Opinion
(February Term, 1892)
Insurance — Contract — Waiver — Pleading.
1. An insurance policy, covering several distinct kinds of property, is not a single contract, but the assured may maintain an action to recover the amount insured upon any one of the articles specified, although he may have alleged a total destruction of all the property in his complaint.
2. The insured may also maintain an action for the amount insured upon some of the property, although the insured has demanded a reference to arbitration, under a stipulation in the policy as to the other insured items, it appearing that the insured had abandoned his claim as to them.
3. If a party relies for his recovery upon a waiver of some material condition or stipulation connected with the cause of action, he should set forth such waiver in his pleadings; but if in the progress of the trial it becomes necessary for him to establish a waiver of some incidental requirement on his part, not affecting the substantial merits of the action, he may prove it without having pleaded it.
(177) ACTION, tried at April Term, 1891, of WAKE, Winston, J. This action is founded upon a policy of insurance whereby the defendant insured the plaintiff as to certain property therein specified against loss by fire. The following is so much of the policy as need be reported:
R. H. Battle and S. F. Mordecai for plaintiff.
J. W. Hinsdale for defendant.
This Policy of Assurance Witnesseth, That the Pioneer Manufacturing Company, having paid to the Phoenix Assurance Company of London the sum of $84, for insurance from loss and damage by fire (subject to the agreements and conditions herein contained) of the property hereinafter described, in the place or places herein set forth and not elsewhere, to the amount hereinafter mentioned, not exceeding upon any one article the sum specified on such article, namely:
$166.66 2/3 on the one-story frame, tin-roof, main factory building, with sheds and engine-room attached.
$1,066.66 2/3 on fixed and movable machinery, including sawmill and fixtures, saw table, shafting, gearing, belting, and all tools and implements contained in above described building.
$533.33 1/3 on engine and two boilers, including inspirator and connections, in engine-room attached to main building.
$26.66 2/3 on water-tank and connections, about ten feet south of main building.
$66.66 2/3 on frame, tin-roof shed, 20 feet north of main building.
$133.33 1/3 on material manufactured and in process of manufacture, under shed and in storehouse attached.
$20.00 on frame, tin-roof, office building, about 20 feet from main building.
$20.00 on platform scales and fixtures, therein and thereto attached.
$66.66 2/3 on frame, shingle-roof building, attached to shed above described, and used as storage-house.
. . . on plow and machinery castings contained in said (178) storehouse.
$2,100.00 1 year @ 4 per cent, $84.
All occupied by the assured for the manufacture of articles from hardwood, and known as the "Pioneer Manufacturing Company's Works," situated on grounds leased by them on west side of West Street, near North Carolina Railroad depot, in the city of Raleigh, N.C. It is understood that a night watchman shall be kept on duty during the life of this policy. $2,100.00 total. $13,650.00 additional concurrent insurance.
Now know all men by these presents, That from 2 October, 1886, at 12 o'clock noon, to 2 October, 1887, at 12 o'clock noon, the capital stock and funds of the said Phoenix Assurance Company of London shall be subject and liable to pay, reinstate, or make good to the said assured, . . . heirs, executors or administrators, such loss or damage as shall be occasioned by fire to the property above mentioned, and hereby insured, not exceeding in each case respectively the sum or sums hereinbefore severally specified and stated against each property.
The facts and grounds of exception necessary to an understanding of the opinion sufficiently appear in the latter.
There was a verdict and judgment for the plaintiff, and the defendant, having excepted, appealed.
The court properly declined to submit to the jury the issues of fact proposed by the defendant in respect to "the engine, two boilers with inspirator and connections." These things had been eliminated from the complaint before the trial began, for reasons that will presently be stated. They were not in question, and hence all such issues were immaterial. Indeed, it would have been improper to submit them, because they would have (179) tended, more or less, to mislead and confuse the jury as to the inquiries they were charged to make.
The plaintiff alleged in its complaint the total loss by fire of the property insured by the policy sued upon, except an engine and two boilers, which were greatly damaged. Before the trial began the court allowed the plaintiff to enter on the record that it abandoned so much of its claim and demand as had reference to and embrace "the engine, two boilers, inspirator and connections." The defendant insisting that the cause of action was single and not divisible, excepted. This exception is not tenable. The policy of insurance sued upon embodies a single contract of insurance, but it does not insure the several articles and kinds of property specified and classified in it as constituting a single item and subject of insurance. It plainly, and of purpose, classifies and specifies numerous items of property and the sum of money for which they are severally insured, the purpose being to make order, convenience, and, in part at least, to enable the insured on the one hand to sue for and recover damages as to any of the several items, and, on the other hand, to the end the insurer may the more readily protect himself by showing that certain items were not destroyed, or were not wholly so, or were not injured at all. Although the plaintiff alleged a total loss of the property, if on the trial he could not prove such loss, he might prove a partial loss, that certain items specified were wholly lost, that others were injured and rendered valueless or partially so, and the defendant might show as a matter of defense that certain items or pieces of property were not destroyed, or only slightly damaged. The nature and terms of the contract of insurance in this case and the purpose of the action contemplate and intend that the plaintiff may recover, and the defendant may make defense as just indicated. The formal entry of abandonment of claim as to the particular things mentioned was really not necessary, but it did no harm or prejudice to the defendant; indeed, it served the good purpose of (180) putting controversy as to them out of the case; and thus out of the case, all issues as to them and all evidence bearing upon and in respect to them were unnecessary, irrelevant, and improper. The plaintiff formally ceased to claim damages under the contract on account of them.
