Davis Shoe Co. v. Kittanning Ins.

OpinioN,

Mr. Chief Justice Paxson :

The first assignment raises the only important question in this record. The plaintiff’s second point requested the court to instruct the jury: “ That if the jury believe that the plaintiff company mailed final proofs of loss to the defendant company on February 25, 1888, and the defendant company received said proofs on February 28,1888, and made no objection to the same before April 24, 1888, it is for them, the jury, to say whether such facts were sufficient evidence of waiver by the defendant company of any informality or deficiency in the proofs of loss.” The learned judge below affirmed this point, and, if he was right in this, the pivotal point of the cause, all that follows is of little moment.

There is not even an allegation that the policy of insurance was not taken out in the usual way, the premium fully paid, and the loss an honest one. The latter circumstance is not, perhaps, material, so far as it concerns the law of the case. It may affect the moral aspect of the defence. When an insurance company is defending against fraud, it might well be justified in resorting to even technicalities to defeat such claim. But, when it has issued its policy and received the premium, it has entered into a contract of indemnity; and common honesty requires that it should keep such contract in good faith, and an attempt to defeat it by shifts, evasions, and bald technicalities can only be regarded with a feeling bordering closely upon contempt.

The plaintiff company was doing business in the state of Virginia. The property insured was located at Richmond. The defendant company is a Pennsylvania corporation having its principal office at Kittanning, Pa., with agents in different localities, whose business it is to solicit insurance. Much of its business appears to come from distant points where it is least known. The policy in this case was for $1,000, and during the life thereof, viz., on the morning of January 31, 1888, a fire occurred by which the property insured was injured and destroyed in whole or in part. On the same day, the assured notified the company of the fire by letter, stating that the loss. would probably be total. There being a large amount of insurance on the same property in other companies, the assured, on the eleventh day of February, notified the insurance company of the meeting of adjusters to adjust the loss and claims. Proofs of loss were made out and sent to the company on the 25th of February, within the time prescribed by the policy. The proofs were very full, and stated, inter alia, that “ any other information that may be required will be furnished on call.” No notice of these communications was taken by the insurance company until April 24th, when the proofs of loss were returned to the assured, with a letter stating generally that they are “ unsatisfactory and incomplete, in that it does not set forth as required by § 10 of the printed conditions of said policy.” Then follows a copy of the section with the requisites of proofs of loss underscored.

There is not a single defect in the proofs pointed out, not a single subject named as to which the company desires other or fuller information, but the entire proofs were rejected with what amounts to a declaration that not one requisite had been complied with. In point of fact there does not appear to have been anything omitted, unless it be the certificate of the officer in charge of the fire department, which certificate, under the ruling in Universal Ins. Co. v. Block, 109 Pa. 5B5, the company had no right to demand. It was there held that a clause in a policy requiring such a certificate was void, this court saying through Mr. Justice GrOEDON: “ The company had no right to require a public officer to act in the adjustment of its risks, and the neglect of the assured to even ask a certificate from that officer, would have been no default.” It was further said in that case, and it is wholesome law, and directly applicable to the case in hand: “ Besides this, it was the duty of the company, on the receipt of the proofs, to return them if they were objectionable, and point out the particular defects. This it refused to do, but replied generally that they did not correspond with the printed instructions, and refused to receive them. This was not sufficient. Insurance companies cannot expect thus to escape from the payment of an honest-claim, through technicalities which do them no harm and which they themselves can easily cure.” See, also, Bonnert v. Insurance Co., 129 Pa. 558, where, in obedience to a call from the company, the assured sent his boots for their examination. The books were kept and not returned until after the limitation had expired. We said: “It was the duty of the company to examine the books and papers promptly, and notify the plaintiffs of the result.”

Here the proofs of loss were kept for over fifty days, and then returned without a specific objection. A few days would be sufficient to enable any company to examine the proofs in a given case, and ascertain if they were satisfactory. If not so, good faith requires that they should be promptly returned, and the specific omission pointed out, or the additional information wanted designated. The great mass of persons who insure their property are in the main ignorant of insurance law, and their business is often solicited by the agents of such companies ; they are not accustomed to making out such papers as proofs of loss, and, when they are defective, the assured should be dealt with fairly, and no advantage taken of their ignorance. Here, the proofs of loss having been kept for a long time, and then returned without specific objection, we think, under all our cases, the company waived its right to call for further proofs. The learned judge below submitted the question of waiver fairly to the jury, and they have found it in favor of the plaintiff. We are of opinion that their finding was justified by the facts in the case. It follows that the suit was not prematurely brought. We find nothing in the minor questions of the case which requires discussion. There is no substantial error.

Judgment affirmed.

Mr. Justice Mitchell noted his dissent.