SEC. 352.

SEC. 353.

Policy void unless notice or assent is shown.

Policies must cover same property.

Must be other insurance by the assured, or for his benefit, with his

assent.

Identity of interest the test.

SEC. 368. Assent without indorsement.

SEC. 369. Effect of knowledge of other insurance after policy is made.

SEC. 376.

SEC. 377.

Evidence may be given to show policies do not cover the same risk.
Notice must be given as prescribed.

SEC. 348. A condition that, if other insurance shall be obtained without the consent of the company, the policy shall be void, only

relates to other valid insurance, and the policy is not avoided by the procurement of other policies that, for any cause, are invalid.' But the entire invalidity of such other insurance must be established. The other policy or policies must, at the time of the loss, have been inoperative, so that no action could be maintained to enforce them. It is not necessary that they should have been absolutely void; it is sufficient if they were voidable. "There is an intrinsic absurdity," says BELL,

1 Thomas v. Builders' Ins. Co., 119 Mass. 121; Jackson v. Mass. Mut. F. Ins. Co., 28 Pick. (Mass.) 418; Hardy v. Union Ins. Co., 4 Allen (Mass.) 217; Clark v. N. E. Mut. F. Ins. Co., 6 Cush. (Mass.) 342; Kimball v. Howard Ins. Co., 8 Gray (Mass.) 33; Stacey v. Franklin F. Ins. Co., 2 W. & S. (Penn.) 506; Gee v. Cheshire Co. Mut. Ins. Co., 55 N. H. 265; 20 Am. Rep. 170; Obermeyer v. Globe Mut. Ins. Co., 43 Mo. 573; Hubbard v. Hartford F. Ins. Co., 33 Iowa, 325; 11 Am. Rep. 125; Forbes v. Agawam Ins. Co., 9 Cush. (Mass.) 470; Philbrook v. N. E. Mut. F. Ins. Co., 37 Me. 187; Gale v. Belknap, 41 N. H. 170; N. Y. Central Ins. Co. v. Watson, 23 Mich. 486; Lindley v. Union Ins. Co., 65 Me. 368; 20 Am. Rep. 701; Knight v. Eureka Ins. Co., 26 Ohio St. 664. A policy conditioned to be void, "if any prior or subsequent insurance is made without the consent of the company indorsed thereon," is not defeated by the taking of a foreign policy, void for want of compliance with statutory regulations. Rising, etc., Ins. Co. v. Slaughter, 20 Ind. 520; Philbrook v. N. E. Mut. F. Ins. Co., 37 Me. 137; Lochlan v. Etna Ins. Co., 4 Allen (N. B.) 173; Allison v. Phoenix Ins. Co., 3 Dill (U. S. C. C.) 480. See contra, Lackey v. Georgia, etc., Ins. Co., 42 Ga. 456; Bigler v. N. Y. Central Ins. Co., 22 N. Y. 402; David v. Hartford Ins. Co., 13 Iowa, 69; Carpenter v. Providence Ins. Co., 4 How. (U. S.) 185; Ramsay Woolen Cloth Co. v. Mut. Ins. Co., 11 Upper Canada (Q. B.) 516. An interim receipt for insurance is other insurance. Hutton v. Beacon Ins. Co., 16 U. C. (Q. B.) 316. So the renewal of prior insurance, when the assured, at the time of obtaining additional insurance, informed the agent it would not be renewed. Deitz v. Mound City Ins. Co., 38 Mo. 85. But the renewal of a prior outstanding policy is not. Pitney v. Glens Falls Ins. Co., 65 N. Y. 1. But the procurement of new insurance to the same amount in other companies, in place of previous policies, is other insurance. Conway Tool Co. v. Hud. R. Ins. Co., 12 Cush. (Mass.) 144. So other insurance, obtained without the knowledge or consent of the assured, invalidates a prior policy if the assured subsequently adopts the insurance, and this may be done by accepting the payment of a loss under it. Dafoe v. Johnstown, etc., Ins. Co., 7 U. C. (C. P.) 55. But that cannot be regarded as other insurance that is procured by a third person, and to which the assured has never assented. Burton v. Gore Dist., etc., Ins. Co., 14 U. C. (Q. B.) 342. Mere notice to the insurer, or his agent, of an intention to procure other insurance, is not enough to cause a breach of the condition. To have that effect, it must be notice of insurance already obtained. Healey v. Imperial Ins. Co., 5 Nev. 268, Although, if the insurer, upon such notice being given, assents to the procurement of other insurance, it is a waiver of notice, although a contrary rule prevails in Massachusetts. Barrett v. Un. Mut. F. Ins. Co., 7 Cush. (Mass.) 175; Fox v. Phoenix Ins. Co., 52 Me. 333; Mitchell v. Lycoming Ins. Co., 51 Penn. St. 402; Allison v. Phoenix Ins. Co., Dil. (U. S. C. C.) 480. When a prior policy exists upon the property containing a condition against other insurance, and a subsequent policy is procured without notice, the first policy is thereby invalidated, and the second stands. Duclos v. Citizens', etc., Ins. Co., 23 La. An. 332.

