Highlands ex rel. Highlands v. Lurgan Mutual Fire Insurance

Opinion by

Mb.. Justice Green,

There is but one question in this case that needs consideration. It is the question of estoppel. Can the defendant be permitted to set up the defense it has made against the plaintiff’s claim? We are clearly of opinion it cannot. There is no controversy as to the facts. The learned court below granted a compulsory nonsuit at the end of the plaintiff’s testimony upon a theory to which we cannot possibly assent. The question of waiver is of no consequence in view of the facts given in evidence by the plaintiff. The legal plaintiff, Hiram Highlands, held a fire insurance policy issued by the defendant, covering a barn and its contents and a dwelling house and furniture. This policy was executed on May 26,1891, to continue for five years. On August 2, 1892, Mr. Highlands made an assignment for the benefit of creditors to Charles B. Baker, who accepted and executed the trust. Mr. Baker testified on the trial that within a few days after the assignment was made, he went to the agent of the defendant, Meredith, for the purpose of having the policy transferred to him as assignee, but was assured by the agent that the policy was good as it was, and did not require any transfer until after deeds were made to the purchaser of the property from the assignee. Later on, at another conversation on the same subject, he said the agent told him “ there was no occasion to have that policy transferred until after the deed was made; otherwise he said, if it was transferred before the deed was made, it would be just about in the same shape as it was before; that it would leave it stand in my hands.” In consequence of this he retained the policy, and the transfer was not made. During the following year, 1893, the same agent of the defendant, Meredith, made a demand upon the assignee for an assessment for a loss which had occurred after the assignment. The witness took the advice of his counsel as to whether he should pay the assessment, and upon being advised to make the payment he did so, and took a company receipt for it, signed by Meredith as collector. That assessment was made on October 14,1892, and the receipt was given on March 18, 1893, for an assessment of $7.50, due the defendant company. The assignee made a sale of the farm on which the barn in question was situated in October, 1892, under an order of the court of common pleas, but the sale was not perfected at that time, and no deed was made to the purchaser until April 21, 1894. In the mean time on April 3, 1894, the barn and its contents were entirely destroyed by fire, and the company refuses to pay because the property had been sold by the assignee, and the court was of opinion that the confirmation of the sale avoided the policy although no deed was made to the purchaser.

The assignee having been assured by the defendant through its authorized agent that the policy was good as it was until a deed was made to the purchaser, and the defendant having claimed an assessment for a loss which occurred not only after the assignment, but also after the sale was made by the assignee, and that assessment having been paid, the case comes clearly within the operation of at least three of our decisions, the last of which was made only one year ago. These cases are Mentz v. Lancaster Fire Ins. Co., 79 Pa. 475; Wachter v. Phœnix Assurance Co., 132 Pa. 428, and Light v. Mutual Fire Ins. Co., 169 Pa. 310. In all'of these we held the company estopped by declarations of their agent of a character precisely similar to those made in this case. In the Mentz case, because the agent told the policy holder that the proper indorsement had been made on the policy, we held the company estopped by his declaration. The Wachter case was almost precisely similar to this, and the company was estopped, because the agent assured the policy holder that the policy was properly transferred to the mortgagee, and that nothing more need be done. In the Light case we expressly held that there was no insurable interest in the policy holder after the sale of the property, but we refused to permit that defense to be made. There as here, the policyholder informed the agent of the sale, and wanted to know what was to be done in regard to the policy. The agent told him he had better hold the policy and have the assessments sent, to him, which was done, and they were paid by the insured, who delivered the deed to the purchaser without transferring the policy in pursuance of the advice of the agent. Although the defense of want of insurable interest at the time of the fire was a perfectly good defense, and although there actually was no insurable interest in the plaintiff when the fire occurred, we refused to allow such a defense to be made solely because of the declaration of the agent and the subsequent acceptance of assessments by the company from the insured. We can see no difference between that case and this. Here the assignee of the insured went to the agent of the company shortly after the assignment and informed him of the assignment, and proposed to have a transfer made. But the agent told him it was not necessary, and therefore it was not done. Subsequently the company demanded an assessment from the assignee and it was paid. These were the exact facts upon which the Light case was ruled and they rule this. The company treated the policy as an active subsisting policy after the assignment, and after the sale by the assignee, and they shall not now be permitted to escape liability by asserting the want of a transfer, which was not made because its omission was induced by their own declarations and acts. We cannot understand why the testimony of Hiram Highlands was stricken out, or why the amendment asked for was refused, but as no assignments of error on that account were made those questions are not before us.

Judgment reversed and new venire awarded.