Gristock v. Royal Insurance

Grant, J. The plaintiff's buildings, consisting of one two-story frame dwelling-house and two barns, and the hay, grain, and farming implements therein, were insured with the defendant. They were destroyed by fire October [164] 17, 1888. The policy required proofs of loss to be submitted within 30 days after the loss occurred. No such proofs were made. Plaintiff commenced suit August 20, 1889. The case was regularly brought to trial, and plaintiff recovered verdict and judgment. 1. Plaintiff admits a failure to submit proofs of loss, but claims that they were waived. One Faxon was the local agent of the company in securing the policy. Immediately after the fire, Faxon notified the defendant of the loss. Defendant immediately sent its adjuster to investigate the loss. It was conceded by the defendant's counsel that the adjuster of an insurance company is clothed with the power of examining into the facts of the loss, and ascertaining the amount of it by the choice of arbitrators, or by compromise or agreement, and reporting to the company the result of his investigations. This adjuster met Thomas J. Gristock, who resided upon the farm at the time of the fire, and was the son and agent of the plaintiff. They spent several days investigating the loss, during which time a list of the persona] property was made, signed, and sworn to by the plaintiff's son. A builder was employed to make an estimate of the value of the buildings. An agreement was reached as to the value of all except the house. Mr. Gristock and the adjuster agreed to refer the value of the house to arbitration. Each was to select one arbitrator, and, if they failed to agree, the two to choose a third, whose decision they agreed to abide by. They agreed to meet with the arbitrators five days after, and close the matter up. Before the time had arrived, the adjuster wrote Mr. Faxon that he could not meet with Mr. Gristock at the time appointed. Mr. Gristock, relying upon this, did not make out the formal proofs of loss as provided by the policy. Four days before the time to make such proofs had expired, Mr. Gristock consulted his attorney, who165 advised him that no other proofs of loss were necessary. Shortly after the 30 days had expired, Mr. Gristock saw the adjuster, who asked him if he had sent in proofs of loss, to which Mr. Gristock replied that he supposed the proofs had already been made out, with the exception of the house, and that he had been waiting on his motion for that ever since he went away. On December 4, 1888, Mr. Gristock wrote the defendant informing it of what had occurred between himself and the adjuster, and asking for a speedy adjustment. Defendant’s general agents in Chicago replied, under date of December 12, in which, after stating that the adjuster denied his statements contained in the letter, they say that they are advised by their counsel that the policy is null and void. Such, in brief, is the testimony on the part of the plaintiff. The defendant introduced no testimony. The circuit judge, after stating, in substance, the .above facts to the jury, instructed them that if the conduct and acts and conversation of the adjuster would induce an honest belief on the part of Mr. Gristock that the proofs that were being made, and the certificates that were being furnished, and the negotiations that were being had, were all that were required by the company, and that Mr. Gristock acted with an honest belief that these were all the company required, and that he was warranted from the facts in entertaining that belief in good faith, as a reasonable man, then the jury would be justified in finding that the formal proofs of loss were waived on the part of the company. He further charged them that, after the receipt of the letter of December 12, the plaintiff was not required to submit proofs of losses. The charge is sustained by the authorities. Security Ins. Co. v. Fay, 22 Mich. 467; Hibernia Ins. Co. v. O’Connor, 29 Id. 241; O’Brien v. Insurance Co., 52 Id. 131; Aurora, etc., Ins. Co. v. Kranich, 36 Id. 289. [166] 2. The testimony on the part of the plaintiff showed that defendant's agent, Faxon, was informed by plaintiff before the policy was issued of the existence -of certain mortgages upon the property, and that Faxon told him that it was all right. Plaintiff made no written application for this policy. Faxon made a daily report to defendant, in which he stated that there was no mortgage upon the property. Plaintiff's son also testified to informing Faxon of these mortgages. Faxon, who was a witness for the plaintiff, on cross-examination, denied these statements. The judge instructed the jury that if they found that, prior to the issue of the policy, explicit and definite notice of the existence of said mortgages was given to the local agent, the plaintiff would not be precluded from recovery, and that in such case they might treat the knowledge of the agent as the knowledge of the company,1 The charge was correct, within the former-decisions of this Court. O’Brien v. Insurance Co., 52 Mich. 131; Copeland v. Insurance Co., 77 Id. 554; Russell v. Insurance Co., 80 Id. 407. 3. In the letter of December 12, above referred to, written by the defendant's agents to plaintiff's agent, referring to the adjuster, is the following language: “He was sent to your town, and instructed to look into the circumstances, and advise the company in regard to the same, 'that the company's proper officer might decide what further to do in that regard.'' It is claimed by defendant's counsel that this was evidence of the limited authority of the adjuster, and that therefore the negotiations and agreement which were testified to oh the part of the plaintiff were without the authority of the adjuster. The obvious reply to this claim is that they were within the general authority of an adjuster, as conceded by defendant's counsel. In the [167] absence 'of notice to plaintiff of this limited authority, he had a right to rely upon the general authority possessed by such agents, and to act accordingly. 4. Mr. Faxon testified that he introduced the adjuster to Mr. Gristock; that he heard some of their conversation, but could not state it any further than that they were taking an invoice or inventory of the property saved, and narrating the things that were lost; that they were together two or three days; and that he was in and out several times. Defendant’s counsel moved to strike the testimony out as immaterial, and not tending to show a waiver, which the court refused. "We see no error in this. It was a part of the history of the transaction. It was competent for the plaintiff to show the circumstances under which the adjuster came, and the length of time spent in the negotiations. 5. The witness Thomas J. Gristock lost by the fire certain personal property covered by a policy of his own. He had made out two sworn statements, one covering his father’s loss of personalty, the other his own. These were introduced in evidence. He testified on cross-examination that some of' the articles in the statement of his own loss belonged to his father. It therefore became a material question to whom these articles belonged. On redirect examination, the witness was asked: “As a matter of fact, did you ever state, or intend to state, that you owned this personal property?” The witness answered, “No.” Counsel objected to the witness testifying to his intention, and moved to strike it out. The court refused, and defendant excepted. The court based its ruling upon the fact that the good faith of the execution of the papers was raised, and therefore the witness could swear to his intent. The witness was entitled to testify that this was a mistake, and in so doing he would indirectly have [168] testified to his intention. We think no error was committed by the court in refusing to strike out the evidence. Judgment affirmed, with costs. The other Justices concurred. Footnotes [1] The facts are more fully stated in head-note 2.