
    The Fire Association of Philadelphia v. Appel, Administrator.
    
      Disagreement as to amount of loss — Under insurance policy— Agreement between insurer and insured to determine loss— Failure to complete appraisement by action of one party — Other party not bound to new appraisement, when — Conditions of insurance policy — Law of insurance.
    
    1. When in the event of a disagreement as to the amount of a loss, a fire insurance company and the insured have entered into an agreement to determine the amount of the loss by appraisers, and appraisers are chosen thereunder who also select an umpire, all of whom enter upon the work of appraisement, if such appraisement is brought to a close before completion, or the final award is made invalid by the default of one of the parties to such agreement, the other party is not bound to enter into a new appraisement, there being no stipulation therefor in the policy.
    2. When in such case one of the appraisers withdraws from the appraisement, without the fault of either party, and refuses to proceed with the appraisement, such conduct on his part does not revoke the appraisement; and it is the right and duty of the party who appointed such appraiser to choose another in his place, and where in such case the insurer refuses to choose another appraiser or to proceed further with the appraisement and demands and insists upon a new appraisement instead, such conduct of the insurer amounts to a waiver of the condition in the polity.
    (No. 9955
    Decided February 26, 1907.)
    . Error to the Superior Court of Cincinnati, General Term.
    Emily Appel, who is now deceased, was doing business as a wholesale and retail dealer in millinery in the city of Cincinnati on the 9th day of September, 1901, when a fire occurred, destroying a large amount of her merchandise and property. Among other policies, she held a policy of insurance, issued by the plaintiff in error, which contained, among other things, the following conditions:
    “This company shall not be liable beyond the actual cash value of the property at the time any loss or damage occurs, and the loss or damage shall be ascertained or estimated according to such actual cash value, with proper reduction for depreciation, however caused, and shall in no event exceed what it would then cost the insured to repair or replace the same with material of like kind and quality; said ascertainment or estimate shall be made by the insured and this company, or, if they differ, then by appraisers, as hereinafter provided; and, the amount of loss or damage having been thus determined, the sum for which this company is liable pursuant to this policy shall be payable sixty days after due notice, ascertainment, estimate, and satisfactory proof of the loss have been received by this company in accordance with the terms of this policy.”
    “If the fire occur the insured shall give immediate notice of any loss thereby in writing to this company, protect the property from further dam-, age, forthwith separate the damaged and undamaged personal property, put it in the best possible order,, make a complete inventory of*the same, stating the quality and. cost of each article and the amount claimed thereon.”
    “In the event of disagreement as to the amount of loss the same shall, as above provided, be ascertained by two competent and disinterested appraisers, the insured and this company each selecting one, and the two so chosen shall first select a competent and disinterested umpire; the appraisers together shall then estimate and appraise the loss, stating separate sound value and damage, and, failing to agree, shall submit their differences to the umpire; and the award in writing of any two shall determine the amount of such loss;” * * *
    “And the loss shall not become payable until sixty days after the notice, ascertainment, estimate, and satisfactory proof of the loss herein required have been received by this company, including an award by appraisers when appraisal has been required.”
    The said Emily Appel gave immediate notice of the loss, as required by the policy, and she and the plaintiff in error immediately entered into negotiations for settlement. Thereupon there arose a disagreement as to the amount of loss, and pursuant to the policy, an agreement for submission to appraisers was entered into between Mrs. Appel and the Insurance Company. They each selected a competent and disinterested appraiser, and the two appraisers so chosen selected a competent and disinterested umpire. Thereupon the appraisers proceeded under the terms of the policy to estimate and appraise the loss. ' While they were in prosecution of the estimate and appraisement of the loss, and when they had more than half completed the same, the appraiser who had been selected by the Insurance Company refused to proceed further, or to conclude the estimate or appraisement of the said loss. This refusal was without any cause or act upon the part of the insured, and was solely on account of differences between him and the other appraiser and the umpire. Thereupon the insured and her attorney also requested the appraiser so selected by the Insurance Company to proceed with the appraisement, which he refused to do. The insured then notified the said appraiser that' the appraisement would proceed at three o’clock in the afternoon of September the 27th, 1901, and notified him to appear and proceed with the appraisement, which he failed to do. The insured, through her attorney, then notified the Insurance Company that the appraiser selected by it had refused to continue and that the remaining appraiser and umpire would proceed on October the 2d, 1901, at one o’clock, with the appraisement; and requested the Insurance Company to have its appraiser or some other appraiser present to continue and conclude the appraisement. The Insurance Company refused to, or at least did not, comply with this request, and, by correspondence, in effect made demand for a new appraisement by new appraisers, which the insured refused to agree to, but stated her willingness to continue and complete the appraisement already entered into. The appraiser appointed by Emily Appel, the insured, acting with the umpire previously appointed by the two appraisers, continued and concluded the estimate and appraisement and made an award in writing and signed the same, and thereafter, and within sixty days after the fire, the insured made due proof of loss without, however, attaching any award as made by the appraisers. The Insurance Company objected to the proof of loss because there should have been attached thereto an award under a new appraisement. 'The amount of the direct loss occasioned to the property by the fire is shown by the award, and also by the evidence included in the record, to have been $9,725.08. The said Emily Appel having in the meantime died, Harry Appel was appointed administrator with the will annexed of her estate, and the Insurance Company having refused to pay the amount of the loss, the said administrator filed a petition against the company, setting up in usual form the insurance and damage by fire within the terms of the policy, ownership of the property, proof of loss and performance on her part of the conditions and requirements of the policy, specifically setting up, however, that there was a direct loss and damage by fire to the said property insured under the policies to the amount of $9,725.08, and specifically setting up the demand for an ap-. praisement on the part of the Insurance Company, the appointment of the appraisers and umpire, the refusal of the appraiser appointed by the Insurance Company to proceed, the failure and refusal of the Insurance Company to appoint another appraiser in his place, and the further proceedings of the appraiser appointed by Mrs. Appel and the umpire, and the making of an award showing the direct loss and damage amounting to $9,725.08, and prayed judgment against the Insurance Company for its pro rata amount of the loss, there being several concurrent policies on the said property. Issue was joined upon these averments, and the case was submitted to Hon. Rufus B. Smith, as referee, for the trial of the issues both of law and fact arising thereon, and upon the report by the referee the facts were found as above stated, and the referee found as conclusions of law as follows: “1. That one-of two results necessarily followed when the appraiser appointed by the defendant refused to continue, and the defendant refused to appoint another appraiser in his place; either the appraiser appointed by the plaintiff and the umpire had to complete it, as was done, or the plaintiff was justified in regarding the right'to an appraisement under the policy as having been abandoned by the defendant, and the plaintiff was therefore entitled to sue for and have the amount of the same fixed by the court. 2. That the defendant was not entitled to a new appraisement, and that therefore its objection to the proof of loss, as made, is not well taken; and, as it made no other objection to the proof of loss, it has thereby waived all other objections. 3. That the said plaintiff is entitled to recover from the said defendant the sum of $555.72, with interest from the 10th day of December, 1901.” The report of the referee was subsequently approved and confirmed by the Superior Court, and judgment rendered against the Insurance Company for the amount found due. Thereupon the case was taken on error to the General Term of the Superior Court, in which court the .judgment of the court in special term was affirmed. The cause is now prosecuted in this court on error to reverse the said judgments of the court below.
    
