Court Opinion

ID: 8060151
Source: CourtListenerOpinion
Date Created: 2022-09-09 04:37:22.557811+00
Date Added: 2024-06-11T16:38:01.630671
License: Public Domain

The opinion of the court- was delivered by
Beasley, Chief Justice.
The fundamental fact in the plea which has called out this demurrer, is that it was one of the terms of the contract of insurance that if any difference should arise as to the amount of the loss, such disagreement should be submitted, at the request of either party, to two impartial persons, such appraisers, in case of'disagreement, to have power to select an umpire to act with them. The plea further avers that by the policy it was stipulated that the loss *456should not be payable until such appraisal, and that, in the language of the instrument, “no suit or action against this company, for the recovery of any claim by virtue of this policy, shall be sustainable in any court of law or chancery until after an award shall have been obtained, fixing the amount of such claim in the manner above provided.”
It is then further alleged that a difference, arising as to the amount of the loss, at the request of the company, two appraisers were selected by the parties, and that at the time of the bringing of the suit, such arbitration was pending and undetermined.
From these statements, we think it is manifest that this demurrer has no support in legal principles. The most elaborate argument advanced in its favor was that the agreement to refer was collateral to the promise to pay the loss, and a number of cases were referred to, showing that when such is the situation, the agreement for appraisal or arbitration does not constitute a condition precedent to the right of action. But the present case, plainly, stands outside of that class, for here the stipulation to refer, instead of being independent of the promise to pay the loss, is attended with the further stipulation, that until such appraisal, such payment shall not be due. Such a provision qualifies, and consequently incorporates itself with the general promise to pay the loss. It is clear, beyond all possibility of controversy, that the agreement between the assured and the company was, that if they could not agree on the amount of the loss, the sum recoverable should, if an arbitration were requested, be the amount found by the award. Such an agreement is both legal and reasonable, and it is not perceived that any authority exists which holds a contrary doctrine. There are, it is true, decisions to the effect, that a clause merely declaring that if the parties shall disagree as to the amount of the loss, such difference shall be arbitrated, does not create a condition precedent, but this is for the reason that it is not made such by the terms of the contract; but, in the present policy, the parties have stip*457ulated that the award upon the submission shall precede the right to sue.
The legal rule in this form is not open to discussion, as will clearly appear by a reference to the cases collected in any of the text books. Wood on Fire Ins., § 431.
But, in the second place, it was urged, that this stipulation to refer relates not simply to the amount of loss or damage, but to the whole matter of the controversy growing out of the policy, and is therefore void, as it is an attempt to oust the courts of their jurisdiction.
This argument is founded in the fallacious assumption that the stipulation in question is so blended and interfused with the more general clause following it, as to render the two inseparable. This is the language of the provision, viz.: “ But if at any time differences shall arise as to the amount of any loss or damage, or as to any question, matter or thing, concerning or arising out of this insurance, every such difference shall, at the request of either party, be submitted,” &c.
From this citation it is plain that the former of the two stipulations, to refer the question of the amount of loss, is distinct and separable from the latter and more comprehensive provision, the consequence being that, although the latter would not be enforced, the former will be.
The defendant is entitled to judgment.