Carroll v. Girard Fire Insurance of the City of Philadelphia

Hayne, C. — Action upon a policy of insurance; verdict and judgment for plaintiff. The grounds for reversal urged by counsel for appellant may be reduced to two.

1. The policy requires that in case of loss the assured shall “ forthwith ” give notice thereof, “ and shall also produce ” a certificate from a notary or magistrate to the effect that he has examined into the circumstances, and believes that the assured has sustained the loss without fraud on his part. These things were not done. But the evidence shows that when the claim was brought to the attention of the company it made no objection on account of the absence of the notice and preliminary proof, but went on and joined in proceedings for determining the amount of the loss by arbitration. These proceedings were required by the policy to be taken to determine the amount of the loss, “ after proof thereof has been received in due form.” They culminated in an award fixing the loss at a certain sum. The first we hear of an objection on ground of want of notice and preliminary proof is in the answer filed by the company in the action. And by this time the period for giving the notice and making the proof had certainly expired. We think that under these circumstances the formalities mentioned must be considered waived. By joining in the proceedings to fix the amount of the loss, the company manifested its intention to dispense with preliminary formalities. The assured had a right to rely upon this manifestation of intention. And to say that the company all along intended to require the notice and preliminary proof, and to take advantage of their absence after the time for giving them had expired, is to impute to it a want of good faith and fair dealing which we will ■ not assume.

The counsel for appellant urges several reasons against this conclusion, viz: —

a. That those who acted for the company had no authority to waive any condition of the policy. But the [300]company does not repudiate the acts of those who acted for it in this regard. On the contrary, it adopts them, and shelters itself behind the award which was the result of such acts. It is plain that it cannot do this without accepting all the consequences of the acts.

b. It is said that the submission to arbitration provides that “ this appointment is without reference to any question or matters of difference within the terms and conditions of the insurance, and is not to be taken as any waiver upon the part of said companies of the said conditions in their policies in case they elect to avail themselves of them.” If this means the right to object on account of the absence of preliminary steps was to be reserved until after the time for taking them had expired, it certainly is a very crafty document. But we do not think such is its meaning. The proceedings for fixing the loss were, as we have seen, not to be commenced until after the preliminary steps had been taken. And the language of the submission is that the appointment is to be without reference to “any other question within the terms and conditions,” etc.; and the proviso is that it “ is not to be taken as any waiver of said conditions.” We think that, taking all the circumstance into consideration, it is a fair construction to hold that the proviso as to waiver refers to the conditions other than the ones relating to the appointment of the arbitrators and those superseded or waived thereby. But however this may be, the language of the proviso relates only to the effect of the “appointment” of the arbitrators, and does not extend to subsequent proceedings. And by going on and completing the award and setting it up as a defense, the company waived the preliminary steps, under the principle first above laid down.