Va. Fire & Marine Ins. Co v. Richmond Mica Co

• Decision Date: 10 February 1904
• Citation: 102 Va. 428,46 S.E. 463
• Court: Virginia Supreme Court
• Parties: VIRGINIA FIRE & MARINE INS. CO. v. RICHMOND MICA CO.

46 S.E. 463

102 Va. 428

VIRGINIA FIRE & MARINE INS. CO.

v.RICHMOND MICA CO.

Supreme Court of Appeals of Virginia.

Feb. 10, 1904.

INSURANCE—STIPULATIONS OF POLICY—WAIVER—REPRESENTATIONS OF AGENT—AGENT'S AUTHORITY—ESTOPPEL TO DENY.

1. Where the agent of an insurance company, who had always represented the company in its relations with assured, informed him when he made application for a renewal of the policy for the ensuing year that it was not necessary to make any change in the provisions of the policy on account of the execution of a contract to sell the premises to another, and the fact that the other had been put in possession, and thereupon assured, who had requested a change in accordance with the facts, paid, the premium, and accepted the policy in its previous form, the company was estopped from asserting a forfeiture under a clause of the policy providing that it should be void in case assured's interest in the premises was other than unconditional ownership, although the policy provided that no officer, agent, or other representative of the company should have power to waive any provision of the policy, except certain specified ones, which they could waive only in a specified manner.

2. In order that an insurance company may successfully assert that its agent has exceeded his powers in waiving conditions of a policy, the assured must have actual notice of the limitations placed on the agent's powers, either by having his attention called to the stipulation of the policy containing such limitation, or otherwise. The constructive notice afforded by the circumstance that the policy contains the limitation is insufficient.

Error to Circuit Court of City of Richmond.

Action by the Richmond Mica Company against the Virginia Fire & Marine Insurance Company. There was judgment for plaintiff, and defendant brings error. Affirmed.

Leake & Carter, for plaintiff in error.

Munford, Hunton, Williams & Anderson and Lewis C. Williams, for defendant in error.

WHITTLE, J. This was a proceeding by motion in the circuit court of the city of Richmond by the defendant in error, the Richmond Mica Company, against the plaintiff in error, the Virginia Fire & Marine Insurance Company, upon a fire insurance policy, to recover the sum of $1,500, loss occasioned the plaintiff from the destruction by fire of certain of the property covered by the policy.

The policy contains, among others, the following provisions:

(1) "This entire policy, unless otherwise provided by agreement indorsed hereon or added hereto, shall be void * * * if the interest of the insured be other than unconditional and sole ownership; or if the subject of insurance be a building on ground not owned by the insured in fee simple."

(2) "This policy is made and accepted subject to the foregoing stipulations and conditions, together with such other provisions, agreements, or conditions, as may be endorsed hereon or added hereto, and no officer, agent, or other representative of this company, shall have power to waive any provision or condition of this policy except such as by the terms of this policy may be the subject of agreement endorsed hereon or added hereto, and as to such provisions or conditions, no officer, agent or representative shall have such power, or be deemed or held to have waived such provisions or conditions unless such waiver, if any, shall be written upon or attached hereto, nor shall any privilege or permission affecting the insurance under this policy exist or be claimed by the insured unless so written or attached."

Plaintiff in error denies liability for the loss on the ground that at the date of the policythe interest of the assured in the property was other than the unconditional and sole ownership, and that the building destroyed was not located on ground owned by the assured in fee simple, and that there had been no waiver of the forfeiture which accrued from the breach of the condition of the policy in the manner and upon the terms prescribed in the second provision, and the entire policy was therefore void and of no effect.

There was a demurrer to the evidence, which the trial court overruled, and rendered judgment for the plaintiff for the damages provisionally assessed by the jury, and the case is here on writ of error to that judgment.

It is conceded that, if the insurance company is liable at all, the amount of the recovery is correct; but, as remarked, the company denies liability in toto, for the reason stated.

