Victoria Park Co. v. Continental Insurance

JAMES, J.

Appeal from a judgment entered in favor of plaintiffs. The action was brought to recover on two policies of fire insurance. The policies were respectively in the amounts of four thousand and five thousand dollars, each covering the same building. The policies in form were as is prescribed by the statute of this state and are designated “the California Standard Policy.” The policies contained the stipulation that in case of loss the insured must give to the company written notice thereof and, within ten days after the commencement of the fire render to the company verified preliminary proof of loss, setting forth certain prescribed things. This provision is also contained in the policies: “If the company claims that the preliminary proof of loss is defective and within five days after the receipt thereof notifies in- writing the insured, or the party making such proof of loss, of the alleged defects (specifically stating them) and requests that they be remedied by verified amendments the insured or such party within ten days after the receipt of such notification and request must comply therewith, or if unable so to do, present to the company an affidavit to that effect.” A further provision of the policies was as follows: “This company shall be deemed to have assented to the amount of the loss claimed by the insured in his preliminary proof of loss, unless within twenty days after the receipt thereof, or if verified amendments have been requested, within twenty days after their receipt, or within twenty days after the receipt of an affidavit

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that the insured is unable to furnish such amendments, the company shall notify the insured in writing of its partial or total disagreement with the amount of loss claimed by him and shall also notify him in writing of the amount of loss, if any, the company admits on each of the different articles or properties set forth in the preliminary proof or amendments thereto. ’ ’ Other provisions contained in the policies provided, in case of a dispute as to the amount of loss, for the arbitration of the same, and certain options were given to the insurer as to rebuilding or replacing the structure destroyed or damaged. In order to exercise any of such options a term of the policies required that the insurer company give notice to the insured within twenty days after receipt of the preliminary proof of loss. There was no issue in the case as to the fire having occurred as alleged by the plaintiffs. Defendant, however, set forth in its answer that the total loss occasioned by the fire was the sum of $6,148.78. In the preliminary proof of loss as furnished by the plaintiff, Victoria Park Company (the interest of plaintiff Buttolph being that of mortgagee only), which was verified by the secretary of the corporation, the clause referring to the amount of loss was as follows: ‘ ‘ The cash value of the dwelling destroyed was about $17,500. The loss was total.” The proof of loss was not excepted to by the insurer, except that ten days after its receipt a letter, signed by the agent of the insurer company, was written to the plaintiff company and contained the following statements: