APPEAL by the defendant, the Commonwealth Fire Insurance Company of Ottumwa, Iowa, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of Kings on the 28th day of July, 1910, upon the verdict of a jury rendered by direction of the court, and also from an order entered on the 8th day of June, 1910, as resettled by an order bearing date the 1st day of August, 1910, and entered in said clerk's office denying the defendant's motion for a new trial made upon the minutes.
Edwin T. Taliaferro [E. Bright Wilson with him on the brief], for the appellant.
J. Solon Einsohn, for the respondent.
Judgment and order affirmed, with costs, on the opinion of Mr. Justice PUTNAM at Trial Term.
JENKS, P. J., BURR, THOMAS, CARR and RICH, JJ., concurred.
The following is the opinion delivered at Trial Term:
The defendant is a foreign insurance company not admitted in New York. The policy is what is known as 'surplus line' insurance which may be procured from companies not admitted by section
137 of the Insurance Law (Consol. Laws, chap. 28; Laws of 1909, chap. 33). The policy is dated and countersigned at Ottumwa, Ia. It bears the following stamped clause: 'It is hereby agreed and understood, that in case of loss under this policy and this Company is not authorized to do business in the State of New York it will settle upon the same basis and in the same manner as may be agreed to by the Northern Insurance Company of England. Warranted same gross rate, terms and conditions, as and to follow above mentioned Company, and that said Company has during the currency of this policy at least $1,000 on the identical subject-matter and risk, and in identically the same proportion on each separate part thereof.'
The defendant resists liability on the ground that the insured had no policy in the Northern Insurance Company of England, thereby breaking a warranty which, it is claimed, exists in the latter part of the above clause. This clause is very confused, but in it are mingled two dependent provisions. First, in favor of the assured entitling it to use against defendant any adjustment of loss made with the Northern Company which was especially valuable to the insured if the defendant should not be authorized to do business in New York, and therefore, not to be readily reached here after a loss. Second, that this insurance shall follow and be on same terms and conditions as those of the policy of this mentioned company, as otherwise an adjustment with it would not apply to defendant's policy.
Apparently the liberty given in section 137 of the Insurance Law does not admit the insuring company to this State or authorize it to transact business therein. It allows citizens of the State to get insurance from unauthorized and unadmitted companies on certain conditions. Such agents, however, under section 137, are the agents of the insured, and not of the company. (Report of Attorney-General , p. 388.) The defendant was not authorized to transact any business in this State, but in the special circumstances pointed out insurance brokers were allowed to procure fire insurance from it. (Baker v. Spaulding, 71 Vt. 169.)
The policy being dated, signed and countersigned at Ottumwa, was on its face an Iowa contract. The secretary of defendant indeed gave evidence ...