Rademacher v. Greenwich Insurance

O’BRIEN, J. Chapter 488 of the Laws of 1886 provides for a uniform policy of insurance, known as the “Standard” policy, and makes its use compulsory upon insurance companies. Such a policy the defendant issued to the plaintiff on wearing apparel and household goods, some of which, it is claimed, were totally, and some partially, damaged by a fire occurring on the 23d day of February, 1891. The policy contained the usual clauses to be found in standard policies, requiring the insured, if a fire occurred, to give immediate notice of any loss, and the further clause providing for an arbitration in the event of disagreement as to the amount of such loss. Upon these clauses, and the fact that the plaintiff claimed $627.66 as her damage, the questions presented upon this appeal turn. The plaintiff alone testified as to value, and not only her competency, but the question of the weight to be attached to her evi [156] deuce, is presented by proper exceptions. It was insisted on the trial,, as it is upon this appeal, that there was a fraudulent statement of the amount of loss, that it did not exceed $70.53, and that the verdict of the jury was erroneous in awarding $400, as was the ruling in refusing to dismiss the complaint. The evidence, though slight and unsatisfactory upon the question of value, was, we think, sufficient for presentation to the jury. Although not a dealer in the articles injured, it nevertheless appeared that the plaintiff for a number of years had been engaged in housekeeping, and had from time to time purchased similar articles, and was familiar with the prices at which they sold. This property consisted of wearing-apparel and household goods, and an expression of her opinion as to-their value, coupled with the basis upon which such opinion was-predicated, showing that she took the cost of such property, and deducted for depreciation 25 per cent., was some, and we think competent, evidence upon the question of value. On the part of the defendant the experts testified that the property' partially damaged was not worth more than $140, and that the damage thereto was' but $70; and these experts expressed the belief that this was the extent of the injury to plaintiff, for the reason that, they did not think, from the character of the fire and the appearance of the property in the house where the fire occurred, that any property was totally destroyed. The value of property destroyed, the plaintiff had placed at over $200; and the questions were before the jury whether any property had in point of fact been destroyed, and, if so, how much, which, together with the partial damage sustained, would be the amount the plaintiff was entitled to recover. Whatever our personal views as to the credibility to-be attached to the different versions, we think that where, as here, there was not that clear preponderance in favor of the defendant which would have justified a direction in its favor, the verdict of the jury thereon is conclusive, as it is upon the cognate question of overvaluation. In addition to the question of the extent of the loss, the defendant, at the close of plaintiff’s testimony, and again at the close of the defendant’s testimony, moved to dismiss upon the following grounds: (1) That it is a condition precedent of the plaintiff’s right to recover under the policy that her loss should be ascertained by appraisal, and, in case the appraisers disagree, by the decision of an umpire; (2) that the policy provides that proofs, of loss should be furnished within 60 days of the fire, and the plaintiff has shown that they were not served until the expiration of 90 days. Upon the law there can be no doubt that the furnishing of proofs of loss, and, in the event of a disagreement, the undertaking, in good faith, to have an appraisal of the property, are conditions precedent to a right to recover, and a breach thereof, unless waived, constitutes a defense. Quinlan v. Insurance Co., 133; N. Y. 357, 31 N. E. 31. The difficulty to be found in the questions; presented upon this appeal is not in the law, which we regard as settled, but in its application to the facts here appearing. In determining, therefore, the strength of these objections, the, testi [157] many relating thereto must be referred to. Immediately after the fire the defendant was duly notified, and sent a person to examine the premises, and, although it is not apparent just how it arose, the parties disagreed as to the extent of the loss. The policy required that, in the event of such a disagreement, the loss should be determined by