Kehm v. German Mutual Insurance

8 Ohio N.P. 542
CourtCourt of Common Pleas of Ohio, Hamilton County
DecidedJuly 1, 1901
StatusPublished

This text of 8 Ohio N.P. 542 (Kehm v. German Mutual Insurance) is published on Counsel Stack Legal Research, covering Court of Common Pleas of Ohio, Hamilton County primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kehm v. German Mutual Insurance, 8 Ohio N.P. 542 (Ohio Super. Ct. 1901).

Opinion

Ppleger, J.

The plaintiff filed his petition on a mutual insurance policy, alleging that the defendant performed all the conditions on his part to be performed.

The defendant company answered, denying liability, on the grounds-—

1. That the policy contained a' provision that the same shall be void if there was other insurance during its running period without consent endorsed thereon by the secretary of the company.

2. That the by-laws, in addition, provided that no indemnity shall be allowed if double insurance exists without the consent of the board of directors and “re-marked” in the-policy; that the plaintiff, sixteen days after the issuing of defendant’s policy, insured in another company;, that the defendant company had no knowledge thereof until after the fire that no consent was endorsed on the policy, and tendered back the premium note and the premium, deducting only for the sixteen days.

The plaintiff, in an amended reply, admitted the other insurance, and says:

1. That he never saw or had knowledge of such by-laws, and that the same -was abandoned, abrogated and waived by the company.

2. That the company never before refused to pay losses on the ground that double insurance existed and had not been re-marked in the policy, and is, therefore, estopped to plead endorsement.

3. That Ü19' defendant’s agent applied for $3,000 insurance; that $2,000 was allowed > that the plaintiff notified said agent that he would take out a policy for the additional $1,000; that he received said policy with that distinct understanding; that "at and immediately after the delivery of the policy1’ he notified the company that he would at once takeout said additional $1,000; that the said company, by its authorized agent, consented thereto and neglected to endorse such consent, or to inform plaintiff that such consent was necessary, and that thereby defendant waived said provisions as to other insurance.

4. That the defendant company, after knowledge of the other insurance and after the fire, caused bids to be made for reconstruction, took other t steps, and sent its agents for a settlement thereof, made no claims as to the other insurance clause, but insisted that plaintiff had set fire to his said building.

5. That the defendant did not tender the premium note and the premium until long after the bringing of this suit, whereby defendant waived the provision as to additional insurance.

The case was tried on the original pleadings and a verdict and judgment rendered in favor of the plaintiff, which was reversed by the circuit court, on the ground that the defendant should not have alleged performance of all the conditions, but should have plead the exception as to other insurance and the waiver; and on the ground that the pleadings admitted that the defendant had no knowledge of other insurance; that the same was not endorsed oh the policy; that the agent had knowledge that the plaintiff merely intended to take other insurance, which he had a right to do, and that no waiver is claimed in the pleadings or shown in the evidence on the part of the company or the agent, and that if the agent had agreed [543]*543thereto it was not competent for him to do so.

And, lastly, that no fraud is alleged, and that the written contract could not be varied by the parol statements of the agent.

Separate motions (demurrers in nature) are filed to the allegations in the reply. The case was twice argued, and ably briefed by counsel on both sides. The question involved not only the substantive law of insurance applicable hereto, but also the necessary pleadings and the remedies. Many authorities, including those cited by counsel, were examined.

Consent by Endorsement.

In many of the states it has been held that a provision prohibiting a parol waiver by officers and agents is valid and enforceable (16 Ency. of Law, 951, note 4, 2nd ed. ;also, in Smith v. Farmers Mutual Company, 19 Ohio St., 287; Frankfuerter v. Home, 10 Misc., N. Y., 159; Union Bank v. Sherman, 71 Fed. R., 473; Walsh v. Hartford, 73 N. Y., 5; Marvin v. Universal, 85 N. Y., 278; Cleaver v. Ins. Company, 65 Mich., 527). Such provisions in by-laws of a mutual company are binding on a policy holder (Stark Ins. Co. v. Hurd, 19 Ohio St., 149; Hall v. Mich. Ins. Co., 72 Mass., 169). Our Supreme Court has said, in Union Central Insurance Co. v. Hook, 62 Ohio St., 264, that the insured has made it impossible to modify the terms of the policy by verbal agreement or by writing, except as therein provided, in the absence of conduct estopping the company.

The general rule sanctioned by the weight of authority is, that the company and its authorized agent may waive, by parol, a condition in the policy as to other insurance, or be estopped to deny the saíne, notwithstanding a provision requiring an endorsement on or attached to the policy (see many authorities in 16 Ency. of Law, 2d. Ed., p. 950 and 951, and especially the following: Baldwin v. Citizens Ins. Co., 60 Hun., 389; Schammer v. State, 30 Oregon, 29; Dale v. Continental, 95 Tenn., 38; Dick v. Equitable, 92 Wis., 46; Cronin v. Ins. Co., 119 Mich., 74; 25 S. W. 796; 80 N. W. 1088 ;Mattocks v. Ins. Co., 74 Iowa, 233; Ins, Co., v. Earle, 33 Mich., 143; Kitchen v. Ins. Co., 23 N. W., 616; 57 Mich., 135; Ins. Co. v. Gallatin, 48 Wis., 36; Kahn v. Ins. Co., 34 Pac., Wyo .,1059; McElro v. British As. Co., 94 Fed., 790; Mutual v. Wood, 95 Va., 231; Ohio Farmers v. Burget, 17 C. C., 619; Ohio Farmers Ins. Co. v. Davidson, 37 Bull., 164 Joyce on Insurance, Sec. 556). Although this point was raised in the pleadings, it was not considered material in Sun Ins. Co. v. Clark, 53 Ohio St., 414. And this is true, although it is against a by-law of a mutual insurance company (Redstrake v. Cumberand, 44 N. J. Law, 294), because a by-law may be mutually waived (Hondeck v. Merchants, 102 Iowa, 303. And this is applicable to a standard policy (Wood v. Ins. Co., 149 N. Y., 382; 159 N. Y., 426). Restrictions by the company on its own powers are ineffectual (Dick v. Equitable, supra). It is not in the power of an insurance company to abolish the law of estop-' pel or waiver by such means (Firemen v. Norwood, 69 Fed. R., 71; Northern v. Grandview B. A. 101 Fed. R., 80 Neb.). Such provision in a policy- has no greater sanctity than any other, and may itself be waived (Gandy v. Ins. Co., 52 S. C., 228) a well-considered case. The same -is true of a clause requiring the au- ■ thority oí a boa-rd of directors and a written endorsement by the president. In this case the company was estopped from asserting the' truth, because “the party was lulled to sleep by the assurance that the condition had bee* complied with, and that the indemnity was secure” (citing Judge Sharswood; Stoffer v. Ins. Co., 164 Pa., 204).

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Bluebook (online)
8 Ohio N.P. 542, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kehm-v-german-mutual-insurance-ohctcomplhamilt-1901.