Turner v. Quincy Mutual Fire Insurance , 109 Mass. 568 ( 1872 )

Ames, J.

The case finds that the plaintiff was the general owner of the property insured, and was the party who applied for the insurance, paid the premium, and subscribed the deposit note. He must be considered as the person insured. Sanford v. Mechanics’ Insurance Co. 12 Cush. 541. The stipulation that in case of loss the amount of indemnity that shall become due is to be paid to a mortgagee does not prevent the plaintiff from being ..he party for whose benefit the insurance is to operate. Jackson v. Farmers’ Insurance Co. 5 Gray, 52. Whatever may in that way be paid to his creditor, operates in effect as a payment to himself. It reduces his debt, and fulfils to that extent his obligation. It would be a payment for him and on his account, and he would have the benefit of it as much as if it were a payment directly to himself. The clause in the policy is merely a direction in advance as to the mode of payment. The decision last cited is distinct and explicit that in such a case the mortgagor, with the permission of the mortgagee, may sue upon the policy in his own name. The evidence reported is distinct that the mortgagee assented to the suit in advance or sanctioned it after-wards.

With regard to the authority of Porter to bind the defendants, oy an agreement to join in the submission of the plaintiff’s claim to the arbitration of the three persons who made the award declared upon, there is more difficulty. He was undoubtedly their • agent for some purposes, and to some extent, and the jury were correctly instructed as to the general rules by which they were to judge of the extent of his authority as such agent. But it is not claimed that he had any previous express authority from the defendants to enter into.this specific agreement of reference, and the only ground upon which the defendants can be said to be bound by his act in so doing must be that such a reference came within the scope of the apparent authority which he had been permitted by them to assume on their behalf, or that they assented to the act by a subsequent ratification. If, with their knowledge and without objection on their part, he had acted in such a manner as to lead third persons dealing with him honestly to believe that he had such authority; in other words, if he was held out by the defendants as having it; they cannot afterwards repudiate his acts as unauthorized. The bill of exceptions shows that he was their Boston agent, and that, as such, he was largely employed in the preliminary arrangement of receiving applications, and the usual and ordinary business of insurance. But the adjustment and settlement of losses would be matters which would only arise occasionally, and much less frequently. Their business in Boston, on such occasions, would not be so remote from their general place of business as to make it either difficult or inconvenient for the directors themselves to act personally upon the subject of the adjustment of claims for losses; and there would be comparatively little occasion or reason for delegating full power of action on behalf of the company, upon a matter of such importance, to a local agent, at so short a distance from the central office.

The plaintiff’s evidence tended to show that Porter did take an active part, to some extent, in the business of ascertaining and adjusting losses, on behalf of the defendants, and that there were instances in which he had joined, as the representative of the defendants, in the selection of arbitrators to estimate the amount of loss. The defendants meet this evidence by saying that there were two or three persons (Goodwin, Poland and one other) upon whose judgment they were willing in such cases to rely, and some one of whom they were in the habit of selecting for such purposes ; and that when Porter selected for them as referee either one of those persons, they acquiesced in such selection. In all the numerous cases of this kind, in which, according to the evidence, these defendants had joined with other companies in submitting the question as to the amount of the loss by fire to referees, but one is found in which it appeared that either Goodwin or Poland was not one of the referees. But this evidence is far short of proving, and it has no tendency to prove, the broad and general authority on the part of Porter to select referees for the defendants according to his discretion, or to join with other companies in such a reference. Still less, if possible, had he any authority to delegate the selection of a referee to any other party in interest. To give to the plaintiff’s evidence its broadest effect, it fails to show that in any case (with one single exception, the particular circumstances of which do not appear) the defendants have paid any loss upon an award not signed by either Poland or Goodwin; or that they have adopted Porter’s agency or confirmed his act in selecting for them any other person as referee. The adoption of a referee previously selected by other parties was not within the apparent scope of his agency.

"In this view of the case, it was an error to leave it to the jury to say whether the estimate made by the three referees was binding as an award upon a submission by an authorized agent of the defendant corporation. The majority of the court are of the opinion that there is no evidence of any such authority. The result is that, unless the plaintiff will consent to reduce the verdict to the sum assessed by the jury, taking the estimate of Kelsey, Fitch and Fox as evidence only, and not as a binding award, the

Exceptions are sustained.