Westchester Fire Ins. Co. v. Robinson , 192 S.W. 793 ( 1917 )

Appellee predicates the right of recovery for the loss of the dwelling and goods as upon a contract of renewal of her policy of April 5, 1913, expiring at noon April 5, 1914, before the fire. And the most important question in the appeal is whether, upon the facts, the appellee is entitled to recover. As found by the jury, T. M. Kensey orally agreed with appellee that he would keep her insurance in force by renewing the policy before the same would expire, the appellee to pay the premium for each renewal. And in the light of the evidence it is made clear that the agreement, as expressed in the verdict, was made at the time the policy of April 5, 1913, was taken out, and that there was intended by the parties only the continuing in force of said policy after its expiration according to its terms by renewal thereof from time to time, without limit of duration, as same might expire, upon appellee's paying the same annual premium for each renewal. The language of the agreement, in the light of the surroundings, plainly indicates an intention on the part of the agent, Kensey, to do something for appellee in the future, rather than a present assumption of an obligation upon his company. And the character of the agreement is, in legal effect, that of an agreement to contract in the future to renew the policy. It is not an executed contract of renewal nor an executed contract to insure in the future. It is not doubted that an insurance company, through its authorized agent, may contract by parol for the renewal of a policy. Cohen v. Ins. Co.,67 Tex. 325. 3 S.W. 296, 60 Am.Rep. 24. And contracts to insure in the future are held valid, and specific performance thereof may be compelled even after a loss which would be covered by the policy if issued. But the law distinguishes between the executed contract of insurance or for renewal of the policy and a mere promise or agreement to contract in the future to renew the policy.

A contract of insurance or for the renewal of the policy is an executed contract, which can be enforced at law. And a promise or agreement to contract in the future to renew the policy is executory, and requires the interposition of equity to give effect to the agreement of the parties. 1 Wood on Ins. §§ 29-31; 6 Rawle C. L. p. 590, § 9. And the promise of an agent, as here, to renew a policy at its expiration is not equivalent to a renewal. Benner v. Fire Assoc., 229 Pa. 75, 78 A. 44,140 Am. St. Rep. 706.

In Zell v. Ins. Co., 75 Wis. 521, 44 N.W. 828, the plaintiff held a policy of insurance for one year, expiring March 30, 1887; and shortly before the expiration of this policy he applied to the agent of the company to renew or continue in force the policy for another year from the termination of the existing policy, and paid the agent the premium for such renewal; and upon the payment of such premium the agent promised the plaintiff to continue the policy in force for another year. It was held by the court that under such facts the contract was a completed oral contract of renewal insurance and within the authority of the agent to make and binding on the company. And on a similar state of facts, and with the same holding of being a completed contract of renewal, are the following: Newark Machine Co. v. Ins. Co.,50 Ohio St. 540, 35 N.E. 1060. 22 L.R.A. 768; More v. Ins. Co.,130 N.Y. 537, 29 N.E. 757; Hardwick v. Ins. Co., 20 Or. 547, 26 P. 840; Croft v. Ins. Co., 40 W. Va. 508, 21 S.E. 854; King v. Ins. Co.,58 Wis. 508, 17 N.W. 297; Campbell v. Ins. Co., 73 Wis. 100, 40 N.W. 661. But all these cases and the principle of law made applicable are quite different from the instant case. In these cases, and generally, it is held that the agent has authority to make a parol contract for renewal in the future where he is authorized to make insurance and issue and deliver policies. But it is not held that the power of the agent, arising under the authority proven, to make a contract for renewal is broad enough to authorize him to bind the company by an agreement to contract in the future to renew the policy. The policy in evidence stipulates that it may, by renewal, be continued under the original stipulations, in consideration of premium for the renewed term. But in McCabe v. Ætna Ins. Co., 9 N.D. 19, 81 N.W. 427, 47 L.R.A. 641, this identical provision was in review, and it was there held that this provision only authorized the agent to make a contract for renewal, and not to make a preliminary agreement to renew in the future the policy upon its expiration. It is therefore concluded that the agreement in the instant case is lacking in the essentials of a completed contract to renew the policy at its expiration, and that there is no proof that the agent had authority to make the agreement in the case.

Consequently the agreement found by the jury, must be held to be the individual promise or undertaking of T. M. Kensey, and the company was not bound. Diamond v. Duncan (Sup.) 172 S.W. 1100. This ruling requires that the judgment be reversed, and that judgment be here entered in favor of appellant, with costs of appeal and of the trial court.