Case Name: H. W. Billings v. National Insurance Co.
Court: Ohio Circuit Court
Jurisdiction: Ohio
Decision Date: 1905-03-11
Citations: 17 Ohio C.C. Dec. 552
Docket Number: 
Parties: H. W. Billings v. National Insurance Co.
Judges: Hull, Haynes and Parker, JJ.
Reporter: Ohio Circuit Court Decisions
Volume: 17
Pages: 552–569

Head Matter:
INSURANCE — WAIVER.
[Lucas (6th) Circuit Court,
March 11, 1905.]
Hull, Haynes and Parker, JJ.
H. W. Billings v. National Insurance Co.
1. Fire Insurance — Stipulation that Waiver op Condition of Policy, must be in Writing Strictly Construed — Filing of Proofs of Loss.
A policy of fire insurance contained a stipulation that a written and sworn statement of the extent of the loss, etc., should he filed with the company insuring within sixty days after the loss occurred, and also that a change in, or a waiver of, any of the- terms of the policy could’ not be made Dy any officer, agent or other representative of the company unless such change or waiver be written on or attached to the policy itself. A loss under the policy occurred and the company sent its general agent, who had charge of all the local agents in the state, to examine the conditions of the loss with a view to adjustment. Acting on the words and conduct of this agent the insured delayed filing his proofs of loss- as required until more than sixty days had elapsed since the loss. In an action on the policy to recover for the loss in question it was held that the trial judge rightly directed the jury to return a verdict for the defendant at the close of the plaintiff’s testimony because it appeared that the proofs of loss had not been filed within the time stipulated and the stipulation of the policy for a written waiver was an essential part of the policy to which the insured assented by accepting the policy, and no agent could waive this condition of the policy as to filing proofs of loss, properly prepared, within the time specified, except in the manner stated in the policy. The doctrine of Travelers’ Ins. Co. v. Myers, 62 Ohio St. 529, applies equally as well to cases of fire insurance as to cases of employers’ liability insurance. — ■ Parker, J., dissents.
2. That Waiver of Conditions in Policy of Fire Insurance must be in Writing Applies to what Occurs after the Loss.
A provision in a policy of fire insurance that a waiver of any condition or stipulation thereof must be in writing applies as well to what occurs after a loss has been sustained, within the risk assumed by the policy, as to what may occur before the loss. — Parker, J., dissents.
Error to Lucas common pleas court.
Merrick & Jones, Doyle & Lewis and J. W. Schaufelberger, for plaintiff in error.
J. L. Lincoln and O. B. Snider, for defendant in error.

Opinion:
HULL, J.
This action was brought in the court of common pleas on two insurance policies, issued, one in 1902 and the other in 1903, on a certain store and its contents owned by Mr. Billings, and situated in the village of Whitehouse, this county. The amount of insurance was $400 on one policy and $1,000 on the other. The first occurred on July 1, 1903. The insurance company refused to pay the policies, on various'grounds, and among them on the ground that no written, sworn statement of the loss was filed with the company within sixty days after the fire, as required by the policies. There were other objections made by the insurance company; that an inventory had not been kept, as required' by the policies; that the "iron safe"- clause, as it is called, had been violated, etc., but it is not necessary to consider any question in this ease except the one of a failure to file a written and sworn statement of loss within sixty days. At the conclusion of plaintiff's testimony, the court directed a verdict in favor of the insurance company, judgment was entered upon it and a petition in error was filed in this court to reverse that judgment.
As I have said, it is not necessary to consider the question as to the keeping of an inventory, or any other question but the one, as it seems to be conceded that there is some evidence in the record tending to show that these provisions of the policies were complied with.
It is claimed by the plaintiff in error that the provision in regard to the filing of a printed and sworn statement of loss within sixty days, was waived by the company through its agent and that, therefore, it ought not to prevent a recovery.
