OPINION
Gillett, J.
This
action is based on a fire insurance policy executed by
appellant to appellee. There was a judgment below in favor of
appellee. Appellant assigns as error the overruling of its
separate demurrer to the second and third paragraphs of
complaint, and the overruling of its motion for a new trial.
The
second and third paragraphs of complaint disclose the fact
that proofs of loss were not made within sixty days after the
fire, as required by the policy, but, in lieu thereof, the
appellee seeks in said paragraphs to charge a waiver of such
requirement. Appellant's counsel contend that said
pleadings are in this respect insufficient. In the second
paragraph of complaint it is alleged that when the fire
occurred the appellee gave oral notice thereof to
appellant's local agents who had issued said policy; that
said agents gave notice to appellant; that the latter sent
its adjuster to adjust the loss on appellee's said
building; that said adjuster and an agent of appellee
examined said building with a view to the adjustment of said
loss; that said adjuster and the appellee's said agent
entered into negotiations concerning said loss, and continued
said negotiations from time to time until after the time
within which, by the terms of said policy, the appellee was
required to furnish formal proofs of loss; that appellee and
appellant were unable to agree as to the amount of said loss;
that the same has never been adjusted or settled; that the
appellant refused and still refuses to pay the same, but that
the appellant did not base its said refusal on the failure of
appellee to furnish proofs of loss, but on other grounds
altogether. By way of showing the theory of the pleader,
there is added to the averments upon this subject the
averment or statement, "that by its said conduct the
defendant waived notice in writing from the plaintiff and the
formal proofs of loss required by the terms of said
policy." The third paragraph of complaint contains the
same allegations in substance, except that it does not allege
that the negotiations continued until after
the time for furnishing formal proofs of loss expired, and it
states explicitly that appellant made no objection to
appellee's claim because of her failure to furnish proofs
of loss.
An
adjuster who had been sent for the express purpose of
adjusting a loss has authority to waive a provision of the
policy concerning proofs of loss. Aetna Ins. Co. v.
Shryer, 85 Ind. 362; Indiana Ins. Co. v.
Capehart, 108 Ind. 270, 8 N.E. 285;
McCollum v. Liverpool, etc., Ins. Co., 67
Mo.App. 66, and cases there cited.
It must
be confessed that the second paragraph of complaint is
wanting in the allegation of facts sufficient to constitute a
technical estoppel, although the paragraph goes some length
in that direction. We think, however, that it can be affirmed
from the facts alleged that if there has not been a waiver
that can be declared as a matter of law, the appellee was at
least entitled to take the verdict of a jury upon the mixed
question of law and fact as to whether there was a waiver.
In
Insurance Co. v. Norton, 96 U.S. 234, 24
L.Ed. 689, where the fact was that an agreement has been made
by an insurance company to
extend the time of payment of a premium note, it was said by
the Supreme Court of the United States: "Forfeitures are
not favored in the law. They are often the means of great
oppression and injustice. And, where adequate compensation
can be made, the law in many cases, and equity in all cases,
discharges the forfeiture, upon such compensation being made.
It is true, we held in Statham's Case, 93 U.S.