      Messrs. Cabell & Kohl and Messrs. Paxton & Warrington, for plaintiff in error.
    
      Mr. Frank Seinsheimer and Mr. John R. Sayler," for defendant in error.
   Davis, J.

The counsel on both sides of this case have discussed several propositions which relate to the validity of the award,- which was made by one of the appraisers and the umpire, and to the insufficiency of the proof of loss, there being no award attached thereto as required by the terms of the policy. As we view the case, these questions aré not necessarily involved. The real question is whether or not the insured was, by the conduct of the insurer, absolved from the obligation of the precedent condition relating to appraisal as written in the policy.

It is the clearly announced doctrine of this court that provisions such as are contained in this policy constitute a condition precedent, which imposes an obligation on the insured, in the event of disagreement as to the amount of loss, to procure an award or ascertainment of the loss by appraisers, or to show a legal excuse therefor, before he can maintain a suit on the noljcv to recover the loss. Phoenix Ins. Co. v. Carnahan.. 63 Ohio St., 258; Graham et al. v. German-American Ins. Co., 75 Ohio St., 374. Do the conceded facts here show a legal excuse for thé plaintiff below, in not strictly performing on her part, the stipulations of the contract which are thus made a condition precedent? Do the undisputed facts justify her in proceeding to recover the loss in a suit upon the policy, instead of first fixing the amount of the loss by an appraisal and .then proceeding to recover upon the award? The contract did not require the insured to perform this condition more than once; and therefore if she entered upon its performance and was carrying it out in good faith, she can not be held to a full and complete performance, if that consummation was prevented by the act of the adverse party.

