Northern Assurance Co. v. Hanna

Sullivan, J. In the district court of Lancaster county Charles A. Hanna, the plaintiff below, recovered a judgment against the Northern Assurance Company of London, England, on a fire insurance policy covering a stock of merchandise. It is insisted that the'judgment should be reversed, because (1) proofs of loss were not furnished within the time fixed by the contract of insurance; (2) that there was neither averment nor proof of a waiver of the condition with respect to furnishing proofs of loss; and (3) that if the defendant is liable, the action was prematurely brought. We will consider these propositions in regular order. It appears that the policy provided for the furnishing of proofs of loss within sixty days after the fire, and that such proofs were not furnished until after the time so limited. Counsel for the defendant claims that the provision in question is a condition piecedent to the right, of recovery, and cites a large number of authorities in support of his claim. Special stress, however, is laid on German Ins. Co. v. Davis, 40 Nebr., 700, 712, where, in an opinion by the present chief justice, it is said: “In the case under review the plaintiff, before he was entitled to recover, was required to establish by competent evidence either that notice and proofs of loss were furnished the company within the time stated in, and according to the requirements of, the policy, or that the defendant waived the same.” We have no doubt about the correctness of the statement quoted as applied to the facts of the Davis Gase. The policy in that case expressly pro [31] viclecl for a forfeiture of all claims under it, if proofs of loss were not furnished within sixty days after the destruction of the insured property. The policy in this case contains no such provision. It declares that “the loss shall not become payable until sixty days after * * proofs of the loss herein required have been received by this company.” Another provision is that no suit shall be commenced on the- contract “until after full compliance by the insured with all the foregoing requirements, nor unless commenced within twelve months next after the fire.” There is no forfeiture expressly provided foia, and we are not authorized to supply one by constxmction. Our conclusion upon this branch of the case is that the time within which proofs of loss were to be furxxished is not of the essence of the contract; and Ahat the failure to furnish such proofs within the prescribed period did not work a forfeiture of plaintiff’s claim for idemnity. The authorities sup]xorting this view are abxxndant: Rheims v. Standard Fire Ins. Co., 39 W. Va., 672; Tubbs v. Dwelling-House Ins. Co., 84 Mich., 646; Steele v. German Ins. Co., 93 Mich., 81; Kenton Ins. Co. v. Downs, 90 Ky., 236; Niagara Fire Ins. Co. v. Scammon, 100 Ill. 644; Vangindertaelen v. Phenix Ins. Co., 82 Wis., 112; 13 Am. & Eng. Ency. Law [2d ed.], 328. Having reached the conclusion that the furnishing of proofs of loss within sixty days from the date of the fire was not a prerequisite to a-suit upon the policy, the defendant’s second proposition may be conceded. This action was instituted within thirty days after plaintiff had furnished proofs of loss, and it' is insisted by counsel for defendant that the right of action had not then accrued. It is alleged in the answer that the company had denied liability on the policy, and had refused to pay the plaintiff’s claim, before suit was commenced. This, according to the authorities, amounted to a waiver of the right secux’ed to the insurer by the clause providing that sixty days should intexwene between the furnishing of proofs of loss and the commencement of an action [32] on the policy. It has been sometimes said that stipulations like the one here in question are to be regarded as contracts for credit; but it is, perhaps, more accurate to say that they are intended to give the insurer time to inquire into the cause of loss and make provision for payment. California Ins. Co. v. Gracey, 15 Colo., 70; Hand v. National Live-Stock Ins. Co., 57 Minn., 519; German Ins. Co. v. Gibson, 53 Ark., 494; Cascade Fire & Marine Ins. Co. v. Journal Publishing Co., 1 Wash., 452; 13 Am. & Eng. Ency. Law [2d. ed.], 375. In Star Union Lumber Co. v. Finney, 35 Nebr., 214, it was held, in an opinion by Maxwell, C. J., that the provision is never effective to defeat an action, and is to be construed merely as a stipulation exempting the insurer from costs during the specified period. Without accepting this view, or at this time dissenting from it, we hold, in conformity with the authori- • ites here and elsewhere, that an unqualified denial of liability, and an absolute refusal to pay at any time, is a waiver by the insurer of the right to have a stipulated time within which to make payment. Omaha Fire Ins. Co. v. Hildebrand, 54 Nebr., 306; Rome Fire Ins. Co. v. Fallon, 45 Nebr., 554. After the company had made its investigation touching the cause of the loss and had decided not to pay it at all, there existed no reason- why the question of its liability might not be immediately determined. The supreme court of Arkansas, speaking upon this subject in German Ins. Co. v. Gibson, supra,501,said: “It would be unreasonable to say that it [the insurer] still retained the right to have the ninety days in which to pay a loss that it never intended to pay. The object of the agreement that the company should have the ninety days was to give it time to pay after the loss was adjusted. Why should it have the time when it did not intend to pay? The denial of liability was inconsistent w-itli such a claim and was a waiver of it.” Language of like import is found in Williamsburg City Fire Ins. Co. v. Cary, 83 Ill., 453, and in. Cascade Fire & Marine Ins. Co. v. Journal Publishing Co., supra. Counsel for defendant [33] thinks there is a distinction between a denial of liability on the ground that the policy was not in force when the loss occurred, and a denial grounded on a failure to furnish proofs of loss. We do not perceive the alleged distinction, and according to the adjudged cases, it does not exist. Hand v. National Live-Stock Ins. Co., supra; California Ins. Co. v. Gracey, supra; Phillips v. Protection Ins. Co., 14 Mo., 167. The judgment is Affirmed.