Court Opinion

ID: 4919415
Source: CourtListenerOpinion
Date Created: 2021-09-22 00:15:08.81767+00
Date Added: 2024-06-11T08:14:00.081634
License: Public Domain

Ellis, J.,
dissenting. T am unable to agree with the conclusion arrived at by the court in this case.
The defendant’s first plea contained substantially the same averments of ultimate facts as its rejoinder, vis: The policies of insurance sued on were Pennsylvania contracts; that Lowry & Prince were not the defendant’s agents, but were agents for the plaintiff only. The plea then avers that each policy contained a certain warranty which the plaintiff had violated. The replication of the plaintiff which considered in its entirety was a mere traverse of the averments of the plea as to the contract being a Pennsylvania contract and that Lowry & Prince were agents only of the plaintiff alleged the contracts to be Florida contracts and a waiver of the warranty by defendant through Lowry & Prince who were alleged to be the defendant’s agents. Now the rejoinder merely took issue upon the allegations of the replication as to the contracts being Florida contracts and that Lowry & *173Prince were 'defendant’s agents and that the warranty had been waived, by averring that the contracts were made in Pennsylvania, that Lowry & Prince were not their agents and that the defendant had not waived the warranty.
If this rejoinder was true it constituted a perfect defense; because neither Section 2765 nor 2777 of the General Statutes of Florida, 1906, Florida Compiled Laws, 1914, can have any force or effect beyond the limits of the State of Florida by imposing upon the defendant and Lowry and Prince the relation of principal and agent in invihm. That a State cannot extend the operation of its statutes beyond its borders into the jurisdiction of another State is conceded to be true in the majority opinion, which contains excerpts from the opinion of Mr. Chief Justice White of the Supreme Court of the United States in the case of New York Life Insurance Co. v. Head, 234 U. S. 149, 34 Sup. Ct. Rep. 879, upon that point. Therefore if Sections 2765 and 2777 of the General Statutes are to be applied in this case the defendant insurance company must be either a corporation of this State or actually doing business in this State through its officers or agents, or that the contracts sued on were made or executed in this State. This is true because the object upon which the statute acts, whether it be persons or things, must be within the State’s jurisdiction. As Mr. Chief Justice White said in the case referred to, there is a difference which in the nature of things must obtain “between questions concerning the operation and effect pf a State law within its borders and upon the conduct of persons confessedly within its jurisdiction; and its right to extend its authority beyond its borders so as to control contracts made between citizens of other States and virtually in fact to disregard the law of such *174other States by which the acts done were admittedly valid.” That is the distinction which was drawn in the case of Hooper v. State of California, 155 U. S. 648, 15 Sup. Ct. Rep. 207, by the then Mr. Justice White. A statute of California punished “every person who in this State procures or agrees to procure for a resident of this State any insurance” from a corporation not of that State unless it had filed the bond required by the statute relative to insurance. Hooper was the agent of certain insurance brokers in New York City. Mott, a resident of California, inquired of Hooper if he could procure a certain amount of insurance on a vessel named the “Alliance” at a given rate of premium, no particular company being specified by Mott. Hooper communicated with his principals in New York, who placed the insurance in a Boston Company and advised Hooper. The policy ivas forwarded by the New York brokers to Hopper, who delivered it to Mott, the latter paying the former the premium as the agent of the New York brokers. Hooper was arrested and charged with the misdemeanor denounced by the statute. It was contended by him that the statute was illegal because it undertook to forbid the procurement of a contract outside of the State, and the evidence showed that the contract in fact was entered into without the territory of California. Judge White said that the admission that the insurance was procured for the resident from a foreign company which had no agent in the State did not exclude the possibility of its having been procured within the State. “If it were obtained for the resident by a broker who was himself a resident, this would be a procuring within the State and be covered by the statute.” Hooper was an insurance broker; he was the representative of other insurance brokers who were in New York, and to the extent of pro*175curing the insurance was the representative of the insurance company, so. that it might be said that he procured the insurance in California for a resident of that State. The statute however dealt with and operated upon the conduct of Hooper, a resident of and whose act was confessedly committed in the State of California. This view however was not concurred in by Justices Harlan, Brewer and Jackson, who thought that the application of the statute to the case was an illegal interference with the liberty both of Mott and Hooper as well as an abridgement of the privilege of the firm of New York brokers through whom the policy was obtained, and the fallacy of the argument lay in the assumption that Hooper was the agent of the insurance company. In the case of New York Life Insurance Co. v. Head, supra, the court simply held that a policy of insurance issued in Missouri and its provisions controlled and governed by the statutes of that State might be affected by a loan agreement made in New York |in such a way as to change the liability of the insurer under the laws of Missouri. The loan was applied for by the beneficiary from New Mexico to the company in New York, and the court held that the loan agreement was a New York contract.