“The law is settled that where a precedent condition was to have been performed by the plaintiff, but its performance has been prevented by the defendant, such prevention may be averred as an excuse for. the non-performance.” Ruble v. Massey, 2 Ind., 636, citing Hotham et al. v. The East India Company, 1 T. R., 638, and Heard, Assignee, v. Wadham, Exr., 1 East, 619. So also in the leading case of Fleming v. Gilbert, 3 Johns., 528, it was said: “The plaintiff’s conduct can be viewed in no other light than as a waiver of a compliance with the condition of the bond. It is a sound principle that he who prevents a thing being done shall not avail himself of the non-performance he has occasioned.” Citations might be easily multiplied upon this point; but we quote one more terse statement of the law: “No party can insist upon a condition precedent when its non-performance has been caused by himself. Such non-performance would not prevent the vesting of an estate, nor can it prevent the accruing of a right, or its enforcement by action. It, in effect, amounts to a waiver.” Mayor of New York v. Butler, 1 Barb., 337, 338.

It does not appear that the Insurance Company was at fault in the refusal of the appraiser, chosen by it, to proceed with the appraisal; and we may assume that it was not in any way responsible for his conduct. But his refusal to go on with the appraisement was not the thing which prevented the insured from carrying out her agreements in respect to appraisal of the loss. That was the result solely of the refusal of the insurer to proceed with the appraisement. The insurer not only refused to select another appraiser to act in the place of the refractory appraiser, but it refused to proceed at all, except- upon a new submission to wholly different appraisers and a new umpire. Unless the Company had the strict legal right to-do this, and unless this conduct on its part was not a waiver of strict compliance with the condition precedent, the counsel for the plaintiff in error are wholly wrong in their contention that the insurer was without-fault in thus refusing to further participate in the appraisal.

As we said in Insurance Co. v. Carnahan, 63 Ohio St., 258, 273, “good faith is required of both parties in the conduct of such an appraisement when once entered upon;” and this implies that neither party would have the right to abandon the appraisement, or to obstruct it in any way, without just cause, otherwise the party so doing might obtain an unfair advantage over the other. Morse on Arbitration and Award, 156. For this reason, one of the parties can not revoke, or annul the agreement of submission- and have a new appraisement when there has been no fraud or unfairness on the part of the other. I11 this case, neither the policy nor the agreement of submission, which is in conformity with the policy, requires-that both of the appraisers and the umpire must concur in the award. It is true that the umpire could act only in case of difference, but the provision of both policy and submission is that the-award “of any two” shall determine the amount of the loss. This can only mean that the two appraisers may make the award, or that when they do not agree, either of the appraisers and the umpire may do so. Hence where the Insurance Company’s appraiser withdrew, neither party appearing to have been in fault, his withdrawal did not ipso facto revoke the submission to appraisement; and when the insured insisted upon continuing the appraisement and requested the insurer to select another appraiser and go on with the appraisement, and the latter refused to do so, and demanded a new appraisement, it put itself irretrievably in the wrong, because the insurer thereby made it impossible for the insured to comply with the condition precedent as it was written in the contract of insurance. The policy requires the insured to do her duty under that condition only once. Without fault on her part, it was sought to compel her to twice perform her obligation to submit the controversy to arbitration, or it might be as many times as the insurer might be dissatisfied with the progress of the appraisement. But, conversely,. when one of the parties to the agreement to appraise, acts in bad faith, or, which is tantamount thereto, unreasonably refuses to carry out the agreement, the other party is absolved from compliance therewith; and so, as held in Uhrig v. Williamsburg City Fire Ins. Co., 101 N. Y., 362,, “When one arbitration fails from default of one of the parties, the other is not bound to enter into a new arbitration agreement.”. See also, 4 Joyce on Ins., sec. 3255, and American Central Ins. Co. et al. v. Landau, 62 N. J. Eq., 73; O’Rourke v. German Ins. Co., of Freeport, Ill., 104 N. W. Rep. (Minn.), 900.

For the reasons which we have stated, and upon the authorities which we have cited, we think it entirely clear that the defendant in error has shown a legal excuse for non-performance of the condition precedent, in conduct of the insurer which amounts to a waiver of the condition; and that the defendant in error was thereby entitled to sue for the loss, under the policy, and have the amount thereof ascertained and adjudged by the court, as was done.

Counsel for the plaintiff in error have cited, among others of the same import, a recent case in which it is held that a mere attempt to have the loss determined by arbitration, which failed without the fault or misconduct of either party, did not constitute a compliance with the condition, and did not entitle the assured, in the absence of a waiver thereof, to sue on the policy without compliance with a further demand for new arbitration. Grady v. Home Fire & Marine Ins. Co. (R. I.), 63 Atl., 173. If we have not made it apparent that in this instance the arbitration did not fail without the fault or misconduct of either of the parties, but on the contrary by the fault of the plaintiff in error, then the foregoing discussion has been in vain. The judgment of the Superior Court in General Term is

Affirmed.

Shauck, C. J., Price, Crew, .Summers and Spear, JJ., concur.  