Wheelock v. Chapman , 54 N.Y.S. 327 ( 1898 )

McLAUGHLIN, J.

On the 24th of June, 1895, the plaintiff’s assignor applied for insurance on certain property in the Capitol Fire Lloyd’s, and received a policy which, among other things, provided that: .

“No action shall be brought to enforce the provisions of this policy except against the general manager as attorney in fact, and representing all the underwriters, and each of the underwriters hereby agrees to abide the result of any suit so brought as fixing his individual liability thereunder. Judgment entered in such an action shall be satisfied out of the premiums in the hands of the underwriters unexpended; if such premiums shall be insufficient, then out of the deposit made by the several underwriters; if both shall be insufficient, then out of the individual liability of the several underwriters as hereinbefore expressed and limited; but in no case shall the judgment bind the property of the general manager.”

The policy bore the names of 10 underwriter i, and that or: "W. J. Turner Lynch, Attorney and Manager.” Thereafter, and during the life of this policy, the property covered by it was destroyed by fire, proofs of loss were duly made, and, the defendant having refused to pay, the cause of action was duly assigned to this plaintiff, and he instituted this action to recover the amount of the loss sustained. The plaintiff had a judgment, and the defendant has appealed.

The real ground urged by him for a reversal of the judgment is that the action should have been dismissed against the defendant upon the ground that the complaint and the evidence failed to make out a cause of action against him; that the person who, under the terms of the policy, is made liable to respond for the loss sustained, is the attorney and manager whose name appears on the policy, W. J. Turner Lynch. But it appeared upon the trial that Lynch, prior to the time this policy was issued, had either resigned or been removed as attorney and manager of the Capitol Fire Lloyd’s, and that the defendant had been appointed, and was at the time the policy was issued, and loss sustained, acting as such attorney and manager. It also appeared that when the policy was issued the Capitol Fire Lloyd’s were, to the knowledge of the defendant, or .at least to the knowledge of its Chicago agent, Russell, from whom the policy in suit was obtained, using old printed forms of policies, with Lynch’s name thereon. Under these circumstances, it ill becomes the defendant to urge that he should be relieved on that ground.

By the terms of the policy it will be observed that any judgment obtained must be satisfied out of the premiums in the hands of the underwriters before the underwriters became personally liable. The defendant, as attorney and manager, held, so far as appears, the unexpended premiums. He was managing the business, and collecting the premiums as they became due. It is therefore difficult for us to see just what avail it would be to the plaintiff to have a judgment against W. J. Turner Lynch, and the defendant has not attempted to satisfy us upon that point. In Lieter v. Beecher, 2 App. Div. 577, 37 N. Y. Supp. 1114, this court held that a provision in a fire insurance policy issued by the agent of an association of underwriters, providing that an action on the policy can be brought only against such agent as attorney in fact of the underwriters, is valid, and authorizes an action on the policy against the agent as such attorney. The defendant, at the time the policy was issued and the action brought, was actually the attorney. He received the proofs of loss at the place of business of the company. The policy by its terms provides that an action to recover a loss sustained shall be brought against “the attorney and manager of the underwriters.” This was the defendant, and not Lynch. Lynch had either resigned or been removed. He had no connection with the company from the inception of the policy to the time the judgment appealed from was entered. The action was properly instituted against the defendant.

The judgment is right, and should be affirmed, with costs to the respondent. All concur.