Commercial Union Assurance Co. v. Hocking

Mr. Justice Clark

delivered the opinion of the court, March 7th, 1887.

The policy in suit was issued 1st December, 1884, by the Commercial Union Assurance Company, to George H. Hocking, in the sum of one thousand dollars, for one year from the date thereof, on his-two-story frame building, etc., in Meversdale, Penna., with the privilege of other insurance. When the policy issued, Hocking held a.policy of the Howard Insurance Company of New York for $2,000, dated 24th November, 1884, on the same building; and afterwards, on the 3d December, 1884, obtained a policy of the German American Insurance Co., in the sum of $1,000, making the total insurance $4,000, all of which was in full force on the fourth day of December, 1884, when the building was destroyed by fire.

The policy required that persons sustaining loss or damage, should forthwith give notice of said loss to the company, and within sixty days render a particular account of such loss, etc., stating certain specific matters of proof, affecting the extent of the defendant’s liability. Notice of the loss was promptly given as required, but the proofs were not furnished within sixty days. The plaintiff's contention was that as there was but a single subject of insurance, the loss, total, and the notice to that effect, no further proof was necessary. But applying the principles laid down in German Insurance Co. v. Hocking, which was argued with the case at bar, it is plain that the company, under the special terms of their policy, had the undoubted right to have furnished to them proofs of certain matters, according to the conditions of the contract. These proofs were furnished, and there is no substantial objection made, we think, either to their form or substance, but it is contended that as the loss occurred on the 4th December, 1884, and the proofs were not furnished until 28th March, 1885, more than sixty days intervening, they were not in time, and the company was not bound to receive them. But the company did receive them, referred them to their adjuster, and retained them without objection or complaint on that or any other ground, from the 28th March, 1885, until the 18th August, 1885. If the company acted upon these proofs as having been received in time, and made no objection whatever until the trial, they would be presumed, we think, to have waived the objections which they now make: Lycoming Insurance Co. v. Schreffler, 6 Wright, 188. The policy is not printed, but as we understand it from the portions which are printed, the proofs of loss were but conditions precedent to the bringing of an action, and not of the insurance, and if the delay in furnishing them was waived, the remedy still remained. It was the duty of the company, if the proofs were imperfect, or out of time, if objected to on that ground, to make their objection known. It is true the policy provided that “no examination of the assured, nor investigation by the company, nor reference to, nor award of arbitrators, shall operate as a waiver on part of the company of any of the provisions, conditions or requirements of the policy, respecting the making or filing of a particular account of loss,” as therein provided; but the act of waiver to which we have given effect, is not embraced in this provision.

The second ground of error alleged is, that by the terms of the policy, it is provided that “ in case differences shall arise respecting any loss or damage, after proof thereof, the matter shall, at the written request of either party, be submitted to impartial arbitrators, whose award, in writing, shall be binding,” etc.; and as it is proven by the plaintiff that arbitrators were appointed, who have not yet made their award, the plaintiff can have no right of action until that condition of the policy has been complied with.

It is undoubtedly true, when the parties to an executory contract agree, that all questions of difference or dispute which may arise between them in reference thereto, or that the amount of any claim arising therefrom shall be first submitted to the arbitrament of a single individual, or tribunal named, they are bound by their contract, and cannot seek redress elsewhere, until the arbiter agreed upon has been discharged, either by the rendition of an award, or otherwise : Monongahela Nav. Co. v. Fenlon, 4 W. & S., 205; Connor v. Simpson, 8 Out., 440; Hostetter v. City of Pittsburgh, 11 Out., 419. But it is equally true, that where the agreement in question does not provide for submitting matters in dispute to any particular person or tribunal named, but to one or more persons to be mutually chosen by the parties, i't is revocable by either party; and such a provision is not adequate to oust the jurisdiction of the courts having cognizance of the subject-matter of the dispute: Gray v. Wilson, 4 Watts 41; Mentz v. Armenia Fire Ins. Co., 29 P. F. S., 480; Hostetter v. City of Pittsburgh, supra.

The applicability of this principle to the case in hand is not disturbed by the further special provision of the policy, that “ no suit or action against this company shall be sustainable in any court of law or chancery till after the award shall have been filed, fixing the amount of such claim,” etc. In Mentz v. Armenia Co., supra, a precisely similar provision existed, and referring to the effect of it Mr. Justice Shakswood said : “If it were not in the power of the party to oust the courts of their general jurisdiction by such an agreement, that clause does not help them ; had a general arbitration clause been valid, it would have been a condition precedent to an action of itself; the provision in question is but the expression of that which was implied.” Nor is the effect of the general arbitration clause in this contract affected by the fact that two arbitrators were in fact chosen ; they failed to agree ;• both parties appear to have abandoned the proceeding, and the bringing of this suit was a -plain revocation of the submission. We are of opinion therefore that the second assignment of error cannot be sustained.

We are clearly of opinion, however, that the suit was prematurely brought. The company, as we have said, had a right to insist upon the provision in the policy for the proofs of loss; they were not furnished until the 28th March, 1885. The company had thirty days thereafter in which to give notice of their intention to rebuild, and the loss was not payable in money, should the option not be exercised, for sixty days, whereas the suit was brought on the 17th April, 1885.

We will not discuss this branch of the case at length; the reasons are set forth in the opinion filed in the Ger. Am. Ins. Co. v. Hocking, already referred to.

The judgment is reversed. .