It appears from the testimony that immediately after the fire Mr. Billings notified a Mr. Meister, who was the local agent of the company at Swanton in this county; that Meister came to the scene of the fire the next day and saw what the loss was — the loss being well nigh total and exceeding the amount of insurance, and about $500 worth of property was saved. Mr. Meister, at the request of Mr. Billings, telegraphed to the company at their general office in Cincinnati, advising them of the fire on that same day or the next day, and he also, at Mr. Billings' request, immediately notified the company by letter of the loss — the policies requiring an immediate written notice of the loss as well as a sworn statement sixty days later. Mr. Meister, hearing nothing from his communications, in a few days wrote again and received a letter from the company informing him that the matter had been left with a Mr. Meeks, who was the state adjuster of the company, and, according to the testimony, had general charge of the local agents in this state — he being a general agent.
About ten or fifteen days after the fire, the exact time is not stated, Mr. Meeks came to Whitehouse and met Mr. Billings and inquired about the fire. He inquired first as to whether Mr.,Billings had an inventory. Mr. Billings told him he had not, as he thought at that time it had been destroyed in the fire. He claims that this inventory was afterwards found. Mr. Billings testifies that Mr. Meeks thereupon threw up his hands: "He threw up his hands, of course," he says, "when I told Mm this, ' ' and then says that he told him afterwards to get an invoice of his goods from the wholesale houses, as best he could. It is not claimed that there was enough here to constitute a denial of liability on the part of the company, that, under the authorities, would obviate the necessity of furnishing a sworn statement of loss afterwards.
Mr. Billings says that Mr. Meeks told him to get invoices from the wholesale houses and said to him, "that will take, probably about ten days.'- Mr. Billings says he understood from this that Mr. Meeks would return; and Mrs. Billings testifies that Mr. Meeks said to get these invoices for his inspection, and that he said that would take a week or ten days. They testify that they expected him to return; but he did not return. Meanwhile, Mr. Billings communicated with the local agent, Meister, at Swanton, in regard to the fire and had several talks with him and Meister wrote to the general office of the company, but received no answer to his communications. Billings got his invoices, so far as he could, from the wholesale houses and looked after the goods which were saved. I should say also, that when Meeks, the general agent, -was on the ground, he inquired about and examined the goods which had been saved from the fire and told Mr. Billings what to do with them, to preserve them, etc. And the time ran along until the time for the giving of written, sworn proof of loss had expired or was within one day of expiring. Thereupon Mr. Billings had such proofs prepared and transmitted them to the company.
The sworn statement did not reach the office of the company until . the,sixty-first or sixty-second day- — there is some dispute as to which it should be called — and was, therefore, out of rule according to the policy, that requiring the statement to be filed, as I have stated, within sixty days from the fire. I have undertaken to state the facts briefly as shown by the record. The company claims that under the faets, this policy is void; that the provision as to proofs has never been waived in the manner required by the policy and contract of insurance and that, therefore, it is not liable.
The policies contain this provision:
"This entire policy, unless otherwise provided by agreement endorsed thereon or added thereto, shall be void if the insured now has * • * -# or in case of loss, if sworn statement, in accordance with all the requirements of this policy, as hereinafter provided, shall not be rendered within sixty days after the fire. ' '
"If fire occurs the insured shall give, immediate notice of any loss thereby in writing to this company, protect the property from further damage, forthwith separate the damaged and undamaged personal prop erty, put it in the best possible order, make a complete inventory of the same, stating the quality and cost of each article and the amount claimed thereon. "And within sixty days after the fire, unless such time is extended in writing by this company, shall render a statement to this company, signed and sworn to by said insured, stating the knowledge and belief of the insured as to the time and origin of the fire. ' '
And then follow other provisions. And this is contained in the policy, at the end of these provisions:
"This policy is made and accepted subject to the foregoing stipulations and conditions, together with such other provisions, agreements or conditions as may be endorsed hereon or added hereto, and no officer, agent or other representative of this company shall have power to waive any provision or condition of this policy except such as by the terms of this policy may be the subject of agreement indorsed hereon or added hereto, and as to such provisions and conditions no officer, agent or representative shall have such power or be deemed or held to have waived such provisions or conditions unless such waiver, if any, shall be written upon or attached hereto, nor shall any privilege or permission affecting the insurance under this policy exist or be claimed by the insured unless so written or attached."