The policy of insurance, among other things, provides that "If at any time differences shall arise as to the amount of loss or damage, or as to any question, matter or thing arising out of this insurance, every such difference shall, at the written request of either party, be submitted at equal expense to each of the parties, to two competent and impartial persons," etc. Differences arose as to the extent of loss and damage as to "the engine and two boilers, with the inspirator and connections," and the defendant demanded in writing that these differences be submitted as above provided. The plaintiff declined to so submit the same. Afterwards, in this action, it was decided that the plaintiff could not maintain its action until such submission had been made. (See Manufacturing Co. v. Assurance Co., 106 N.C. 28.) The defendant insists that although the plaintiff abandons its claim as to the things last mentioned, it cannot maintain this action, because it so refused to submit the difference mentioned. But the policy does not so provide, nor, as we have seen, is there anything in the nature and purpose of the contract embodied in it that prevents the plaintiff from maintaining his action as to so much of the cause of action alleged as is not embraced by the defendant's demand that certain specified differences be submitted to arbitration. This action was not founded solely upon the latter account; its compass and purpose extended to all damages sustained by the plaintiff on account of all loss insured against by the policy. If the plaintiff could not for any cause recover as to loss sustained on a particular account, he might nevertheless recover as far as the merits of the case in his favor would allow. The (181) failure to maintain the action successfully as to damages sustained on a single account, among many, did not necessarily put an end to it. It continued for all proper purposes. Nor did this Court decide otherwise when this case was before it by a former appeal. For the present purpose, it decided no more than that the action could not be maintained as to so much of the cause of action as was embraced by the defendant's demand that certain differences be submitted to arbitration. We cannot conceive of any just or even plausible reason why, as to a second cause of action or other separate item of damage sustained, the action might not be made available. Indeed, it ought to be continued until it completes its purpose as nearly as practicable. We are not called upon to decide whether the plaintiff could in any case maintain a second action upon the same policy as to items of loss not embraced by this action, but embraced by the policy.
The defendant alleged in its answer that the plaintiff had failed upon demand to furnish it "with plans and specifications of the building destroyed," and "with plans and specifications of the one-story frame, tin-roof, main factory building with shed and engine-room," and that it also failed to furnish "the duly verified certificate of some reliable and responsible builder as to the actual cash value of the building insured immediately before the fire." The plaintiff on the trial produced evidence tending to prove that it had furnished proof of its loss as required by the policy, except in the respects above mentioned, and it also offered evidence tending to prove that it had furnished specifications of the buildings mentioned as far as it could be reasonable diligence do. It further produced evidence to prove that the defendant had waived the demands above mentioned. The court admitted evidence tending to prove such waiver, and submitted pertinent issues to the jury in that respect. The defendant objected to (182) this evidence and the submission of such issues because there was no allegation of such or any waiver in the complaint, and further upon the ground that there was, as it insisted, no evidence of a waiver. Where a party relies upon a waiver of something required to be done incident to a cause of action, particularly in respects material and important, he should allege the same in proper connection in the pleadings, and it would be safer and better to do so in all cases. But where on the trial in the action he fails to prove sufficiently his compliance with some requirement that does not affect the real and substantial merits of the matter in controversy, there is no sufficient reason why he may not at once suggest and prove the waiver if he can, and thus help out his defective proofs. If the party offering such proofs had been negligent the court might decline to admit the same, and if the opposing party should be surprised, it might in a proper case allow a mistrial on just terms as to cost. The court might also allow appropriate amendments of the pleadings. Such practice can do no harm, and in many cases it might promote the ends of justice. It is quite in harmony with the liberal spirit of the Code of Civil Procedure made manifest in many of its provisions. In such case it is not necessary that a pertinent issue be submitted to the jury, but the court may do so, in its discretion, with a view to convenience and the more distinctive and intelligent ascertainment of the fact, unless where in possible cases a party might suffer prejudice from it.
The defendants' counsel insisted earnestly on the argument that there was no evidence on the trial of such waiver suggested by the plaintiff. We have carefully examined the evidence sent to this Court, and are clearly of opinion there was such evidence, as well as evidence to the contrary. The jury, acting upon the whole, rendered their verdict upon the material issues favorable to the plaintiff.
The defendant propounded to the plaintiff, as it might do (183) under a provision of the policy, certain questions which it failed to answer. It is insisted that such failure is fatal to the plaintiff's recovery. This contention is unfounded. The evidence and information intended to be elicited by these questions were not pertinent or material on the trial. They related to the "engine and two boilers, including inspirator and connections." As we have seen, these things were eliminated from the action, and all inquiry concerning them was immaterial and irrelevant.
There are numerous exceptions, several of which were properly abandoned on the argument. The others are disposed of by what we have said, except such as are unimportant and plainly without merit.
No error.
Cited: Wooten v. Walters, post, 256; Clegg v. R. R., 135 N.C. 154.