Case ID: keyes_3/html/0416-01.html
Source: Caselaw Access Project
Author: {"author": "Grover, J. Hunt, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Henry Solmes, Appellant, v. The Rutgers Fire Insurance Company, Respondent.
    By error, a policy of insurance was issued to A. H. Quisse, husband of Charlotte Quisse, the owner of the property insured, and for whom the application was made.
    After discovery of the error, the policy was taken to the office of the company, and presented to the secretary, with a statement that the property insured belonged to Charlotte Quisse, and that she wanted the loss, if any, made payable to Mary Entwistle. The secretary indorsed on the policy the loss payable as requested.
    
      Held, that the indorsement of the secretary was a valid contract with Charlotte Quisse, "under which the company was hable for loss of the premises by fire.
    In 1856 Charlotte Quisse owned a house and some furniture occupied and used by her in Westchester county, upon which she desired insurance for $4,000. She employed her husband to obtain- such insurance, and gave him fifty dollars to pay the premium. The husband went to Hew York, and made application to the Stuyvesant company for the whole amount of insurance, informing the company that it was to be insured for Charlotte Quisse,1 who owned the property, as appears from his uncontradicted testimony. The company agreed to make- the insurance, and received from him the fifty dollars for the premium. The Stuyvesant company,not wishing to assume the whole risk, applied to the defendant, who agreed to insure $2,100 of the amount. About a week afterward A. H. Quisse, the husband, called again, and the Stuyvesant company gave him two policies upon "the property, one for $2,100 executed by the defendant, and one for $1,900 executed by itself, both insuring A. H. Quisse, the husband, instead of, Charlotte the wife. A. H. Quisse did. not learn this, but spoke about there being two policies, when he expected but one, but was assured defendant’s company was good, and that it was all right, and he took the policies. The mistake.in the policies remained undiscovered by Charlotte and A. H., until Charlotte was called upon for additional security for two mortgages' given by her, when she took both policies to Mr. Thorn, the attorney of the mortgagees, who at once discovered the error, knowing that the title was in Charlotte, and informed her thereof, at which time she employed him to procure them to be corrected, and authorized him to have, in addition, the losses made payable to the respective mortgagees, the policy in question to Mary Entwistle. Thorn gave the policies to a clerk to go to the officers and get them arranged in accordance with the wishes of Mrs. Quisse. The clerk proceeded with the policy in question to the defendant’s office, and presented same to defendant’s secretary, and informed him that the property in question belonged to Charlotte Quisse, and that she wanted the loss, if any, made payable to Mrs. Mary Entwistle. The secretary indorsed on the policy the loss payable as requested, and returned the policy to the clerk, who received it, supposing it all right. The secretary made no verbal reply to the request of the clerk, and did nothing except as above stated. The property insured was afterward, and during the life of the policy, destroyed by fire, and Charlotte Quisse and Mary Entwistle each assigned their claim to the plaintiff, who prosecuted the defendant for the recovery of the amount insured. Upon the trial, the only question was whether a recovery could be had, for the reason that the insurance was to A. H. Quisse, the husband, and the title was in Charlotte, the wife. The cause was tried before a jury, and the judge, upon the plaintiff’s proofs, dismissed the complaint upon defendant’s motion, to which plaintiff excepted. Judgment was entered in accordance therewith, and, after affirmance thereof by the General Term of the Superior Court, the plaintiff appealed to this court.
    
      Spring & Wetmore, for the appellant.
    
      L. K. Miller, for the respondent, . -
   Grover, J.

The plaintiff showed no right to relief upon the ground that there was a mistake in making out the policy originally by the defendant. Although the evidence showed that the application made for insurance upon the property to the Stuyvesant company by A. H. Quisse, was for insurance in behalf of Charlotte Quisse, the owner of the property, yet there was no evidence tending to show that any such application was made by that company to the defendant, nor but that the defendant made the policy in strict accordance with the application and agreement entered into. It is clear that no recovery could be had upon the x policy as made, because A. H. Quisse was the party thereby insured, and he had no interest in the property, either at the time of making the insurance, or at any time thereafter, and consequently had sustained no loss, and therefore had no claim for indemnity. The ground entitling the plaintiff to relief, if any, was the presentation of the policy to defendant’s secretary by the clerk of Thorn, the clerk at the time informing' the secretary that Charlotte Quisse owned the property, and wanted the loss, if any, made payable to Mary Entwistle. The secretary must be presumed to have understood this, as there was no contradictory evidence. His taking the policy and making .an indorsement thereon making the loss payable, as requested, without expressing any dissent to regarding the policy as a valid one, in behalf of Charlotte Quisse, the owner, must be regarded as an agreement on his part to make a valid policy to her upon the property. The company had already received the premium for a valid insurance upon the property to the amount expressed in the policy. It had executed and delivered a policy supposed to be' valid, but which, through mistake, probably of the Stuyvesant company, was a mere nullity. This transaction with the clerk, unexplained, required the finding of an agreement by the defendant to insure Charlotte Quisse, the owner of the property, in consideration of the premium already received, whether the secretary supposed the policy made to her originally as the assured, and believed that the remark of'* the clerk that she owned the property and desired the loss made payable to Mrs. Entwistle, to show that the change in that. respect was desired by the assured, or whether through inadvertence, the correction was omitted, does not appear, nor is it material. At any rate, the assent of the secretary to an agreement to insure Mrs. Quisse does appear. It is well settled that an agreement by parol to insure and to make out a policy where the ierms are all understood, is binding upon the insurer, and will be enforced in the courts. In this case, I think this agreement of the secretary was a valid contract binding upon the company, and that, as the evidence stood at the time the motion to dismiss the complaint was made, the plaintiff was prima facie entitled to recover. The. judge therefore erred in dismissing the complaint. The judgment should be reversed and a new trial ordered.

