Court Opinion

ID: 6921881
Source: CourtListenerOpinion
Date Created: 2022-07-23 23:04:49.589747+00
Date Added: 2024-06-11T16:06:49.429548
License: Public Domain

HINCKS, Circuit Judge
(concurring in part and dissenting in part).
I agree with my brothers that the plaintiff’s judgments below should be reversed for error in the charge. But I dissent from their holding that it was proper to submit to the jury the question whether the notice provision of the policies had been complied with. I would hold that it was error to deny the defendants’ motions for directed verdicts and to set aside the jury’s verdicts. Accordingly, I would reverse with a direction to enter judgments for the defendants.
Without deciding whether Ward or Davidson were Mrs. Rand’s agents whose knowledge would be imputable to her, it is clear that Stephens, the trainer, was such an agent, and that Mrs. Rand is chargeable with the knowledge Stephens acquired while acting within the scope of his authority on her behalf. Corrigan v. Bobbs-Merrill Co., 228 N.Y. 58, 126 N.E. 260, 264, 10 A.L.R. 662. Cf. Melcher v. Ocean Accident & Guarantee Corp., 226 N.Y. 51, 123 N.E. 81. While so acting, Stephens learned of the injury which eventually resulted in Tom F., Jr.’s destruction, on at least three different occasions: January, April, and July 1957. On none of these occasions were the insurers given “immediate” notice “by telephone or telegraph.” No notice at all was given until September 4th. If the condition clause of the policies means what it says, no question of fact existed for the jury to decide, and the district court erred in denying defendants’ motion for a directed verdict. The questions before us, then, are these. Under the law of New York, is this clause to be enforced according to its terms, or is a so-called rule of “reasonableness” to be injected? If the latter interpretation be adopted was the question whether “immediate notice” was given properly submitted to the jury?
The majority opinion rests principally upon cases holding that “immediate notice” means “notice within a reasonable-time.” But these cases are not determinative of the New York law applicable to a case such as this which turns upon a policy of livestock mortality insurance. Greenwich Bank v. Hartford Fire Ins. Co., 250 N.Y. 116, 164 N.E. 876, was a. fire insurance case. Deso v. London &. Lancashire Indemnity Co., 3 N.Y.2d 127, 164 N.Y.S.2d 689, 143 N.E.2d 889; Marcus v. London & Lancashire Indemnity Co., 6 A.D.2d 702, affirmed 5 N.Y.2d 961, 184 N.Y.S.2d 837, 157 N.E.2d 714; Gluck v. London & Lancashire Indemnity Co., 2 N.Y.2d 953, 162 N.Y.S. 357, 142 N.E.2d 423; and Melcher v. Ocean Accident & Guarantee Corp., 226 N.Y. 51, 123 N.E. 81, all involved policies of third-party liability insurance and all except Melcher contained clauses providing for notice “as-soon as practicable.”
The present case is in what we once called, in a different context, the “zone in which federal courts must do their best to-guess what the highest state court will do.” Cooper v. American Airlines, Inc., 2 Cir., 1945, 149 F.2d 355, 359, 162 A.L.R. 318. So doing, I think that the-New York Court of Appeals would hold' that the notice provisions in these mortality policies should be strictly enforced and that that court, made up now, as in 1945, when Cooper was decided, of “reasonable intelligent lawyers * * * fully conversant with New York ‘jurisprudence,’ ” Cooper, supra, would not regard livestock mortality insurance policies as contracts entered into by parties of unconscionably unequal bargaining power and would feel that this clause is part of the price paid by owners to insurers such as the present defendants. If such a clause is to be read out of the *350policies, the only result will be higher premiums or greater difficulty in obtaining this type of coverage. I think that the New York court would regard the policy reference to notice by telephone or telegraph as pointing up the intended meaning of “immediate notice” in these policies. Especially is this so as the requirement of notice of injury and illness in livestock mortality insurance policies has an importance not generally existing elsewhere in the field of insurance. For immediate notice of the disability under a mortality policy may enable the underwriter to take steps to prevent the death upon which the policy is conditioned. Indeed, in these very policies there was a provision that “the Assured shall * * * allow removal [of the insured animal] for treatment, if required by the Underwriters.” Plainly this option was one for the underwriter — not the assured.1 None of the New York cases cited in the majority opinion was addressed to a notice requirement in such policies as these.
The weight of authority elsewhere supports the views I have attempted to articulate. I think a New York court would regard these decisions in sister states as representing the American law of livestock insurance and would adopt them. In Hough v. Kaskaskia Live Stock Ins. Co., 1923, 230 Ill.App. 341, the court held:
“It was not for appellee to determine the seriousness of the sickness. Under the provisions of the policy it was his duty to notify the company, unless he was willing to undertake to carry his own insurance so far as that sickness was concerned.”
And in Green Bros. v. Northwestern Live Stock Ins. Co., 1893, 87 Iowa 358, 54 N.W. 349, which involved an animal that became ill on the 14th, then seemed to recover, and died on the 22nd, a charge that the illness must be such as to indicate to a reasonable man that the animal is in danger was held erroneous and a judgment in favor of the insured based on a jury verdict was overturned. Acting “vicariously” for the New York courts, then, see Dale System, Inc. v. Time, Inc., D.C.D.Conn., 116 F.Supp. 527, I would hold that under New York law the court below erred in reading a rule of reasonableness into the notice condition of these livestock policies. It should have enforced the provision according to its plain meaning.
But even if the New York court would interpret the “immediate” notice required by these policies to mean “reasonably immediate” or, as the majority opinion suggests, such seasonable notice as the “proverbial ‘reasonably prudent man’ would have given,” there still was a failure of the required notice.
In Deso, supra [3 N.Y.2d 127, 164 N.Y.S.2d 691], it was said: “It is also well settled that the reasonableness of a delay [in giving notice], where mitigating circumstances such as absence from the State or lack of knowledge of the occurrence or its seriousness are offered as an excuse, is usually [one] for the jury.” But here there was neither pleading nor evidence of any mitigating circumstances. As pointed out above the plaintiff, through Stephens her trainer, knew as early as January and in April that her valuable and heavily insured race horse had suffered a.lameness. In July, *351she learned that the initial improvement of this lameness had ceased. Yet she gave no notice until September. These facts place the instant case within the Deso holding that “an unexcused delay of that length [51 days] constitutes a breach of condition as a matter of law.” The case here should be remanded for a dismissal as was the Deso case.
The Melcher and Gluck cases, also cited in the majority opinion, are distinguishable from the instant case for the same reasons that they were expressly distinguished in the Deso opinion. In Melcher, there was evidence that the assured was without knowledge of any bodily injury which could result in a claim against the assured. Here, the plaintiff’s own agent testified to contemporaneous knowledge of the injury or lameness. Hence here there was no basis for lack of knowledge as an excuse for the delay. In Gluck, the assured’s confusion as to the coverage of the policy was advanced as an excuse for the delay. No such factor is present here. In Greenwich Bank, the court was concerned with an “immediate notice” of loss clause in a fire insurance policy. The court held that because this clause “is linked up to those provisions relating to requirements after the loss, we should give this policy a reasonable interpretation, and a fairly liberal construction. Such is the law.” [250 N.Y. 116, 164 N.E. 880.] In the instant case we are concerned with a requirement preceding the loss and hence not within the Greenwich Bank doctrine.
In my opinion, in the case here the reasonableness of the notice was a question of law for the court under that line of cases which stem from Chief Judge Cardozo’s opinion in Rushing v. Commercial Cas. Ins. Co., 251 N.Y. 302, 304, 167 N.E. 450,2 holding that notices were not “immediate” when given after delays far shorter than that occurring here. I think that even if “immediate” notice was reasonable notice under applicable New York law, the court should have ruled as a matter of law that such notice was not given.

