Viele v. Germania Insurance Co.

Saratoga County Mutual Fire Insurance Company, 3 Hill, 508.

In the notes to Carpenter v. Washington Insurance Company (2 Am. Lead. Cases, pp. 624, 625) the learned editor criticises this case, and says: "The weight of authority in modern times would seem to be clearly the other way,' ," and cites Clark v. Jones (1 Denio, 516), which was the case of a voidable lease on non-payment of rent; and the same learned judge (BRONSON) held that the collection of rent after the forfeiture, and with knowledge, was a waiver. The editor further says, that "the view taken in Smith v. The Saratoga Mutual Insurance Company (above) has consequently been overruled by the subsequent course of decision, and the receipt of a part or the whole of the premium by the insurers with full knowledge of a prior forfeiture, held to affirm the contract and restore the policy to its former validity." (Citing Frost v. The Saratoga Mutual Insurance Company, 5 Denio, 154; Vial v. The Genesee Mutual Insurance Company, 19 Barb. 440; Leathers v. The Farmers' Mutual Insurance Company, 4 Foster, 259; Burbank v. The Rockingham Mutual Fire Insurance Company, id. 550; Bovier v. The Connecticut Life Insurance Company, 23 Conn. 244.

The case of Frost v. The Saratoga Mutual Insurance Company was an action on a policy issued by a mutual insurance company. The defense was on the ground of a false warranty, in that the insured, in his application, which was made part of the policy, had untruly stated that there were no buildings within ten rods of the buildings insured, but the insurers, with a knowledge of the loss, and of the inaccuracy of the statement, had afterward made assessments on the premium note given by the insured, which he had paid: held, that the insurers, in affirming the validity of the premium note, necessarily affirmed that the policy was also originally valid ; and the

Viele v. Germania Insurance Co.

court say, "the defendants shall not now be allowed to set up any fact dehors the policy, in order to impeach the original validity."

Here was no forfeiture, for the breach of the warranty occurred before the policy ever took effect; and how could that be void through a forfeiture which never had any validity.

Ames v. The New York Union Ins. Co. (14 N. Y. 253) was a case in which, by the terms of the policy and the conditions annexed, all applications for insurance should be made in writing and specify all incumbrances, etc. No application was signed by the assured, but what purported to be one was filled up by the agent without knowledge of the insured and sent to the company. It contained no notice of any incumbrance. The first policy had been issued by the agent with verbal notice from the plaintiff of the city bank mortgage, and he issued the one in suit as a renewal policy, with full knowledge of such mortgage, the property remaining in the same condition as when first insured. "The defendants took the premium for insuring the plaintiff and issued the policy, well knowing that there had been verbal notice, but none in writing." This was not a forfeiture but an estoppel upon consideration paid.

In the following cases relied upon by the counsel for plaintiff in this suit, the insurance companies were held to have waived conditions in the applications, requiring written notice or consent to certain things, or were estopped from setting up that the contract of insurance, the policy, had never been in force, or had effect; it having been shown that the company, with full knowledge of the breach of the conditions, had received the premium and issued the policy and delivered the same, after such breach and after such knowledge. Smith v. Gugerty, 4 Barb. 614; Goit v. National Protection Ins. Co., 25 id. VOL. XXVI. — 4

Viele v. Germania Insurance Co.

190; Liddle v. Market Fire Ins. Co., 4 Bosw. 179; New York Central Ins. Co. v. National Protection Ins. Co., 20 Barb. 468; Bigler v. New York Ins. Co., 22 N. Y. 402; Brown v. Cattaraugus County National Ins. Co., 18 id. 385.

On the contrary, in the case of Jennings v. The Chenango County Mutual Ins. Co. (2 Denio, 75), where the conditions made part of the policy declare that all applications for insurance must be in writing, and must state the relative situation of the property as to other buildings and the distance from each, if less than ten rods, and the printed application was so filled up as not to show the distance of other buildings from the insured property, though there was one within ten rods, - held, that the insured could not show by parol that the agent knew of this building at the time of making the application, and that plaintiff could not recover.

This case is affirmed in Chase v. Hamilton Ins. Co., 20 N. Y. 52; also, Brown v. The Cattarugus Mut. Ins. Co., 18 id. 387, and the case of Plumb v. The Cattaraugus Mut. Ins. Co., id. 392, distinguished.

The cases of Boehen v. Williamsburg Insurance Company, 35 id. 131; Rowley v. Empire Insurance Company, 36 id. 550; and Pindar v. Kings County Insurance Company, id. 648; Insurance Company v. Johnston, 23 Penn. 72; Sanford v. Ins. Co., 12 Cush. 541, are not in conflict with the foregoing cases.