Now the defendant company was not a corporation of Florida, nor was it doing business in this State by and through any of its.officers or agents so the pleadings admit. The only question therefore, so far as this point is concerned is, were the contracts sued upon Florida contracts, or were they made and executed in Pennsylvania? The rejoinder avers that the contracts sued on “were written and executed by the defendant in the State of Pennsylvania and thereupon delivered and.sent by mail to the said Lowry & Prince at Tampa, Florida, as brokers of the plaintiff.” “That Lowry & Prince were not agents of the *176defendant, or authorized by it to make contracts of insurance, to accept risks, to write, sign or issue policies, to collect, receive or receipt for money on its account, to waive any provisions in the contract sued on or to represent it in any manner, shape or form,” etc. These averments of fact being well pleaded were admitted by the demurrer. If, however, the rejoinder contains any averments which are inconsistent with or contradictory of those quoted it should be held to be bad on the demurrer; or if the language used has on its face two intendments, it will be tested by the weaker.
The attack made by the demurrer upon the rejoinder, however, can in the nature of the case receive no assistance whatever from the sections of the General Statutes referred to, until it appears from the pleadings that the contracts of insurance are Florida contracts, because until that is established they cannot be affected or controlled by the laws of Florida. The defendant is not a Florida corporation. It was not at the time the policies were issued nor had been represented in this State by any officer or representative, nor do the policies themselves contain any clause as to the intention of the parties concerning any place according to the laws of which they desired the contracts to be governed. Nor do they provide that the payment of the premium shall be a condition precedent to their taking effect. All this is shown by the pleadings and exhibits A and B, which are made part of the declaration. When the contracts were entered into therefore if Lowry & Prince were not the defendant’s representative or agents then neither the proposition, acceptance nor delivery if necessary was made in this State. There was nothing so far as the defendant was concerned to which the statute could apply. If the contracts were made in this State, then certainly they will *177be affected and controlled by the statutes of this State; but if they were not made here, but were made in some other jurisdiction, then as certainly the laws of this State do not control -their provisions. Now the rejoinder expressly avers that the contracts were made in Pennsylvania, and denies that Lowry & Prince were defendant’s representative. The court holds that inasmuch as the rejoinder admits that the defendant had written insurance on the plaintiff’s property since 1908 continuously, and that Lowry & Prince transmitted to the defendant at Philadelphia the applications for such insurance and received by mail the policies for the plaintiff, and transmitted for the plaintiff the amount of the premiums less the usual brokers’ commission, it is subject to the demurrer because such admissions show that the policies sued on were Florida contracts. This conclusion does not follow because a policy of fire insurance is a personal contract which like all such contracts is completed by the signature of the parties and the transfer of the consideration. It is a parol contract, not a sealed instrument, and may be proved as other parol contracts. See authorities cited in note to Stephenson v. Allison, reported in 138 Am. St. Rep. 26. It is a simple contract of indemnity against loss by fire. See Paul v. Virginia, 8 Wall. (U. S.) 168. The making of such a contract is a mere incident of commercial intercourse. See New York Life Ins. Co. v. Cravens, 178 U. S. 389, 20 Sup. Ct. Rep. 962. And the situs of the contract or place of consummation is determined by the place of acceptance, and not by the place of proposal. See Peters v. E. O. Painter Fertilizer Co., decided at the present term of this court. In that case Mr. Chief Justice Browne, speaking for the court, said: “A contract of sale may be made by the acceptance of an offer to sell as well as by the acceptance, of an offer to *178purchase, and where the last act necessary to complete the contract is performed, that is the place of the contract.” The case follows the doctrine laid down by this court in Morgan v. Eaton, 59 Fla. 562, 52 South. Rep. 305, to which it refers. In the latter case the court, speaking through Mr. Justice Taylor, said: “It seems to be well settled law that ivhere a person residing in one place makes a proposal to purchase property by letter to a person residing in another place and such proposal is there accepted, the place of acceptance, and not the place of the proposal, is the place of the contract. 22 Am. & Eng. Ency. Law, (2nd ed.) p. 1324, and numerous cases there cited.” On this point therefore it is unnecessary to examine other authorities because the doctrine announced in the two cases cited is the settled law of this State, and by that doctrine this case must be tested as to the situs of the contracts sued upon for this court to be consistent.
