The Long Island Insurance Company v. The Great Western Manufacturing Company

• Citation: 2 Kan.App. 377,42 P. 738
• Decision Date: 01 October 1895
• Docket Number: 40
• Parties: THE LONG ISLAND INSURANCE COMPANY v. THE GREAT WESTERN MANUFACTURING COMPANY
• Court: Court of Appeals of Kansas

42 P. 738

2 Kan.App. 377

THE LONG ISLAND INSURANCE COMPANY v. THE GREAT WESTERN MANUFACTURING COMPANY

No. 40

Court of Appeals of Kansas, Northern Department, Central Division

October 1, 1895

Opinion Filed November 11, 1895.

MEMORANDUM.--Error from Republic district court; F. W STURGES, judge. Action by The Great Western Manufacturing Company against The Long Island Insurance Company. Judgment for plaintiff. Defendant brings the case here. Reversed. The opinion herein, filed November 11, 1895, states the case.

Judgment reversed.

H. M Jackson, for plaintiff in error.

Jay F. Close, for defendant in error.

GARVER J. All the Judges concurring.

OPINION

GARVER, J.:

The controversy in this case is over the right to recover for a loss by fire under a policy of insurance issued by The Long Island Insurance Company, under date of March 22, 1890, insuring one Charles F. Neerman against loss or damage by fire on certain mill machinery alleged to have been destroyed by fire on the 12th day of April, 1890. After the fire Neerman transferred and assigned all his interest in and rights under the policy to the Great Western Manufacturing Company, plaintiff below. This action was commenced August 28, 1890, and a summons in the ordinary form of a summons was issued by the clerk of the district court of Republic county, directed and transmitted to the superintendent of insurance, by whom service was duly acknowledged, and the summons, with his return thereon, returned to and filed in said court. The jurisdiction of the court was questioned by the insurance company by a motion to quash the summons. This objection was overruled, and the case proceeded to trial, and judgment against the insurance company. The summons is attacked because it was directed to the superintendent of insurance instead of to an officer authorized by law to make service of a summons; and the service is objected to because made by direct transmission of the summons by the clerk of the court to the superintendent. It is admitted that the defendant is a foreign insurance company authorized to do business in this state, and that it duly filed in the insurance department its written consent, as required by the statute, "that action may be commenced against such company . . . by service of process on the superintendent of insurance of this state." Counsel for plaintiff in error, in his brief, states his objection to the summons as follows:

"The true construction of such statute is, that the summons must be issued to the sheriff as otherwise required by the code, and by him served on the superintendent, upon service of which the superintendent must notify the company of such summons."

This objection stands in the face of the positive and unequivocal direction of the statute, and, if sustained, would require the court to substitute a particular form of summons and manner of service, when the legislature has clearly said that another form and manner should be adopted. The same section of the statute which provides that jurisdiction shall be acquired by service of summons on the superintendent of insurance also directs what shall be the form and manner of such service. The language of the statute is: "The summons shall be directed to the superintendence of insurance, and shall require the defendant to answer by a certain day not less than 40 days from its date. Such summons shall be forthwith forwarded by the clerk of the court to the superintendent of insurance, who shall," etc. It is not disputed that the legislature has the right to provide upon what terms and conditions a foreign insurance company may do business in this state. Having formally and voluntarily assented to the conditions imposed, and having agreed that jurisdiction might be obtained in an action brought against it in the manner provided by the statute, and having done business in the state under the permission so granted, it cannot, when brought into court by process issued and served in strict compliance with the statute, question the sufficiency or validity of such service. A similar objection was considered by this court in the case of German Ins. Co. v. Hall, 1 Kan.App. 43 (41 P. 69), and the validity of the service sustained. We see no reason to change the views expressed in the opinion in that case.

The next question raised is as to the right of the insured or his assignee to recover, in any event, under the policy. It is contended on behalf of the plaintiff in error that the interest of Neerman in the property insured was not truly stated in the policy; that he was not the absolute owner thereof, and that, therefore, under the terms of the policy, the contract of insurance was avoided. It appears from the record that Neerman, a short time before the insurance was written, purchased the mill machinery from The Great Western Manufacturing Company under a contract or agreement providing for payment therefor in installments, and that, until full payment was made, the legal title was to remain in the vendor. At the time of the fire, something over $ 1,100 remained unpaid on the contract. No written application was made for the insurance, but the policy contained, among others, the following conditions:

"This entire policy, unless otherwise provided by agreement indorsed hereon, or attached hereto, shall be void . . . if the interest of the insured be other than unconditional and sole ownership, . . . or if the subject of insurance be personal property, and be or become incumbered by chattel mortgage."

The policy also contained the provision that no officer, agent or other representative of the company should have power to waive, or be held to have waived, any conditions or provisions of the policy, unless the waiver be written upon or attached thereto. There is no material conflict in the evidence as to the facts and circumstances surrounding the writing of this policy. Radford, the local agent of the insurance company, who wrote the insurance understood at the time the risk was taken, and before the policy was delivered by him, the nature of Neerman's interest in the property; and he was then informed that it was only partially paid for; that it had been purchased under a contract of sale which provided for the retention of the title by the vendor as security for the deferred payments, and that Neerman was not, and did not claim to be, the unconditional and sole owner of the property. Counsel for plaintiff in error claims that such knowledge of the agent cannot aid in avoiding the forfeiture provided for by the express terms of the policy; that the conditions of the policy as to ownership cannot be held to have been waived, unless such waiver was indorsed on or attached to the policy. With this contention we cannot agree. There is, of course, much force in the argument, that one claiming under a written policy of insurance is bound by whatever representations or limitations of authority appear therein with reference to any particular agent or class of agents. So long as such express limitations are with reference to matters...