. Conditions 9 and 10, respectively, of the two policies contained options for cancellation, one in behalf of the Assured and the other in behalf of the insurers. The insurers’ option read as follows:
“This Certificate may also be cancelled, with or without the return or tender of the unearned premium, by the Insurers or by Thoroughbred Service Corp. [insurers’ American agent] in their behalf, by delivering to the Assured or by sending to the Assured by mail, registered or unregistered, at the Assured’s address as shown herein, not less than five days’ written notice stating when the cancellation shall be effective, and in such case the Insurers shall refund the paid premium less the earned portion thereof on demand.”
It will be observed that such an option lends further emphasis to the importance of strict compliance with a requirement of immediate notice by the assured of “any illness, lameness, etc.” in a livestock mortality policy.

. The Deso opinion, supra, in the following passage reaffirms and applies the Rushing doctrine:
“Thus in the Rushing case, supra, 251 N.Y. at page 304, 167 N.E. at page 451, Cardozo, Ch. J., stated that as a matter of law, ‘In the absence of explanation or excuse, a notice of an accident withheld for 22 days is not the immediate notice called for by the policy’. In an earlier case this court, having found no mitigating circumstances, held that a delay of 10 days was unreasonable as a matter of law (Haas Tobacco Co. v. American Fidelity Co., 226 N.Y. 343, 123 N.E. 755, 13 A.L.R. 132; see, also, Quinlan v. Providence Washington Ins. Co., 133 N.Y. 356, 31 N.E. 31 [33 days]; Reina v. United States Cas. Co., 228 App. Div. 108, 239 N.Y.S. 196, affirmed 256 N. Y. 537, 177 N.E. 130 [26 days]; Vanderbilt v. Indemnity Ins. Co. of North America, supra [265 App.Div. 495, 39 N.Y.S. 2d 808] [28 days]).”