24, 23 L.Ed. 789, that, in life insurance, time of payment is
material, and can not be extended by the courts against the
assent of the company. But where such assent is given, the
courts should be liberal in construing the transaction in
favor of avoiding a forfeiture. The case of leases is not
without analogy to the present. It is familiar law, that,
when a lease has become forfeited, any act of the landlord
indicating a recognition of its continuance,
such as distraining for rent, or accepting rent which accrued
after the forfeiture, is deemed a waiver of the condition. *
* * In Ward v. Day, 4 Best & Sm. 335,
after a forfeiture of a license to gather minerals off of a
manor had been incurred, the landlord entered into
negotiations with the licensee and his son, to grant to the
latter a renewal of the license when it should expire; and
terms were agreed on, which the landlord afterwards refused
to carry out. It was held that by entering into those
negotiations, he waived the forfeiture of the original
license. The negotiations assumed that the original license
was to continue to its termination. The exaction of the
forfeiture was in the landlord's election; and he evinced
his election not to enforce it by entering into the
negotiations. Justice Blackburn says: 'Most of the cases
in which the doctrine of election has been discussed have
been cases of landlord and tenant under a regular lease, in
which has been reserved a right of reentry for a forfeiture;
that is, an option to determine the lease for a forfeiture;
but this doctrine is not, as Mr. Russell seems to think,
confined to such cases. So far from that being so, the
doctrine is but a branch of the general law, that, where a
man has an election or option to enter into an estate vested
in another, or to deprive another of some existing right,
before he acts he must elect, once for all, whether he will
do the act or not. He is allowed time to make up his mind;
but when once he has determined that he will not consider the
estate or lease, whichever it may be, void, he has not any
further option to change his mind.' And then the learned
judge cites authorities, going back to the Year Books, to
show that a determination of a man's election in such
cases may be made by express words, or by act; and that if,
by word or by act, he determines that the lease shall
continue in existence, and communicates that determination to
the other party, he has elected that the other shall go on as
tenant. These cases show the readiness with which courts
seize hold of any circumstances that indicate
an election or intent to waive a forfeiture. We think that
the present case is within the reason of these authorities;
and that the objection, that the note was already past due
when the agreement to extend it was made, is not sufficient
to prevent said agreement from operating as a waiver of the
forfeiture."
In the
opinion of the court in Queen Ins. Co. v.
Young, 86 Ala. 424, 5 So. 116, 11 Am. St. 51, we
find the following language: "Conditions in a policy of
insurance, limiting or avoiding liability, are strictly
construed against the insurer, and liberally in favor of the
assured. Though a waiver may be in the nature of an estoppel,
and maintained on similar principles, they are not
convertible terms. The courts, not favoring forfeitures, are
usually inclined to take hold of any circumstances which
indicate an election to waive a forfeiture. A waiver may be
created by acts, conduct, or declarations, insufficient to
create a technical estoppel. If the company, after knowledge
of the breach, enters into negotiations or transactions with
the assured, which recognize and treat the policy as still in
force, or induce the assured to incur trouble or expense, it
will be regarded as having waived the right to claim the
forfeiture."
In
Kiernan v. Dutchess, etc., Co., 150 N.Y.
190, 44 N.E. 698, it was said by the New York court of
appeals: "There may be a waiver by express agreement or
through estoppel, but neither is required to effect that
result, as words or acts from which an intention to waive may
reasonably be inferred are sufficient, at least when acted
upon. Titus v. Glens Falls Ins. Co., 81
N.Y. 410, 419; Roby v. American Central Ins.
Co., 120 N.Y. 510, 24 N.E. 808; Armstrong v.
Agricultural Ins. Co., 130 N.Y. 560, 29 N.E. 991.
The distinction between waiver and estoppel, as applied to
the law of insurance, is not in all respects clearly defined.
An express waiver is in the nature of a new contract,
modifying to some extent the old one. It does
not require a new consideration unless it is by inducing a
change of position, for the law of waiver seems to be a
'technical doctrine, introduced and applied by courts for
the purpose of defeating forfeitures.' People v.
Manhattan Co., 9 Wend. 351, 381; Insurance
Co. v. Norton, 96 U.S. 234, 24 L.Ed. 689. An
estoppel forbids the assertion of the truth by one who has
knowingly induced another to believe what is untrue and to
act accordingly. While express waiver rests upon intention,
and estoppel upon misleading conduct, implied waiver may rest
upon either, for it exists when there is an intention to
waive unexpressed, but clearly to be inferred from
circumstances, or when there is no such intention in fact,
but the conduct of the insurer has misled the insured into
acting on a reasonable belief that the company
has waived some provision of the policy."
Cases
in this State, as well as elsewhere, justify the conclusion
that there are some acts that the courts will treat as a
waiver per se. In the...
