Where there was a correspondence relating to the insurance of a
house against fire, the insurance company making known the terms
upon which they were willing to insure, the contract was complete
when the insured placed a letter in the post office accepting the
terms.
The house having been burned down whilst the letter of
acceptance was in progress by the mail, the company was held
responsible.
On the acceptance of the terms proposed, transmitted by due
course of mail to the company, the minds of both parties have met
on the subject in the mode contemplated at the time of entering
upon the negotiation, and the contract becomes complete.
The practice of this company was to date a policy from the time
when the acceptance was made known to their agent.
The agent of the company having instructed the applicant to
"send him his check for the premium, and the business was done,"
the transmission of the check by mail was a sufficient payment of
the premium within the terms of the policy.
One of the conditions annexed to the policy was that preliminary
proofs of the loss should be furnished to the company within a
reasonable time. The fire occurred on 22 December, 1844, and the
preliminary proofs were furnished on 24 November, 1845. This would
have been too late, but that the company must be considered to have
waived their being furnished by refusing to issue a policy, and
denying their responsibility altogether.
The cases in
27 U. S. 2 Pet. 25
and
35 U. S. 10 Pet.
507 examined.
A court of equity, having obtained jurisdiction to enforce a
specific performance of the contract by compelling the company to
issue a policy, can proceed to give such final relief as the
circumstances of the case demand.
A prayer for general relief in this case covers and includes a
prayer for specific performance.
Page 50 U. S. 391
A decree
pro forma was entered, under the agreement of
the parties, dismissing a bill filed by Tayloe against the
insurance company under the following circumstances.
The office of the insurance company was at Baltimore, but there
was an agent at Fredericksburg, Virginia, who was John Minor.
On 25 November, 1844, this agent addressed to the company the
following letter.
"Fredericksburg, Virginia, November 25, 1844"
"MERCHANTS' FIRE INSURANCE CO. OF BALTIMORE:"
"The undersigned, William H. Tayloe, desires to effect insurance
to the amount of eight thousand dollars on his dwelling house, of
stone covered with wood; main building about ninety by sixty feet,
two stories; two wings, two stories, covered with wood, about fifty
by fifty feet, and connected with the main building by covered ways
of stone, covered with wood. The above-mentioned house is known by
the name of Mt. Airy, and is situated in Richmond County, about two
miles and a half from the courthouse."
"J. MINOR"
"for WILLIAM H. TAYLOE"
"P.S. Mr. Tayloe (not Mr. Taylor) passed through this place this
morning on his way to Alabama and, not having time to attend to his
application, desired me to forward one in his name. The measures
given are as nearly correct as I can remember, but, as the building
is worth double the amount proposed, the measures are not of much
importance. I have long been familiarly acquainted with the house.
One thing I should state, that it is built of red sandstone, which
in my opinion will not stand fire. Mr. Tayloe's family inhabits the
house, and he will return in January or February; meanwhile I am to
communicate to him your answer."
"J. MINOR"
On 30 November, 1844, the following answer was received:
"M. F. I. Co., Baltimore, November 30, 1844"
"J. MINOR, ESQ.:"
"Dear Sir -- Yours of 25th and account of 28th are received. I
have forwarded Mr. B.'s policy. Mr. Tayloe's risk
Page 50 U. S. 392
will be taken at the same rate as Mr. Bernard's,
viz.,
70 cts. on $8,000, $56. Policy, $1."
"Yours, respectfully,"
"GEO. B. COALE,
Secretary"
When this letter was received by Minor, Tayloe was in Alabama,
and Minor addressed to him the following letter, which he directed
to Demopolis, Alabama, and which was sent from Demopolis to Macon,
where Tayloe then was.
"Fredericksburg, December 2, 1844"
"This day I received from the secretary of the board of the
Merchants' Fire Insurance Company of Baltimore an answer to your
application for insurance to the amount of $8,000 on the Mount Airy
house; rate 70."
