National Liberty Insurance v. Banta

Crownhart, J. There can be no question but that the defendants were bound to carry out the orders of their principal, and, failing to do so, would be bound to respond in damages resulting from such failure. However, defendants had five days within which to replace the insurance, and in the meantime it was perfectly proper for the defendants to ask the plaintiff for a reconsideration' of its action. This they did. The plaintiff undoubtedly had a reasonable time within which to reply, and in the meantime defendants would not be liable for any loss occasioned until after the expiration of the five days for replacement. The plaintiff did not reply to the letter of the defendants, which it received on May 4th, until May 15th. The trial court found that this was an unreasonable delay and that the defendants had a right to assume that the plaintiff had acceded to their request for a reconsideration of the order. The trial court-had a right to take into consideration the. ordinary course [196] of modern business. Pie would know, as we know, that in matters of this kind requiring prompt action the plaintiff company should have answered the letter within a day or two at least. But there is positive - evidence that the company, upon receipt of defendants’ request for reconsideration of its order to cancel, did in fact so reconsider the matter and referred it to its Milwaukee office. Then we have the company’s letter from the Milwaukee office recognizing the propriety of the acts of defendants in asking for reconsideration of its order, and explaining that upon-, reconsideration of the subject the company renewed its demand to cancel, and giving the defendants the usual five days in which to- effect replacement. Thus the acts of the defendants in not making immediate cancellation were in effect approved. No other reasonable construction of the correspondence can be made. ■ Immediately upon receipt of the letter of May 15th, namely, May 18th, the defendants sought to replace the insurance, but within the five days allowed for replacement the loss occurred. During these five days the risk was that of the plaintiff. By the Court. — The judgment of the trial court is affirmed. RoseNBERry and Eschweiler, JJ., dissent.