Inman v. Western Fire Insurance

By the Court, Sutherland, J. It is well settled that the proposals and conditions annexed to a policy of insurance form a part of the contract between the parties, and have the — 456 — same legal force and' effect as though they were in form incorporated in the body of the policy. Routledge v. Burrell and another, 1 H. Black. 254. Wood v. Worsley, 2 id. 574, and Oldman v. Bewicke, reported in note to the last case, page 577: and Worsley v. Wood, being the same case in error, 6 T. R. 710. Duncan v. Sun Fire Insurance Company, 6 Wendell, 488. 2 Coudy’s Marsh. 811. The doctrine is not denied, but is conceded by the form of the pleadings in this case ; for the plaintiff sets forth the proposals and conditions in his declaration as a part of the contract, and undertakes to show a substantia] compliance with them. The same cases also show that the acts required by these proposals to be done by the assured are conditions precedent, without the performance of which he cannot require payment of the loss. This was finally settled, after an elaborate argument and a mature consideration by the court, in Wood and others v. Worsley, 6 T. R. 710, in error. The proposals attached to the policy upon which that action was brought, required among other things, that the assured should give notice of the loss forthwith, and as soon as possible deliver in an account, &c. and should procure' a certificate under the hands of the minister, church wardens and some respectable householders of the parish not con cerned in the loss, importing that they were acquainted with the character and circumstances of the person insured, and knew or believed that he, by misfortune and without fraud or evil practice had sustained by such fire the loss and damage therein mentioned. The declaration averred that the plaintiffs gave notice of the loss on the day of the fire, and also delivered a particular account of the same ; and that on the same day they procured and delivered tothe company a certificate under the hands of four reputable householders of the parish, to the effect required in the printed proposals; and that they applied to the minister and church wardens of the parish to sign such certificate, but that they, without any reasonable or probable cause, wrongfully and unjustly refused, and hace ever since rfused to sign it. If was the unanimous opinion of the court of king’s bench that this averment was not sufficient to enable the plaintiffs to recover; that the certificate of the minister andchurch warden, by the contract between the parties, was made a condi — 457 — tion precedent to the payment; and that it was not in the power of the plaintiffs to vary the contract by substituting a certificate made by other persons. It was admitted by the counsel for the plaintiffs (the defendants in error) that if the procuring of the certificate was a strict condition precedent, no action could accrue until they had procured it. But it was strongly contended that it was not so to be considered ; that the procuring of the certificate was not a fact on which the plaintiffs’ title was grounded, but was mere evidence of that title; that here the title was made out without it. It was urged that it was apparent from the whole instrument that it was the intention of the parties that the assured should recover, provided they had been guilty of no fraud; that here the loss was settled by the verdict, and all fraud negatived. It was admitted that the assured were bound to comply with the prescribed regulations and conditions as far as such compliance depended upon themselves ; that here they had done every thing that was in their power to comply with them; they had given notice and delivered in an account of the loss, and procured a certificate from four reputable freeholders, and had called upon the minister and church wardens for their signatures, which they had, without any reasonable cause, refused; that the plaintiffs ought not to be prejudiced by such improper refusal — an act over which they had no control. But it was answered by Lord Kenyon, that it was clear in his judgment from the printed proposals, that the certificate there prescribed should precede payment by the insurance office ; that it was therefore a condition precedent; and that where it is imposed, as a condition precedent, that any thing shall be done, not impossible in itself, no matter how improbable or difficult it may be, it must be done, or the right which was to attach on its being performed did not vest ; and he put the case of a condition, that A. shall enfeoff B., and A . do all in his power to perform the condition, and B. will not receive livery of seisin; yet, he remarked that it had not been doubted, from the time of Lord Coke, that the right which was to depend on the performance of that act did not accrue. He also adverted to the imputed harshness and — 458 — severity of this doctrine, and remarked that these companies-w6re subject to great frauds and impositions ; and that it was-but an act of common prudence, to take all possible ea-re to- • Protect themselves from imposition; and that, to require a-certificate from the minister and church wardens, men of character and respectability, as might be presumed, that they believed the loss had been fairly sustained, was not unreasonable ; but whether it was or not, they had a right to make it a condition of the contract, and to refuse to insure upon any other terms ; that it was the misfortune of the plaintiffs if the individuals named would not certify ; but that it gave, neither to them nor the