Premium on $8,000 . . . . . . $56.00
Policy. . . . . . . . . . . . 1.00
------
$57.00
"Should you desire to effect the above insurance, send me your
check, payable to my order, for $57, and the business is
concluded."
This letter, having been misdirected by Minor, did not reach the
appellant until 20 December, 1844, and on the next day he wrote
Minor the following letter.
"Macon, Marengo County, Ala. 21 Dec., 1844"
"Dear Minor -- Yours of the 2d came to hand yesterday, and I
send you my check for fifty-seven dollars, as the premium of
insurance on Mount Airy house. You will please deposit the policy
in the Bank of Virginia, in your town &c."
Mem. endorsed, "Mem. rec'd December 31, 1844."
"
(Check Enclosed)"
"Marengo County, Ala. 21 Dec., 1844"
"$57. Bank of Virginia, Fred'g, pay John Minor, Esq. or order
fifty-seven dollars, premium of insurance on Mt. Airy house."
"WM. H. TAYLOE"
Written across the face -- "This check not to be presented."
On 22 December, 1844, the house was burned down.
Page 50 U. S. 393
On 1 January, 1845, Minor addressed a letter to Tayloe, from
which the following is an extract.
"Fredericksburg, Jan. 1, 1845"
"My dear friend -- Your letter of the 21st
ultimo came
to hand yesterday, unhappily too late. You have before this time,
perhaps, received information that the center building of Mount
Airy was burnt on Sunday week Dec. 22,"
&c.
Mr. Minor was informed of the loss by Mr. Charles Tayloe on the
day after it took place.
In the summer of 1845, Tayloe called at the office of the
company and had some conversation respecting the insurance and the
burning of his house, and in November, 1845, furnished them with
the preliminary proofs of the loss which are always required to be
handed in as soon as possible after the loss by the conditions
annexed to the printed policies of the company.
To the letter accompanying the preliminary proof, the company
returned the following answer.
"Merchants' Fire Insurance Co., Baltimore"
"Dec. 15, 1845"
"W. H. TAYLOE, ESQ.:"
"Dear Sir -- The Merchants' Fire Insurance Company has received
your letter of 24 November, 1845, containing notice of claim for
loss by fire on 22 December, 1844, and I am instructed to reply
that the company declines to pay the claim as thereby made by you,
and that under the circumstances of the case it does not waive any
grounds of defense whatever, but will avail itself of all and any
that by law it may."
"Very respectfully, your obedient servant,"
"[Signed] GEO. B. COALE,
Sec'y"
During the progress of the suit, the following admission was
filed in the circuit court by the respective counsel.
"
Admission"
"It is admitted that the printed advertisement marked
complainant's No. 1 of John Minor, dated on 27 July, 1842, giving
notice of his agency, was published by him in a newspaper published
in Fredericksburg, Virginia. It is also admitted that the letter of
said Minor to Wm. H. Tayloe, the complainant, dated December 2,
1844, marked complainant's No. 2, was written by said Minor, and
addressed to said Tayloe, at Demopolis, Alabama, and afterwards
sent from Demopolis
Page 50 U. S. 394
to Macon, Alabama, at the dates of the two postmarks thereon,
where said Tayloe then was, and that the letter from said Minor to
said Tayloe, dated 1 January, 1844-1845, marked complainant's No.
3, was written by said Minor. It is agreed that the charter of the
said defendants act of Maryland, 1835, ch. 65, and supplements may
be used by either party, and read from the printed laws as if
proved, and also it is admitted that the printed blank policy,
filed with the defendants' answer as an exhibit, is the form
uniformly used by said defendants from its incorporation till this
time, and that the exhibits G, H, and I, with the defendants'
answer, are admitted, and all of said above papers may be used, at
the trial of the above cause, as if the same had been regularly
proved by the respective parties."