Even when there is a local agent of the insurance company in the State where the property insured is located, but his authority is limited to receiving and forwarding applications to the insurer's home office for acceptance or rejection, there the contract will be deemed to have been made at such home office when a policy in substantial conformity to the application is mailed directly from such office to the insured or his agent in another State and no conditions precedent to its taking effect are expressly imposed and there is nothing in the transaction showing that the contract was intended to be left open until the receipt of the policy by the insured. See 2 Wharton on Conflict of Laws, 1011; State Mutual Fire Ins. Ass’n. v. Brinkley Stave & Heading Co., 61 Ark. 1, 31 S. W. Rep. 157, 29 L. R. A. 712; Northampton Mut. Live Stock Ins. Co. v. Tuttle, 40 N. J. L. 476; Rose v. Kimberly & Clark Co., 89 Wis. 545, 62 N. W. Rep. 526, 27 L. R. A. 556; Hart *179fort Steam-Boiler Ins. & Ins. Co. v. Lasher Stocking Co., 66 Vt. 439, 29 Atl. Rep. 629. The same rule applies where the policy is mailed to a third person who for the purposes of the transaction was, or was deemed to be the agent of the insured. See French v. People, 6 Colo. App. 311, 40 Pac. Rep. 463; Commonwealth Mut. Fire Ins. Co. v. William Knabe & Co. Mfg. Co., 171 Mass. 265, 50 N. E. Rep. 516; 3 Am. & Eng. Ency. Law, 551; May on Insurance, Sec. 66; Baker v. Spaulding, 71 Vt. 169, 42 Atl. Rep. 982; Galloway v. Standard Fire Ins. Co., 45 West Va. 237, 31 S. E. Rep. 969. The deposit of the policy in the mail at the home office of the insurer is a delivery and charges the insured with constructive notice of the acceptance of the proposition. Galloway v. Standard Fire Ins. Co., supra. The policies which are made part of the declaration contain clauses that they “shall not be valid until countersigned by the duly authorized agent of the company at Philadelphia, Pa.” They were countersigned there as shown upon their face.
Now it cannot be said from the pleadings in this case that either notice to the plaintiff of the acceptance of its application by the defendants for the insurance, or the delivery of the policies to the insured or the payment of the premium by the insured were conditions precedent to the taking effect of the policies; nor can it be said that the insertion of the warranty was a condition imposed by the defendant materially changing the terms of the original proposition. As to the latter proposition it will be observed that the policies sued on are attached to the declaration and made a part of it by apt words. They contain the warranty on their faces. The plaintiff alleged in its replication that “Lowry & Prince caused the defendant to write the said first policy of 1908 and said Lowry & Prince caused and procured the defendant to renew said *180policy from time to time and to finally write and issue policies here sued on,” etc. From this allegation it appears that the application for the policies sued on contemplated the insertion of .the warranty mentioned which from the pleading appears to have been contained in the policies issued prior to those sued on which seem to have been issued in the usual form containing the same warranties and conditions. I do not regard either the notice of acceptance by the defendant of the application for insurance nor the delivery of the policy to the plaintiff as conditions precedent to their taking effect because this court has held that the contract is consummated where the acceptance of the proposition takes place, not where notice of acceptance is Received or delivery. made, besides delivery of a policy of insurance is not essential to its validity. It is a simple, not a sealed contract and may be sued on although there has been no delivery of it to the insured. If the payment of the premium is regarded by some authorities as an implied condition precedent to the consummation of the contract it has not been so held in this State, which holds to the doctrine as stated that the place of acceptance of the proposition determines the place of the making of the contract; but whether that is true or not the determination of the point is unnecessary as the rejoinder avers that Lowry & Prince were not authorized to receive money on defendant’s account, and that the plaintiff transmitted to the defendant by mail the amount of the premium through Lowry & Prince, which fact was admitted by the demurrer. Therefore it appears from the pleadings that the premium was paid not in this State, but in Pennsylvania.
There is no distinction between the contracts considered in the two Florida cases cited and the contracts sued on in this case that requires the application of different *181rules of law to determine their situs because a contract of insurance like the contracts involved in the two Florida cases cited is a personal contract and is a mere incident of commercial intercourse and is consummated or executed at the place of acceptance, and delivery is not necessary to its completion. See Stephenson v. Allison, 165 Ala. 238, 51 South. Rep. 622, 138 Am. St. Rep. 26. Now the proposition to insure was made by the plaintiff through Lowry & Prince, its agents, by letter to the-defendant at Philadelphia; so much the pleadings admit. The proposition was accepted by the defendant at Philadelphia, and there the contracts were written and signed and there delivered to the United States postal service to be transmitted to Lowry and Prince for the plaintiff; this the pleading also show. When then did Lowry & Prince become the representatives of the defendant in the making of the contract? Not when they received the premiums from the plaintiff, because that was the plaintiff’s act; besides, the contracts had then been executed. Nor when they transmitted the premiums to defendant by mail, because that was also the plaintiff’s act. If the sections of the General Statutes referred to were intended to operate, only upon the act of Lowry & Prince and affect them only, the case of Hooper v. State of California, supra, would be in point, and no doubt the case would be authority for holding them to answer to the statute’s provisions; but in my opinion the statute cannot be made to operate through them upon a person or corporation beyond the limits of the State and affect the provisions of a contract made elsewhere.
