Opinion
7 Div. 60.
May 15, 1934. Rehearing Denied June 5, 1934.
Appeal from Circuit Court, Calhoun County; W. B. Merrill, Judge.
Action by Grace Newriter against the Life Casualty Insurance Company of Tennessee, on a policy of insurance. From a judgment of nonsuit, plaintiff appeals.
Reversed and remanded.
Certiorari denied by Supreme Court in Newriter v. Life Casualty Ins. Co. of Tennessee, 229 Ala. 359, 157 So. 73.
Chas. F. Douglass, of Anniston, for appellant.
The insurer is presumed to know the nature of its policies. Price v. So. Home Ins. Co., 100 Fla. 338, 129 So. 748; 22 C. J. 92, 103; Hunt v. Stewart, 7 Ala. 525. When an application is not made part of policy by incorporating therein or attaching thereto, matter set up therein cannot be made the basis of warranty. Independent L. I. Co. v. Butler, 221 Ala. 501, 129 So. 466. A clause limiting liability to return of premiums if a policy of the same kind be then in force as to insured is waived if with knowledge of the first policy the second is issued and premiums received thereon. Notice to the agent is notice to the insurer. National L. I. Co. v. Jackson, 18 Ala. App. 347, 92 So. 201; American L. I. Co. v. Buntyn, 227 Ala. 32, 148 So. 617; American Ins. Co. v. Inzer, 216 Ala. 553, 114 So. 187; Inter-Ocean Casualty Co. v. Stallworth, 221 Ala. 71, 127 So. 850; Hagan v. M. B. I. Co., 81 Iowa, 321, 46 N.W. 1114, 25 Am. St. Rep. 493; Western Assur. Co. v. Stoddard, 88 Ala. 606, 7 So. 379: West v. Federal Auto Ins. Co., 22 Ala. App. 467, 116 So. 898; Lett v. Liverpool, etc., Ins. Co., 213 Ala. 488, 105 So. 553; Alabama St. M. A. Co. v. Long, 123 Ala. 667, 26 So. 655; Triple Link v. Williams, 121 Ala. 145, 26 So. 19, 77 Am. St. Rep. 34; McLain v. American, etc., Co. (Tenn. Sup.) 57 S.W.(2d) 554; Life C. I. Co. v. King, 137 Tenn. 685, 195 S.W. 585; 16 L.R.A. (N.S.) 1226. Estoppel and waiver cannot be abolished by contract. American Equitable Assur. Co. v. Powderly Coal Lumber Co., 225 Ala. 208, 142 So. 37; Great American Ins. Co. v. Dover, 219 Ala. 530, 122 So. 658; Lyon v. United Moderns, 148 Cal. 470, 83 P. 804, 4 L.R.A. (N.S.) 247, 113 Am. St. Rep. 291, 7 Ann. Cas. 672; State L. I. Co. v. Finney, 216 Ala. 562, 114 So. 132; 16 L.R.A. (N.S.) 1188 note; Hanover F. I. Co. v. Dallava (C.C.A.) 274 F. 258.
Morean P. Estes, of Nashville, Tenn., for appellee.