"JOHN GLENN,
for Complainant"
"JOHN J. LLOYD,
for Defendants"
In April, 1846, Tayloe filed his bill in the circuit court. It
stated the substance of the facts above mentioned, and concluded
thus:
"To the end, therefore, that he may have redress on the premises
and that by a decree of this Court the said defendants may be
ordered and adjudged to pay to your orator the amount of actual
loss which he has sustained, to an amount not exceeding eight
thousand dollars, and that he may have such further relief as his
case may require, may it please your honors to order that a writ of
subpoena may issue directed to said Merchants' Fire Insurance
Company of Baltimore to be and appear in this Court to answer this
bill and to stand to and abide by the decree in the premises, and
he will ever pray &c."
"R. JOHNSON"
"J. GLENN"
The answer of the appellees admits that John Minor was the agent
of the appellees at Fredericksburg, Virginia, "to receive and
forward to appellees proposals for insurance against fire"; that
said agent did, on 25 November, 1844, in behalf of the appellant,
send a proposal for insurance, which was answered on 30 November,
1844, but that no reply was received from appellant till 31
December, 1844, by a letter enclosing appellant's check for the
amount of the premium. That immediately on the receipt of said
reply, the appellant was informed that it came too late; that the
dwelling proposed to be insured had been burnt on 22 December,
1844, and that the check had not been and would not be
presented
Page 50 U. S. 395
for payment, and that said check was cancelled. The answer
further exhibits a copy of the printed from of the policy uniformly
used by the appellees in 1844 and before and since that time, and
avers that it contains the terms and conditions on which the
appellees insured, and that all answers of the appellees to
applications for insurance against fire have always been with
reference to the terms of said policy and the printed conditions
thereto annexed, and it further avers that the reply of the
appellees to the application on behalf of the appellant, in this
instance, was made with reference to said terms and printed
conditions, and that except on those terms and conditions, the
appellees would not and did not offer to insure the appellant. The
answer further denies that any contract of insurance was at any
time made by appellees with the appellant, or that any premium of
insurance was paid by appellant or received by appellees, or that
the appellant had a right to demand a policy of insurance, or
payment for loss by fire. It also denies that the appellant, before
filing his bill, required appellees to furnish him with a policy of
insurance, or that any demand of payment for the loss by fire was
made, except as therein specified, in the summer of 1845, and after
that time, as particularly set forth in the answer. The answer
further insists that if it should be held that the transactions
relating to said application did amount to a contract of insurance,
yet it was a contract on the terms and conditions specified in the
policy, and that the appellant never complied therewith, and
particularly never complied with the seventh printed condition
which is set forth in the answer, the therefore he is not entitled
to demand payment.
The blank policy which, it is admitted --
see Admission,
supra -- "is the form uniformly used by the appellees from
their incorporation till this time" provides
"that the amount of such loss or damage as the assured shall be
entitled to receive by virtue of this policy shall be paid within
sixty days after notice and proof thereof made by the assured in
conformity to the conditions of this corporation subjoined to this
policy."
It also provides that the
"insurance is made and accepted in reference to the conditions
which accompany these presents, and in every case the said
conditions are to be used to explain the rights and obligations of
the parties except so far forth as the policy itself specially
declares those rights and obligations."
The fifth condition is -- "No insurance will be considered as
made, or binding, until the premium be actually paid."
The seventh condition provides that
"All persons insured by this company sustaining any loss or
damage by fire are
Page 50 U. S. 396
forthwith to give notice to the company, and as soon thereafter
as possible to deliver in as particular an account of their loss or
damage, signed by their own hands, as the nature of the case will
admit, and make proof of the same by their oath or
affirmation,"
&c., "And until such affidavits and certificates are
produced, the loss shall not be payable."
