Kalmutz v. Northern Mutual Insurance

Insurance — Fire insurance — Additional insurance — Waiver—Estoppel. Whore other insurance is required to be indorsed on a policy of insurance, if notice thereof is given to the insurer or its agent, and consent is not indorsed, nor the policy canceled, further compliance is treated as waived, and the insurer is estopped from setting up such other insurance to defeat its liability upon the policy. A policy of fire insurance required that other insurance should be indorsed on the policy. In an action upon the policy it was conceded that there was other insurance which had not been indorsed upon the policy. The evidence showed that the insurance company’s secretary had notice of the additional insurance about one month after an assessment had been paid; that, notwithstanding this notice, the policy was neither recalled nor canceled, nor were the assessments returned; nor was any effort made to return the premium note given by the insured, binding him to pay the premium at such times and in such maimer as the company’s directors might by law require it. Held, that, the company was estopped from setting up the failure to have the other insurance indorsed on the policy as a defense.

Appeal, No. 181, Jan. T., 1897„by defendant, from judgment of C. P. Schuylkill Co., on verdict for plaintiff. Assumpsit on a policy of fire insurance. Before Lyon, P. J. At the trial the defendant set up as a defense the fact that other insurance had not been indorsed upon the policy as required by the contract of insurance. Plaintiff’s points and the answers thereto among others were as follows: 3. If the jury believe that, after the policy in this case was issued, the secretary of the company was notified by its agent, John Holdeman, that the plaintiff bad other insurance on the property described in this policy, and having sucb knowledge failed to indorse this fact on the policy, and having failed to notify the plaintiff that his policy was canceled and no longer in force, and by its acts and conduct treated the policy as in force for the purpose of collecting assessments upon it or to release premium and assessments already made, and also the premium note, tbe jury would have a right to find from these facts the further fact that the policy was in force for the purpose of paying a loss, which might rise thereunder, and for securing the indemnity against loss by fire provided for in this policy. Answer: This is affirmed, if you find the facts to be from the evidence as stated in this point. [4] 4. A person taking an application for insurance from another, sending it to an insurance company, receiving from the company and delivering to the applicant the policy applied for, taking the premium note and collecting the premium for the policy, and afterwards collecting an assessment on the policy, giving receipts which the company recognized, and paying over to the company the assessment collected, must be regarded as the company’s agent in the transaction. If the jury believes John Holdeman was such an agent of this company, and, on taking the application for insurance from the plaintiff, was informed by the plaintiff .that he had #3,000 of other insurance, then it was the duty of Holdeman to so inform the company in order that the proper officer of the company might indorse on the policy notice of such other insurance, and the fraud or mistake of Holdeman, the agent, in failing to so inform the company, will not enable the company to avoid the policy to the injury of the plaintiff, if the plaintiff innocently became a party to the contract. Answer: This we affirm; the company could not adopt the acts of its agent so far as it inured to its own benefit and then repudiate it when the other party sought to enforce it. [5] The court charged in part as follows : [Now, if Mr. Holdeman, representing this company, had any fraudulent purpose in concealing this fact from the company and did not make it known to them at- the time when he presented his application to the company for its acceptance, then the company was bound as soon as it had notice of the fact, to give Mr. Kalmutz notice that it would not be bound by this policy and that he had no right to other insurance, because the company could not avail itself of the act of its agent, and collect the assessments due upon this policy, and at the same time hold it was null and void. It was its duty when it learned this fact (if it did so learn it), that this insurance had existed upon the property from the time that this policy was issued and before the application was made, to have notified Kalmutz that it would not accept his policy — to have returned, his premium note and not to have held out the belief to him that his policy was of binding force and effect. Now, Mr. Holdeman denies this. He denies that Kalmutz told him that he had additional insurance. He denies that he had any knowledge of the fact until in the month of October, 1894; that when he was there at the place of Mr. Kalmutz, and after he had collected the assessment, which was laid upon this policy for Kalmutz, that it was then that Kalmutz told him that he had additional policies upon this property, and that was the first time he knew of it. Then, he says, he did learn the fact and he communicated it to the secretary of the company at the meeting of the board of directors in the first week of November, I believe, 1894. There is again a discrepancy in the testimony. Mr. Kalmutz testified that when Holdeman called upon him for the assessment, he told him that his policy was of no use; that he had it read, and that he had learned that it was void because there was no notice indorsed upon it in writing that he had other insurance, and he testifies that he did this before he paid the assessment that was levied upon his policy. Now, how is that ? There is a conflict in his testimony and it is for you to determine. If the company, after the notice of this fact, and its attention was called to it by its agent, went on and collected this assessment and kept the money, then it would be estopped from denying the validity of the policy; but it could not be es-topped unless it did that after it had knowledge of this fact. Now, you will take this case into consideration, and if you find the company had knowledge before it levied an assessment, then it would clearly be liable, but I do not recollect that there is any testimony, and I think there is not, in the case, to show that it had knowledge until after that assessment had been collected and paid over. Mr. Shepherd: There is no evidence of that kind. Mr. Wadlinger: We argue there was. Mr. Shepherd: When? Mr. W adlinger: F rom the statement Hoi deman made to Prince in Frank’s that he believed ho had sent that notice, but was not certain, but said to Kalmutz that in order to make that sure he would put it in his memorandum book and send it there. The Court: If from any evidence in this ease the jury find that such was the fact,-that the company had notice before it levied and collected this assessment of this other insurance, it would be estopped from setting up that as a forfeiture of the policy. We submit all the evidence to you, and under the evidence you must determine whether such was the fact or whether it was not. There is considerable conflict in the testimony, and it is for you, and you must determine what the facts are. If on the other hand, you should find that this insurance company had no knowledge that there was other insurance upon this property at the time that it levied and collected this assessment, then it would not be held to have waived that condition of the policy,- unless you consider from all the circumstances of the case, that it made no effort to notify Kalmutz, the plaintiff, that it would insist upon it after the knowledge had been communicated to it by their secretary.] jj7] Verdict and judgment for plaintiff for $1,152.80. Defendant appealed. Errors assigned among others were (4, 5, 7) above instructions, quoting them.