Fireman's Fund Insurance v. Western Refrigerating Co.

Mr. Presiding Justice Waterman delivered the opinion of ti-ie Court. It appeared in evidence upon the trial of this cause, that at the time of the fire there was on storage with appellee, a mere storage company, $55,000 worth of poultry belonging to thirty-one different parties, upon which appellee had claims amounting to $24,833.12. Some of the owners had, upon such of the poultry as belonged to them, separate insurance, not included in that issued to appellee. Each lot of goods stored by appellee was marked with a different mark; the goods having been received at different times. It is manifest that the insurance upon “ poultry and packages for same,” was of the interest of appellee in all poultry in the refrigerating warehouse. This poultry was continually changing; and so from day to day as poultry was received and sent out, the articles, the interest in which was insured, were changing, and so, too, was the interest of appellee, as the amount of their charges increased or diminished. ISTo specific article was insured. The utmost that can be said is that a special class of goods was insured by the other policies containing forms “A” and “ B.” Was that such a specific insurance as is mentioned in the . policy upon which this suit is brought % That policies of insurance are to be liberally construed in favor of the insured is well established. Commercial Ins. Co. v. Robinson, 64 Ill. 268; Healy v. Mutual Accident Ass’n, 133 Ill. 556. Applying this rule to the present case Ave think it must be held that the insurance of poultry and packages for same, is not a specific insurance. Had the insurance been of the packages of poultry then in warehouse C, marked “ John Doe,” such insurance might Avell have been held to be specific, but insurance of a class of constantly changing articles can not, under the terms of this policy, be so regarded. May on Insurance, Sec. 436. We think that the conduct of the defendant in respect to the provisions of the policy limiting the right of action thereon to the period of six months after the happening of the loss was such that it can not noAV insist upon this limitation. Conditions of this nature are sustained only when they are reasonable; they will not be construed so as to favor fraud or imposition. The agent of the defendant, Mr. Bliss, said in substance to the plaintiff, that the limit of time Avould cut no figure; that the defendant was ready to settle for such an amount as it Avas liable, Avhether suit was brought or not. The defendant, by its conduct, not merely agents of the company, but the defendant—for acts of its agents within the scope of their authority are its acts—entered into negotiations with the plaintiff for a settlement of his claim; these negotiations Avere carried on apparently, and Ave must presume in good faith, and were of such a character as Avere calculated to induce the plaintiff to withhold the bringing of suit under the belief that the defendant Avould pay Avithout suit, or if it did not do this, that it Avould not urge as a defense that theplaintiff had not broken off negotiations and brought suit ere the six months had elapsed. Whatever may have been the limitation as to Avaiving conditions of the policy, the company itself could, by its conduct, estop itself to set up this defense. This company, like all other corporations, acts through and by agents only. In the absence of proof to the contrary it must be presumed that it, that is, its di-. rectors and managing officers, knew what was going on relative to a settlement of this loss, and what the plaintiff was being induced to believe and rely on. Under such circumstances, to permit the defendant to now avail itself of this defense would be to encourage deception and fraud. Andes Ins. Co. v. Fish, 71 Ill. 625; Home Ins. Co. v. Mayer, 93 Ill. 276; Allemania Ins. Co. v. Peck, 133 Ill. 220; Conductors’ Benefit Ass’n v. Loomis, 142 Ill. 560; Phoenix Ins. Co. v. Hart, 149 Ill. 513; May on Insurance, Sec. 138; Ætna Ins. Co. v. Maguire, 51 Ill. 342; N. E. Fire & M. Ins. Co. v Schettler, 38 Ill. 166. The proofs of loss in this case were delivered to the defendant on the 28th day of March, 1891. The liability of the company matured May 27,1891. At the last mentioned date, the rate of interest as fixed by statute upon such demands as this was six per cent. July 1, 1891, a statute of this State went into effect reducing the rate of interest upon claims like this to five per cent per annum. In Sharpe v. W. J. Morgan & Co., 44 Ill. App. 346, the question of the effect of this statute upon claims that became due before the statute went into effect was considered. We there held that the statute was not designed to and did not affect matured demands existing before the statute took effect. The judgment by us rendered in that case was affirmed by the Supreme Court in an opinion published in 144 Ill. 382. We feel bound by the decision of the Supreme Court above mentioned, as well as by our own, more especially since—although, in the case in this court, the writer of the opinion fell into the error of saying that a judgment is a contract—the judgment of this court in that case was affirmed. However true it may be in other States that a judgment is not a contract, it is not the law in Illinois, as appears by the cases of Williams v. Waldo, 3 Scammon 264; Rae v. Hulbert, 17 Ill. 572; Templeton v. Home, 82 Ill. 491. The judgment of the Superior Court is affirmed. Mr. Justice Shepard. Unless we are bound by the decision of the Supreme Court in the case of Sharpe v. Morgan, 144 Ill. 382, where, although the point was involved it is not mentioned in the opinion, I should be inclined to withdraw from the position we took in that case when it was before us, in regard to interest. The sounder rule it seems to me would be that in actions ex contractu, where there is no express agreement to pay interest, but where interest is recoverable as damages for the withholding of payment, the rate should follow the statute, and if the statutory rate is changed after the right of action accrues, interest should be reckoned at the old rate until the change, and thereafter at the new rate. Such is the rule laid down in 1 Sedgwick on Damages, Section 339, and supported by numerous authorities there cited. See, also, 1 Sutherland on Damages, 666 et seq. That such a rule does not give an unlawful retrospective effect to the statute, see a careful and elaborate review of the authorities in Bullock v. Boyd, 1 Hoffman’s Chancery Rep., 294.