Garden Mutual Fire Ins. Co., 18 Pa.Super. 139, at Pages 146, 147.
'* * * Officers only bind a corporation when they undertake to represent it and act within the limits of their authority. The authority conferred may be extensive, yet the officer is still an agent. The same person may be an officer of two independent corporations, and his acts while representing one will no more bind the other than the acts of a stranger. The knowledge of an agent which will affect his principal with constructive notice must be gained by the agent while acting for the principal in the matter to which it relates.' Id., 18 Pa.Super.at page 146.
'* * * information acquired by a lawyer while conducting transactions for one client is not to be considered as within his knowledge when acting as attorney for another client.' Ross v. Mayflower Drug Stores, Inc., 338 Pa. 211, at pages 214, 215, 12 A.2d 569, at page 571.
'Conceding his agency was for both appellants and the mortgagee, it was not for both as to all transactions involved; the attorney was agent for appellants to secure the money; * * * for the mortgagee to obtain proper security for the money * * * Any information the attorney acquired while conducting transactions in behalf of one may not be considered as within his knowledge as agent of the other for different purposes.' Kinch v. Fluke, 311 Pa. 405, at pages 412, 413, 166 A. 905, at page 908. And again '* * * not when secured in the course of other independent transactions.' Hertzler v. Nisly, 295 Pa. 62, at page 65, 144 A. 824, at page 826; Byrne v. Dennis, 303 Pa. 72, at page 77, 154 A. 123; Barbour v. Wiehle, 116 Pa. 308, at page 316, 9 A. 520.
The real question is in what capacity did he act. Gunster v. Scranton Illuminating Heat & Power Co., supra, 181 Pa.at page 339, 37 A. 550.
Here there is no competent evidence to show knowledge as to defendant bank and nothing to support plaintiff in its defense that the mortgagee had violated any provisions of the policy.
A Standard Mortgagee Clause in a fire insurance policy creates a separate, distinct and independent contract of insurance in favor of the mortgagee. Willits v. Camden Fire Ins. Ass'n, 124 Pa.Super. 563, at pages 567, 568, 189 A. 559; Overholt v. Reliance Ins. Co. of Philadelphia, 319 Pa. 340, 344, 179 A. 554.
'Notwithstanding there may be * * * increased hazard, from the provisions of the contract, the insurance continues in full force for the benefit of the mortgagee though notice of such change had not been given to the insurance company. The notice required is to be given by the mortgagee when he knows of the changes * * *.' Knights of Joseph Building & Loan Ass'n v. Mechanics Fire Ins. Co., 66 Pa.Super. 90 at Page 95.
And as to binding instructions, see Sitler v. Spring Garden Mutual Fire Ins. Co., supra, 18 Pa.Super.at page 147, and Bitonti v. National Liberty Ins. Co., Inc., 96 Pa.Super. 521.
As to the claim of mortgagee, we will therefore deny plaintiff's motions for Judgment (declaratory and summary) and, on the contrary, grant the prayer of the mortgagee that Judgment be entered in its favor.
As to the Witney claim-
Whether the risk was increased in violation of the terms of the policy and whether Witney notified Jones of the intended immediate use as a bakery and was led by Jones to believe the change was covered by insurance
being disputed are for the Jury.
Assuming arguendo the risk was increased the policy would be suspended.
The Witneys could not recover unless they established that the policy had been continued by agreement indorsed thereon, or that the company waived the condition or proved facts which would estop the company from asserting such a defense. Kompa v. Franklin Fire Ins. Co., 28 Pa.Super. 425, at page 429.
Jones knew the terms of the lease- that it was to be used as a bakery commencing November 1. When Iwanowski informed him of the actual use of the premises he then, as insurance agent, examined the insurance files. Finding the change not noted, he wrote to the Rating Bureau advising them thereof and requesting a rate. He intended thereby to continue the insurance including the change subject to an additional rate. The policy being in the custody of the bank, no provision in writing was added thereto at the time.