appraisal, each party selecting one appraiser, and, in case such appraisers disagreed, by the decision of an umpire. The agreement of arbitration, signed by both parties, bears date the 2d day of April. These appraisers could not agree, and undertook to select an umpire, the defendant’s appraiser selecting four names, which were forwarded to plaintiff’s appraiser, and upon which the latter did not act until he had received a letter from defendant’s appraiser calling attention to the names submitted, and requesting an answer, which was sent on the 13th of April by the plaintiff’s appraiser, who, without objecting in his letter to the names submitted by defendant, proposed three other names. To this the defendant’s appraiser responded, stating that he had made an examination of the standing of the parties submitted to act as umpire, and that he could not accept any of them, because he had ascertained that they were not furniture dealers, or in any way competent to act in a loss of the kind, and that he would like to hear from the plaintiff’s appraiser as to whether he accepted or declined the parties offered by him. In addition, the plaintiff’s appraiser testified that he had suggested the names of furniture men, naming one firm, and that he was unable to agree with the other side upon an umpire. The motion to dismiss upon this branch was necessarily placed upon the ground that upon this showing by plaintiff the court was bound, as a matter of law, to hold that the plaintiff had not complied with this condition of the policy in obtaining an appraisal. In Uhrig v. Insurance Co., 101 N. Y. 365, 4 N. E. 745, it was said: “Under the arbitration clause it was the duty of each party to act in good faith to accomplish the appraisement in the way provided in the policy; and if either party acted in bad faith, so as to defeat the real object of the clause, it absolved the other party from compliance therewith; and if either party refused to go on with the arbitration, or to complete it, or to procure the appointment of an umpire, so that there could be an agreement upon an appraisal, the other party was absolved. The claimant under such a policy cannot be tied up forever, without his fault and against his will, by an ineffectual arbitration.” And, as further said in the opinion in that case: “Upon all the evidence, it was a. question of fact for the jury to determine whether there was any breach of this clause in the policy.” So, here, we think it was, upon the evidence, a question of fact proper to be submitted to the jury, because plaintiff’s want of good faith was not so clear as to have justified the court in ruling, as a matter of law, that the plaintiff had violated this condition. Had the defendant requested to go to the jury upon this question, it would undoubtedly have been entitled to do so, as, upon all the evidence, a question of fact was fairly presented whether or not the [158] plaintiff had acted in entire good faith in endeavoring to select, after the appraisers had disagreed, a disinterested and impartial umpire. Such request, however, was not made by defendant, relying, as it did, upon the right to have the question disposed of as a matter of law; and, with this position taken by the defendant, we do not think the ruling of the trial judge was wrong. The other ground of the motion to dismiss, namely, the failure to present proofs of loss in time, is the most serious question in the case. It is conceded that the fire occurred in February, that proofs were not furnished until May, and that the policy required that they should be furnished within 60 days after the fire. Upon the law, therefore, unless the evidence shows that this condition has been expressly or impliedly waived, it would bar the plaintiff's recovery. The question .of what will constitute a waiver has been frequently discussed. In Koller v. Insurance Co.1 it was said: “While a waiver of a condition of forfeiture need not be based upon a technical estoppel, yet, in the absence of an express waiver, some of the elements of an estoppel must exist—the insured must have been misled by some action of the company which caused the omission to comply with the condition, or it must have done something, after knowledge of a breach of the condition, which could only be done by virtue of the policy. Armstrong v. Insurance Co., 130 N. Y. 560, 29 N. E. 991; Ronald v. Association, 132 N. Y. 378, 30 N. E. 739. Forfeitures plainly incurred, and not waived, must be enforced by the courts. Quinlan v. Insurance Co., 133 N. Y. 356, 31 N. E. 31. * * * Mere silence at a time when it