The appellant examined several witnesses under a commission
issued to Fredericksburg, Va. John Minor, the agent, proves that
the appellant authorized and requested him to apply to the
appellees to effect the insurance, and that in consequence thereof
the application was written by him. That on 31 December, 1844, he
received a letter from appellant enclosing his check for $57, which
the appellant directed to be applied to the payment of the
insurance on the property, but that the check was never presented
for payment, because the property on which the insurance was to
have been effected was destroyed on 22 December, 1844. That soon
after the receipt of said letter and check, the deponent wrote to
appellant that his check had been received, but too late. And on
his cross-examination he proves that he held said check subject to
appellant's order, and wrote across its face, "This check is not to
be presented," of all which he duly advised the appellant by letter
written, as he thinks, immediately after the receipt of the check,
and that when the appellant returned to Virginia, deponent told him
he was ready to return the check, and tendered it to him &c.;
that he kept it, by appellant's direction, but always subject to
appellant's authority. He also proves, in answer to the sixth
cross-interrogatory, that if there had been no fire before the
receipt of the check and a policy had been issued, the insurance,
according to the custom and practice of his agency, would have
begun, in ordinary cases, on the day on which payment of the check
was made, but that in this particular case, as deponent was willing
to cash the appellant's check, it would have begun on the day the
check came to hand.
In November, 1847, the cause came on for trial, when the circuit
court passed a decree, which it has already been stated was
pro
forma under the agreement of the parties, that the bill should
be dismissed, with costs.
The complainant, Tayloe, appealed to this Court.
Page 50 U. S. 398
MR. JUSTICE NELSON delivered the opinion of the Court.
The case in the court below was this. William H. Tayloe, of
Richmond County, Virginia, applied to John Minor, the agent of the
defendants, residing at Fredericksburg in that state, for an
insurance upon his dwelling house to the amount of $8,000 for one
year, and, as he was about leaving home for the State of Alabama,
desired the agent to make the application in his behalf.
The application was made accordingly, under the date of 25
November, 1844, and an answer received from the secretary of the
company, stating that the risk would be taken at seventy cents on
the thousand dollars, the premium amounting to the sum of fifty-six
dollars. The agent stated in the application to the company the
reason why it had not been signed by Tayloe; that he had gone to
the State of Alabama on business, and would not return till
February following, and that he was desired to communicate to him
at that place the answer of the company.
On receiving the answer, the agent mailed a letter directed to
Tayloe, under date of 2 December, advising him of the terms of the
insurance and adding, "Should you desire to effect the insurance,
send me your check payable to my order for $57, and the business is
concluded." The additional dollar was added for the policy.
This letter, in consequence of a misdirection, did not reach
Tayloe till the 20th of the month, who, on the next day, mailed a
letter in answer to the agent, expressing his assent to the terms
and enclosing his check for the premium as requested. He also
desired that the policy should be deposited in the bank for
safekeeping. This letter of acceptance was received on the 31st at
Fredericksburg by the agent, who mailed a letter in answer the next
day, communicating to Tayloe his refusal to carry into effect the
insurance on the ground that his acceptance came too late, the
center building of the dwellinghouse
Page 50 U. S. 399
in the meantime, on the 22d of the month, having been consumed
by fire.
The company, on being advised of the facts, confirmed the view
taken of the case by their agent and refused to issue the policy or
pay the loss.
A bill was filed in the court below by the insured against the
company setting forth substantially the above facts and praying
that the defendants might be decreed to pay the loss, or for such
other relief as the complainant might be entitled to.
I. Several objections have been taken to the right of the
complainant to recover which it will be necessary to notice, but
the principal one is that the contract of insurance was not
complete at the time the loss happened, and therefore that the risk
proposed to be assumed had never attached.
Two positions have been taken by the counsel for the company for
the purpose of establishing this ground of defense.
