold of any circumstances that indicate an election to waive."
By the express terms of the telegram, the loss was referred to the adjuster. In effect, it read: Acting on this advice, the insured company complied by taking the adjuster to the field, where they made a minute inspection of the damage, agreed upon the per cent. thereof and the amount to be paid in settlement which Bates, for the company, agreed to pay. It would be incongruous to hold that, after such action of the insurer, it could lie quietly by until the expiration of the time in which the insured was required to furnish formal proof of loss, and then, in answer to a suit on the policy, claim for the first time that he had failed to comply with that condition. This would be to permit the insurer to lull the insured into a sense of security and whisper in his ear a promise of settlement until the expiration of 60 days and then break it to his hopes. This would be to permit the insurer to mislead the insured to his own harm. Such will not be tolerated. Armstrong, Resp., v. Agriculture Ins. Co., etc., 130 N.Y. 560, 29 N.E. 991.
The chief object of furnishing proof of loss is to enable the insurer to determine the extent of its liability. When by any means agreed upon the extent of this liability is determined between the parties, and a certain sum is agreed to be paid in settlement thereof, the necessity of formal proof no longer exists, and it goes without saying that the law will not compel the insured to do a useless thing as a condition precedent to a right of action. The amount to be paid in settlement of this claim was ascertained by a proceeding in the nature of an arbitration; Mr. Bates acting for the insurer, and Mr. Corwin for the insured. The proof of loss was furnished by the latter to the former at the request of the insurance company by an actual inspection of the field. The authorities are agreed that a settlement made in such a way is a waiver of formal proof of loss. In Jacobs v. St Paul Fire & Marine Insurance Company, 86 Iowa, 145, 53 N.W. 101, there was notice to...
To continue reading
Request your trial