It appeared in evidence that R. A. Lancaster, Jr., was the general agent of the insurance company for the city of Richmond; that during a series of years he had received the premiums and written insurance upon the property in question for the defendant in error in the company of his principal; that these policies were renewed from year to year, it being the practice of the agent before the expiration of a former policy to write insurance upon the property for the ensuing year, to deliver the policy to L. M. Williams, the secretary and treasurer of the assured, and collect the premiums from him. There was no written application for any of this insurance, and no information with respect to the property was demanded of the assured. Lancaster solicited the risk, wrote the insurance, received the premiums, and, in fine, was alone known to the assured throughout the transaction.

In accordance with custom, in the latter part of the year 1902 Lancaster approached Williams for the purpose of renewing the insurance for the year 1903, when he was informed by Williams that the Richmond Mica Company had contracted, in writing, to sell the property to one Mersereau, and had placed him in possession of it; that Mersereau had paid part of the purchase price, but owed a balance on the property of $3,402.43, which, when paid, or secured to be paid, would entitle him to a conveyance. Having thus voluntarily made a full and fair disclosure of the state of the title of his principal, Williams requested Lancaster to write the insurance so as to meet the exigencies of the case. Whereupon Lancaster assured him that it was not necessary to alter the policy as it had been prepared by him; that, when the title to the property was transferred to Mersereau, it would be time enough to make the change. Acting upon that information and assurance, the premium was paid, and the policy accepted as filled up by Lancaster.

The status quo of all parties was main tained until May 30, 1903, when the property was destroyed by fire. In its proof of loss, the assured having again called attention to its contract with Mersereau, the insurance company denied liability, and tendered the amount of the premium to Williams, who promptly declined to receive it.

On a similar state of facts, this court has so often decided that the conduct of the agent estops the insurance company from asserting the forfeiture relied on that it may be stated as established law in this jurisdiction.

In the case of The Georgia Home Insurance Co. v. Kinnier, 28 Grat. 88, it was held that when a policy of insurance contained a condition that the policy should be vitiated if the premises became vacant by the removal of the owner or occupant for a period of more than 20 days without immediate notice to the company, and written consent, it was competent for the insurer or its lawful agent to waive this condition, and if, at the time the agent of the company received the premium of insurance and delivered the policy, he had knowledge of the vacation of the property, and did not then avoid the policy, but treated it as valid and subsisting, such conduct of the agent was a waiver of the condition, and a breach of it could not be relied on by the company to defeat a recovery upon the policy. In the case of McLean v. Insurance Co., 29 Grat. 372, the above case is cited as authority for the proposition that conditions in a policy which are for the benefit of the insurer, the breach of which may operate a forfeiture, may be waived by the insurer or his lawful agent, The rules there laid down with respect to the doctrine of waiver and estoppel in such cases are followed and approved in Insurance Co. v. Weill, 28 Grat. 389, 26 Am. Rep. 364; Insurance Co. v. West, 76 Va. 578, 44 Am. Rep. 177; Insurance Co. v. Teiger, 90 Va. 277, 18 S. E. 195; Easley v. Insurance Co., 91 Va. 169, 21 S. E. 235; Insurance Co. v. Paukey, 91 Va. 259, 21 N. E. 487; Insurance Co. v. Rodefer, 92 Va. 747, 24 S. E. 393, 53 Am. St. Rep. 846; Insurance Co. v. Ward, 95 Va. 231, 28 S. E. 209; Farmers' Ass'n v. Williams, 95 Va. 248, 28 S. E. 214; Insurance Co. v. Goode, 95 Va. 751, 30 S. E. 306; Insurance Co. v. Nails, 101 Va. —, 44 S. E. 896.

In many of those cases the policies were "standard policies, " identical in form with the one under consideration.

In Lynchburg Fire Insurance Co. v. West, 76 Va. 578, 44 Am. Rep. 177, the court recognizes the general rule that parol testimony is inadmissible to vary or contradict written instruments, but holds that exceptions exist where the assured is misled by declarations of the insurer or his agent; where the insurer insists on forfeitures of his own creation; where the insurer or his agent, in preparing an application or policy, fails to follow correct descriptions...