1. The want of notice to the agent of the company of the
acceptance of the terms of the insurance; and,
2. The nonpayment of the premium.
The first position assumes that, where the company have made an
offer through the mail to insure upon certain terms, the agreement
is not consummated by the mere acceptance of the offer by the party
to whom it is addressed; that the contract is still open and
incomplete until the notice of acceptance is received; and that the
company are at liberty to withdraw the offer at any time before the
arrival of the notice; and this even without communicating notice
of the withdrawal to the applicant; in other words, that the assent
of the company, express or implied, after the acceptance of the
terms proposed by the insured, is essential to a consummation of
the contract.
The effect of this construction is to leave the property of the
insured uncovered until his acceptance of the offer has reached the
company, and has received their assent, for if the contract is
incomplete until notice of the acceptance, till then the company
may retract the offer, as neither party is bound until the
negotiation has resulted in a complete bargain between the
parties.
In our apprehension, this view of the transaction is not in
accordance with the usages and practice of these companies in
taking risks, nor with the understanding of merchants and other
businessmen dealing with them, nor with the principles of law,
settled in analogous cases, governing contracts entered into by
correspondence between parties residing at a distance.
Page 50 U. S. 400
On the contrary, we are of opinion that an offer under the
circumstances stated, prescribing the terms of insurance, is
intended, and is to be deemed, a valid undertaking on the part of
the company, that they will be bound, according to the terms
tendered, if an answer is transmitted in due course of mail,
accepting them; and that it cannot be withdrawn, unless the
withdrawal reaches the party to whom it is addressed before his
letter of reply announcing the acceptance has been transmitted.
This view of the effect of the correspondence seems to us to be
but carrying out the intent of the parties, as plainly manifested
by their acts and declarations.
On the acceptance of the terms proposed, transmitted by due
course of mail to the company, the minds of both parties have met
on the subject, in the mode contemplated at the time of entering
upon the negotiation, and the contract becomes complete. The party
to whom the proposal is addressed has a right to regard it as
intended as a continuing offer until it shall have reached him, and
shall be in due time accepted or rejected.
Such is the plain import of the offer. And besides, upon any
other view, the proposal amounts to nothing, as the acceptance
would be but the adoption of the terms tendered, to be, in turn,
proposed by the applicant to the company for their approval or
rejection. For if the contract is still open until the company is
advised of an acceptance, it follows, of course, that the
acceptance may be repudiated at any time before the notice is
received. Nothing is effectually accomplished by an act of
acceptance.
It is apparent, therefore, that such an interpretation of the
acts of the parties would defeat the object which both had in view
in entering upon the correspondence.
The fallacy of the argument, in our judgment, consists in the
assumption that the contract cannot be consummated without a
knowledge on the part of the company that the offer has been
accepted. This is the point of the objection. But a little
reflection will show that in all cases of contracts entered into
between parties at a distance by correspondence, it is impossible
that both should have a knowledge of it the moment it becomes
complete. This can only exist where both parties are present.
The position may be illustrated by the case before us. If the
contract became complete, as we think it did, on the acceptance of
the offer by the applicant on 21 December, 1844, the company, of
course, could have no knowledge of it until
Page 50 U. S. 401
the letter of acceptance reached the agent on the 31st of the
month, and on the other hand, upon the hypothesis it was not
complete until notice of the acceptance, and then became so, the
applicant could have no knowledge of it at the time it took effect.
In either aspect, and indeed in any aspect in which the case can be
presented, one of the parties must be unadvised of the time when
the contract takes effect, as its consummation must depend upon the
act of one of them in the absence of the other.
The negotiation being carried on through the mail, the offer and
acceptance cannot occur at the same moment of time, nor, for the
same reason, can the meeting of the minds of the parties on the
subject be known by each at the moment of concurrence; the
acceptance must succeed the offer after the lapse of some interval
of time, and if the process is to be carried farther in order to
complete the bargain and notice of the acceptance must be received,
the only effect is to reverse the position of the parties, changing
the knowledge of the completion from the one party to the
other.
