St. Paul Fire & Marine Ins. v. McQuaid

Cook, P. J.

delivered the opinion of the court.

This case originated in the chancery court of the first district of Hinds county, and is an action to reform a certain fire insurance policy issued on the 11th day of December, 1912, by the St. Paul Fire & Marine Insurance Company to Fitzgerald & McQuaid, tenants in common of a frame dwelling located in the city of Jackson, which building was destroyed by fire. The insurance on the building destroyed had been carried by the agency of Wharton & Roberts, located at Jackson, for some years prior to the date of the policy the bill of complaint seeks to reform. All of the policies, including the present policy, named Fitzgerald & McQuaid as .the owners of the building insured. The complainant below, appellee here, is the son of the McQuaid named in the policies. In 1909, Mr McQuaid died, and by proper proceedings in the chancery court, the property belonging to Fitzgerald & McQuaid was partited, and the property in question was assigned to appellee.

Mrs. McQuaid, the mother of appellee, qualified as guardian of appellee, and she testified that she called up the agency of Wharton & Roberts over the telephone; that some one answered the telephone call, and she told this person that she wanted to speak to H. C. Roberts, who was then the owner of the agency. She said that she believed at the time that she recognized the voice answering the telephone as that of Mr. H. C. Roberts. However, she stated that the person at the other end said that Mr. Roberts was not then in the office, and would not be there for some time, but that he was a clerk in the office and could attend to her business. She testified, further, that she told this person that the building had been assigned by the decree of the court to Edward F. McQuaid, and she wanted the insurance transferred to his name, to Edward F. McQuaid, a minor, Mrs. Margaret McQuaid, guardian;that the voice answered that he would attend to the matter and have the insurance transferred as requested. The testimony of Mrs. McQuaid about the telephone conversation was corroborated by another witness. We have stated briefly, but, we think, comprehensively and as strong as may be, the testimony of Mrs. McQuaid, because the decree of the chancellor granting the prayer of the bill must stand or fall upon her evidence.

The course of business between the insurance agency' and the firm of Fitzgerald & McQuaid had been to write policies insuring their property for a term of three years, and when the policy immediately antedating the one which is the subject of this suit expired, they wrote this policy in a different company.

Mr. H. C. Eoberts, the owner of the agency, testified that he never heard of the telephone conversation until shortly .before this suit was begun; that he had no telephone conversation with Mrs. McQuaid. The son of Mr. Eoberts, who was a clerk in the office, testified that he had not talked with Mrs. McQuaid over the telephone, and never heard of the alleged telephone conversation until shortly before the beginning of this suit.

There was a young woman clerk in the office whose duty it was to make all transfers of insurance, and she testified that shfe wrote the policy in question and named Fitzgerald & McQuaid as the owners of the property insured; that she did that advisedly, and there was no mistake in the policy so far as she was concerned; that she did not intend to transfer the insurance to appellee, and never heard of the alleged telephone conversation with Mrs, McQuaid, and, therefore, no mistake, accident, •or inadvertence occurred in the writing of the policy.

It appears that another man, Mr. Davis, was employed by the agency at the date Mrs. McQuaid fixed the telephone conversation. Mr. Davis was not in the employ of the agency when the suit was filed, or when the evidence was taken, and was not examined as a witness.

Counsel say that Mr. Eoberts, the son of H. C. Eoberts, -while under cross-examination, said that it was possible for him to have had a telephone conversation with Mrs. McQuaid and have forgotten it, but he could not see how it was possible. From this they say that he •does not positively state that he had no such conversation. This, we think, is hypercritical. Any honest man is bound to admit that it is possible for him to forget. The witness was, we think, quite postive that he did not talk with Mrs. McQuaid.

So, the record shows that the defendant, and no agent authorized to act for them, made any contract or agreement to transfer the insurance to Edward McQuaid, unless it can be said that Davis’ failure to testify supplies the missing link.