The policy, it is seen, provides in express terms, that no alteration shall be made in it unless made in'writing, and none of its provisions shall be waived or held to have been waived by any agent or officer of the company unless such waiver is in writing indorsed upon the policy or attached thereto.
It is said that this provision requiring the waiver to be in writing, although stipulated for in the policy, may be waived by the general agent of the company, such as Mr. Meeks seems to have been, and that if so, it will be binding upon the company.
In the case of Stacy v. Insurance Co. 25 O. C. C. 67, we so held, under the circumstances of that case. In that case, however, the agent whom we held had waived this condition, was appointed as a local- agent at Bowling Green, Ohio, but, under the circumstances, he being the only agent known to the insured in this country, the company being a foreign one, and the policy not having been delivered at the time of the fire, we held that he should be deemed to be and regarded as a general agent.
The principal office of the company was in England, and we held in that case, following some of the authorities, that a provision requiring a waiver to be written upon the policy, as this policy does, relates to the alterations or waivers that might be made during the life of the policy and before the loss occurred and that such provisions did not apply after the loss. That case went to the Supreme Court and that court reversed the ease, without report, so that we do not know the exact ground upon which it was reversed, but it is no longer authority in this court' or any other court.
The question here is, whether under the law, especially of this state, there was evidence tending to show that this provision as to a sworn statement of loss had been waived by the company, by a general agent such as Mr. Meeks was, in such a manner as to bind the company. There was no express waiver by Mr. Meeks; he did not say to Mr. Billings "you need not prepare your sworn statement" or "you need not file it;" but it is claimed that this conduct was such that Mr. Billings, as a reasonably prudent man, might consider it a waiver and had a right to assume that the company did not intend to insist upon this provision, the general agent having been sent to look after the affair — an adjuster of losses as he was — having been sent there by the company, and the evidence showing that Mr. Meeks was a state adjuster and general agent of the company having charge of all the local agents in the state. Mr. Billings appears to have acted entirely honestly and in good faith. Whether his attention had ever been called especially to this provision of the policies,. does not appear; but, having accepted the policies, he was, of course, bound by their conditions by accepting them and thereby beeoming a party to the contract.
After examining the authorities which were cited by counsel on both sides in this case, and some others (and a great many were cited in the briefs on both sides), a majority of the court have reached the conclusion that under the decisions of our Supreme Court, the action of the court belo^ was correct — was in accordance with the decisions of the Supreme Court. Whatever our own notions may have been in the case; whatever our own judgment was as to what the law was or should be," we deem it our duty, as of course it is, to follow the decisions of the Supreme Court of our state.
There are many decisions in other states that sustain the contention of the plaintiff in error — the contention that a provision of this kind requiring that a waiver be in writing, does not apply to what occurs after the loss. This is held by many courts' and laid down in some textbooks, especially May on Insurance, which was cited in Stacy v. Insurance Co., supra, but, on the other hand, there are decisions of other states which hold the contrary, and we think our own Supreme Court hold and intend it to be the law of this state that a provision of this kind is to be regarded as an essential part of the contract and that it continues in force after the loss as well as before. It is a provision which the insurance company has a right to make — that there shall be no alteration or any waiver by any agent of the company unless it is in writing and indorsed upon the policy or attached to it. The parties have a right to make such a contract as that, and the insurance company has the right to insist upon it so as to remove this whole question as far as possible from the uncertain realm of oral testimony, and if a man accepts a policy with this a part of the contract, he is bound by it as well as by all the valid provisions of that contract.
Travelers' Ins. Co. v. Myers, 62 Ohio St. 529 [57 N. E. Rep. 458; 49 L. R. A. 760], is in point. This was not a fire insurance case, but the "Employer's Liability Co." for insuring employers against loss or damage by reason of an employe being injured. The policy required immediate notice to the company in case of an injury to an employe; which should be construed, the Supreme Court say, to be notice within a reasonable time. The court say it is very important for the company in such cases to have immediate notice of an injury, that they may inquire into it and find out whether it is within the policy, etc. And a fire insurance company may regard it important that they have a sworn statement w-ithin sixty days, setting forth the origin of the fire, so that it may be inquired into by the company. It may not be of as great importance as it is in an employer's liability case, but it is clear that it is of very considerable importance. In the third paragraph of the. syllabus, the court say
"When such policy contains a stipulation that 'no agent has authority to waive or alter anything in this policy contained,', and the same is accepted by the insured, it is both notice to and an agreement by, the insured that an agent has no authority to waive or alter anything contained in the policy. Union Cent. Life Ins. Co. v. Hook, 62 Ohio St. 256, approved and followed.