It is obviously impossible, therefore, under the circumstances
stated ever to perfect a contract by correspondence if a knowledge
of both parties at the moment they become bound is an essential
element in making out the obligation. And as it must take effect,
if effect is given at all to an endeavor to enter into a contract
by correspondence, in the absence of the knowledge of one of the
parties at the time of its consummation, it seems to us more
consistent with the acts and declarations of the parties to
consider it complete on the transmission of the acceptance of the
offer in the way they themselves contemplated, instead of
postponing its completion till notice of such acceptance has been
received and assented to by the company.
For why make the offer unless intended that an assent to its
terms should bind them? And why require any further assent on their
part after an unconditional acceptance by the party to whom it is
addressed?
We have said that this view is in accordance with the usages and
practice of these companies, as well as with the general principles
of law governing contracts entered into by absent parties.
In the instructions of this company to their agent at
Fredericksburg, he is advised to transmit all applications for
insurance to the office for consideration, and that, upon the
receipt of an answer, if the applicant accepts the terms, the
contract is considered complete without waiting to communicate
the
Page 50 U. S. 402
acceptance to the company, and the policy to be thereafter
issued is to bear date from the time of the acceptance.
The company desired no further communication on the subject,
after it had settled upon the terms of the risk and sent them for
the inspection of the applicant, in order to the consummation of
the bargain. The communication of the acceptance by the agent
afterwards is to enable it to make out the policy. The contract is
regarded as complete on the acceptance of the terms.
This appears also to have been the understanding of the agent,
for, on communicating to the insured the terms received from the
company, he observes, "Should you desire to effect the above
insurance, send me your check payable to my order for fifty-seven
dollars, and the business is concluded," obviously enough importing
that no other step would be necessary to give effect to the
insurance of the property upon the terms stated.
The cases of
Adams v. Linsdell, 1 Barn. & Ald. 681,
and
Mactier's Adm'rs v. Frith, 6 Wend. 104, are
authorities to show that the above view is in conformity with the
general principles of law governing the formation of all contracts
entered into between parties residing at a distance by means of
correspondence.
The unqualified acceptance by the one of the terms proposed by
the other, transmitted by due course of mail, is regarded as
closing the bargain from the time of the transmission of the
acceptance.
This is also the effect of the case of
Eliason v.
Henshaw, 4 Wheat. 228, in this Court, though the
point was not necessarily involved in the decision of the case. The
acceptance there had not been according to the terms of the bargain
proposed, for which reason the plaintiff failed.
2. The next position against the claim is the nonpayment of the
premium.
One of the conditions annexed to the policies of the company is
that no insurance will be considered as made or binding until the
premium be actually paid, and one of the instructions to the agent
was that no credit should be given for premiums under any
circumstances.
But the answer to this objection is that the premium, in
judgment of law, was actually paid at the time the contract became
complete. The mode of payment had not been prescribed by the
company, whether in specie, bills of a particular bank, or
otherwise; the agent therefore was at liberty to exercise a
discretion in the matter and prescribe the mode of
Page 50 U. S. 403
payment, and accordingly we find him directing in this case that
it may be paid by a check payable to his order for the amount. It
is admitted that the insured had funds in the bank upon which it
was drawn, at all times from the date of the check till it was
received by the agent, sufficient to meet it, and that it would
have been paid on presentment.
It is not doubted that if the check for the premium had been
received by the agent from the hands of the insured, it would have
been sufficient, and in the view we have taken of the case, the
transmission of it by mail, according to the directions given,
amounts in judgment of law to the same thing. Doubtless, if the
check had been lost or destroyed in the transmission, the insured
would have been bound to make it good; but the agent, in this
respect, trusted to his responsibility, having full confidence in
his ability and good faith in the transaction.
II. Another objection taken to the recovery is that the usual
preliminary proofs were not furnished according to the requirement
of the seventh article of the conditions annexed to the policies of
the company. These are required to be furnished within a reasonable
time after the happening of the loss. The fire occurred on 22
December, 1844, and the preliminary proofs were not furnished till
24 November, 1845. This was doubtless too late, and the objection
would have been fatal to the right of the complainant if the
production of these proofs were essential to the recovery.
