Kalmutz v. Northern Mutual Insurance

Opinion by Mr. Chibe Justice Sterrett, The policy in suit contains this provision as to other insurance : “ Policies of all other insurance upon property herein described — whether made prior or subsequent to the date hereof —must be indorsed on this policy, otherwise the insurance shall be void.” The existence of such other insurance, of which no indorsement was made on the policy, was conceded; and, in order to avoid the effect of the condition above quoted, the plaintiff undertook to prove that the defendant company, by its own acts, had waived the condition, and was thereby es-topped from setting it up as a bar to his recovery. As is usual in such cases, there was more or less conflicting testimony as to what passed between the plaintiff and the defendant’s agent at the inception of the contract. In the court below, as well as here, it was iorcibl}1' contended on plaintiff’s behalf that the testimony referred to was sufficient to warrant the jury in finding such facts as legally constitute an estoppel; but, inasmuch as the record discloses other undisputed evidence which necessarily leads to the same conclusion, it is unnecessary to consider in detail the conflicting testimony that was submitted to the jury on that question. The policy in suit was issued in April, 1894, and the last assessment thereon ivas made in October following. Defendant company’s secretary testified that he had notice of the additional insurance on the first Wednesday of November, 1894. Notwithstanding that notice to the company, the policy was neither recalled nor canceled; the premiums or assessments col [576] lected were not returned, nor was any effort made to return the premium note given by plaintiff, binding him to pay the premiums at such times and in such manner as the company’s directors might by law require. These facts were admitted; and if, as the authorities appear to hold, they operated as an estoppel, it will be unnecessary to consume time in the consideration of other questions sought to be raised by several of the specifications of error. On the subject of estoppel, a learned text writer has said: “ Where other insurance is required to be indorsed on the policy, if notice thereof is given to the insurer or its agent, and consent is not indorsed, nor the policy cancelled, further compliance is treated as waived, and the insurer is estopped from setting up such other insurance to defeat its liability upon the policy, and the same is true where the same agent issues both policies; although consent is not indorsed upon either policy, yet being issued with knowledge of the facts, the insurer is treated as having waived compliance, apd is estopped from setting up nonindorsement in defense. In all cases where the insurer, at the time the policy was issued, knew of other insurance, and there is no agreement for its cancelation or non-renewal, or when notice is given that other insurance has been obtained, it is bound either to indorse consent upon the policy or cancel it, or, failing to do either, it will be treated as having assented thereto Wood on Ins. (2d ed.) pp. 1162-1163. On the same subject, in Elliott v. Lycoming County Mutual Ins. Co., 66 Pa. 26, Mr. Justice Sharswood said: “Undoubtedly, if the companjr, after notice or knowledge of the over-insurance, treated the contract as subsisting, by making and collecting assessments under it from the insured, they could not afterwards set up its forfeiture. It would be an estoppel, which is the true ground upon which the doctrine of waiver in such cases rests.” In Wilson v. Mutual Fire Insurance Co., 174 Pa. 557, substantially the same doctrine is applied to the case of additional insurance. In Eureka Ins. Co. v. Robinson, Rea & Co., 56 Pa. 256, it was held that assenting to an assignment of the policjr subsequently to a known breach will operate as a waiver. The principle underlying these and other cases of like character is that where the company has knowledge of violation of a condition in the policy and yet continues to treat the policy as in force, it can [577] not bo permitted to set up sucb breach to defeat the contract. Presuming that the company did not intend to act dishonestly, the condition is considered as having been waived: Insurance Co. v. Todd, 83 Pa. 279. In Farmers’ Mutual Insurance Co. v. Taylor, 73 Pa. 342, an application was made to the agent of an insurance company for a risk of $4,000; the agent, in forwarding the application, said if the company could not take $4,000, he would place $1,000 in another company of which he was agent. The secretary agreed to take only $3,000, and this amount was placed in the first company, and $1,000 in the other, both policies being issued at the same time. The conditions of the first company avoided the policy unless other insurance was indorsed thereon. Eight months thereafter, and before any loss, the agent indorsed the insurance on the policy, notified the company, and no objection was made. This Court, in disposing of the question presented, said: “ So far as appears, the defendants were entirely satisfied with the acts of their agent. If they were dissatisfied, then was the time to have indicated it. If they desired to repudiate the policy, then was the time to have done so. They could not, after a full knowledge of the facts, retain the money paid for the insurance and withhold their objections until after the loss, thereby inducing the assured to rely on the validity of his policy.” The language of this Court, in Light v. Countrymen’s Mutual Fire Insurance Co., 169 Pa. 316, may be aptly applied to tbe ease before us : “This company demanded and received from bills plaintiff, as the lawful bolder of this policy, all the benefits and advantages which it was entitled to receive under it as a valid, subsisting policy, up until the moment of the fire. It would be a perversion of justice to permit it now to deny its liability and allow it to escape the payment of its just dues under tbe contract. That is precisely wbat estoppel means.” Further elaboration of the subject is not required. Enough has been said to show that upon the undisputed evidence in the case the learned trial judge would have been warranted in holding, as matter of law, that the defendant was estopped from setting up the condition above quoted as a bar to plaintiff’s claim, and in instructing the jury accordingly. Judgment affirmed.