" 'Immediate written notice' in such stipulation means written notice within a reasonable time under the circumstances of the case; and where the facts are not disputed, what is a reasonable time is a question of law."
Turning back to Eureka F. & M. Ins. Co. v. Baldwin, 62 Ohio St. 868 [57 N. E. Rep. 57], we find this, in the third paragraph of the syllabus :
"The power of an agent to waive conditions in a policy of fire insurance is not different from the same power in life insurance. As to such power, Union Cent. Life Ins. Co. v. Hook, 62 Ohio St. 256, is followed and approved."
That is another ease in this volume. I have no recollection that these eases were cited to us in Stacy v. Insurance Co. supra, at Bowling Green. They are not mentioned in the opinion. On page 541 of the opinion by Judge Davis (Travelers' Ins. Co. v. Myers, 62 Ohio St. 529 [57 N. E. Rep. 458; 49 L. R. A. 760]), this is said:
"It was further expressly stipulated in the policy that 'no agent has authority to waive or alter anything in this policy contained.' The policy is not unilateral. Since the insured have received, accepted and retained the policy, they are parties to it, although not signing it, and are presumed to know and accept all of its terms and conditions. The insured, having agreed that the stipulation as to notice could not be waived or altered by an agent, cannot excuse themselves for nonperformance of the contract as to notice to the company, by showing that they acted on the suggestion of the soliciting agent that they should not perform the contract as they had made it. In this conclusion we are sustained by numerous decisions in other states.
"We are aware that there are decisions to the effect that conditions in respect to notice and proofs of loss may be waived by an agent, notwithstanding a provision that no agent can change the same. Those decisions are put upon the ground that such limitations on the authority ®f agents apply only to provisions relating solely to the formation and continuance of the policy, and which are essential to the binding force of the contract while it is running, and do not apply to conditions which are to be performed after the loss has occurred, such as giving notice and proof of loss. While we prefer to put the decision of this case on the grounds, and in line with, the decisions already stated, we think that we have made it sufficiently clear that the stipulation as to notice in this policy, is of the very substance of the contract in insurance, of the kind here contracted for, and therefore could not be waived by any agent. ' '
Referring to some of the decisions cited at the bottom of pdge 541, we can gather from them the doetrine that seems to be approved by the Supreme Court. The first of these cases which we will notice is Smith v. Insurance Co. 60 Vt. 682 [15 Atl. Rep. 353; 1 L. R. A. 216; 6 Am. St. Rep. 144], where, in the sixth paragraph of the syllabus, this is said:
"But a local agent, who never had been held out by the company as possessing any authority except to receive proposals for insurance, fix rates of premium and issue policies, has no power to waive the condition of a policy requiring a statement of loss; and there was error in the charge when the jury were at liberty to find a waiver from the declarations of either the local or general agent. • '
Then follows the seventh paragraph:
"But the general agent cannot waive the statement of loss in a manner other than that provided for in the policy; thus, he cannot give an oral consent to a waiver, when by the terms of the contract the waiver must be indorsed on the policy. ' '
This was a fire insurance case. On page 691 of the opinion, this is said:
"Having held that Turner had authority to waive any condition of the policy, the question remains whether he could do so, save in the manner provided by the contract. One condition of the policy is that no officer, agent or representative of the company should be held to have waived any of the conditions of the policy unless such waiver was indorsed on the policy. This provision was a valid one, binding upon the parties, and effect should be given to it. While the defendant could give its oral consent to a waiver of the statement, no officer, agent or representative could consent unless the consent was indorsed on the policy.' This point we think well taken."