Presumably, however, a copy of the letter was placed with Jones' copy of the policy. Since the bureau was the authorized and customary channel for notifying the insurer
the only one not specifically notified was the insured. The Witneys were however bound by the acceptance of their offer
and liable for the additional premium.
Under the circumstances, disregarding Witney's testimony and relying solely upon that offered upon insurer's behalf, can the insurer escape liability under the policy?
Assuming arguendo that mere knowledge was not the notice demanded or equivalent to it,
here we have knowledge followed by Jones' conduct intending to continue the policy in force and to include the change under policy coverage. Such conduct dispenses with the necessity of proving notice. Eureka Ins. Co. v. Robinson, Rea & Co., 56 Pa. 256, at pages 266, 268; State Ins. Co. of Missouri v. Todd, 83 Pa. 272, at page 279; cf. McSparran v. Southern Mut. Ins. Co., 193 Pa. 184, at page 191, 44 A. 317.
Similarly as to the provision 'unless otherwise provided in writing added hereto' such provision being for the benefit of the insurer may be waived by it or by a duly authorized agent acting in good faith in the course of his duties on the company's behalf; or the acts of the agent in relation thereto may estop the company from successfully setting up a breach of such condition as a defense to an action on the policy. Witmer v. Royal Ins. Co., Ltd., 68 Pa.Super. 12, at page 17; Evans v. Metropolitan Life Ins. Co., 294 Pa. 406, at page 410, 144 A. 294; Collins v. Homes Ins. Co. of New York, 110 Pa.Super. 72, 167 A. 621; Mentz v. Lancaster Fire Ins. Co., 79 Pa. 475; Sitler v. Spring Garden Mut. Fire Ins. Co., 18 Pa.Super. 148, 152; Goldin Op. Cit. supra, p. 298; Silas McFarland v. Kittanning Ins. Co., 134 Pa. 590, 19 A. 796; 29 Am.Jur.Insurance, § 800, pa. 604. The waiver need not be expressed; it may be inferred. Fedas v. Ins. Co. of Pennsylvania, 300 Pa. 555, 559, 151 A. 285.
For examples of the various situations where waivers of provisions of policies have been sustained, see Isaac v. Donegal & Conoy Mut. Fire Ins. Co., 308 Pa. 439, at page 443, 444, 162 A. 300.
'The principle underlying these * * cases * * * is that where the company has knowledge of violation of a condition in the policy, and yet continues to treat the policy as in force, it cannot be permitted to set up such breach to defeat the contract. Presuming that the company did not intend to act dishonestly, the condition is considered as having been waived.' Kalmutz v. Northern Mut. Ins. Co., 186 Pa. 571, at page 576, 40 A. 816, at page 817. '* * * estoppel * * * is the true ground upon which the doctrine of waiver in such cases rests.' Elliott v. Lycoming County Mut. Ins. Co., 66 Pa. 22, at page 26.
Waiver is the voluntary relinquishment of a known right. Estoppel rests upon the misleading conduct of one party to the prejudice of another. The latter requires consideration the former does not. Globe Indemnity Co. v. Cohen, 3 Cir., 106 F.2d 687, at page 691; and see Antone v. New Amsterdam Casualty Co., 335 Pa. 134, at page 140, 6 A.2d 566. The distinction is fairly clear where waiver is expressed, less so where implied from conduct. 29 Am.Jur. § 799, p. 603, 604.
Plaintiff argues that neither waiver nor estoppel are available to bring within coverage of the policy risks not covered by its terms or risks expressly excluded therefrom. See Note 113 A.L.R. 857; 29 Am.Jur.Insurance § 801, p. 607, Sec. 903. He relies principally upon Antone v. New Amsterdam Casualty Co., 335 Pa. 134, 6 A.2d 566. We find no aid for his position in either citation.