court, a right to alter the contract; Ashurst, J. also held the certificate to be a condition precedent, without which the plaintiff should not recover. He also expressed the opinion that there was nothing unreasonable in requiring it; that when the temptation to commit fraud was so great, it was an act of prudence in them to require a certificate from the minister and church wardens, persons who, from their situation in life, were not likely to assist in such fraud. Grose and Lawrence, Js. were equally clear and decided in their opinions. The latter remarked, that it appeared to him that a fire without fraud (under the contract of the parties) was not enough to give the assured a right of action ; but it must be a fire accompanied with the notice, affidavit and certificate specified in the proposals ; that the certificate produced was not even a substantial performance of the condition, admitting that would have been sufficient; that it was the substitution of one certificate for another ; that it may be difficult to determine who shall be called reputable or substantial persons ; and, in order to avoid that difficulty, the insurance company insists upon a certificate from persons holding public situations in the parish; that in his opinion there was nothing unreasonable in this: that it was a duty which the officers owed to the public as well as themselves, to take every precaution to guard against fraudand unless some such check as this were interposed, they would be holding out a premium to wicked mentó set fire°to their own houses. He was clear that-it was a condition precedent and admitting the refusal of the minister and church wardens to be improper — 459 — and unreasonable, he said the cases were uniform to show that if a person undertakes for the act of a stranger, that act must be done. I have stated the observations of counsel and the opinions of the judges in this case somewhat at length, because they appear to me substantially to present the whole argument upon both sides of the question. In Oldman v. Bewicke and others, 2 H. Black. 577, note the declaration, instead of averring the delivery of the certificate signed by the miuister and church wardens, alleged by way of excuse, that the minister, at the time of and long before the loss, resided at a distance from and out of the parish, and was wholly unacquainted with the character and circumstances of the assured, and wholly unable to make such certificate as was required by the policy; but the assured did procure and deliver to the defendant a certificate, under the hands of A., B. and C., respectable inhabitants of said parish. The defendant pleaded that the premises were wilfully set on fire by the assured, and that he had no interest in them at the time of their destruction ; upon which plea the plaintiff took issue, and both the issues were found in his favor by the jury. But the judgment was arrested, for the defect of the declaration, in not averring delivery of the certificate of the minister. It was held to be a case of a defective title, and not of a title defectively set forth and therefore not waived by the plea, or cured by the verdict. All the judges who heard the cause, Lord Loughborough, and Gould and Nares, justices, held it to be a clear case of a condition precedent, in which an averment of performance was indispensable ; that an excuse for performance was inadmissible. In Routledge v. Burrell, 1 H. Black. 254, the plaintiff averred that he applied to the minister and church wardens, and to many respectable inhabitants, to procure the certificate required by the proposals, and that he was entitled to such certificate; but that the defendant, by false insinuations, induced the minister to refuse to sign it. The defendant, in his plea to the first count, denied that he had induced or prevailed upon the minister so to refuse the certificate. To the second count he pleaded generally, that the assured had not procured and delivered the certificate, &c; to which the — 460 — plaintiff demurred. The court held the case too clear to ad- ” mit of doubt, and gave judgment for the defendant. It is well settled that where there is a condition precedent, or a warranty in a policy of insurance, it is of no consequence whether the thing warranted, or to be performed, is material to the risk or not, if not performed. The defendant has a right to say non hcec in fader a veni. Fowler v. The Ætna Fire Ins. Co., 6 Cowen, 673. Duncan v. The Sun Fire Ins. Co., 6 Wendell, 488. 7 Cowen, 649. Cornell v. Le Roy, 9 Wendell, 163, and the authorities cited in those cases. 19 Johns. R. 72. 6 Cowen, 624. It seems, then, from an examination of the preceding cases to be well settled, that the acts required to be performed by the proposals annexed to the policy are conditions precedent, without the performance of which the plaintiff cannot recover his loss: that performance must therefore be averred in the declaration, or it will be held bad upon demurrer, or judgment will be arrested after verdict; that no excuse can be received in lieu of performance, and that it will not avail the plaintiff, although he show that he Ijas done every thing in his power to comply with the condition, but has been prevented by the unreasonable or wrongful act of a third person ; and that it is of no, importance whether the risk of the defendant is, or is not increased by the omission. Let us now apply these principles to the case before us. The ninth condition, annexed to the policy on which this action is founded, provides that all persons sustaining loss or damage by fire shall