That is one of the cases cited with approval by Judge Davis in Travelers' Ins. Co. v. Myers, supra, and approved by the court, as we understand it. According to that case, although Mr. Meeks was a general agent, yet, as such officer or agent, he could not waive this provision of the policy unless it was done in writing as required by the policy. In the case at bar it is not claimed that the waiver- was in writing, and the only claim is that Billings had the right to believe and did believe, from the conduct of Mr. Meeks, that this provision was waived.
Another case cited in this opinion is Kirkman v. Insurance Co. 90 Iowa 457 [57 N. W. Rep. 952; 48 Am. St. Rep. 454], There are other cases from Iowa, and there is one more recent than this, that seems to hold, perhaps, a different rule from this case, but we are only citing these cases that were approved by the Supreme Court. It is held in this ease that:
"Under a policy making it an express condition that none of its provisions could be waived, except in writing by the secretary, an adjuster cannot orally waive proof of loss required by the policy."
There was some correspondence in this case with the president of the company, and the insured sent for a copy of the policy, which was sent to him. The court say, on page 458:
"The claim of waiver of proofs of loss is based upon the acts of the officers and agents of the company by which the plaintiff was induced to believe that no proofs of loss were required. There is nothing in the evidence by which any waiver could be inferred, founded upon the acts or declarations of the agent, Mullen. ' '
Another ease cited in this opinion is, Gould v. Insurance Co. 90 Mich. 302 [51 N. W. Rep. 455]. There the court say, in the syllabus:
"A failure to furnish proofs of loss within the time required by an insurance, policy bars an action thereon, unless waived, where the policy further provides that such failure shall work a forfeiture of such right of action. ' '
"A verbal waiver of such condition by an agent of the company will not prevent such forfeiture, where the policy plainly provides upon its face that no agent shall have power to waive any of its conditions except by writing endorsed on or attached to the policy."
Walsh v. Insurance Co. 73 N. Y. 5, is also cited. The court there say, on page 10 of the opinion:
"The doctrine is established to prevent fraud, and proceeds also upon the ground that when one of two innocent persons must suffer from the act of a third person, he shall sustain the loss who has enabled the third persoft to do the injury. If, however, a person dealing with an agent knows that he is acting under a circumscribed and limited authority, and that his act is in excess of or an abuse of the authority actually conferred, then manifestly the principal is not bound, and it is immaterial whether the agent is a general or a special one. ' '
Referring to the power of the agent to waive unless in writing.
There are other cases cited, but I will not refer to them; they will be found in the opinion of Judge Davis. In that ease the court says there are cases which hold the other way; but that they prefer to follow these, and they are thus made practically a part of this opinion and are approved by the Supreme Court.
It seems like a hardship upon Mr. Billings to lose his insurance upon this account; but if the contract which was made was valid, if the failure on his part to comply with it works a forfeiture under the law of this state, this court is unable to help him. There is force in the contention that where a company has sent its general agent to adjust a loss and look into it, that it should be held to be a waiver of a written and sworn statement of loss; that would seem to be an equitable doctrine; but the cases decided by and approved of by the Supreme Court seem to hold that such a provision is an essential part of the contract; that it cannot be waived in any other way than that approved by the policy, so that there may be no question, no dispute, nothing to be proved by oral testimony, no alleged verbal statements to be met upon this question of waiver, which it is provided shall be shown only in writing. It is said that the time had only gone a day or two beyond the time provided for in the policy. That is true, but, if the condition is to apply at all, it must apply in the words of the policy — sixty days — and if sixty-one days might be approved, then seventy days might be and it would be difficult to draw the line.
There is no statutory provision on this question, no provision that if the company has not been prejudiced by the failure of the insured to transmit a sworn statement of loss within the time that this shall not be a bar or forfeit the policy. A very full opinion was delivered by the trial judge (Judge Morris), in deciding this question, in which he has gathered many authorities — many more than we have cited — which opinion will be found in Billings v. Insurance Co. 14 Dec. 387. We are unable to see how, under these decisions to which I have referred, he could have-decided the question otherwise. As was said by Judge Morris, we sympathize with Mr. Billings in his loss, but it is our duty to follow the law as we understand it to be.
The judgment of the court of common pleas is affirmed.