Mercer County Mutual Fire Insurance v. Stranahan , 1884 Pa. LEXIS 8 ( 1883 )

Mr. Justice Clark

delivered the opinion of the court, January 7th 1884.

This action is brought to recover assessments upon two policies of insurance of the Mercer County Mutual Fire Insuranee Company. One of the said policies, No. 86, issued January 13th 1873, covered an insurance to James A. Stranalian, upon certain property therein described, for one year from that date, to the amount of $3,086 ; the other, No. 290, issued 16th January 1874, after the expiration of No. 86, covered an insurance to Stranalian and Hoagland, upon a portion of the same property, for one year from the latter date, to the amount of $1,280.

- The company operated under a charter of incorporation, the sixth section of which provides as follows: “ Every member of said company shall be bound to pay for all losses or damages, and all necessary expenses accruing in said company, in proportion to the amount he or she may have insured, in the different classes annually, or as often as the directors may make assessments.” No premium notes were taken, the assessments being made directly against the policyholders, under this clause of the charter, which was incorporated into each policy, and formed part of the contract.

The affairs of the company were conducted by a board of twelve directors; no assessments were at any time made, until the 13th April 1880, when in obedience to a writ of mandamus awarded by the court of Common Pleas of Mercer county, the board assessed the policy holders for a sum sufficient to pay the indebtedness of the company. In this general assessment, policies, Nos. 86 and 290 were embraced, the former to the amount of $246.88, and the latter of $48.

On or about the 17th March 1S74, after policy No. 86 had expired, and whilst No. 290 was in force, the property insured was wholly or partially destroyed by fire. The company was duly notified of the loss, and on the 13th July 1874, Seth Hoagland, president of the company, J. P. Kerr and another, composed a committee on behalf of the company to adjust the same.

The third section of the first article of the by-laws of the company provides, that the president “ shall have full power to examine, adjust and settle in all cases of loss, not exceeding one hundred dollars,” and in “ all cases exceeding this amount, he may call to his assistance one or more directors, as he may think necessary, and shall call special meetings of the board of directors when necessary, and shall have general supervision over the affairs of the company.”

Mr. Stranahan’s loss was adjusted under this provision of the by-laws by Mr. Seth Hoagland, president, and Mr. J. P. Kerr, director of the company, at $S00, an abatement of $4S0 having been agreed upon. The defendant alleges that in this adjustment, and by the agreement upon which it was effected, he was released from all future assessments which might otherwise have been made on his policies, Nos. 86 and 290, to cover losses incurred during the period of their continuance, and that the policies were cancelled and surrendered to the company, the release being embodied in a writing thereon indorsed.

We have no doubt, whatever, that an adjustment upon such terms was within the power of the company, and if so, that authority under the fourth section of the charter might be delegated, as it was in this case, to an adjusting committee of the board. The president had “ general supervision over the affairs of the company,” and a^one or with the concurrence- of any member of the board had full power to examine, adjust and settle in all cases of loss. This adjusting committee had as much power to effect a settlement of losses incurred as the board, and that power was derived from the same source; the action of the committee was not subject to the approval of the board of directors, the committee had “ full power.”

By the ninth section of the company’s charter it is provided that “any member can -withdraw from this company at any time, by paying his or her proportion of the losses up to the date of withdrawal, and surrendering his or her policy.” This surrender and settlement, it is alleged, was made and the policies properly cancelled and delivered to the president of the company. If this be true, and the jury have so found, the insurance relation was thereby broken, and no further liability remained as against either of the contracting parties. The proportion which the losses incurred bore to the whole amount insured'at the time of the loss, gave the ratio of the defendant’s liability to the loss, and thus a reasonably approximate estimate could at any time be made.

Whether or not there was in fact an agreement to release the defendant’s policies from future assessments, was the specific question for the jury. The release, if given at all, covered both policies, and this defence was to the whole of the plaintiff’s claim. Mr. Stranahan’s testimony, upon this question was positive, he testified as to an existing fact of which he claimed to have actual knowledge. Mr. IToagland, in rebuttal, testifiled as positively, that no such fact existed, and although he testified in negative form, his assertion is positive in effect, that is to say, he testifies positively that no such transaction occurred with him.

There is, however, a difference between the character of the testimony delivered by Hoagland, and that of J. P. Kerr on the precise question before the jury. The court used language a little strong perhaps, in saying that the testimony of Mr. Kerr “ amounted to nothing in the shape of contradicting Mr. Stranahan,” if this was spoken of the entire testimony of both of these witnesses ; we think, however this language is subject to a qualification which is contained in the charge as a whole. The vital question for the jury, as has been stated, was whether or not there was an agreement to release the policies from future assessments. Even if there was, in fact, a difficulty in the adjustment, such as Mr. Kerr referred to, arising out of Clingan’s alleged purchase, that was not at all inconsistent with the agreement; for the adjustment and abatement .made, might have been in consideration of either, or both of these together. The distinction between positive and negative testimony was carefully stated, and the jury was fully instructed as to the nature and effect of each ; it was certainly manifest to the jury that the reference of the court in the expression quoted was alone to the negative portion of Kerr’s testimony, and to this only was it applied.

We are not inclined, therefore, to reverse the judgment upon this ground, as we are clearly of opinion, there is no room for the assertion that the charge as a whole was misleading.

As the defence, embraced in this submission to the jury, was to the whole of the plaintiff’s claim, the finding of the jury being for the defendant, it is unnecessary for us to considér the question arising under the statute of limitations.

Judgment affirmed.