Mutual Fire Ins. of New York v. Alvord

COLT, Circuit Judge. The policy of insurance upon which this suit was brought contains the following provisions relating to the ascertainment or estimate of loss: [755] “This company shall not he liable beyond the actual cash value of the property at the time any loss or damage occurs, and the loss or damage shall be ascertained or estimated according t.o such actual cash value, with proper deduction for depreciation, however caused, and shall in no event; exceed what it would then cost: tlie Insured to repair or replace the same with material of like kind and quality. Said ascertainment or estimate shall be made by the insured and this company; or, if they differ, then by appraisers, as hereinafter provided; and, the amount of loss or damage having been thus determined, the sum for which this company is liable pursuant to this policy shall be payable sixty days after due notice, ascertainment, estimate, and satisfactory proof of the loss have been received by this company in accordance with the terms of this policy. * * * In the event of disagreement as to the amount of loss, the same shall, as above provided, be ascertained by two competent and disinterested appraisers, the insured and this company each selecting one, and the two so chosen shall first select a competent and disinterested umpire. The appraisers, together, shall then estimate and appraise the loss, stating separately sound value and damage, and. failing to agree, shall submit their differences to the umpire; and the award in writing of any two shall determine the amount of such loss. " This company shall not be held to have waived any provision or condition of this policy, or any forfeiture thereof, by any requirement, act, or proceeding on its part relating to the appraisal, or to any examination herein provided for; and the loss shall not become payable until sixty days after the notice, ascertainment, estimate, and satisfactory proof of the loss herein required have been received by tills company, including an award by appraisers, when appraisal has been required.” It is undoubtedly true 'that a policy of insurance may contain a valid provision which prohibits the insured from maintaining an action until the amount of loss shall have been first submitted to arbitration, and an award shall have been made. In such a case the determination of tlie amount by arbitration is recognized as a condition precedent to the right of the insured to bring suit. Hamilton v. Insurance Co., 136 U. S. 242, 10 Sup. Ct. 945; Scott v. Avery, 5 H. L. Cas. 811; Viney v. Bignold, 20 Q. B. Div. 172. But, in order to make such award a condition precedent to the right of maintaining suit, it must be so expressed in the policy, or necessarily implied from its terms. A mere provision in the policy that the amount to be paid in case of disagreement shall be submitted to arbitration does not prevent the insured from maintaining an action, unless the policy further provides that no action shall be maintained until after award; but such agreement to submit to arbitration is regarded as a collateral and independe mi; agreement, the breach of which, while it will support a separate action, cannot he pleaded in bar to an action on the principal contract. Hamilton v. Insurance Co., 137 U. S. 370, 385, 11 Sup. Ct. 133; Roper v. Lendon. 1 El. & El. 825; Collins v. Locke, 4 App. Cas. 674; Dawson v. Fitzgerald, 1 Exch. Div. 257; Reed v. Insurance Co., 138 Mass. 572; Seward v. City of Rochester, 109 N. Y. 164, 16 N. E. 348; Insurance Co. v. Pulver, 126 Ill. 329, 18 N. E. 804; Crossley v. Insurance Co., 27 Fed. 30. There is nothing in the terms of this policy which expressly or by implication forbids Hie insured from bringing suit until after the amount of loss has been submitted to arbitration and an award has been made, and therefore we must consider the provisions in the policy relating to this subject as constituting a collateral and independent agreement, and not one which was a condition precedent to the right of maintaining an action. [756] We start, then, with the proposition that the .plaintiff had a right to bring suit any time after 60 days from the receipt of proper proofs of loss by the defendant, and it is clear that the present action was not brought until more than 60 days after the receipt of such proofs of loss. But it is contended that the evidence which was offered and excluded in the court below was to the effect that an agreement for submission was entered into between the parties, and an award made. We find, however, in the agreement of submission, this express provision: “It is further expressly understood and agreed that this submission to appraisers is not, and shall not be construed into, a waiver of any of the rights or defenses of either party.” By this provision the parties expressly reserved to themselves all the rights which they possessed under the policy, and the plaintiff thereby reserved the right of bringing suit, which he possessed independently of any award. This clause was evidently intended to guard against the waiver, by virtue of the submission, of any right possessed by either party. ' The plaintiff further contends that this evidence was properly rejected, because, by the terms of the policy, before there should be any submission, the insurance company should first make an estimate of the loss as well as the insured, and then, if there were a disagreement, appraisers should be selected; that the evidence offered did not disclose that the insurance company had ever made any estimate of loss, but only the assured; and that, therefore, the conditions under which a submission could properly take place had not been complied with. The policy further provides that the appraisers chosen “shall first select a competent and disinterested umpire,” but in the evidence offered it did not appear that any such umpire was chosen. Upon the whole, we are clearly of opinion that the court below committed no error in excluding the agreement to submit, the award, and the documents relating thereto. Other, assignments of error relate to the alleged improper admission of certain witnesses to testify as experts, on the ground of want of qualification. Whether a witness is qualified to testify as an expert is to be passed upon and determined by the court below. It is a question largely within the discretion of the presiding judge, and his determination is generally conclusive. Spring Co. v. Edgar, 99 U. S. 645; Tucker v. Railroad Co., 118 Mass. 546; Perkins v. Stickney, 132 Mass. 217; Lawrence v. Boston, 119 Mass. 126. Nor do we find any error in the refusal to admit the evidence contained in the deposition of Samuel R. White. The evidence was plainly unintelligible, and liable to mislead, in the form in which it was presented. As to the examination of the plaintiff, who was called as a witness by the defendant, the order of his examination was within the discretion of the court, and therefore affords no ground of error. The charge of the presiding judge relating to overinsurance was correct, because the mortgagee clause contained.a provision that [757] the mortgagee should not suffer for any act or neglect of the mortgagor or owner of the property. Consequently, if the mortgagor obtained more insurance than be was entitled to, it was his own act, and could not affect the rights of the mortgagee. The fact that the policies were in the possession of the mortgagee did not make him a party in obtaining any excess of insurance which may have existed. With respect to the Concord policy which the evidence tended to show was obtained by the mortgagee or plaintiff, trustee, we think the court was right in charging the jury that, if such insurance was taken out at the request of the mortgagor, it would be his act, and not the act of the trustee; and, further, if they believed it was the act of the trustee, and that at the ime of issuing such policy the whole amount of insurance then existing, including the policy in question, did not exceed the amount permitted, it could not invalidate his claim under this policy. Upon the whole, we can find no error in the court below, and it follows that the exceptions must be overruled, and judgment affirmed.