application is rejected, to return the premium paid. Unless the application is in the proper exercise of the company's rights, under the law and the contract, rejected, and the insurance refused, the preliminary contract provides protection from the date of the medical examination, and if death results from some cause arising after the date of such examination, the company is liable upon the contract, according to its terms; but if the company, in the proper exercise of its legal rights, under the law and the contract, which it is unnecessary for us to define in this opinion, rejects the application upon the ground that the applicant is not insurable and returns the premium paid, no liability can arise thereunder. Counsel for appellee cites a few cases from other jurisdictions, which, it is argued, reach a different conclusion from that reached herein; but these cases deal with contracts different materially from the one under consideration, and when carefully analyzed are not out of harmony with the views expressed in this opinion. Judgment affirmed. HARTFORD FIRE INS. CO. v. FARRISH. (Supreme Court of Illinois, 1874. 73 Ill. 166.) CRAIG, J. This was an action of assumpsit, brought by appellee, in the superior court of Cook county, against the Hartford Fire Insurance Company. A trial was had before a jury, which resulted in a verdict in favor of appellee, for $6,312.25. The court overruled a motion made by appellant for a new trial, and rendered judgment on the verdict. The appellant brings the record here by appeal, and relies upon three grounds to secure a reversal of the judgment: First-That no contract of insurance was effected. Third-The court erred in the exclusion of evidence and in refusing certain instructions. It appears, from the evidence, that appellee was a commission merchant at Chicago, and was accustomed to receive consignments of certain goods from Chas. Tennent & Co., of Glasgow, Scotland, in bond, for sale for the manufacturers. On the 8th day of August, 1871, there arrived at Chicago 64 casks of soda ash and 157 casks of bleaching powder, consigned to appellee, in bond. The goods were taken possession of by the custom house authorities, and placed in the Burlington warehouse, to be held until such time as the goods should be sold and the government duties paid. Appellee was notified by the custom house officer that the goods had arrived, and were held in bond in the Burlington warehouse. He at once called upon S. M. Moore & Co., agents of appellant, to obtain insurance upon the goods. A contract was made for insurance on the goods for two months from the 8th day of August, 1871-$3,000 on the bleaching powder and $2,500 on the soda ash-and the premium for the insurance paid. It was not the custom of appellant to issue a formal written policy on this character of insurance. It furnished what was called an "open policy book," in which, under printed headings, was entered, in writing, the number of policy, name of insured, date of insurance, time it expires, amount of insurance, amount of premium and a description of the goods insured. When the contract was made by appellee, the usual entries were made in a book held by appellee, and also in a book kept by appellant's agents. It is not claimed by appellant that its agents did not have authority to make the contract in the manner made but it was said the evidence "is inadequate to maintain the declaration." * one. * * We see no reason why the contract of insurance was not a proper The agents of appellant agreed to insure the property against loss from fire, for a certain time, for a specified sum of money. The proposition was accepted by appellee, and the premium or consideration. for the insurance was paid. The parties were competent to contract, there was a good consideration, and a contract fairly entered into, based upon that consideration. We are aware of no other requisites which should be engrafted in a contract of this character to make it binding. We do not regard it as indispensable, or even necessary, that a written policy should be issued in order to render the company liable. Tayloe v. Merchants' Fire Insurance Co., 9 How. 390, 13 L. Ed. 187. If an insurance company enter into a contract to insure property, for a good consideration, which it receives, we are aware of no reason why the contract should not be enforced, whether it be in writing or by parol. Under the second head, it is insisted, conceding an insurance was effected, no recovery can be had by appellee, for the reason, as is said, the goods were insured in one building, warehouse B, and were destroyed while in another building, warehouse A. If appellant was correct in its position on the question of fact, we are free to concede no recovery could be had; but the location of these goods when insured, was one of the questions of fact submitted to the jury, upon which the testimony of appellant and appellee did not agree. Judgment affirmed. * SECTION 2.-DELIVERY OF THE POLICY WILLIAMS v. PHILADELPHIA LIFE INS. CO. et al. (Supreme Court of South Carolina, 1916. 105 S. C. 305, 89 S. E. 675.) 1 GARY, C. J. This is an appeal from an order sustaining a demurrer to the complaint, on the ground that it does not state facts sufficient to constitute a cause of action, "in that it does not allege any contract, between Philadelphia Life Insurance Company and plaintiff's intestate, and in that it does not allege the breach by the defendants, of any duty owing by defendants, to plaintiff or plaintiff's intestate, or the neglect of any such duty." * * * In the case of Blakeley v. Bradley, 99 S. C. 229, 83 S. E. 184, the action was to recover of the defunct State Mutual Fire Insurance Company, against an alleged policy holder, for past-due assessments. The defendant denied that he was a policy holder, on the ground that he had never received the policy of insurance. The secretary and treasurer of the company testified that the policy was issued by them, and mailed to the defendant, addressed to his post office. This court said: "If that 1 The complaint referred to is omitted. be true, then the policies were issued, bound." and the defendant is If, at the