But the answer is that the ground upon which the company
originally placed their resistance to the payment of the loss, and
which is still mainly relied on as fatal to the proceedings,
operated as a waiver of the necessity for the production of the
preliminary proofs, and that is that no obligation to insure the
loss was ever entered into by the company, the contract being
incomplete at the time it occurred. On this ground they refused to
issue the policy, which would have imposed upon the insured a
strict compliance with its conditions, or to recognize any
obligations arising out of the arrangement between him and their
agent.
The objection went to the foundation of the claim, which, in
connection with the refusal to issue the policy, superseded the
necessity of producing these proofs, as the production would have
been but an idle ceremony on the part of the insured in the further
prosecution of his right. Why produce them after the company had
denied the contract and refused the policy?
The case of
Columbian Insurance Company v.
Lawrence,
Page 50 U. S. 404
2 Pet. 25, has been referred to on this point. An objection was
there taken on the trial to the sufficiency of the preliminary
proofs on the ground that the certificate of the magistrate was not
in conformity with the ninth article of the conditions. The
particular objection had not been taken by the company when the
proofs were furnished, although several others had been to their
liability, and the court left to the jury the question, among
others, whether the company had not thereby waived the objection to
the sufficiency of the certificate.
The plaintiff recovered, and on the motion for a new trial,
among other grounds assigned for granting it was this instruction
of the court. It was held that there was no evidence in the case
from which the jury could properly infer a waiver.
The preliminary proofs had been presented to the company on 16
February, 1824, soon after the loss. The suit was discontinued, and
a new certificate procured from the magistrate correcting the
defects in the first, and furnished to the company, on 14 February,
1829, five years after the first had been delivered. A new suit was
brought, and the case as reported the second time will be found in
35 U. S. 10 Pet.
507.
On the second trial, the objection was taken that the
certificate had not been produced within a reasonable time after
the loss, but the court held otherwise, placing their decision upon
the ground that the laches were not properly imputable to the
insured, but to the company, on account of their neglect to give
notice of the defect when the first certificate was presented, and
of the mistaken confidence which the party had placed in them. The
court said
"If the company had contemplated the objection, it would have
been but ordinary fair dealing to have apprised the plaintiff of
it, for it was then obvious that the defect might have been
immediately supplied; as it was, the company, unintentionally it
may be, by their silence misled him."
It is manifest on an examination of the two cases that the
doctrine of the first on this point of waiver was virtually
overruled, for, if maintained in the second, it would have upheld
the ruling at the circuit in the first. The reasons given in
support of the corrected certificate, procured and furnished some
five years after the loss, are cogent and unanswerable in favor of
the position that the conduct of the company in not objecting to
the defect in the first one, at the time it was furnished, operated
to mislead the party, and should have been regarded as a waiver of
the objection.
The cases are very full upon this point, and clearly establish
the position that the preliminary proofs, under the
circumstances
Page 50 U. S. 405
stated in this case, were dispensed with by the company, as
inferable from the ground upon which they placed their denial of
liability. 9 Wend. 165; 25
id. 378, 382; 6 Harr. &
Johns. 412; 6 Cow. 404.
III. It has also been objected that the plaintiff had an
adequate remedy at law, and was not, therefore, under the necessity
of resorting to a court of equity, which may very well be
admitted.
But it by no means follows from this that a court of chancery
will not entertain jurisdiction. Had the suit been instituted
before the loss occurred, the appropriate, if not the only, remedy
would have been in that court, to enforce a specific performance
and compel the company to issue the policy. And this remedy is as
appropriate after as before the loss, if not as essential, in order
to facilitate the proceedings at law. No doubt a count could have
been framed upon the agreement to insure, so as to have maintained
the action at law. But the proceedings would have been more
complicated and embarrassing than upon the policy. The party
therefore had a right to resort to a court of equity to compel the
delivery of the policy, either before or after the happening of the
loss, and being properly in that court after the loss happened, it
is according to the established course of proceeding, in order to
avoid delay and expense to the parties, to proceed and give such
final relief as the circumstances of the case demand.