forthwith give notice thereof to the company, and as soon thereafter as possible deliver in a particular account of such loss. The declaration alleges the buildings to have been consumed on the 23d of February, 1827, and that the plaintiff gave notice thereof to the defendants on the 2d of April ensuing. Does this satisfy the condition which requires notice to be forthwith given ? Forthwith means immediately, without delay, directly. In giving a construction to terms of this description, some regard must undoubtedly be had to the nature of the act or thing to be performed, and the circumstances of the case. Where the thing required to be done is complicated, composed of a variety of parts, incapable in the nature of — 461 — things, of being instantly accomplished by a single act or volition of the parties will be understood, when they use language of this, prompt and imperative character, as intending merely that there shall be no unnecessary delay in the performance. It may perhaps be conceded that it never imposes upon the party any thing more than what is called due indulgence, under all the circumstances of the case. There must be no unnecessary procrastination or delay. Cornell v. Le Roy, 9 Wendell, 165, 6. Nothing which the law calls laches. The act required to be done forthwith in this case was simply the giving notice to the company that this building, covered by their policy, had been burned. A written notice to that effect, directed to the agent of the company and deposited in the post-office, would have been a full compliance with this condition— an act which it certainly required neither labor nor time to accomplish. No argument can illustrate the proposition, that a notice given thirty-eight days after the fire, was neither a literal nor a substantial compliance with this condition. Even if the law would allow of an excuse for delay, it is difficult to conceive of a reasonable apology for negligence like this. That time may be deemed of the essence of a contract cannot be questioned. Indeed, as a genera] rule, it is so considered at law. If the vendor, in a contract for the sale of land, is not ready and able to perform his part of the agreement on the day fixed by the contract, the purchaser may consider the contract at an end, and stand discharged from its obligation. Sugd. Law of Vendors, ch. 8, p. 266. Mr. Sugden says, in sales by private agreement, it is usual to fix a time for completing the contract, which is at law deemed of the essence of the contract; but in certain cases equity will carry the agréement into execution, notwithstanding the time appointed be elapsed. Waters v. Travis, 9 Johns. R. 450. 5 Cranch, 262. Berry v. Young, 2 Esp. N. P. C. 641, note. Cornish v. Rowley, cited 1 Wheat. Selw. 137. Bank of Columbia v. Hagner, 1 Peters’ R. 455, 465. And in such cases, to entitle the vendor to recover the purchase money, he must aver in his declaration performance of the contract on his part, or an offer to perform, on the day specified for performance; and this averment must be sustain — 462 — ed by proof, unless the tender has been waived by the purchas-er. 1 Peters, 467. The case of Lester v. Garland, 15 Ves. 248, shows, that even in equity, time is frequently considered as the essence of an act. That was a bequest of the residue A of the testator's personal estate to trustees, to be paid to the children of A., in case A. should, within six months after the testator’s decease, give security to the satisfaction of the trustees, not to marry B., with a proviso to go over to other relatives, if she should refuse or neglect to give such security. It was held that the giving the security within the six months was a condition precedent, without the strict performance of which the children of A. could not claim the estate. Lancashire v. Killingworth, 1 Ld. Raym. 686, and the authorities there referred to. The case of Doe, ex dem Pitt v. Lanning, 4 Campb. 73, presented the question, whether a third person could avail himself of the omission of a party to a contract, to perform an act within a stipulated time, where the other party to the contract did not claim a forfeiture, but had subsequently ratified the act; and all that Lord Ellenborough says beyond that point is extra-judicial. That it is not material to an insurance company to receive prompt notice, where buildings insured by them are destroyed by fire, is too clear to require argument or illustration to prove it. All the circumstances of the case are then fresh in the recollection of those who have any knowledge of the transaction. The indicia of fraud are then more easily detected and developed. A thousand circumstances, too unimportant to make a lasting impression upon the memory, may be susceptible of proof, while the transaction is fresh, and may afford a clue which will lead to the most important results. Witnesses may die, or be induced to go off. To what extent is the indulgence claimed in this case to be carried l If strict diligence is not required, I see no limitation. Two, three or even six months may as well he contended for as one. It will be found, upon an examination, of the precedents and cases, that it is uniformly averred in the declaration, that notice of the loss was forthwith given, in the very terms of the condition. It appears to me, therefore, upon this broad view of the case, that the plaintiff’s declaration is — 463 — radically defective, and that on that ground the defendants must have judgment. It is unnecessary, therefore, to go into a consideration of the subsequent pleadings. Judgment for defendants on demurrer.