time of mailing a policy, properly addressed to the applicant, it is the intention of the insurer that it is to be delivered to the applicant without further action on the part of the insurer, then the law regards the policy as issued and delivered, as soon as it is placed in the post office for that purpose. The mailing of the policy, under such circumstances, manifests an intention on the part of the insurer to complete the negotiations for insurance, and such will be the effect unless the applicant gives notice of some good reason for refusing to accept the policy. Is there any difference, in principle, when the insurer mails the policy to a third party, or even to an agent, with the sole object, in using such a medium of communication, to effect the unconditional delivery of the policy to the applicant? If the insurer in such a case. does not contemplate any further action than the delivery of the policy by the agent, then the delivery becomes effectual as soon as the policy is mailed; and no unauthorized act on the part of the agent in disobeying the instructions of the principal will be allowed to defeat the vested rights of the applicant and the intention of the insurer, when he placed the policy in the post office. It is even doubtful whether the insurer himself could prevent the delivery of the policy to the applicant, after mailing it under such circumstances. The test is whether the policy is mailed to the agent without any other intention than its unconditional delivery to the applicant. It would be inequitable and unjust, and would be prejudicial to the conduct of the business interests of the country, if the doctrine was recognized that an agent, by an unauthorized act, and in disobedience of his instructions, should. be allowed to defeat, not only the intention of his principal, but likewise the rights of those dealing with him. A contrary doctrine would, at least, be against the spirit of the maxim that equity considers that as done which should have to be done. It is also a well-recognized doctrine that a principal is liable for the wrongful acts of his agent while acting within the apparent scope of his authority, even when committed against the instruction of the principal, and it unquestionably would be in violation of the spirit of this rule if a principal should be allowed to reap a benefit from the wrongful and unauthorized act of an agent, especially when such wrongful act would be prejudicial to the rights of an interested third party dealing with the principal. The words, "having made arrangements with the defendants for the payment of the premium therefor satisfactory to them," in the fourth paragraph, do not, it is true, show the terms of the agreement between the parties in regard to the payment of the premium, but they were evidently intended to convey the idea that the nonpayment of the premium was not to interfere with the delivery of the policy in case the application was approved by the insurer. The allegations of the fifth paragraph are as follows: "The plaintiff is informed and believes that some time in January, 1911, the defendant issued a contract of insurance on the life of the said Margaret E. Williams for the sum of $10,000, payable at her death to her estate, and forwarded the same to its said agent, for delivery to the said Margaret E. Williams." The allegations which we have quoted show that the policy was mailed by the defendant to the agents, for delivery, and, as there are no allegations that they were authorized to do any other act in regard to the policy, it must be presumed that such delivery was intended to be unconditional. It was therefore a wrongful and unauthorized act on their part in failing or refusing to deliver the policy. We have already shown that a policy is constructively delivered as soon as it is mailed, under the circumstances alleged in the complaint. * Judgment (for defendant) reversed. CHAPTER II THE INSURANCE POLICY Section 1. In General, 2. Interpretation of Contract. SECTION 1.-IN GENERAL Unfortunately, the word "insurance" is used to denote contracts. of two almost entirely different kinds: First, insurance that merely indemnifies the insured against certain loss; and, second, insurance that absolutely promises to pay a certain amount of money upon the occurrence of a certain event. Fire, tornado, earthquake, plate glass, hail, theft, and liability insurance are all merely indemnity against loss. Where a loss occurs after insurance of this kind, the amount to be recovered on the policy cannot exceed the amount of the loss, unless the policy is valued; that is, unless the policy sets a certain amount as the amount to be paid by the insurer to the insured in liquidation in the event of a loss. There are valued fire insurance policies written, and the questionable practices of some fire insurance companies in "adjusting" losses to please themselves have impelled some of the state Legislatures to say that all fire policies shall be valued. Marine insurance policies are commonly of the valued type, and the exigencies of the situation of insured and insurer seem to make it desirable that this should be so; otherwise, after a loss at sea, the question of actual value of goods lost might become a very difficult one. However, the mere fact that a fire or marine policy is valued does not make the policy, in theory, any other than a contract of indemnity. On the other hand, a life, health, or accident policy is not an indemnity contract. It is a mere agreement to pay a certain sum upon the happening of a certain event, which may be the death of the insured, the illness of the insured, or an accident to the insured. A life insurance company cannot successfully plead that the insured, now deceased, was a worthless man, and that the $10,000 for which his life was insured was therefore too large a sum. This is because the life policy is not an indemnity contract. But it is the practical custom of health and accident insurance companies not to insure one for so large a sum that it would be profitable for one to become ill or the victim of an accident in order to get a benefit promised in the policy. BAU.& DIL.B.L.-45 |