Lycoming Fire Insurance v. Woodworth

Mr. Justice Gordon delivered the opinion of the court, January 2d 1877. The material questions in this case are raised on the first, third and sixth points of. the defendant beloAV (plaintiff in error) and the answers thereto. As to the first point, Ave are not in a proper position to judge Avhether the answer is, or is not, strictly correct. The poAver executed by the company to Miller constitutes him “agent or surveyor,” but it does not define his duties or authority. It would appear, from the ansAyer, that Miller Avas called upon to define his own poAver, but tha.t part of his testimony is not before us, hence we must take it for granted that the submission Avas warranted by the evidence. If, hoAvever, we Avere to deal Avith the paper alone, we must take the word “ agent” in its general signification, and as embracing all powers which the company might confer on one whom it selected to represent it. If it be said the Avord “surveyor” limits and defines “agent,” we answer, not any more than the word “agent” limits and defines “surveyor;” in other words, either includes the duties and powers of both ; the agent is surveyor and the surveyor is agent; one officer is clothed Ayith the powers necessary to fill both offices. In any vieAV of the case the court cannot be convicted of error. The remaining exceptions 'will be considered together. It is true that one insuring [227] in a company formed on the mutual plan, is bound to inform himself of the rules and regulations of such company: Mitchell v. The Ins. Co., 1 P. F. Smith 402. But it is also true, that, as to those outside of it, such a company occupies no other or better position than one organized on the stock plan. As to one dealing for insurance such a company is bound, as any other, by the representations of its agent in the act of making the contract, for it cannot assume the advantages of his acts and avoid the disadvantages. The maxim “ Qui sentit eommodum, sentiré debet et onus,” is said by Justice Sharswood, in Mundorff v. Wickersham, 13 P. F. Smith 87, to embrace a principle which pervades the law in all its branches. It follows that this company could not profit by the fraud of its agent in inducing the plaintiffs to enter into a contract which they would not have entered into had it not been for such fraud, and it does not help the matter that they were thus made members of the company, for such membership arises from, but does not precede, the contract. What, then, does it matter that the plaintiffs were afterwards bound to know that the agent had no authority to make the representations by which they were induced to sign the contract ? It is doubtless true that, after the discovery of the true state of the case, • the plaintiffs could not lie by for an unreasonable length of time, and enjoy the security afforded by the policy and then be permitted to set up the fraud of the agent in order to relieve themselves of the assessments; this would be such a fraud upon the company as would estop them from alleging the invalidity of their contract. But this matter was properly disposed of in the answer to' the defendants’ fifth point. This case is similar, in every material particular, to that of the Lycoming Ins. Co. v. Bundy, afiirmed by this court at October Term 1872, per curiam. The same kind of representations were made, by the agent, to induce the defendant to enter into the contract of insurance as were made in this case, and nearly the same length of time intervened between the date of the policy and the setting up of the false representations to defeat the judgment on the premium note. In that ease, as in this, the main point, on which the company relied to defeat the plaintiffs’ action, was, that the agent was not authorized to make the representations which induced the execution of the premium note. Indeed, so nearly are the cases alike that to reverse the one would be to overrule the other; as, however, we are not prepared to adopt such a result, we must affirm this judgment. Judgment affirmed.