Hunt, J.

I think this judgment is erroneous. Mrs. . Quisse paid to the defendants her money for an insurance upon her property. The defendants received her money, intending so to insure her, and supposing they had insured her to the amount of $2,100. If they had any knowledge of the error, and intended to receive or to retain her money, allowing her to suppose that she had a valid insurance, when they understood it to be otherwise, they were guilty of a fraud, which will afford them no protection.

That the mistake of the name was a mere mistake, and that it was the mistake of the defendents’ agent, Burnett, was proven by the testimony of both Mr. and Mrs. Quisse. On a nonsuit all disputed facts are to be,assumed in favor of the plaintiff. ' This is, therefore, to be assumed as the true state of the case. Burnett knew that the property was that of Mrs. Quisse, and was informed, while examining the same on behalf of the defendants, that the insurance was desired in the name of Mrs. Quisse. The defendants knew not only what the property was, its nature and character, but knew who made the application, and who was the party desiring the insurance. The knowledge of their agent was the knowledge of the defendants. (Evans v. Montgomery Co. Ins. Co., 5 Hill, 101; Martin v. Madison Co. Ins. Co., 11 Barb. 624; Bunton v. Orient Ins. Co., 8 Bosw. 448, affirmed in Court of Appeals, not reported.) I think all these circumstances establish a contract on the part of the defendants with Mrs. Quisse, and that if the property had been destroyed, intermediate the receipt of their portion of the premium by the defendants and the issuing of their policy, the defendants would have been liable to her for the $2,100. The evidence of Mr. Quisse, who testifies that he made the application to the company in that form, and of Mr. and Mrs. Quisse' who testify that they so informed the defendants’ agent while examining the premises, and the retention of the money by the defendants with this knowledge, give all the essentials of a valid contract of insurance in favor of the party so applying and paying. (Kelly v. The Commercial Ins. Co., 10 Bosw. 82; Whittaker v. Farmers' Ins. Co., 29 Barb. 312; Angell on Ins. § 35, and cases cited; Johnson v. Talman, in Court of Appeals, not reported.)

The transaction which took place when the error was discovered, I think also reheves the case from its difficulty. It is not pretended there was any error in the character of the risk, the amount of the premium, or at that time in the name of the individual to be insured. The defendants were distinctly informed that there was an error in the name of party insured, that it should be Charlotte Quisse instead of A. H. Quisse, that the former was the owner of the property, and they were desired to correct it or to make a suitable memorandum upon the subject. They made a memorandum consenting to the assignment desired,-but containing nothing on the subject of the erroneous name of the person insured, and handed back the policy. It was distinctly proven that they were informed of the error at this time. What was the intention and what was the legal effect of this return of the policy, with a consent indorsed that the loss should be paid to Mary Entwistle ? The intent could honestly be no other than to redeliver the policy after this information, and insure anew the property described. If the defendants can be supposed to have reasoned with themselves that here was an error, we will say nothing about it, we will keep the premium and avoid a liability if a loss should occur; the well settled principles of law and morality would compel the indemnity to the party claiming. The defendants will be compelled to perform the contract, as they allowed the other party to understand it, and to suppose that they understood it. I doubt not that the intention of the defendants in returning the policy to Mrs. Quisse’s agent, uncorrected, after being advised of the error, was to re-issue and redeliver the same, disregarding the error, and such was its legal effect. The act of the defendants .was either a trick unworthy of a respectable company, or it was a statement to Mrs. Quisse that she might regard her policy as valid, notwithstanding the error, and that if any loss occurred it should be paid to Mrs. Entwistle, in the same manner as if the correct name were therein inserted. On this point the argument in the court below was to the effect that these acts were only proof, either that the defendants did not understand that any request was made to them to alter the policy, or, if they did so understand it, they refused it, as they had a right to do. The evidence was distinct that the request was made to the secretary of the company, and there was no pretense, in fact, that it was not understood. If the secretary had so testified, a question would have been presented for the consideration of the jury, and if they had found, with the defendants on that question, it would have ended the point. ¡Neither is it just to say that if they did understand it, the company refused the request to make the alteration, as they had a right to do. On the contrary they assumed to grant it, allowed and induced the assured to understand that the matter was entirely satisfactory to them, and never intimated a refusal or dissatisfaction, until called upon to make good the loss. If they had refused the correction, the assured could have supplied the want by a new insurance. They did not, however, refuse, .and cannot now justify themselves on that ground.

I think a new trial should be ordered.

All the judges concurring,

Judgment reversed and new trial ordered.