Judgment of the Court
SEDGWICK J.-On the 22nd day of August, 1891, the plaintiff insured his dwelling house for $1,500 with the appellant company for three years. The property was burned on the 18th of July, 1895. One of the conditions of the policy was as follows:
Nersons who have insured property with this company must forthwith give notice of any other insurance already made, or which shall afterwards be made, on the same property, and have a memorandum of such other insurance indorsed on the policy or policies effected with this company, otherwise this Policy will be void; provided, however, that on such notice being given at any time after the issue of the policy, it shall be optional with the company to cancel such policy.
In the event of any other insurance on the property herein described having been once declared as aforesaid, then this company sball, if this policy shall remain in force, on the happening of any loss or damage, only be liable for the payment of a ratable proportion of such loss or damage whether such other insurance be force or not, unless the discontinua of sueh other insurance shall have been previously agrevd to ths company indorsement upon this policy.
Upon the plaintiff suing- for the amount of his policy, the defendants set up failure on the part of the assured to comply with this condition as a defence, alleging that the issured had effected other insurance on the property but -had not forthwith given notice thereof and had a memorandum relating to it indorsed on the policy.
(1) Can. R. 270.
Iowa
33 Penn. 397.
U. P.
17.N. Y.
The facts upon which this defence is based are practically undisputed.
The plaintiff was an insurance agent in St. John,
New Brunswick, where he lived, one company of which he was agent being the Quebec Fire Assurance
Company, an institution having its head office in the J. city of Quebec.
On the 10th July, several days before the fire, the plaintiffs son, in the absence of his father through illness, but with his implied authority, wrote to the office at Quebec requesting an additional insurance of a thousand dollars upon the property.
On the
17th of July, the day before the fire, the directors of the Quebec company passed a resolution authorizing the additional insurance asked for to be effected.
This resolution was not communicated to the plaintiff either directly or indirectly until the 20th of July, two days after the fire, and the plaintiff received notice of it in the course of mail on or about the 21st or 22nd July.
The plaintiff being thereby expressly authorized by the
Quebec company, after knowledge of the fire, to issue in their name the policy asked for did so, and the company paid him the amount of it, there being no question as to the accidental character of the fire and the property being worth an amount largely in excess of the insurance upon it.
We are of opinion that under the circumstances the verdict of the jury in favour of the plaintiff was right, and that upon two grounds: First, that there was no valid insurance such as that set up by the defence existing at the time of the fire; no policy was issued until some time subsequent to the fire.
At the time of the fire there was no obligation on the part of the
Quebec company to effect any insurance at all. The resolution authorizing the insurance passed on the 18th of July might have been rescinded immediately afterwards, and was not in any respect binding upon them until the 20th, after the fire, when it was communicated to the plaintiff. The fact that the company subsequently recognized the transaction as an insurance and paid it in fulfilment of what doubtless they conceived to be an honourable obligation does not support SedgewickJ.the allegation that there was an existing insurance at the time of the fire, and the ground upon which the court below proceeded was equally a bar to the defendants' contention.
Secondly, the condition in the policy must be given a reasonable meaning. It cannot mean that a party is bound to give notice of an insurance of which he has not and cannot have any knowledge.
Neither can we presume that it was intended to provide for a case where an insurance happened to be effected subsequent to a fire of which the assured was bound to give notice, and that under such circumstances the company should have the option of cancelling the policy. That could not have been the intention of the parties. It could solely have reference to an insurance effected before a fire of which subsequent insurance the assured before the fire could have given notice to the company. If it is in the interest of assurance companies that policy holders should give such a notice as that contended for, it will be necessary that the condition be changed so as to compel notice of application for subsequent insurance rather than of the insurance itself. We are all of opinion that the appeal should be dismissed with costs.
Appeal dismissed with costs.