An examination of the Antone case shows clearly that it has no applicability to the present situation. Said the court, 335 Pa.at page 138, 6 A.2d at page 568, 'The cases in Pennsylvania and elsewhere that recognize the estoppel theory in insurance contract cases are all cases where some contractual relationship existed between the parties. Before a court can say that a company is estopped to deny that 'it waived the condition of the policy', there must be a covering policy. But where there is no policy, there is no condition to be waived. * * * Here the doctrine of estoppel is being used, not to make a contract operative, but to create a contract where none existed.' And again, 335 Pa. at page 141, 6 A.2d at page 569, 'Since Antone had no contractual relations whatever with the insurance company, he cannot invoke any estoppel against it. An estoppel 'can operate neither in favor of nor against strangers."
See Note 113 A.L.R.at page 857. 'The annotation deals only with implied waivers, for it may be conceded that any condition, irrespective of its character, may be waived by express agreement to that effect, supported by a valuable consideration.'
Jones, as plaintiff's authorized agent to issue and countersign policies, had full power and authority to accept the additional risk.
The increase in risk did not per se breach any condition or covenant in the contract. The policy expressly provided for the contingency of an increased risk; the only deficiency, if any, was in Jones' carrying out its terms. Here is an affirmative action, an agreement by the agent on the company's behalf to include a risk in return for a valuable consideration, i.e., the additional premium.
If the intention to contract was clear it would have been valid even if entirely oral.
The use of the letter does not detract from the strength of insured's position. See Myers v. Keystone Mut. Life Ins. Co., 27 Pa. 268, 270; Curran v. National Life Ins. Co., 251 Pa. 420, 96 A. 1041; Hamilton v. Lycoming Mut. Ins. Co., 5 Pa. 339, at page 344.
The insured ought not to be prejudiced by the mistake of the insurance agent. Evans v. Metropolitan Life Ins. Co., 294 Pa. 406, at page 410, 144 A. 294.
'If they would avail themselves of the want of complete performance of a condition existing only for their benefit, it was their duty to make complete performance possible, or at least, by no act or default of their own, interpose obstacles in the way of performance.' Eureka Ins. Co. v. Robinson, Rea & Co., supra, 56 Pa.at page 267. See Hamilton v. Lycoming Mut. Ins. Co., 5 Pa. 339, at page 344.
"Where the terms of a policy are susceptible, without violence, of two interpretations, that construction which is most favorable to the insured, in order to indemnify him against loss sustained, should be adopted.' Humphrey's (Humphreys) v. National Benefit Ass'n, 139 Pa. (264, 20 A. 1047, 11 L.R.A. 564.)' Marcello v. Concordia Fire Ins. Co., 234 Pa. 31, at page 38, 82 A. 1090, at page 1092, 39 L.R.A.,N.S., 366; Central Market Street Co. v. North British & Mercantile Ins. Co., 245 Pa. 272, at page 276, 91 A. 662.
Plaintiff's motions for declaratory judgment and for summary judgment must therefore be denied. The Witneys insisted upon the right to a jury trial to preclude declaratory judgment for the plaintiff.
In the alternative they asked for a declaratory judgment in their favor but did not make a counter motion for summary judgment.
Ordinarily where the testimony is oral, the facts are for the jury. See Nanty-Glo Borough v. American Surety Co., 309 Pa. 236, 163 A. 523; Lilly v. Metropolitan Life Ins. Co., 318 Pa. 248, 177 A. 779. 'When the facts are admitted, or established beyond all controversy, as they are in this case, there is no necessity for submission to a jury. It then becomes the province of the court to declare the law applicable to such facts.' Wachter v. Phoenix Assur. Co., 132 Pa. 428, at page 440, 19 A. 289, at page 291; Murphy v. Beverly Hills Realty Cop., 98 Pa.Super. 183, at page 188; Gartsee v. Citizens' Ins. Co., 30 Pa.Super. 602, at page 605; 29 Am.Jur.Insurance, 1536. This is particularly true here in view of the testimony of Jones as agent for the plaintiff. See Smith v. Penn Twp. Mut. Fire Ins. Co., 323 Pa. 93, at pages 97, 98, 186 A. 130.
We are of the opinion that the record discloses there can be only one possible conclusion, i.e., that the plaintiff is liable for the Witney claim.
An order granting judgment in favor of the Witneys will be filed this date.