was not required to speak is not a waiver, nor evidence from which waiver may be inferred, (Armstrong v. Insurance Co., supra;) so that the mere retention of proofs served after the time limited for their service is not performance of the condition precedent.” The facts relied upon in this case to show waiver are the receipt of the proofs of loss without objection, and retaining the same, and the entering into the agreement of arbitration before the time had expired within which the proofs of loss should have been furnished. In Brink v. Insurance Co., 80 N. Y. 113, it was said: “If a company intends to avail itself of the technical objection that the proofs are not filed in time, common fairness requires that it should refuse to receive them on that ground, or at least promptly notify the assured of their determination; otherwise, the objection should be regarded as waived.” And, though the question has not been directly passed upon in this state, an argument in support of the proposition that the entering into an arbitration before notice or proofs of loss have been served is a waiver of notice or proofs of loss, notwithstanding a stipulation in such submission that it shall not operate as such waiver, is furnished by the case of Gale v. Insurance Co., 33 Mo. App. 664. The answer of the defendant does not affirmatively allege a forfeiture for failure to file proofs of loss; such answer admitting that they were received at the date fixed in the complaint, which was subsequent to the 60 days, but denying that the plaintiff has complied with the conditions of the policy. Although we think that the question as to a waiver by implication is [159] close, yet, in view of the issues, and the way in which this question was presented, we think that the trial judge was not obliged to dismiss the complaint; and, upon the same motion being made at the close of the case, the additional reason was then furnished by the circumstance appearing that after the appraisers had failed to agree, but within the time limited for filing proofs of loss, the defendant sent three appraisers, who made out a detailed statement of the loss, after fully interrogating the plaintiff upon the extent of her claim. Our conclusion, therefore, is that the judgment is right, and should be affirmed, with costs. All concur. Footnotes [1] See note at end of case. [159] NOTE. In the action by Joseph B. Koller against the German-American Insurance Company, in the superior court of New York city, the following opinion was delivered by McAdam, J., (January, 1893,) on a motion to dismiss complaint in the nature of a demurrer: “The action is on a fire insurance policy, and the complaint, properly construed, alleges that the plaintiff performed all the conditions of the policy on his part, by serving on the defendant, March 14, 1891, notice and proofs of loss, which were received, accepted, and retained by the defendant without objection. The fire occurred December 26, 1890, so that the proofs of loss were served seventy-eight days after the fire, while the policy, which is annexed to and made part of the complaint, requires that such proofs be served within sixty days after the occurrence of the fire. This is a condition precedent to any right of action. McDermott v. Insurance Co., 44 N. Y. Super. Ct. 221; Underwood v. Insurance Co., 57 N. Y. 500; Blossom v. Insurance Co., 64 N. Y. 162; Quinlan v. Insurance Co., 133 N. Y. 356, 31 N. E. 31. True, the condition may be waived; but neither excuse for nonperformance nor waiver is pleaded, unless it is to be inferred from the allegation that ‘the proofs were received, accepted, and .retained by the defendant without objection;’ and in this regard the plaintiff has failed to recognize the obvious distinction between acts amounting to waiver before breach or forfeiture and those occurring afterwards. The distinction is clearly stated in May, Ins. (3d Ed.) § 464. See, also, Wood, Ins. (2d Ed.) p. 941; Brown v. Assurance Corp., 40 Hun, 101, 107; Blossom, v. Insurance Co., supra. The books contain cases wherein the courts have held that the retention, without objection, of proofs of loss timely served, is a waiver of all technicalities or informalities which might have been corrected if they had been promptly pointed out, (Titus v. Insurance Co., 8 Abb. N. C. 315, 81 N. Y. 410; Richards, Ins. § 85;) and wherein proofs have been held waived altogether, where the company led the insured to-suppose that none would be required, (Lawry v. Insurance Co., 32 Hun, 329;) or by its conduct led to delays, which it afterwards complained of, (Van Allen