Such relief was given in the case of
Motteux v. London
Assurance Company, 1 Atk. 545, and in
Perkins v.
Washington Insurance Company, 4 Cow. 646.
See also 1
Duer 66 and 110, and 2 Phillips, 583.
As the only real question in the case is the one which a court
of equity must necessarily have to decide in the exercise of its
peculiar jurisdiction in enforcing a specific execution of the
agreement, it would be an idle technicality for that court to turn
the party over to his remedy at law upon the policy. And no doubt
it was a strong sense of this injustice that led the court at an
early day to establish the rule that, having properly acquired
jurisdiction over the subject for a necessary purpose, it was the
duty of the court to proceed and do final and complete justice
between the parties, where it could as well be done in that court
as in proceedings at law.
IV. It is further objected that, admitting the claim to be
properly enforceable in equity, still the complainant is not
entitled to the relief sought on the ground that the bill contains
no sufficient statement of the contract or of the performance of
the conditions, and also for want of a proper prayer.
We are of opinion that these several objections are not well
founded. The contract as set forth we have already considered and
held complete and binding on the company, and further that the
denial of having entered into the agreement, and refusal to issue
the policy, also set forth, are sufficient ground upon which to
infer a waiver of the production of the preliminary proofs, as a
condition of liability, and if sufficient ground to infer a waiver,
it was of course unnecessary to set forth these proofs in the bill.
And as to the prayer it is sufficient to say that the prayer for
general relief which is here found will enable the court to make
such a decree as the complainant may show himself entitled to, upon
the facts set forth in the stating part of the bill.
The pleading is not very formal nor very cautiously drawn, and
in the absence of the prayer for general relief might have led to
embarrassment in making the proper decree in the case. There is a
specific prayer for a decree for the loss, but it would have been
more formal and appropriate, regarding the ground of jurisdiction
in these cases, to have added also a prayer for a specific
performance of the agreement to insure.
But the particular relief permitted under a general prayer,
where the statement in the body of the bill is sufficient to
entitle the party to it, meets the difficulty suggested and well
warrants the decree proposed to be entered. Story Eq.Pl. ยงยง 41, 42,
and cases
Upon the whole, without pursuing the examination further, we are
of opinion that
The decree of the court below should be reversed, and that
the cause be remitted with directions to the court to take such
further proceedings therein as may be necessary to carry into
effect the opinion of this Court.
Order
This cause came on to be heard on the transcript of the record
from the Circuit Court of the United States for the District of
Maryland, and was argued by counsel. On consideration whereof, it
is now here ordered, adjudged, and decreed by this Court that the
decree of the said circuit court in this cause be and the same is
hereby reversed with costs, and that this cause be and the same is
hereby, remanded to the said circuit court with directions to that
court to take such proceedings therein as may be necessary to carry
into effect the opinion of this Court.
Page 50 U. S. 406
MR. JUSTICE CATRON stated from the bench that he objected to a
decree's being made by this Court on the bill because the cause
came here by a transfer from the circuit court, never having been
heard there. It was only prepared for hearing, and is now presented
and heard as an original cause in this Court. We have appellate and
not original jurisdiction in such cases, both by the Constitution
and by the Judiciary Act of 1789. Before an appeal can be
prosecuted, something must be adjudged to appeal from. And in the
second place, if it be once established that causes can be sent
here by mere transfer, nothing having been decided below, we must
be overwhelmed by such causes, there being now thirty courts and
more that may send them up. This is one evil intended to be avoided
by the framers of the Constitution when the Supreme Court was
excluded from the exercise of original jurisdiction in cases like
the present.