VIII. The doctrine is established by an unbroken series of decisions, that, after a policy has once been forfeited, no waiver or estoppel can be set up successfully against the company by parol, unless made by the company or by an agent fully authorized, and upon a new and valuable. consideration. 1 Phillips on Ins. § 10, p. 8 (5th ed.); also, § 904, 1040, and authorities cited; also, 2 id. § 2155; Cockerill v. Cincinnati Ins. Co., 16 Ohio, 149; Frost

Viele v. Germania Insurance Co.

v. Saratoga Co. Mut. Ins. Co., 5 Denio, 154; Gates v. Madison Co. Mut. Ins. Co., 2 N. Y. 43; Smith v. The Saratoga Co. Mut. Ins. Co., 3 Hill, 508; Neely v. Onondaga Co. Mut. Ins. Co., 7 id. 50; Phonix Ins. Co. v. Lawrence, 4 Metc. 9; Forbes v. Agawam Mut. Ins. Co., 9 Cush. 470; Worcester Bank v. Hartford Ins. Co., 11 id. 265; Lee v. Howard Ins. Co., 3 Gray, 583; Barrett v. Un. Mut. Ins. Co., 7 Cush. 175; Murphy v. People's Ins. Co., 7 Allen (Mass.) 239; Evans ▾. Timountain Ins. Co., 9 id. 329; Muvey v. Shammut Ins. Co., 4 id. 116; Tebbetts v. Hamilton Ins. Co., 3 id. 569; Hale v. Mechanics' Ins. Co., 6 Gray, 169; Kimbal v. Howard Ins. Co., 8 id. 33; Philbrook v. New England Ins. Co., 37 Maine, 137; Gardiner v. Piscataquis Ins. Co., 38 id. 439; Hazard v. Franklin Ins. Co., 7 R. I. 429; Trask v. State Fire and Marine Ins. Co., 29 Penn. St. 198; Ripley v. Etna Ins. Co., 30 N. Y. 136; New England Fire & Marine Ins. Co. v. Scheulter, 38 Ill. 166.

In Wing v. Harvey (27 Eng. Law. & Eq. 140), the company collected and received the annual premium due after a forfeiture, and with full knowledge of the forfeiture, and thereafter treated the policy as in full force, and the court held they were estopped to set up the forfeiture.

In Keenan v. The Mo. State Mut. Ins. Co. (12 Iowa, 126), the provisions of the policy declare, that the consequences for the appropriation of the property to uses hazardous or extra hazardous are, that the policy should cease to be of effect "so long as the same shall be so used"; and the court very properly distinguished that case from one where the policy is absolutely void.

David v. Hartford Ins. Co. (13 Iowa, 69) does not conflict with the doctrine which we claim.

City of Davenport v. Peoria Ins. Co. (17 Iowa, 276) simply holds, that a parol contract to insure, followed by

Viele v. Germania Insurance Co.

delivery of a policy, is good, and the policy relates back to the parol contract, so as to cover an intervening loss.

The case of Hutchinson v. The Western Ins. Co. (21 Mo. 97) fully sustains the doctrine we have enunciated. IX. The court below charged the jury, that there was a waiver of the forfeiture in this case, if the agent of the defendant, with knowledge of the forfeiture, by his words, acts and declarations, led the plaintiff or his agent to believe, that the policy was still in force, and forfeiture not insisted upon by the company; and such acts, words and declarations were inconsistent with the forfeiture, and were such as to justify such belief in the mind of a reasonable man.

We assert, with the greatest confidence, that the law on this subject, as laid down by the court, is erroneous. It is clearly not within any of the numerous authorities already cited.

If a belief is generated in the mind of the plaintiff that the policy is in force, it is sufficient, without his acting on this belief, without his changing his position, without his doing something on the strength of that belief; and, in short, although the policy was absolutely forfeited and void, this conversation between the respective agents, which led plaintiff's agent to believe that the policy was still in force, was sufficient as a waiver of the forfeiture, or as an estoppel on the defendant from setting it up. This doctrine is not sustained by a single authority.

In the case of Cockerill v. Cincinnati Insurance Co. (16 Ohio, 149), it is held, that there must not only be a new and additional consideration, but it must be in writing. Baptist Church v. Brooklyn Insurance Co., 28 N. Y. 153.

In Spitzer v. St. Marks Insurance Co. (6 Duer, 6), the court say, that, "to revive a policy forfeited is the same as to make one, and it must be done in writing."