Hill v. Phœnix Insurance

The opinion of the court was delivered by Hoyt, C. J. This action was brought upon an insurance policy issued by the defendant upon certain buildings and other property of the plaintiff. In its answer the defendant set up three grounds of defense: (1) That the action was barred by the limitations of the policy; (2) that the property had been burned by the willful- act of the plaintiff; and (S) that the claim of loss had been compromised, and a release of the defendant from all liability executed by the plaintiff, upon sufficient consideration. Plaintiff in reply denied that the limitation of time in which the action could be brought was six months from the date of the fire, as claimed in the answer, and alleged that such limitation was twelve months from such date, and denied the other defenses set up in the answer. Plaintiff introduced evidence as to the time of the appearance of the defendant in the action, and the proofs of loss which had been furnished the defendant, and rested. Thereupon the defendant made a motion for a non-suit, which was denied by the cohrt. The date of the fire was agreed upon, and it was also agreed that the action was not commenced until more than six months thereafter. Defendant introduced proof tending to show that the policy contained a clause [166] limiting the time in which an action could be brought to six months after the fire, and also, introduced proof tending to sustain the other .affirmative defenses set up in its answer. Plaintiff, in rebuttal,-introduced evidence which it was-claimed- tended to show that the limitation of time in the policy was twelve instead of six months, and that, if the limitation was' six months,.the action of the defendant had been such as to waive such limitation. • He also offered evidence for the purpose of contradicting that offered by the defendant in support of -its other affirmative defenses. A verdict was returned -for the plaintiff, upon which, after a motion for a new trial had been denied, judgment was duly entered. One of the grounds upon which it is claimed that the judgment should be reversed is the admission in evidence, over the objection of the defendant, of certain letters which passed between the local agents of the defendant and its general.agents. These letters were admitted' by the court only, for the purpose of being considered by the jury upon the question of the diligence of the plaintiff: in bringing the action, and it is contended that for that purpose they were competent evidence, for the reason that they had a tendency to show that the company had not come to a final determination in regard to the payment of plaintiff’s claim of loss; that until it had the limitation in the. policy as to. the time within which the action could be commenced was suspended. And in support of this contention the case of David v. Oakland Home. Ins. Co., 11 Wash. 181 (39 Pac. 443), is cited. An examination will show that it was the peculiar circumstances of that case which induced this court to hold that the action might be commenced within a reasonable time after the'company had noti167 fled the assured that it did not intend to pay the loss. The proofs wer.e such that the court was satisfied that up to and including the time within which the action could have been brought under the limitation in the policy, there had been negotiations between the par-* ties in regard to a compromise of the claim, and that the assured had reason to believe, from the action of the company, that such negotiations were to he continued until he was informed, of the company’s intention not to pay the loss; and it was under these circumstances that it was held that the assured would have a reasonable time within which to commence an action, after being informed of the company’s intention. In the case at bar there was no pretense of the existence of pending negotiations, for the settlement of the claim. The testimony on the part of the plaintiff was to the effect that the whole matter had been adjusted, and that nothing remained to be done, except for the company to pay the loss, while that on the part of the defendant was to the effect that the loss had been repudiated by the company, and such repudiation acquiesced in and confirmed by the plaintiff. On account of the difference in the circumstances surrounding this case .and the one above cited, what was said in that is of but little aid in the decision of this. It might well be questioned whether there was any proof in this case tending to show any waiver of the limitation in the policy by the defendant, and, if there was not, that question should not have been left to the jury. But it is not necessary to decide this question; for, even.if there was testimony sufficient to go to the jury upon that question, the letters .should not have been admitted as a part of such evidence. The assured was in no manner a party to these letters, and the fact that they had been written did not come [168] to his knowledge until long after the action had been barred, if the limitation in the policy was six months. They were not competent even for the purpose of showing that the company had not cometo a decision. The local agents by whom they were written had nothing whatever to do with the adjustment of the loss, and were not the agents of the company for any purpose in relation thereto. The letters, therefore, were of no more force than would have been letters of the same import from a stranger. They made suggestions as to the action desired on the part of the company, but such suggestions were purely voluntary and could have no effect upon the rights of the company. And, if the fact that they had been written had been communicated to the plaintiff, he would have had no right to have relied upon them, and for that reason they would not have been admissible in evidence against the company; and the fact that he had no notice that they had been written but furnishes an additional reason why they should have been excluded. Besides, it is doubtful whether, under .the pleadings and admitted facts, any proofs should have been admitted tending to show that the action would have been sooner brought but for the negotiations in reference to a settlement. It is indirectly admitted in the reply that definite notice of the understanding of the company that the policy had been' long before canceled, and the liability thereunder compromised, was communicated to the plaintiff on July 80th, and' the Undisputed proofs showed that these facts had been communicated to him early in August. Hence, from that date, if not earlier, he had definite notice of the refusal of the company to recognize his claim. The action was not commenced until November - 23d, and [169] since, under the authority of the case cited, the action must be brought within a reasonable time after a notice of a refusal to pay, it may well be questioned whether this action was commenced in time. What is a reasonable time must depend upon circumstances. And in view of the fact that, under the limitation in the policy which is under consideration, the time in which all of the preliminaries relating to the proof of loss, the decision of the company thereon, and such negotiations as might result, must be concluded and the action brought within six months, it is at least doubtful whether a period of more than three months after notice of refusal to pay was a reasonable time in which to bring suit. If a reasonable time was less than this three months and more, but one issue should have been submitted to the jury, and that was as to whether the limitation in the policy was six months or twelve. But since there must be a retrial of the cause, in which the evidence may disclose a different state of facts from that shown by the record, we shall not now decide whether or not the action was brought within a reasonable time after the communication to the plaintiff of the decision of the company as to the payment of the claim. The evidence in relation to the compromise of the claim and the execution of a release to the company was reasonably satisfactory, and it is open to question whether, in the light of all the circumstances, the testimony of the plaintiff was sufficient to authorize a finding by the jury that no such compromise had been made, or release executed. But for the same reason that we deem it unnecessary to pass upon the question of reasonable time for bringing the action, we shall not now decide as to the sufficiency of this evidence. [170] The court instructed the jury that, even if they found this compromise to have been made and the release executed for a consideration less than the amount of the loss, it would not bar an action, if at the time the release was executed the loss had. been .adj usted, and an agreement made by the' company to pay. A careful'examination of the evidence has failed.to-disclose anything which warranted this instruction' on the part of the court. The only proof bearing upon the subject was to the effect that the loss had been ad-justéd, and that the adjuster had stated to the plaintiff that it would be paid in due course ; and this, in the light of the circúmstances disclosed by-the undisputed evidence, was insufficient to show-that the company had agreed that' it was liable to the plaintiff in the amount at which the loss had been adjusted; The object of the'adjustment was to determine the amount of damage which the. fire had caused to the property, covered by the policy of insurance, and, upon such de-> termination, to cause- proofs óf loss to bé furnished the company, upon' which ' it was to determine as to whether or not it was liable- to the assured. -The business of the adjuster is only to determine the amount of the loss, and to assist the assured in making up his proofs. Under the changed conditions of a retrial in accordance with this opinion, any discussion of the ■ other alleged errors would be of little value. The judgment will- be reversed, and the cause remanded for retrial; Anders and Scott, JJ., concur.