Schoenich v. American Insurance

LEWIS, J. This action was brought to vacate and set aside the award of the referees appointed to adjust a loss by fire, and to recover on the policies. [390] 1. The trial court found that, an attempt to adjust the loss having failed, appellants demanded that the amount be ascertained by referees, according to the provisions in the Minnesota standard policy, and proposed to respondent three names from which to make a selection, and she chose Mr. James Leclc. Respondent, in turn; submitted to appellants three names from which to make their selection, and they named H. W. Seidlitz. These two were residents of Minnesota, and they selected as the third referee A. IT. Mitchell, a resident of Wisconsin. Mr. Mitchell was selected without consulting with respondent, or anyone acting on her behalf, and without her consent, directly or indirectly, and she had no knowledge or notice of the fact of his non-residence until after the making of the award. The court further found.that she was not guilty of any negligence in not ascertaining that he was a. nonresident. Appellants attack this finding upon the ground that the evidence clearly shows that respondent either had actual knowledge, or was in possession of such knowledge as required her to make inquiry, as to Mr. Mitchell’s residence, and, not having done so, she must be held to have waived the objection. The statute (section 1645, R. L. 1905) reads:. “No person shall be a qualified referee who is not a resident of the state, disinterested, and willing to act.” This statute is mandatory and jurisdictional, and a failure to comply with it renders the award void. Barney v. Flower, 27 Minn. 403, 7 N. W. 823; Franklin v. Pratt, 101 Mass. 359; Burckland v. Johnson, 50 Neb. 858, 70 N. W. 388. Whether this requirement may be waived is not necessary to determine in this case, for the record fails to show that respondent had knowledge of the fact. Appellants did not produce any direct evidence to that effect, but contend that under the circumstances it was her duty to make inquiry. True, both respondent and her counsel had opportunity to make the inquiry; but they were warranted in assuming that the two referees had proceeded in accordance with the law, and that Mr. Mitchell was a resident of the state. We discover nothing in the record to put them upon inquiry, or to challenge their good faith in accepting him as a legally qualified referee. 2. The court found that the three referees, after qualifying, examined the premises, took measurements, and ..made estimates of the [391] quantities of material and labor necessary to restore tbe same to their previous-condition! In this work they spent several hours during a day, and in the evening of the same day went to a hotel and conferred by themselves, and arrived at the conclusion that the damage amounted to $1,744.51, and signed an award accordingly. They gave respondent no notice of any time or place where she might appear before them and offer evidence as to the extent of her damages. Respondent made no formal request for an opportunity to present evidence, but was ready and would have offered it had an opportunity been given her. Appellants submit that, having knowledge that the referees were working on the case, it was respondent’s duty to make a formal demand, or request, for an opportunity to submit evidence. If the parties have reasonable opportunity to present evidence and do not avail themselves of it, and permit the referees to proceed and complete the award, such conduct will be considered á waiver. What constitutes a waiver depends on the circumstances of each particular case, and a general rule cannot well be formulated. In this case it is unnecessary to determine what was the effect of the failure to give respondent notice, and we deem it sufficient to state the law generally applicable to the subject. ■ Eeferees appointed under the Minnesota, standard policy are a quasi court. They must be disinterested, and determine the matters before them upon proper evidence. They are not vested with absolute authority to make independent inquiry and investigation, and base their judgment on the result of such examination. It is the purpose of the statute to give the parties interested reasonable opportunity to present evidence. Produce Refrigerating Co. v. Norwich Union Fire Insurance Society, 91 Minn. 210, 97 N. W. 875, 98 N. W. 100; Redner v. New York Fire Ins. Co., 92 Minn. 306, 99 N. W. 886. Affirmed.