Girard Fire & Marine Insurance v. Hebard , 95 Pa. 45 ( 1880 )

Mr. Justice Green

delivered the opinion of the court,

This was an action by Hebard, Foreman & Smith, for the use of Hebard & Smith, on a policy of fire insurance for $2500, issued June 1st 1875, to expire June 1st 1876. The subject of insurance was a stock of lumber, lath, shingles and pickets at Williamsport, Pennsylvania. On the 29th of April 1876, Forsman sold his interest in the firm to the other members, who thereafter composed the firm called Hebard & Smith. On the same day, the policy in suit was assigned by the old firm to the new, by writing of that date. The assignment was endorsed upon the policy which was then handed by Hebard to Thompson & Olinger, who had been agents of the company until March 1st 1876, to be sent to the company for the purpose of obtaining its consent to the assignment, and having the same endorsed upon the policy, and it was so sent on the same day, April 29th 1876. On May 1st 1876, the secretary of the company replied by the following letter:—

Philadelphia, May 1st 1876.

Messrs. Thompson & Olinger, Williamsport, Pa.

Gents: — Yours of the 29th ult. is at hand, enclosing policy No. 84,271, H., F. & Smith, for approval of transfer. We prefer to cancel policy, and will return the premium pro rata. Please signify your assent to this and I will send you a check for the amount.

Truly yours,

James B. Alvosrd Sec’y.

There was a reply to this letter from Thompson & Olinger which was lost and not given in evidence, and on May 8th 1876, the secretary sent by mail to Thompson & Olinger a check for the return premium $4.17, which was subsequently returned. The fire occurred on the 6th of May 1876, and notice thereof was sent to the company on the 9th. They took no notice of it and refused to pay the loss.

On the trial, the company made defence on the ground that two conditions of the policy had been broken, and that it had thereby become void. They are as follows :— -

Condition 1. “ If the property be sold or transferred, or any change takes place in title or possession, whether by legal process or judicial'decree, or voluntary transfer .or» conveyance, or if this policy shall be assigned before a loss without the consent of the company endorsed hereon, * * * then and in every such case this policy shall be void.”

Condition 12. “ No assignment of this policy shall be valid unless notice thereof be immediately given the company, and said assignment be approved by the endorsement and approval of the president or secretary prior to any loss. The company reserves the right to approve the transfer or not.”

“And it is hereby mutually understood and agreed by and between this company and the assured that this policy is made and accepted in reference to the foregoing terms' and conditions * * * which are declared to be a part of this contract, and are to be used and resorted to in order to determine the rights and obligations of the parties hereto, * * * and that no condition, stipulation, covenant or clause hereinbefore contained, shall be altered, annulled or waived, nor any clause added to these presents except by writing endorsed hereon or annexed hereto by the president or secretary with their signatures affixed thereto.” There were printed blanks on the policy, one for expressing the consent of the company to the assignment of the policy, and another for the assignment itself. The latter was filled up and signed and constituted the assignment heretofore mentioned. The other was never filled out or signed at all. In point of fact, the company did not approve of, or consent to the assignment, and of course no such consent was endorsed upon the policy.

The court below held that upon receiving notice of the assignment, the company had the right to disapprove of it and declare the policy forfeited, and “ if they did this, it was their duty to notify the insured of their election in this respect.” They further held, in answer to the plaintiff’s fourth point, that if the company failed to give notice to the insured of their disapproval of the transfer and of cancelling the policy, these omissions were evidences of waiver of the conditions of the policy, and left the question of waiver on these grounds to the jury. In all this there was error. The express terms of the contract avoided the policy if either the property insured was transferred or the policy assigned, without the consent of the company endorsed upon the policy. It is not enough that notice of the transfer in the one case or the assignment in the other be given to the company. The contract requires that in addition to the notice, the consent of the company must be obtained and must be endorsed on the policy. The duty of procuring these things to be done rests with the assured. If he fails in his efforts or neglects to comply with the whole of the requirements, the contract is at an end by force of its own terms. The court below held that a right of forfeiture by a positive act accrued to the company after receiving notice, and that without such an act and notice of it to the insurer, the avoidance of the contract did not transpire. Rut such is not the agreement of the parties. In the present case there was no notice of the transfer of Eorsman’s interest in the firm other than as it was to be implied from the notice of the assignment of the policy. But that is not a sufficient compliance with the provisions of Condition 1. It is argued that the property referred to in the pertinent clause of Condition 1 is real estate. A reading of the whole text of this condition, as well as of this particular part of it, demonstrates beyond all question that in the use of the word property, it was intended to include any and all kinds of property, whether real or personal, which constituted the subject of insurance.' It is a printed condition, and we find it in a policy insuring personal estate. It would be equally applicable to a policy on buildings. The language is carefully framed so as to refer to property of either class. The portion of the clause in question is as follows : “ Or if the property be sold or transferred, or any change takes place in title or possession, whether by legal process or judicial decree or voluntary transfer or conveyance, * * * or if the interest of the assured in the property, whether as owner, trustee, consignee, factor, agent, mortgagee, lessee or otherwise, be not truly stated,” &c. The mere exhibition of the words is sufficient to show that the word property throughout is intended to refer to the property insured', whether it be real or personal. We hold that no proper notice of the transfer of Forsman’s interest in the property insured by the policy in suit was given to the company, and that the consent of the company was not obtained or endorsed on the policy, either to the transfer of Forsman’s interest or to the assignment of the policy, and hence the contract was at an end, and there was no right of recovery. No act of forfeiture by the company was necessary to accomplish this result, nor was the omission of such an act any evidence of waiver of its rights. A waiver, to be effective, must be intentional, and it would be impossible to predicate such a purpose of any act or omission of the defendant in this case. The positive act done was a refusal to consent, and an immediate notice of such refusal to the persons from whom the application for consent was received. To construe such an act, and the omission to do something further which the contract did not require, into a voluntary waiver of the contract rights of the company, would be a perversion of justice. The principles controlling this case have been so frequently announced by this court, that an extended citation or review of the authorities is entirely unnecessary. The following amongst others are quite conclusive : Finley v. Lycoming Mutual Ins. Co., 6 Casey 311; Buckley v. Garrett, 11 Wright 204; Ferree v. Ins. Co., 17 P. F. Smith 373; Carpenter v. Ins. Co., 16 Pet. 496; Trask v. Ins. Co., 5 Casey 198; Desilver v. Ins. Co., 2 Wright 134. The third, fourth, fifth, sixth, seventh and eighth errors are sustained.

Judgment reversed.