Harper v. Michigan Mutual Tornado, Cyclone & Windstorm Insurance

Brooke, J. {after stating the facts). While the evidence that plaintiff gave notice to defendant of the de-, struction of the building before defendant’s approval of the assignment was indorsed upon the policy is not to us convincing, we find it unnecessary to determine that the verdict based upon that finding is against the weight of the evidence. We will assume that on November 18th, when the secretary indorsed his approval of the assignment, he knew that the building had been destroyed, and that he intended by his act to receive the policy so as to make it cover a loss that had already occurred. It is clear that under section 15 of the charter the insurance under this policy ceased upon October 27, 1911, the day of the sale from the Browns to plaintiff. Section 14 provides how the insurance may be assigned. The approval of the secretary is made a prerequisite. Assuming that plaintiff secured the signature of the Browns to the assignment on November 8th, that act did not make him a member of defendant company. So that on the 11th, when the loss occurred, plaintiff was an utter stranger to defendant. No contractual relations whatever existed between the [463] parties at that time. On the 18th, when, by virtue of the approval of the assignment, plaintiff for the first time became a member of the defendant organization, liable for its assessments and entitled to its benefits, he had no building to insure. Baldly stated, plaintiff’s proposition is this: That, after his building was destroyed, he could effect an insurance upon it through the wrongful act of the secretary. This is not a case of waiver, and is not governed by the rules laid down in the many cases cited by plaintiff. It is a case where, if plaintiff’s contention could prevail, defendant’s secretary would be permitted to take $1,500 from the members of this defendant organization and present it to plaintiff. This is not insurance. It is vicarious philanthropy. Section 3 of the by-laws forbids the defendant from insuring buildings not on a solid and secure foundation. At the time the insurance was effected (in plaintiff’s interest), the building was in ruins as shown by the exhibits. But it is unnecessary to have recourse to the policy. Public policy forbids the holding that the agent or officer of an insurance company possesses any such power. As well might it be claimed that, after a building had been destroyed by fire, the owner thereof could, after acquainting the agent with the fact, secure a policy which would cover his loss, upon the theory that the insurance company had waived the existence of the building because the agent knew it was already burned. While the citation of authorities upon so obvious a question is unnecessary, we refer to a recent exhaustive decision of this court, Kamm & Schellinger Brewing Co. v. Insurance Co., 168 Mich. 606 (134 N. W. 999), where Mr. Justice Stone defines the reciprocal rights and duties of members of mutual insurance companies and reviews the authorities. Judgment is reversed, and there will be no new trial. Moore, C. J., and Steere, McAlvay, Kuhn, Stone, Ostrander, and Bird, JJ., concurred.