The act of Lowry & Prince in retaining from the amount of the premiums which they were instructed by the plaintiff to forward to the defendant the “usual brokers’ commission” did not have the effect of changing the situs of *182the contracts and constitute them the defendant’s agents for “all intents and purposes” SO' that they could alter the terms of the contract which had been made in Pennsylvania. That is to say, constitute them the agents of the defendant to make a new contract of insurance or waive any warranty in the old ones. The case of Davis Lumber Co. v. Hartford Fire Ins. Co., 95 Wis. 226, 70 N. W. Rep. 84, 37 L. R. A. 131, referred to in the .majority opinion is not in my judgment in point, because in that case the policies of insurance under consideration were Wisconsin contracts, and the court merely held that under a statute similar to the Florida statute one who procures insurance for another may be the agent for some purposes of both the insurer and insured. In the case of Schomer v. Hekla F. Ins. Co., 50 Wis. 575, 7 N. W. Rep. 544, the defendant company was doing business in Wisconsin directly through local agents to whom Lawson who was employed by plaintiff to obtain insurance applied for the policies, and it appears that they were executed in Wisconsin. In the case of Rose v. Kimberly & Clark Co., 89 Wis. 545, 62 N. W. Rep. 526, 27 L. R. A. 556, which was a suit on a policy of insurance by the receiver of the company for an assessment, it appeared that the policy was written in Illinois by a company not authorized to do business in Wisconsin. The court applied the Lex Fori and held that the contract could not be enforced in Wisconsin, but not doubting that it was a valid contract of Illinois. See also 5 R. C. L. p. 941. In the case of Presbyterian Ministers’ Fund v. Thomas, 126 Wis. 281, 105 N. W. Rep. 801, also cited in the majority opinion the court had under consideration a statute of Wisconsin which prohibited any corporation from doing any business of insurance of any kind in Wisconsin or with any resident of that State except according to the conditions *183and restrictions of the statute. A resident of Wisconsin applied by letter to the Insurance Company at Philadelphia for life insurance. The application was accepted, the policy sent to the applicant who gave his notes for the premium payable at Philadelphia. The company had not complied with the conditions and restrictions of the Wisconsin statute. The note was not paid and the company brought suit in Wisconsin to recover on -the note. The court held that the contract was made in Philadelphia, but as it was made with a resident of Wisconsin contrary to the laws of that State, it would not be enforced in that State. In Wisconsin Cent. R. Co. v. Phoenix Ins. Co., 123 Wis. 313, 101 N. W. Rep. 703, the question is not discussed, but it appears that the Insurance Company was represented in Wisconsin by agents and the policies issued in that State. In Wicks Bros. v. Scottish Union & National Ins. Co., 107 Wis. 606, 83 N. W. Rep. 781, the question was upon the right to cancel. The court held that the right to cancel exists only by contract. The policies were issued in Wisconsin. The other Wisconsin cases referred to are deemed to be not in point as the contracts sued upon were made in the State of Wisconsin by the defendant’s acknowledged agents. It is undoubtedly true that considerations of public policy demand that an insurance company entering a State in defiance of a statute which lawfully prescribes the terms upon which it may exert its powers there, should be held to have assented to such terms as to business transacted there, as was said by Mr. Justice Harlan in Old Wayne Mut. Life Ass’n. of Indianapolis v. McDonough, 204 U. S. 8, 27 Sup. Ct. Rep. 236, yet such assent cannot be assumed as to business transacted in another State although with citizens of the former State. The defendant in this caseaccording to the pleadings, transacted no business in *184Florida through its officers or agents, and therefore did not subject itself to any provision of the statutes of this State. It had a right to enter into the contract of insurance in Pennsylvania with a citizen of Florida for the purpose of insuring the latter’s property in this State which it did. Any act of the legislature which would impose upon the defendant in such case, without its consent, conditions and liabilities which it did not assume by the contract would be invalid. See Allgeyer v. State of Louisiana, 165 U. S. 578, 17 Sup. Ct. Rep. 427. The act therefore should not be given that construction.
The case of Miller Brewing Co. v. Council Bluffs Ins. Co., 95 Iowa 31, 63 N. W. Rep. 565, decided in 1895 upon a contract made in 1887 where the Supreme Court of that State held in effect that the mere writing of insurance upon property located in one State by a foreign insurance company of another State at its home office was the transaction of business in the former State I think is contrary to the view entertained by the Supreme Court of the United States in Allgeyer v. State of Louisiana, supra. I think the order of the court sustaining the demurrer to the rejoinder was erroneous, and the judgment should be reversed.
Taylor, J., concurs.