Summary
Contract on a poEcy of insurance dated March 2, 1865, by which the defendants, who were a stock insurance company doing business in New York, insured the plaintiffs for one year against loss or damage by fire to the amount of $10,000 “ on their Eability for loss and damage by fire occasioned by sparks from locomotives to property of others situate on lands not owned or occupied by the plaintiffs. The poEcy purported on its face to be made and accepted in reference to certain printed conditions annexed to it, and which were declared to be part of the contract. The 9th of these conditions was as foEows :
“ Persons sustaining loss or damage by fire shall forthwith give notice thereof in writing to the company, and within sixty days from the occurring of said fire they shaE deEver as particular an account of their loss and damage as the nature of the case will admit, signed with their own hands. And they shaE accompany the same with their oath or affirmation, declaring the said account to be true and just; showing also the ownership of the property insured ; what other insurances, if any, existed on the same property, and giving a copy of the written portion of the policy of each company; what was the whole sound or cash value of the subject insured; in what manner the building insured, or containing the subject insured, and the several parts thereof were occupied at the time of the loss; who were the occupants of such building, and when and how the fire originated, so far as they know or believe. They shall also produce a certificate under the hand and seal of a magistrate, or notary public, most contiguous to the place of the fire, and not concerned in the loss, stating that he has examinéd the circumstances attending the fire, loss or damage alleged; that he is acquainted with the character and circumstances of the claimant; and that he verily believes that such ■ claimant has, by misfortune, and without fraud or evil practice, sustained loss and damage to the subject insured, to the amount which such magistrate or notary shall certify.
“When merchandise or other personal property is partially damaged, the assured shall forthwith cause it to be put in as good order as the nature of the case will admit, assorting and arranging the various articles according to their kinds, separating the damaged from the undamaged; and shall cause an inventory to be made and furnished to the company, of the whole, naming the quantity and cost of each, and the amount of sound or cash value. The damage shall then be ascertained by the examination and appraisal of each article by disinterested appraisers, mutually agreed upon.
“Whenever required in writing, the insured, or person claiming, shall exhibit his books of account, and other vouchers, to the insurers or their agent, at the office of this company, and permit copies thereof to be made ; and shall also exhibit to any persons named by the company, and shall permit to be examined by them, any property- damaged on which loss is claimed, or any property saved which was insured by this policy; and until such proofs, declarations and certificates are produced, and such appraisals and examinations of property and accounts permitted by the claimant, the loss shall not oe payable.
“In case of claim for loss or damage on a policy assigned, where there is no actual sale or transfer of the property insured, proofs of loss shall be made by the assured in conformity with the conditions of this policy, in like manner as if no assignment had been made; otherwise this policy shall be void.
“ The sound or cash value of the property destroyed or damaged by fire shall be deemed to be such as it may cost at the time of the fire to replace the same.”
After the decision reported 98 Mass. 420, the case was referred to an auditor, who found that between August 16, 1865, and November 14, 1865, more than |10,000 worth of property covered by the policy was consumed by fire; that “ no notice forthwith of the several losses was ever given in -writing to the defendants, as they occurred or came to the knowledge of the plaintiffs, and no statement of loss signed and sworn to, as provided in the 9th condition of insurance, was given to the defendants until June 14, 1866 ; ” but that on that day an accurate statement of the losses of the plaintiffs on the property covered by the policy, the amount due on each and the time each occurred, with a certificate sworn to by the plaintiffs’ treasurer that the statement was “ a copy of claims filed and paid in the office of ” the plaintiffs, was given by the plaintiffs to Abraham K. Hills; “ that the defendants duly appointed Hills their general agent in Massachusetts under the Gen. Sts. c. 58, §§ 68-78; that he continued to act as such until March 28,1866, when Horace O. Whittemore was appointed general agent, and continued so to act through 1866; that Hills & Whittemore were partners in business with one Gage, calling themselves general insurance agents under the style of Hills, Whittemore & Company, and acted for the defendants as such from July 1864 to 1867; that no distinction was made between the acts of Hills or Whittemore and the acts of Hills, Whittemore & Company; that this firm solicited insurar ce and issued policies for the defendants; that they so advertised and held themselves out during the years 1865 and 1866; that they had the policies of the defendants signed by the officers of the company in blank, containing the clause that the policy was not valid until countersigned by A. K. Hills, agent, as did the policy in suit; that they made the insurance themselves and filled out the policies of the defendants ; that the policy in suit was so signed in blank, the insurance made, and the terms, risk, &c., written in by them at their office in Boston, and the policy issued by them to the plaintiffs March 2, 1865, they receiving the premium ; and that they were often in the habit of adjusting and settling, themselves, and drawing on the company for the same, though as a general rule they first forwarded the statement of loss to the company.” ■
“ The defendants offered sundry letters written by the company to Hills and to Hills, Whittemore & Company, as their agent or agents, at various dates between January 4, 1864, and March 13, 1866, for the purpose of showing the extent of the authority of Hills and the firm as agents of the defendants ; but the auditor was of opinion that they were not competent for that purpose, being private instructions not communicated to the plaintiffs, and excluded them.
“ Upon these facts, the auditor found that Hills, and the firm of which he was a member, were the duly appointed agents of the defendants, and as such agents made insurance, received the premiums, issued policies, adjusted losses, and thereby held themselves out, with the knowledge of the company, as having authority generally to transact the business of the company.”
