McGraw v. Germania Fire Insurance

Campbell, J. So far as the questions raised in the record refer to the proofs of loss, and the attempt at cancellation, we [148] con cm1 in the results arrived at by Judge Champlin, that there is no error. But we think there is no error in the rulings depending on the supposed agency of the firm of Knaggs, Clark & Plum, under which the court below properly, as we think, excluded any responsibility against McGraw for what they may have done or omitted. It is certainly worthy of some consideration how far those questions could be raised at all under the facts as shown by defendant. The policy in suit, if valid, covered a loss under a previous fire to the one now in question. The defendant’s agent, Mr. Stringham, examined the property and risks, and advised the company, who determined and attempted, not to repudiate the entire policy, but to cancel what was left of it; and the various notices which they gave, and the steps which they took, were inconsistent with any claim of its invalidity. If they proposed to repudiate, they could not treat it as good so far as premiums were concerned, and bad as to liability. It does not appear, but the inference is otherwise, that the first loss was treated as not binding defendant. The premium offered to be returned was only a portion of that paid for the whole period. Such a transaction would seem to be an affirmance, as far at it is significant at all; and there was never any attempt at rescission. But, as we do not know how far this matter may have been viewed below, we do not propose to do more than refer to it as an element which might have been significant if the other rulings were doubtful. But so far as the relations of McGraw with Knaggs, Clark & Plum become important, we do not think they involved such agency as defendant claims. The testimony tended, in our opinion, to prove distinctly that as between McGraw and that firm they represented the insurers and not him. He, by his agent, applied to them for insurance, and in answer to that application obtained the insurance. He paid them all the premiums required on all the policies, and they receipted for the whole in one receipt, and without other discrimination than separating the items belonging to the several policies. He did not become responsible for their compensation. There was nothing tending to show that any one but Mr. Curtiss and [149] Mr. Birdsall liad authority to represent him. From the business in which this firm was engaged no one would have a right to suppose that they could possibly have personal knowledge of the exact condition of all property that they got insured, or that any policy valid on its face could be fairly charged with their failures in representations. If the policy in suit had been issued on written representations, those would no doubt have formed a part of it, if referred to, and there could then have been no ambiguity about the contract. But where the effect of a written contract is made to depend — if this can legally be done in all cases — upon contemporaneous verbal representations, those must, in our opinion, be made by an actual agent, or one whose action is ratified with knowledge of what he has done. We can see no good reason in law for applying to insurance business any different rules of agency from those which apply elsewhere. No one could contend that these persons were MeGraw’s agents in those insurances which were obtained from their own companies, although insurance policies sometimes attempt to put their agencies in this anomalous position, as binding the insured in all cases where their conduct might prejudice him, and only representing the company where it will benefit the company. The companies always have it in their power to have everything material reduced to writing. It is contrary to general practice in other cases to have an agreement partly in writing and partly in parol. If this can lawfully be done, as perhaps it may be, it must nevertheless stand as written, unless varied by authority, and an assured party is not bound to inquire how far unauthorized persons have undertaken to represent him in matters of which he has no notice. The policy refers to property fully identified. He could not be bound to assume or imagine that anything further had been represented about it, except by his own agents, of whose acts he is bound to inform himself. No one would be safe in taking out insurance under any other rule. The insured has a right to know where he stands, and while he takes the risk of his own representatives, he cannot be subjected to those of' persons whom, he has never appointed or recognized. [150] If we thought there was anything tending to show that Clark and his firm were plaintiff’s agents, we could not jrnss upon the weight of testimony; but we think there is nothing from which any such inference could be raised. The judgment must be affirmed. Cooley, C. J. and Sherwood, J. concurred.