Fowler Cycle Works v. Western Insurance Co. of Pittsburgh

Mb. Justice Stein delivered the opinion of the court. If LeMay had authority express or implied from appellant to request the cancellation of the policy sued on at the time the request is alleged to have been made, then the cancellation was valid and the judgment in favor of the company should be affirmed; otherwise not. Generally speaking, possession of a policy by an insurance broker confers upon him implied authority to procure its cancellation. Newark Ins. Co. v. Sammons, 11 Ill. App. 230; Ins. Co. v. Bermond, 45 Ill. App. 22; Oil Co. v. Ins. Co., 64 N. Y. 85; Schauer v. Ins. Co., 88 Wis. 561. But that consideration is not conclusive in respect of the issues in the present case. Here, appellee was informed at the very time when the request for cancellation was made that the person making it or (to speak more accurately) causing it to be made had ceased to be the agent of the party owning the policy. By this information the implication of authority arising from the mere physical possession of the policy was destroyed. If a man were to say to the representative of an insurance company, “ here is a policy belonging to A, I am not his agent, but it is in my possession and I want you to cancel it,” it is safe to assert that the person so addressed would refuse to comply with the request; and if he did, it is beyond all controversy that the cancellation would be void. Yet that is virtually what took place. The company through its representative was told that appellant had transferred its insurance line from LeMay & Go. to Kennedy & Co., “ that the line had gone to Kennedy & Co. and they would call for the insurance.” We do not lose sight of the fact (although so far as appears the company was ignorant of it) that some limited authority was left in LeMay & Co. by the letter of Eovember 23. They were still to complete the work of increasing appellant’s insurance to $40,000, and to change the form of the policies. The proof shows, however, that the request to cancel was not made in pursuance or in execution of the power still remaining. It was not made for the purpose of increasing appellant’s insurance or changing the form of any of its policies. Indeed LeMay does not so pretend. Moved as he appears to have been by a feeling of spite or vexation at the loss of appellant’s business he was willing and possibly wanted to have the policy cancelled “ so far as our account is concerned.” The further fate of’the policy seems to have been a matter of indifference to him. It remains to be considered whether the work to be completed by him carried with it an implied authority to bring about the cancellation of the policy in suit. He himself says “ at the time these policies were cancelled Kennedy & Co. were acting for ” appellant; “ I was' not. I did nothing further for them after I received the letter ” of Hovember 23. This is his own view. Under the letter he might have taken out further policies. It is not perceived how this gives rise to a power to do the exact opposite. He was also to procure a change in the form of appellant’s policies. Clearly this applied to the policies which were handed to him when he was lirst employed by appellant. In the absence of proof to the contrary, it should be presumed that he took out the policy in suit (which he did subsequently) in accordance with the prescribed form. Ho occasion is shown or claimed to exist for having the policy cancelled in connection with any change in its form. If appellee’s representative had (as he should have done) inquired of Le-May’s clerk what authority he had for requesting a cancellation in view of the fact that his employer, LeMay, had ceased to be appellant’s agent, and the clerk had answered that LeMay was still to increase appellant’s insurance and change the form of its policies, the representative of appellee would or surely should have replied, “ Yes, but that is not what you are asking me to do.” The proof tends to show and we are inclined to believe that Holmes & Co., the general agents of the company, cancelled^ the policy of their own volition, a thing they could not do under its terms without giving five days’ notice to the insured. Ho notice was given. True, Mr. Holmes’ clerk testified that the policy was cancelled at the request of LeMay; but this is a mere conclusion. Why the policy was cancelled and how it came to be cancelled appears from the testimony of Wetsel, clerk of Holmes & Co., when he says : “ Our object in cancelling it when he (LeMay’s clerk) told us Mr. Kennedy was coming for it was because at that time we were not writing bicycle factories except as an accommodation. We didn’t consider them a good risk.” The testimony of Mr. Holmes upon the same subject is noteworthy. Being asked whether, where a broker brings the policy in for cancellation he considered it was cancelled at the request of the insured, he answered : “ In this case, I should say yes. Let me modify that—well, I should say 3res, that wherever this agent, wherever the broker who places the order with us for the insurance brings in the policy for cancellation, we cancelled the policy.” Q. “ And you cancelled it at the request of the insured ? ” A. “ That would depend.” Q. “ Depend upon what ? ” A. “ It would depend upon the circumstances.” Q. “ What circumstances were there in connection with this case that you cancelled it at the request of the company ? ” A. “We were tickled to death to get off the risk.” Q. “ Did you give notice, you say ? ” A. “ Ho, sir; I say Ave were pleased to get off the risk.” The last question but one assumes that the policy was cancelled “at the request of the company;” he does not deny the assumption, and says they were tickled to death, pleased, to get off the risk. It should also be borne in mind that LeMay did not instruct his clerk, by whom he returned the policy to Holmes & Co., that he Avanted it cancelled. His language Avas “ he (Holmes) could cancel the policy himself if he chose to do it.” According to the terms of the policy, if cancelled at the instance of the insured, the return premium is figured at short rates; if cancelled at the instance of the company, it is figured pro rata. In the present case, it is figured j>ro rata, indicating that the policy was cancelled at the instance of appellee. True, Wetsel says this Avas done “ as a favor to LeMay & Co.,” but the reason he assigns for so figuring the return premium possesses as little weight and validity as the attempted cancellation. If a favor was done to any one, it Avould be not to LeMay & Co. but to appellant; it and it alone Avould receive the benefit of the greater amount paid back. If we are correct in our conclusion that the policy Avas cancelled at appellee’s instance, it necessarily follows, no notice thereof having been given to appellant, that it ay as in full force at the time of the fire. • For the reasons indicated appellant is entitled to recover. The judgment of the Circuit Court will be reversed and judgment entered here for the s mi of $865.19, Avith interest theTeon at the rate of five per cent per annum from February 12, 1901, less the premium, $15.20, with like rate of interest thereon from November 26,1900, a finding of facts to be embodied in the judgment. Reversed, and judgment here.