The auditor also found “ that on or about October 15, 1865, the treasurer of the plaintiffs, with their superintendent, visited Hills at his office, and informed him that they had had, and were then having, numerous fires along the whole line of their road, calling his attention particularly to the September and October fires; that claims were made on them from all quarters; that they had sent their road-master, accompanied by an impartial and disinterested person, experienced in such matters, one Rowell, to examine into each individual case, to report thereon if caused by the sparks of their locomotives, and to determine and assess the damage done to the property of each individual making a claim ; that they had done this, and were still at the work, and wished to know if that course was satisfactory to them; that Hills replied that it was, to continue as they were doing and the defendants would do what was right, and, when they got through paying, to hand in a schedule of what had been paid and it should be attended to; that several interviews were afterwards had in the autumn and winter, and some as late as March or April 1866, and the same assurances were made by Hills; that Rowell, on behalf of the plaintiffs, in December or January 1866 visited Hills, and asked him if he wished any information or desired that he should go to New York to see the defendants, in regard to the losses and assessment of damages on the road, and Hills replied that he did not, that the policy would be adjusted satisfactorily; that the plaintiffs, relying on this, gave no notices or statements in writing, but continued to make adjustments; that, after the adjustments were made the sums awarded were put upon their next monthly pay-rolls; and that nearly all the sums, awarded and stated in the statement of loss, were paid on the pay-rolls of the plaintiffs; but that a number of sums awarded and stated in said statement were not in fact paid to the parties on June 14, 1866, when the statement was given to Hills, but were paid by the plaintiffs after that date.”.
The auditor also found that on November 21,1865, the plaintiffs’ superintendent wrote to Hills, informing him that suits had been begun against them for damages from fires claimed to have been caused by sparks from their locomotive engines, and asking the defendants to attend to their defence; that on December 2, 1865, Hills, Whittemore & Company sent the following reply signed by them: “We have received at our office various papers relative to losses by fire claimed to have been caused by sparks from your locomotives, and we can only say that while the Relief Insurance Company will throw no obstacles in the way of a sipeedy and satisfactory adjustment of all reasonable and legitimate claims, still it cannot attend to any suits which may have been or may be brought against the railroad corporation on account of such damages as are represented. The proper course seems to be for your company to proceed as though they had no insurance whatever, and if any liability is proven beyond a reasonable doubt, then claims based upon such proofs must be presented to the insurance company, and they will be considered. Of course no suits must be allowed to go by default, and you wiT please understand from this communication, that it is not intended in any way or manner to bind the Relief Insurance Company to any particular course of action. When such proofs are presented as have satisfied the persons who may have been employed to investigate the claims, and also the course of your company consequent thereon, we will forward them at once to the company in New York, and will aid you all in our power in effecting a satisfactory and prompt adjustment; ” but that this letter, which was written by Whittemore, referred exclusively to the losses on which suits had been brought, (which suits were successfully defended by these plaintiffs,) Whittemore having no knowledge of other losses at that time.
The auditor further found “ that, from the nature of the losses, their number and character, the difficulty in ascertaining them, the delay in receiving notice, and the great delay necessarily attending their examination and adjustment, it was practically impossible to make a full and accurate statement of every loss within sixty days from the date of its occurrence; that the arrangement made was under the circumstances a proper and reasonable one (assuming the defendants to be satisfied with the accuracy of the adjustments and the method of making them, of which no question was made) ; that the statement of loss was made under the circumstances within a reasonable time; that at the time the statement was given to Hills he made no objection either to the time of making or the form of it, but stated he would forward it to the company; and that the plaintiffs received no notice at any time from the defendants or their agents that there was any objection to the statement for any reason; but that on a subsequent demand- the defendants refused to pay.”
The auditor therefore found “ that there was a waiver of the sixty days’ provision in the 9th condition of insurance, by the defendants’ agents ; that the defendants were bound thereby; and that the defendants owed the plaintiffs the sum of §10,000, which was due and payable to them August 14, 1866, sixty days from the time the statement was delivered to Hills, together with interest thereon from that date.”
The auditor, in a supplemental report, found, as additional facts, that “the dates when the fires actually occurred wsstated with substantial accuracy, but that there was no evidence presented to the auditor of the precise time when these several losses or fires came to the knowledge of the plaintiffs; that the plaintiffs generally learned that fires had taken place within a few days of their occurrence; that their agent at once proceeded to ascertain in regard to them, as stated in the report; that generally an appraisal of the loss of each person was made within ten or twenty days, except in some cases where further delay was necessary to ascertain the facts; that in regard to these losses it was impossible for the plaintiffs to give notice of each loss immediately on receiving information of a fire, on account of the delay attending the examination and adjustment of each individual claim; that notice was given within a reasonable time ; that the defendants’ agents waived notice in writing; and that the defendants were bound thereby for reasons and upon facts more fully stated in the report.”
The case was reserved, by Ames, J., for the consideration of the full court, upon the reports of the auditor; “ if, as matter of law, he was authorized to find as he did, upon the facts by him reported, and if the evidence rejected by him was rightfully rejected, then judgment to be entered for the plaintiffs for $10,000 and interest, on his report; otherwise the case to stand for trial.”
Syllabus and headnotes are prepared by the reporter or publisher, not the court, and are not part of the opinion.
