Parker v. Arctic Fire Insurance — 59 N.Y. 1

Majority

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John G. Parker et al., Respondents, v. The Arctic Fire Insurance Company of the City of New York, Appellant.

(Argued October 7, 1874;

decided November 10, 1874.)

Headnote

A clause in a policy of fire insurance providing that, in case of “ any change in the risk,” not made known at the time of renewal, the policy and renewal will be null and void, only covers such changes as increase the risk. No notice is required of a change or alteration in the condition of the property that does not increase the risk.

Appeal from judgment of the General Term of the Supreme Court in the second judicial department, affirming a judgment in favor of plaintiffs, entered upon the decision of the court on trial, without a jury. (Reported below, 1 N. Y. S. C. [T. & C.], 397.)

This action was upon a policy of insurance issued by defendant June 4, 1869, insuring plaintiffs’ “brick grist and plaster mill,” situate in the city of Poughkeepsie, for one year. The policy contained this clause:

“ This insurance (the risk not being changed) may be continued for such further time as may be agreed on, provided

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the premium therefor is paid and indorsed on this policy, or a receipt given for the same, and it shall be considered as continued under the original representations, and for the original amounts and divisions; but in case there shall have been any change in the risk, either within itself or by neighboring buildings or premises, not made known to the company by the assured at the time of renewal and indorsed hereon in writing, this policy and renewal shall be null and void.” Also, that “ the use of general terms, or any thing less than a specific agreement, clearly expressed and indorsed on this policy shall not be construed as a waiver of any printed or written conditions or restrictions herein.”

The court found the following facts, among others :

That in the fall of 1869, the plaintiffs erected a steam power contiguous to said mill, to be used when the water was insufficient, which was so constructed as in no way to increase the risk, of which alteration defendant’s agent, through whom the policy was obtained, had due notice and consented thereto. That in the latter part of May, 1870, and before the expiration of the policy, the said defendant, by its agent, was notified of said steam improvements, and requested to renew and continue the insurance, which it did, giving a renewal certificate for one year, from the 4th of June, 1870, to the 4th of June, 1871, plaintiffs paying the premium thereon. That said mill and contents were consumed by fire on the 18th day of October, 1870, being in value largely in excess of all insurances on the same.

Further facts appear in the opinion.

Samuel Hand for the appellant.

Frost was the agent of plaintiffs and not of defendant. (Martine v. Intern. L. Ins. Co. of London, 53 N. Y., 339 .) He was not defendant’s agent for the purpose of consenting to a change of risk. ( Wilson v. Gen. M. Ins. Co., 14 N. Y., 418 ; Stringham v. St. N. Ins. Co., 3 Keyes, 280.) Frost must have known the terms of the policy at the time of his interview with defendant’s secretary. (Pindar v. Res. F. Ins. Co., 47 N. Y., 114 ;

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Ervin v. N. Y. Cent. Ins. Co., 3 N. Y. S. C., 213.) Plaintiffs cannot recover on the ground that defendant is estopped by the secretary’s omission to object to the parol notice. (Wendell v. Van Rensselaer, 1 J. Ch., 344 ; Nevin v. Belknap, 2 J. R., 573; Hall v. Fisher, 9 Barb., 17 ; Frost v. Sar. Mut. Ins. Co., 5 Den., 154 .) The maxim qui tacet consentiré videtar is only applied upon the clearest proof of full knowledge of the matter or thing presumed to be consented to. (Hope v. Lawrence, 50 Barb., 258 ; Spencer v. Carr, 45 N. Y., 406 ; Hutchins v. Smith, 46 Barb., 235 ; Otis v. Sill, 8 id., 102; Welland C. Co. v. Hathaway, 8 Wend., 480 ,483; Dezell v. Odell, 3 Hill, 215 , 221-225 ; Liddle v. Market Ins. Co., 29 N. Y., 184 , 195.) The general doctrine of parol waiver of the conditions of a written instrument does not apply to the conditions of this policy. (Carpenter v. Providence Wash. Ins. Co., 16 Pet., 495 ; Hall v. M. M. F. Ins. Co., 6 Gray, 169 ; Kimball v. How. F. Ins. Co., 8 id., 29; Pendon v. Am. M. Ins. Co., 12 Cush., 469 .)

John Thompson for the respondents.

Defendant is estopped from setting up that the policy was void because its consent to the renewal was not indorsed on the policy, and that the consent to waive the condition of indorsement was not in writing. ( 25 Wend., 379 ; 2 Comst., 53; 14 Barb., 206 ; 2 Kern., 81; 26 N. Y., 406 ; 35 id., 131; 14 id., 253; 29 id., 184; 46 id., 526; 4 Bosw., 184 ; Franklin F. Ins. Co. v. Chicago Ice Co., 36 Md.; 14 N. Y., 253 ; Caroll v. C. O. Ins. Co., 38 Barb., 402 , 407; 1 Abb. N. Y. Ct. Apps., 316.)

The judge on the trial found that the defendant was orally notified before the renewal of the policy that steam power had been introduced into the mill, and consented to continue the insurance, after notice of the change, and thereupon the plaintiffs paid the premium for another year, and received a renewal certificate from the company. The fact of notice was denied by the defendant, but there is evidence

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tending to support the conclusion of the judge, upon that question.

The policy contained a provision, that in case of any change of risk, not made known to the company by the assured, at the time of renewal, and indorsed thereon in writing, the policy and the renewal “shall be null and void,” and the further provision that no agreement unless indorsed on the policy shall be construed as a waiver of any of the conditions therein.

It is claimed by the defendant that the parties have, by their contract, made an indorsement on the policy the only competent evidence of notice, where there has been a change of risk, and that in the absence of such an indorsement, the condition attaches, and the contract of renewal is void. We do not think that this question arises in the case, in view of the further fact found by the judge, that the steam power was so annexed to the mill, that the risk was not thereby increased. The evidence was that the boiler and engine were placed in a safe building, detached from the mill, and that the connection between the engine and the mill, was by a shaft passing through a window, and that the wall of the mill opposite the engine-house was of stone, two and a half feet in thickness. The evidence authorized the finding that the annexation of the steam power did not increase the risk. If there was no increase of hazard by reason of the annexation of the steam power there was no change of risk, within the meaning of the policy, and no notice was required to be given. The object of the provision requiring notice where the risk has been changed, is to enable the company to act intelligently upon the application for renewal. If the risk -was not increased by changes in the condition of the property, the company had no interest in knowing the fact that they had been made. If notice was not given the assured would losé the benefit of the contract if it turned out that the risk was increased thereby.

Upon the ground that the provision as to notice did not, upon the facts found, apply to this case, and without passing

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upon the other question argued, we are of opinion that the judgment should be affirmed.

All concur.

Judgment affirmed.