v. Insurance Co., 10 Hun, 397, affirmed 72 N. Y. 604; Goodwin v. Insurance Co., 73 N. Y. 480; Bishop v. Insurance Co., 130 N. Y. 488, 29 N. E. 844;) or where the company, in advance, unconditionally refused to pay anything. There are cases also where the proofs were not served in time, and the objection was deemed waived because the company retained the proofs, and puts its refusal to pay on other grounds. O’Reilly v. Assurance Corp., 19 N. Y. Wkly. Dig. 147; Owen v. Insurance Co., 10 Abb. Pr. (N. S.) 166, note; Bennett v. Insurance Co., 15 Abb. N. C. 234. The headnote to Brink v. Insurance Go., 80 N. Y. 108, intimates that the mere intention of proofs served too late amounts to a waiver of the objection; but the decision of the court does not sustain the intimation. The court holds that a company may refuse to pay a loss without specifying any ground, and, when sued, may insist upon any available ground; but if the company plants itself upon a specific defense, and so notifies the assured, it cannot retract after he has acted on its position, and incurred expense in consequence of it. In that case the company accepted the proofs after the time had gone by, examined the insured in respect to them, and decided not to pay the loss upon the ground of fraud, and so declared to the assured. The company, at the trial, sought for the first time to raise the question of the [160] time of filing the proofs of loss, and the court held that by its conduct it was ■estopped from so doing. No new consideration is required to support the waiver, and it may be established by proof of acts or conduct, even after forfeiture, recognizing the continued validity of the policy, and indicating ■an intention to waive such condition. Prentice v. Insurance Co., 77 N. Y. 483; Goodwin v. Insurance Co., 73 N. Y. 480; Titus v. Insurance Co., 81 N. Y. 410; Brink v. Insurance Co., supra; Weed v. Insurance Co., 133 N. Y. 394, 31 N. E. 231. While a waiver of a condition of forfeiture need not be based upon a technical estoppel, yet, in the absence of an express waiver, •some of the elements of afi estoppel must exist,—the insured must have been misled by some action of the company, which caused the omission to comply with the condition, or it must have done something, after knowledge of a breach of the condition, which could only be done by virtue of the policy. Armstrong v. Insurance Co., 130 N. Y. 560, 29 N. E. 991; Ronald v. Association, 132 N. Y. 378, 30 N. E. 739. Forfeitures plainly incurred, and not waived, must be enforced by the courts. Quinlan v. Insurance Co., 133 N. Y. 356, 31 N. E. 31. In the present case, waiver is not alleged; nor is it claimed that the defendant, by any act of its officers or agents, dispensed with the proofs, or with due and timely service thereof, or that it put its refusal to pay on any specific ground which recognized the continued validity of the policy. Mere silence at a time when it was not required to speak is not a waiver, nor evidence from which waiver may be inferred, (Armstrong v. Insurance Co., supra;) so that the mere retention of proofs served after the time limited for their service is not performance of the condition precedent. No one would seriously contend that the indorser of a promissory note would be held to have waived timely service of notice of protest by the mere fact -of retaining a notice served eighteen days after the time legally appointed for such service. Some affirmative act or expression recognizing continuing liability would be necessary. . Silence would not be sufficient. And yet there is no substantial difference between the case put and the one at bar. The ■demurrer to the complaint must therefore be sustained, unless (1) within ten days the plaintiff amends his complaint by striking out the special allegation of service of the proofs on March 14, 1891, leaving the cause of action rest on the general allegation of performance; or (2) by omitting allegations ■of performance, and alleging waiver of performance, or excuse for nonperformance, (Oakley v. Morton, 11 N. Y. 25; Garvey v. Fowler, 4 Sandf. 665; Hosley v. Black, 28 N. Y. 438; Baldwin v. Munn, 2 Wend. 399; Crandall v. Clark, 7 Barb. 169; Baxter v. Insurance Co., 44 Hun, at page 185;) or (3) by amending in such manner or form as he may be advised to bring the case within the authorities applicable to the facts; that the allegata and probata may agree, (Riggs v. Chapin, [City Ct. N. Y.] 7 N. Y. Supp. 765;) the amendment to be made on payment of $20 costs, (the trial fee of an issue ■of law,) and without prejudice to the proceedings already had.