Stebbins v. Lancashire Ins.

Whore an agent of an insurance company, authorized to issue policies, writes and delivers a policy to another agent from whom the application was received, charging the premium to such agent under a business arrangement between them, and the policy is delivered to the insured, the contract of insurance is complete; and, in the absence of fraud, it can he terminated only in conformity to the stipulations of the policy, or by agreement of the parties. An agent of an insurance company lias no authority to insure property already destroyed; and a policy written and intended as a substitute for a subsisting policy in another company, but not delivered, and of which the assured lias no knowledge until after the property is destroyed by fire, is not a valid contract of insurance.

Covenant .broken, on a policy of insurance. Plea, the general issue. The plaintiff’s evidence tended to prove, that in April, 1877, he lived in Hinsdale, and owned a building occupied for stores and offices; that F. J. Barber, an attorney and insurance agent, had an office in the building, and the plaintiff employed Barber to get him good insurance to the amount of $4,667, at a rate not exceeding two per cent.; that nothing was said as to when the premium should be paid, but the plaintiff was good and able to pay on demand; that Barber had an arrangement with one Doolittle, of Keene, an insurance agent, to place insurance that Barber could not place in companies he represented, on some division of the commissions, he being responsible for the premiums; and Doolittle had an arrangement with the firm of Jenne & Sherman, insurance agents of Brattleboro’, Vt., under which each gave to the other applications for insurance they could not place, the agent furnishing it being liable for the premium; that Jenne & Sherman had the ordinary powers of insurance agents, and were liable to their companies for the premiums, less their commissions, and settled once a month with them; that they were agents for the Commercial Union, the German American, the Plienix of New York, the North British & Mercantile, and the Lancashire ; that Barber had no companies in which he could place the plaintiff’s risk, and he sent it to Doolittle under the arrangement; and Doolittle, having no companies in which he could place it, sent it to Jenne & Sherman; and they, April 8d, 1877, wrote two policies for the plaintiff, each for $2,338.50,■ — one in the Commercial Union, the other in the German American, — for one year, to commence that day, at noon, charged the premium to Doolittle, and sent him the policies by mail; that Doolittle was agent for the German American, and had a policy on personal property in the same building, and he, knowing that the company would not accept another risk, returned the policy to Jenne & Sherman to be cancelled; that they received it about the 5th of April, cancelled it, wrote another policy in the Phenix, of New York, for the same sum, dating it April 3d, notified the company, and they, not liking the risk, ordered it cancelled; that Jenne & Sherman cancelled it, and immediately wrote a third policy for the same amount in the North British and Mercantile, reported it to the proper office of the company, charged the premium to Doolittle according to the arrangement, and about April 8th sent the policy to him; and he, on the 17th, and before any notice of a desire of the company to recall the policy, delivered it to Barber, the plaintiff’s agent; that, April 13th, the company wrote Jenne & Sherman that they preferred not to carry the risk, and advised that it be placed elsewhere, and, April 15th, they wrote on the margin of the record of the policy in their office, “Can-celled April 13th, 1877; ” the policy not being then in their possession, they gave no notice to the company that the policy was cancelled till April 23d, after seeing Barber; that Jenne & Sherman wrote the policy in suit the 17th or 18th of April, and dated it the third, for the same sum in the prior policies, for one year from its date, and it is in other respects in the usual form of like policies, and it remained in their office till the 19th, when it, with a letter of that date duly directed to Doolittle, was mailed, requesting him to exchange it for the one in the North British; that the letter and policy were not received by Doolittle till the afternoon of the 20th, and not till after he had heard that the building had been burned; if the letter had been mailed before three o’clock of the 19th, it would have reached Keene the same day, but it did not appear at what time in the day it was mailed; that the building was destroyed by fir^ about two or three o’clock of the morning of the 20th; that at the time the fire was discovered, Barber, as the agent of the plaintiff, had the policy in the North British and other policies of the plaintiff in his possession, in his office, in the building, and during the fire he gave them to the plaintiff, and he paid Barber the premium on the North British, $46.67; that the plaintiff before this time knew that he was insured, but did not know in what companies, and had no knowledge as to what had been done between Barber, Doolittle, and Jenne & Sherman as to it; he supposed when he paid his money and received his policies in the Commercial Union and North British that they were in force, and that he was paying the premiums on those policies and no others, and Barber had not then any knowledge of the policy in suit; that Doolittle, April 21st, wrote to Barber, enclosing the policy in suit and Jenne & Sherman’s letter of the 19th, asking Barber to send the North British policy in exchange to Jenne & Sherman, which Barber received about 10 o’clock A. M.; he immediately saw the plaintiff and showed the same to him, and the plaintiff gave him the North British policy, with directions to see Jenne & Sherman, and on the 23d he did see them, and they, thinking that the policy in suit was the one in force at the time of the fire, he paid them the premium on that policy, and took a receipt to Doolittle for the same, to whom they had charged it, and gave to them the North British policy; that proofs of loss were-made by the plaintiff against both companies, and the defendants were duly notified; that if the plaintiff is entitled to recover, his damages are $2,184 and interest from the time the loss was payable ; that the special agent of the defendants to supervise agencies, examine risks, and adjust losses, under the direction of his superiors to meet with the agents of other companies on the 30th of April to adjust the loss, met at that time, and not being able to' adjust the loss, signed a submission to have it determined by arbitration ; but it appeared that at the time of the direction, and at the time of the signing, neither the defendants nor the agent had any knowledge of the circumstances as to the liability of the defendants. unless the knowledge of Jenne & Sherman was their knowledge, and that when the circumstances did come to their knowledge they denied their liability, refused to go forward in the arbitration, and returned to Jenne & Sherman the premium when sent to them as a part of their monthly settlement. The evidence also tended to prove that Barber had no authority to get insurance for the plaintiff for a greater sum than $4,667, and that this sum was covered by the two first policies of $2,333.50 each, and that Jenne & Sherman were the agents of the companies for which they assumed to act, but that they had no authority to take risks on property that had been destroyed. 4']ie North British and Mercantile policy contained this agreement : “ This insurance may also be terminated at any time, at the option of the company, on giving notice to that effect, and refunding a. suitable proportion of the premium for the unexpired term of the policy.” Motion for a nonsuit.