A soliciting agent has no authority to bind the company by waiver of a warranty provision in the policy. Champion v. Life C. I. Co., 25 Ala. App. 101, 141 So. 363; Atlantic Life v. Hoefer (C.C.A.) 66 F.(2d) 464, 465; Mutual L. I. Co. v. Hilton-Green, 241 U.S. 623, 36 S.Ct. 676, 60 L.Ed. 1211. If information given in the second application was false, it was known to both the agent and the plaintiff, and such a condition constitutes a fraudulent collusion which defeats a recovery. American Ins. Co. v. First Nat. Bank, 206 Ala. 535, 90 So. 294; Commonwealth Life v. Wilkinson, 23 Ala. App. 561, 129 So. 300. Unless parties to a contract are equally bound, neither is bound. If appellee is not bound by the provision of the contract operating against her, she cannot claim the benefits of its provisions operating for her. Crosby v. Metropolitan Life Ins. Co., 167 S.C. 255, 166 S.E. 266, 268; Frierson v. Inter-Ocean Cas. Co., 168 S.C. 178, 167 S.E. 232, 234; Prince v. Ins. Co., 77 S.C. 187, 57 S.E. 766; Metropolitan v. Davis, 219 Ky. 335, 292 S.W. 774. The Alabama statute requiring application to be made part of the policy is applicable only where the contents of the application are sought to be used as evidence that the policy was void from the beginning. Appellant knew the agent had no authority to enter into any agreement with reference to the policy unless in writing and set out in the policy. Code 1923, § 8371. Appellee could not legally pay to appellant more than the amount of premiums paid in accordance with the provision of the policy. Shuff v. Life C. I. Co., 164 La. 741, 114 So. 637; Fisette v. Mutual L. I. Co., 162 La. 620, 110 So. 880.
Suit by appellant, as beneficiary, on a life and casualty policy.
The appeal is from a judgment of nonsuit because of adverse rulings by the court on the pleadings.
It is made to appear that the policy, in amount $1,000, in question, was issued on December 21, 1931, on the life of one Roy L. Gladden, naming appellant, the mother, as beneficiary; that theretofore on January 20, 1930, a like policy, in the same amount, had been issued by appellee on the life of the same Roy L. Gladden, naming Mary Gladden, the wife, as beneficiary; that each of said policies contained the following clause, to wit: "If a like Travel and Pedestrian policy or policies previously issued by the Company to the insured be in force concurrently herewith, making the aggregate indemnity in excess of $1000.00, the excess insurance shall be void and all premiums paid for such excess shall be returned to the insured." And that the amount of the policy payable to Mary Gladden had been paid to her.
So far as appears, the application for the policy sued on was not incorporated as a part of the policy contract. Code 1923, § 8371.
We think the following principles of the law of our state govern this case, namely:
1. "Insurance application, not made part of policy by being incorporated therein or attached thereto, is not part of contract." Independent Life Ins. Co. of America v. Butler, 221 Ala. 501, 129 So. 466.
2. The law of waiver and estoppel, as respects insurer, cannot be abolished by contract. Great American Ins. Co. v. Dover et al., 219 Ala. 530, 122 So. 658.
3. Agent of insurance company, while procuring or writing the policy here sued on, had authority to waive the existence of the concurrent insurance (Mary Gladden policy, supra) on the life of Roy L. Gladden, "and to estop the defendant (appellee) from setting up the existence of this concurrent insurance as a defense. * * * The insured has a right to rely on statements and information given him by insurer's agent in procuring policy." West et al. v. Federal Automobile Ins. Ass'n, 22 Ala. App. 467, 116 So. 898; American Ins. Co. of City of Newark, N.J., v. Inzer, 216 Ala. 553, 114 So. 187.
4. Law imputes to insurer notice of facts coming to knowledge of agent acting within scope of authority in prosecution of life insurer's business. American Life Ins. Co. v. Buntyn, 227 Ala. 32, 148 So. 617.
5. A policy condition as to prior insurance may be expressly or impliedly waived by insurer, as where, with knowledge of breach of the condition, it continues to accept premiums. The rule that knowledge of an insurance agent is the knowledge of the insurance company as to matters within the general scope of his authority applies to solicitors with reference to matters known to them prior to execution of the policy. An agent, collecting premiums for insurer, must report to his principal information regarding such contracts coming to his knowledge and within the scope of his agency, and the insurer is bound by his knowledge. National Life Accident Ins. Co. v. Jackson, 18 Ala. App. 347, 92 So. 201.
It is manifest that the rulings inducing the nonsuit in this case, and which are properly brought before us for consideration, were not made in accordance with the principles we have set down.
Accordingly, the judgment appealed from is reversed, and the cause remanded, in order that the said rulings may be made to conform to the law as we have hereinabove stated it.
Reversed and remanded.