Hickey v. Hartford Fire Insurance — 99 N.Y. Sup. Ct. 192

Majority

p. 192

Michael Hickey, Appellant, v. The Hartford Fire Insurance Company, Respondent.

Headnote

Insurance —a delivery of a policy to an agent, who is to issue a new one, does not effect a cancellation of the old, until the new policy is issued.

In an action brought to recover the amount of a loss by fire under a policy of Are insurance issued by the defendant, the answer, among other things, alleged that the policy had been canceled. It appeared that the plaintiff sent the policy to tlie defendant’s agent for the sole purpose of having another policy issued in its place covering only the property destroyed, the first policy having through an error also insured property located upon another farm; that the purpose was simply to remedy this mistake, and that the property in question should remain insured until the new policy was issued ; that the policy by its terms could only be canceled at the instance of the insurer upon the giving of five days’ notice to the insured and upon returning the premium actually paid, and that no such action had been taken by the insurer, tlie defendant.

Held, that the complaint, which was upon the original policy, and not upon the promise to issue a new policy in place of tlie original one, was sufficient;

That, as the evidence tended to show that the parties did not intend a cancellation until the new policy was issued, at the time of the loss the old policy was still in force.

Appeal by the plaintiff, Micliael Hickey, from a judgment of tbs Supreme Court in favor of tlie defendant, entered in the office of the clerk of the county of Tioga on the 4th day of April, 1895, dismissing the plaintiff’s complaint upon the merits after a trial at the Tioga County Circuit; also, from an order entered in' said clerk’s office on the 4th day of April, 1895, denying the plaintiff’s motion for a new trial made upon the minutes, and also from the order of the court granting a nonsuit upon the trial of the action.

Martin 8. Lynch, for the appellant.

Horace McGuire, for the respondent.

The complaint in this action in effect alleged that the defendant, through its agent, who was duly authorized to effect and enter into contracts of insurance for it, in consideration of the sum of six dollars and fifty cents, paid by the plaintiff, made and entered into a contract of insurance, by the terms of which it contracted and

p. 193

agreed to insure tbe plaintiff against loss or damage by lire upon a certain frame barn and contents owned by tbe plaintiff, for tbe sum. of $550.

It then alleged that the barn and contents were destroyed by fire,, and that tbe property so destroyed was of a value equal to tbe’ insurance; that proofs of loss were furnished tbe defendant, and that it refused to pay tbe same on the ground that before tbe fire the-’ contract of insurance was canceled.

Tbe defendant, after admitting its incorporation, tbe authority of its agent, tbe destruction of tbe barn and contents by fire, tbe service upon it of proofs of loss, and that it refused to adjust the same, denied tbe remaining allegations in the complaint, and in effect alleged that tbe policy it bad issued bad been canceled.

On tbe trial, tbe plaintiff was nonsuited. Tbe court held r: (1) That the action was upon a policy which bad been canceled, and. (2) that tbe plaintiff could not recover upon tbe contract of insurance made with tbe defendant, because of tbe insufficiency of the-complaint.

In bolding that tbe policy issued bad been canceled, tbe court relied' upon the cases of Von Wien v. S. U. & N. Ins. Co. ( 118 N. Y. 94 ) and Crown Point Iron Co. v. Ætna Ins. Co. (127 id. 608). We; think that those cases are not decisive of this, but that they are clearly distinguishable. In this case there was no absolute surrender of the policy. It was left for or sent to tbe defendant’s agent with the-express understanding and for the sole purpose of having another-policy issued in its place which should cover only the property destroyed. Tbe first policy bad insured it with property located-, upon another farm. Upon discovering this and bringing that fact, to tbe knowledge of tbe defendant, it agreed, upon tbe return of’ tbe policy issued, to issue a new and separate policy upon tbe property destroyed. There is nothing in tbe appeal book which discloses any intent upon the part of the plaintiff, or any understanding by the defendant, that the policy issued wras to be surrendered or canceled until a new policy was issued in accordance with the agreement between the parties. We think it is quite manifest that both parties intended that the plaintiff’s property should remain insured, under the policy already issued, until a new one was written to take

p. 194

its place, and that tbe surrender of tbe old and tbe writing of tbe new policy were to be simultaneous. Under sucli circumstances, it could not properly be lield that tbe policy already issued was canceled. By tbe provisions of tbe policy, it could be canceled by tbe defendant only upon its giving five days’ notice and returning tbe premium actually paid.’ Tliat it was canceled by any sucli action of tbe company is not claimed or pretended. On tbe other band, we tbiuk tbe court was not justified in bolding tbat tbe plaintiff intended to have this policy canceled, and thus leave bis property uninsured, until another was issued in its stead.

Moreover, we are inclined to tbe opinion that tbe complaint in this action was sufficient to justify proof of a contract to insure tbe building in question upon tbe terms agreed upon between tbe parties, and to sustain a recovery for a breach of such agreement to tbe extent of tbe loss sustained by tbe plaintiff under the principle of tbe cases of Ellis v. Albany City Fire Ins. Co. ( 50 N. Y. 402 ); Angell v. Hartford Fire Ins. Co. (59 id. 171); De Grove v. Metropolitan Ins. Co. (61 id. 594); Train v. Holland Purchase Ins. Co. (62 id. 598); Hubbell v. Pacific Mutual Ins. Co. (100 id. 41); Ruggles v. American Central Ins. Co. of St. Louis (114 id. 415); More v. N. Y. Bowery Fire Ins. Co. (130 id. 537); Forward v. Continental Ins. Co. (142 id. 382, 389).

A somewhat critical examination of tbe evidence and tbe authorities bearing upon tbe questions involved lias led us to tbe conclusion tbat tbe court erred in bolding tbat tbe policy issued by tbe defendant bad been canceled, and tbat tbe plaintiff’s complaint was insufficient to justify a recovery upon tbe contract of insurance made between tbe plaintiff and tbe defendant; tbat tbe court erred in nonsuiting tbe plaintiff, and tbat for tbat error tbe judgment should be reversed.

Present- — -HardiN, P. J., MartiN and Merwot, JJ.

Judgment and order reversed and a new trial ordered, with costs to abide tbe event.

Cases cited

Von Wien v. Scottish Union & National Insurance 118 N. Y. 94 N.Y. 1889-12-20 p. 193
Ellis v. Albany City Fire Insurance 50 N. Y. 402 N.Y. 1872-11-26 p. 194