The ease stands about this way: Mrs. McQuaid called up the telephone exchange and asked to be connected with the Roberts Insurance Agency, and presumably she was connected with the agency; some one answered the phone call — Mrs. McQuaid knew that this person was not Mr. Roberts, the man she intended to talk with — she did not ask who it was; this person agreed to have the insurance transferred; the.message was never delivered to the clerk whose duty it was to make the contract; no memorandum was made and filed by this person in the records of the office; the transfer was not made, but when the policy previously issued expired, it was rewritten in another company. The contract as written was deliberately and intentionally made with the former owners, Fitzgerald & McQuaid. This is not a suit against the insurance agency for breach of contract, but is a suit for the reformation of a contract with the ap-. pellant insurance company. Mrs. McQuaid did not select the insurance company — she says that she left the selection of the company to the Roberts Agency; the Roberts Agency did not select the appellant io write a risk on the property of Edward McQuaid — this is made clear by the clerk who wrote the policy. Certainly no actual mistake was made in writing the policy. Was the failure to write the policy according, to Mrs. McQuaid’s request such a mistake as would warrant a court of equity in reforming the policy written so as to make it conform to Mrs. McQuaid request, made in the manner she says it was made? Stated in another way, did the evidence justify the decree of the chanceloor? By all the evidence in the case no one authorized to transfer the insurance had any notice of the request.

Some more facts appear in the record. The policy which the policy issued superseded was dated December 11, 1909, and expired December three years later. The policy in question is dated December 11, 1912, and expires three years after date, while the fire occurred May 15, 1915. The premiums on this policy were paid by Mr. Bridges, who was the agent of appellee to collect, rents and look after the property. Mr. Bridges sent, statements to appellee which show on their face that the premiums were paid on a policy issued to Fitzgerald. & McQuaid. There is nothing to indicate that any objections were made to Mr. Bridges’ account. If the-statements were read, the appellee or his mother must have known that no change had been made in the beneficiaries in the last policy; that this policy named Fitzgerald & McQuaid as the owners of the property insured..

Now as to the law touching conversations over telephones: We think the law is well settled that such conversations are admissible in evidence. The fact that the voice at the telephone was not identified does not render the conversation inadmissible. The weight to -be given to such evidence is largely left to the jury, or to the chancellor, when the case is tried without a jury. In Central Union Tel. Co. v. Fairley, an Indiana case reported in 118 Ind. 194, 19 N. E. 604, 10 Am. St. Rep. 128, and in the notes thereto, may be found a full discussion of this subject. There was no error in admitting; Mrs. McQuaid’s evidence touching the telephone conversation.

The real question is, Did Mrs, McQuaid’s testimony,, taken in connection with all the evidence, warrant the decree? This court, speaking through Judge Truly, in Jones v. Jones, 88 Miss. 784, 41 So. 373, said:

“Adhering to the arbitrary, but salutary, rule which requires a party seeking reformation of a deed, the recitals of which are definite and unambiguous, to establish, not only by the preponderance of the testimony,, but practically to the exclusion of every other reasonably hypothesis, that mutual mistake, fraud, or error occurred in the making of the instrument sought to be reformed, we are constrained to hold,” etc.

“Reformation of an agreement, sought by reason of an alleged mistake in drawing it up, can only be had upon proof, clear and frée from doubt. Harrington v. Harrington, 2 How. 701; Mosby v. Wall, 23 Miss. 81, 55 Am. Dec. 71.”

Tested by the rules announced by this court, it seems that the chancellor resolved all doubt in favor of the party seeking reformation. On his side, a (telephone conversation with some unidentified person was- proven, and there the ease was rested. The defendant- then proved by all of the witnesses available, and all who were authorized to change policies, or write new policies, •and established that no such conversation was had with them, and they never heard of it.- The person to whom was delegated the power to change or write new policies knew nothing of the conversation, and wrote the policy "binding this company without mistake and exactly as she intended to write it. By his decree, the chancellor makes a contract for this company which it never heard of until this suit was begun; the chosen agent of the company made no such contract — no one authorized io make the contract knew anything about the contract. But there remained the telephone conversation, and this was all powerful. If the chancellor was right in his conclusions, a merchant with a legion of employees, when sued on a alleged telephonic contract with some unidentified employee, which conversation changed a written contract, would have to scour the country for his employees who had left his employment and bring every man to the witness stand who could possibly have had such -conversation, and prove each and all of them knew nothing of "the alleged telephone agreement.

It was, of course, incumbent upon the defendant in this case to show, with reasonable certainty that the message was not taken or received by any employee authorized to receive and pass along important messages of this character. This, we think, was done.

Reversed and remanded.