Mitchell v. Lycoming Mut. Ins. Co., 51 Penn. St. 402; Jackson v. Mass. F. Ins. Co., 23 Pick. (Mass.) 418; Clark v. N. E. Mut. F. Ins. Co., 6 Cush. (Mass.) 542; Hardy v. Union Ins. Co., 4 Allen (Mass.) 217. If the policy is prima facie valid, the assured must show its invalidity. Schenck v. Mercer Co. Ins. Co., 24 N. J. L. 447; Bigler v. N. Y. Cent. Ins. Co., 20 Barb. (N. Y.) 635. But if invalid on its face, it does not avoid the other policies. Schenck v. Mercer Co. Ins. Co.,

ante.

J.,' “in holding that to be an insurance by which another is bound to make good another's loss, only in case he pleases to do it." Therefore, if the policies at the time of the loss were only voidable by reason of the breach of some condition, and the insurer had waived the breach, either expressly or impliedly, before the loss, the policies are operative, and constitute "other insurance" within the meaning of the terms."

In an Iowa case," the plaintiff applied to defendant's agent for insurance on his property, on the 18th of the month, and it was agreed that the agent should issue and send to A. the policy on that day. The policy was, in fact, issued on and bore the date of that day, but was not delivered to A. nor the premium paid until the 22d of the month. The policy contained a condition that it should be void in case of prior or subsequent insurance. On the 21st of the same month A. applied to the agent of the P. company for insurance on the same property, and the terms were agreed on and the premium paid. The agent of the P. company, having no blanks for policies, agreed to send a policy to A., and gave him a receipt, specifying the property to be insured. The usual policies of the P. company contained a condition of avoidance in case of other insurance. Neither company was informed of the transaction with the other. On the 26th of the month the insured

property was burned. As soon as the P. company was informed of the policy issued by defendant, it treated its contract with A. as void. In an action on the policy issued by defendant, it was held that the policy became operative and binding from the day it was issued, though not delivered, and was, therefore, prior to the P. company's contract; that the effect of the receipt given by the agent of the P. company was to bind the company the same as if a policy, with the ordinary conditions, had been issued; that the contract with the P. company being void by reason of the prior insurance, and being so treated by the company, did not amount to a breach of the condition in defendant's policy against subsequent insurance.*

'Gale v. Belknap Co. Ins. Co., 41 N. H. 170; Lindley v. Union Ins. Co., 65 Me. 368; Lovett v. United States, 9 Ct. of Claims (U. S.) 147.

Mitchell v. Lycoming Ins. Co., 51 Penn. St. 402.

'Hubbard v. Hartford F. Ins. Co., 33 Iowa, 325; 11 Am. Rep. 125.

BECK, J., in passing upon the question, said: "We have the case of two policies given at different dates covering the same property, each having a condition against other insurance, both prior and subsequent, and providing that a breach thereof shall avoid the respective instruments. The question for us to determine is which, if either, of these instruments is valid, and which is avoided by the operation of a breach of the condition. It will be remembered that a breach of the condition does not absolutely render void and of no effect the policy; it simply

Voidable policy.

SEC. 349. It is held that the fact that the policy is invalid of itself, prevents the forfeiture, and that the fact that the insurer under such invalid

renders it voidable-its binding force and effect being subject to be defeated at the option of the company issuing the instruments. If no objection be made by the company on account of the breach of the condition, the policy may be enforced as though no forfeiture had ever happened. The act of the company, whereby it is shown that the instrument is treated as avoided, must be shown in order to defeat recovery thereon. If no such act or objection on the part of the company be shown, the contract will be considered binding. It is not necessary here to state what will amount to an act avoiding the contract, or when it must be done, further than to observe that it must appear that the underwriter relied upon the breach of the condition to defeat the contract. Of course, the company issuing the subsequent policy could not rely upon the breach of the condition, in order to avoid the instrument, until knowledge thereof was acquired, and its acts treating the policy as avoided would be sufficient, if shown to have been done after such knowledge. The same principles will apply to the prior policy. It was not absolutely void, on account of the subsequent insurance, but was voidable only. It was a binding instrument when executed, and would so continue until some act done by defendant intended to avoid it, on account of the breach of the condition against the subsequent insurance. But it could not be avoided on account of the Phoenix policy, unless that instrument itself was valid. If it so happened that, when the action was brought on defendant's policy, or even at the trial, it was made to appear that the Phoenix policy could not be enforced, was avoided on account of the breach of a condition therein, it is obvious that the existence of that instrument shown to be inoperative would not constitute a breach of the condition in defendant's policy against subsequent insurance. That condition is against actual insurance to be subsequently made. The Phoenix policy created no insurance; it was avoided by the act of the company, and therefore did not constitute a breach of defendant's policy. The general principle of law upon this point may be stated as follows: In order to avoid a policy on account of a subsequent insurance against an express condition therein, it must appear that such subsequent insurance is valid, and that the policy upon which it is made is capable of being enforced. If it cannot be enforced, it is no breach of the prior policy. This principle is substantially embodied in the fourteenth instruction given by the court to the jury. The instruction could have been more properly worded, but its import is quite clear, and to the effect that, if the Phonix company treated its policy as avoided, after notice of the existence of defendant's policy, it constituted no such subsequent insurance as would invalidate the policy in suit. Our conclusion upon this branch of the case is not without support of the authorities. The following cases may be cited as sustaining the principles above stated: Jackson v. Mass. Mut. Ins. Co., 23 Pick. (Mass.) 418; Clark v. New England Ins. Co., 6 Cush. (Mass.) 343; Gale v. Belknap Ins. Co., 41 N. H. 170; Stacy v. Franklin Ins. Co., 2 W. & S. (Penn.) 506; Philbrook v. New England Mut. Ins. Co., 37 Me. 137; Schenck v. Mercer Co. Mut. Ins Co., 4 Zabr. (N. J.) 447; Jackson v. Farmers' Ins. Co., 5 Gray (Mass.) 52.

