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Ætna Life Insurance v. Pelham

110 N.Y.S. 220 Court N.Y. App. Term Decision date 1908-05-15 English

Delivered by GILDERSLEEVE, J.

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p. 220
ÆTNA LIFE INS. CO. v. PELHAM.
(Supreme Court, Appellate Term.
May 15, 1908.)

Headnote

Frauds, Statute of—Promise to Answer for Debt of Another—False Representation of Agency—Liability.
One who induced an insurance company to issue policies on his false representation that he was the assured’s agent is liable to the company for the amount of premiums that could have been recovered under the policies had he had authority, to bind assured; an action to enforce such liability not being not maintainable as being founded upon an oral promise to pay the debt of another.
Appeal from Municipal Court, Borough of Manhattan, First District.
Action by the vEtna Life Insurance Company against Eugene T. Pelham. From a judgment for defendant, plaintiff appeals. Reversed, and judgment for plaintiff directed.
See 52 Misc. Rep. 658 , 102 N. Y. Supp. 461 .
Argued before GILDERSLEEVE, P. J., and GIEGERICH and GREENBAUM, JJ. •
Winter & Winter, for appellant.
John F. Joyce, for respondent.

The defendant is an insurance broker, and represented to the plaintiff that he had received an order from John P. Kane Company, for the issuance of liability insurance policies, and procured the plaintiff to write three policies. The Kane Company refused to accept the policies, and pay the premiums. It turned out that the defendant had no authority from the Kane Company to obtain the policies, and they were surrendered and canceled. The policies were in force for two months, and the plaintiff brought this action to recover from defendant the proportion of premium earned while the policies were in force, to wit, $153.94. Judgment was for the defendant. Upon a previous trial plaintiff obtained judgment for $51.65 upon the assumption, apparently, that the plaintiff was bound by a letter in which it claimed only that sum. The judgment was reversed by this court for the reason that there was proof tending to show that the letter erroneously stated the amount. 52 Mise. Rep. 658, 102 N. Y. Supp. 461 .

. It seems plain that the defendant rendered himself liable for the damages suffered by the plaintiff on account of the breach of warranty that he was the agent of the assured. White v. Madison, 26 N. Y. 117 . The' measure of damage is the amount of premiums that could have

p. 221
been recovered under the policies had the defendant had authority to-bind' the Kane Company. As we have seen, that is $153.94. The claim of appellant that the action cannot be maintained because founded upon an oral promise to pay the debt of another cannot be sustained. The action is not brought on the promise of the defendant to pay the premium. It is for damages arising from the false representations of the defendant that he was the agent of the assured. The facts are practically undisputed, and it is manifest that there could be no change in the evidence upon another trial.

The judgment must be reversed and judgment directed in favor of the plaintiff and against the defendant for $153.94, with interest from March 21, 1906, together with costs in this court and the court below.. All concur.

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