Westchester Fire Ins. Co. v. Wagner

• Decision Date: 24 April 1894
• Parties: WESTCHESTER FIRE INS. CO. v. WAGNER et al.
• Court: Texas Court of Appeals

30 S.W. 959

WESTCHESTER FIRE INS. CO. v. WAGNER et al.

Court of Civil Appeals of Texas.

April 24, 1894.

Appeal from district court, Bexar county; George H. Noonan, Judge.

Action by Wagner & Chabot against the Westchester Fire Insurance Company. From a judgment for plaintiffs, defendant appeals. Reversed.

Swearengen & Brooks, for appellant. Wright & Summerlin, for appellees.

FLY, J.

Appellees instituted this suit, and alleged in their petition that appellant had insured them in the sum of $2,000 against loss from the destruction of a certain stock of goods that had been destroyed by fire; that the goods belonged to Kloak Bros. & Co., of Cincinnati, Ohio, and that appellees had been holding them on consignment and selling them in consideration of a certain per cent. of the profits. It was also alleged that the goods had been insured as the property of appellees, but that the agent of appellant had been informed, when the contract of insurance was executed, that the property did not belong to appellees, but was the property of Kloak Bros. & Co., and that appellees were selling the same on commission. The policy was attached as an exhibit to the petition. The petition was excepted to, as showing on its face that the policy was void by reason of the true interest of appellees in the goods not being stated therein, the terms of the policy showing that it was expressly provided that the agent should not have authority to waive the provision in regard to the interest of the assured in the property. The authority of the agent to waive the provision was specially denied in the answer. The exceptions were overruled, and the case was tried by a jury, and a verdict rendered in favor of appellees for $2,000.

The policy provides that the insurance company "shall not be liable beyond the actual cash value of the property" at the time the loss occurred. We think it was error to give the special charge requested by appellees, wherein the jury were instructed to find for the appellees for the amount expressed in the policy. This was, in effect, an instruction to disregard any proof that may have been made as to the actual value of the goods that were destroyed by fire. Insurance Co. v. Starr, 71 Tex. 733, 12 S. W. 45.

In the policy of insurance is found the following clause: "This entire policy shall be void if * * * the interest of the insured in the property be not truly stated herein." As said by the supreme court of Pennsylvania in passing upon a clause in the same language: "This clause is not without force. Its meaning is apparent. Its object is to enable the insurance company to know who it is insuring." Diffenbaugh v. Insurance Co. (Pa. Sup.) 24 Atl. 745. Where there is a clause in the policy requiring a true statement of the assured's interest in the property, it works a forfeiture of the policy, in the absence of a waiver upon the part of the insurer. It is admitted by appellees that the property, although insured as belonging to them, was not in reality theirs, but the property of Kloak Bros. & Co., of Cincinnati. The property had been placed by the owners with appellees for sale, and their interest in the property was contingent upon a sale, and, while admitting the force of the proposition that they can only recover upon proof of a waiver of the clause in the contract, yet they insist that the agent of appellant was informed of the exact status of their connection with the property before and at the time of the execution of the contract, and that his principal is estopped from setting up a forfeiture of the policy. It is provided in the policy that it "is made and accepted subject to the foregoing stipulations and conditions, together with such other provisions, agreements, or conditions as may be indorsed 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 indorsed hereon or added hereto, and, as to such provisions and conditions, no officer, agent or representative shall have such power or be deemed or held to have waived such provisions, 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." The object of this clause is to define and limit the powers and authority of the agent, and to prescribe the subjects about which he shall and shall not have authority to waive the provisions of the policy, and to set forth the manner in which he shall indicate his waiver, in connection with those subjects over which he is given this power. It is clear that no authority is given in the policy to the agent to waive the requirement that the insured shall state their true interest in the property, but, on the other hand, it is expressly provided that he shall not have authority "to waive any provision or condition of the policy except such as by the terms of the policy may be the subject of agreement." The clause in regard to the statement of the interest of the insured in the property is not of this class. According, then, to the contract entered into between the parties, the policy was rendered void by the failure of the insured to make known their true interest in the property, and they were duly notified that the stipulation in question could not be waived by the agent of the insurer. We can see no difference in the binding force and effect to be given in any ordinary case and one of insurance; and, where the policy expressly provides that no agent has authority to waive certain conditions or stipulations therein, the holder of the policy is bound by such limitation of the agent's authority. The proposition is supported by the weight and logic of the adjudicated cases. Quinlan v. Insurance Co., 31 N. E. 31, 133 N. Y. 356; O'Brien v. Insurance Co. (N. Y. App.) 31 N. E. 265; Moore v. Insurance Co. (N. Y. App.) 36 N. E. 191; Kirkman v. Insurance Co. (Iowa) 57 N. W. 952; Cleaver v. Insurance Co. (Mich.) 32 N. W. 660; Hankins v. Insurance Co. (Wis.) 35 N. W. 34; Herbst v. Lowe (Wis.) 26 N. W. 751; Mersereau v. Insurance Co., 66 N. Y. 274; ...