The doctrine which we have above announced does not go to the full extent of some of the cases just cited. It is held in Philbrook v. The New England Mut. Ins. Co., supra, that the prior policy is valid, even though the subsequent policy is not avoided by the underwriter issuing it, but the loss thereon is paid; and, in others of these cases, the rule is not expressly based upon the fact that the subsequent policy was treated by the underwriter issuing it as avoided. The doctrine which we recognize here is based upon the fact that the subsequent policy was treated and considered as avoided by the company issuing it as soon as it had notice of the prior insurance. In our view, this is a most important consideration, for, if the underwriter in the second policy does not treat it as avoided, it cannot so be considered by the insured or the company issuing the prior policy. The condition against prior insurance in the subsequent policy is for the benefit of the insurer, who may, at his option, waive it or insist upon enforcing its terms. If he seeks to enforce the condition, and treats the policy as a void contract, it is indeed difficult to see upon what grounds it may be regarded as valid, as an

policy sees fit, after the loss, to waive the invalidity and pay the loss under it, does not affect the question.' This question was raised in a recent case in the Supreme Court of Massachusetts. In that case the plaintiff procured a policy in the defendant company upon certain property, among the conditions of which was one that "if the assured shall have made, or shall hereafter make, any other insurance upon said property, without the knowledge or consent of this company in writing, then in such case this policy shall be void." A few days subsequently another policy, upon the same property, was taken out by the plaintiff in the Merrimack Ins. Co., which also contained a condition. "that without the consent of this company, no other insurance shall exist upon the property insured by it. No consent was given by either company. A loss occurred and the Merrimack Company settled the loss under its policy, without insisting upon the forfeiture. The defendant insisted that it was not liable, because of the breach of this condition by taking out the insurance in the Merrimack Company, and that, the plaintiff could not insist that the policy in the Merrimack Company was invalid, because the company had elected to treat it a valid obligation, and had settled the loss with him thereunder. But the court held that the question was, simply, whether any other valid insurance had been effected upon the property, and that if the policy in the Merrimack Company was in fact invalid, no other insurance within the meaning of the term employed in the policy, had been effected, and that the mere circumstance that that company had seen fit to waive the forfeiture, did not affect the question of the defendant's liability, and could not alter the rights of the parties under the policy. The test is whether a policy exists in defiance of the condition, which is a valid outstanding legal obligation, and which can be enforced in a court of.

insurance that will defeat the prior policy. In this view, our conclusion is not in conflict with David v. The Hartford Ins. Co., 13 Iowa, 69, and Bigler v. The N. Y. Central Ins. Co., 20 Barb. 635, and same case, 22 N. Y. 402. In the first of these cases, an action was brought upon a policy containing a condition against subsequent insurance. Other insurance, taken after the date of the policy, was relied upon to defeat recovery. The plaintiff claimed that the subsequent policies, on account of certain conditions therein which were violated, were void. It is held that these policies are not void, but, on account of the breach of their conditions, might have been avoided. As they were treated as valid contracts by both of the parties thereto, the losses occurring thereon having been paid by the companies executing the subsequent policies, the breaches of the conditions were regarded as waived, and the instruments held to be binding upon the respective underwriters."

'Jackson v. Mass. F. Ins. Co., 23 Pick. (Mass.) 418; Hardy v. Union Ins. Co., 4 Allen (Mass.) 217; Clark v. N. E. Mut. F. Ins. Co., 6 Cush. (Mass.) 342; Lindley v. Union Ins. Co., ante; Lovett v. United States, ante.

2 Thomas v. Builders' Mut. F. Ins. Co., 119 Mass. 122.