Willoughby v. St. Paul German Insurance

71 N.W. 272, 68 Minn. 373, 1897 Minn. LEXIS 411

• Court: Supreme Court of Minnesota
• Decided: May 26, 1897
• Docket: Nos. 10,594—(139)
• Status: Published

Opinions

BUCK, J.

This is an appeal by the intervenor from a judgment disallowing his claim in a suit against the stockholders of St. Paul German Insurance Company, an insolvent corporation. There, is no settled case, and the only question is whether the facts stated in the decision sustain the conclusions of law. The following facts were found by the trial court, viz.:

“That the St. Paul German Insurance Company issued to said Steffen the policy of insurance referred to in his claim; that by said policy it was provided that no suit or action on said policy for the recovery of any claim should be sustained in any court of law or equity unTil after full compliance by the insured with all the foregoing requirements, nor unless commenced within twelve months next after the fire; that a loss occurred under said policy on the 2d day of April, 1892; that notice of such loss was duly given to said insurance company and thereafter, and on or about April 11, 1892, the amount of the loss and damage by said fire was adjusted at the sum of $2,795; that said insurance policy provided for insurance to the amount of $5,000; that on April 14, 1892, said insurance company made an assignment under the insolvency law of the state of Minnesota to one J. F. Franzen, and that thereafter said Steffen duly filed his claim with said Franzen, as assignee in insolvency, which claim was in said proceedings allowed by said assignee, and a dividend thereon paid of six per cent, about November 1, 1895; that this present action was not commenced until on or after December 1, 1893; that no suit or action upon said policy for the recovery of any claim was commenced in any court of law or equity within twelve months next after said fire and loss, or after said adjustment, or after said loss occurred,- and said claim was not exhibited or filed in this action; and that this action was not commenced until more than twelve months after said fire and loss or adjustment.”

Tn addition to the foregoing stipulation, the policy of insurance referred to was introduced in evidence at the hearing without objection. Said policy contains provisions that in case of fire the insured should su bmit proofs of loss to said company, and what they should contain, and that the company might make examinations, and that, in case of the disagreement of the parties as to the amount of loss, appraisers should be selected to determine the amount of the 18ss; and said policy contains the further provision:

“This company shall not be held to have waived any provision or conditions of this policy, or any forfeiture thereof, by any requirement, act, or proceeding on its part .relating to the appraisal, or to any examination herein provided for.”

Upon these facts the court found as a conclusion that by reason of the one-year limitation contained in the policy Steffen Is barred from maintaining any action upon said policy, and from asserting his claim in this action, and disallowed his claim.

The appellant insists that when an insurance company adjusts a loss, the right under the policy provisions to demand arbitration, as well as a short statute of limitations, becomes immaterial, and, if a suit becomes necessary to collect the amount, the complaint would be based, not upon the policy, but upon the adjustment; and that in such case the policy would be set forth solely by way of inducement; and that the term “adjusted,” as stated in the finding of the trial court, imports a compromise; that the compromise and implied promise to pay the amount adjusted form a new contract, for which it is claimed that upon the face of the findings there appears to be ample consideration. But the finding relates merely to the amount of the loss and damage by the fire, which was adjusted at the sum of $2,795, and not to any adjustment of the amount due from the company to the insured. The distinction between adjusting the amount of the damage done by the fire and the sum for which the company is liable is very apparent. In the first ease there would be a recognition of the extent of damage done by the fire; in the latter, a recognized liability, properly adjusted by the parties. But the mere fixing of the amount of the loss by the fire is not, of itself, an admission on the part of the insurer that any liability exists against it upon such policy, and. does not raise an implied promise to pay. 2 Wood, Fire Ins. § 450.

Assuming that an adjustment of the extent of the damage done by the fire, and that such amount is admitted by the insurer to be due to the insured, would raise an implied promise to pay it, yet the facts in this case do not even bring it within any such rule. The defendant did not waive anything by agreeing upon the amount'd the loss, and is not estopped from insisting upon all the conditions agreed upon in the policy, one of which conditions was that no suit or action on said policy should be sustained in any court of law or equity unless commenced within twelve -months next after the fire. The controlling issue in this case, and the only one raised by the record, is whether a mere adjustment of the loss by the respective parties, without any compromise or adjustment of a liability, created a liability against the insurer which he had not promised to pay. We are of the opinion that upon the facts the plaintiff is barred by the statute of limitations from maintaining this action. We have avoided any reference to or discussion of the question of what may have been the liability of the stockholders by reason of the assignment of the company under the insolvency law, the filing of this claim in due time, and the payment by the assignee to the intervenor of the six per cent, dividend out of the insolvent estate, as no such question was raised or discussed by counsel.

Judgment affirmed.