
    Joseph Tyler, plaintiff and respondent, vs. The New Amsterdam Fire Insurance Company, defendants and appellants.
    1. Assuming that an insurance company can make a contract of insurance without a writing, and that the president or secretary are duly authorized to make one, any agreement, to be binding on the company, as such, must at least have all the elements of such a contract.
    2. There are at least five ingredients necessary, in a contract of insurance, viz. the subject matter; the risks insured against; the amount insured; the duration of the risk, and the premium- of insurance; and a contract deficient in any of these is incomplete. • ■
    8. A promise to insure, which wants those elements of a contract which consist of the risks insured against, and the duration of the insurance, is too vague and indefinite to be binding.
    Heard March 18, 1866;
    decided-, 1866.
    (Before Robertson, Oh. J., and McCunn and JoNes, JJ.)
    Appeal from a judgment entered on the verdict of a jury. The action was brought upon an alleged agreement, by parol, to insure a stock of goods in a woollen mill, at Franklin, New Jersey, for the sum of $2500, for one year from July 5, 1860. The fire occurred July 12, 1860, and the plaintiff’s loss exceeded the amount named in the policy.
    
      The facts in regard to the making of the agreement sued on, are stated in the opinions which follow.
    The jury found in favor of the plaintiff for the amount claimed, with interest.
    
      L. R. Marsh, for the appellant, defendant.
    I. The motion to dismiss the complaint at the close of the plaintiff’s proof should have been granted. 1. There was no proof of authority from the corporation to the president or secretary to make such a contract as was claimed; and it appeared affirmatively, by the plaintiff’s proof, that the secretary was the only party with whom Davis made the contract sued upon. 2. Such an authority could not be inferred. Neither the president nor secretary is, by any general law, the agent of an insurance company authorized to make and consummate contracts of insurance. The general rule is, that a corporate body can only act in the mode described by the law-creating it. (Dawes v. North River Ins. Co., 7 Cowen, 462.) 3. In the absence of any proof of delegating authority by the corporation upon any particular officer, it cannot he inferred that an insurance company has power to make contracts of insurance in any other way than by the action of its hoard of directors.
    II. The court below erred in denying a similar motion, after the charter of the defendants had been read.
    1. The defendants had no authority or power to make a verbal contract to insure like the one claimed here. The mode in which the defendants were authorized to insure is limited by law to a policy. See section 10, of the law of 1849, (Sess. L. 849, p. 441,) under which the defendants were chartered. 2. Article 15 of the charter declares : “ All policies of insurance issued by this company, shall be subscribed by the president, or in case of his absence or inability to act, by such other member of the board of directors as said hoard shall appoint for that purpose, and shall be countersigned by the secretary.” No other “ mode or manner of exercising” the power of making insurance is declared b.y the charter. See opinion of Gardner, J. in the Trustees of the First Baptist Church v. The Brooklyn Fire Ins. Co. (19 N. Y. Rep. 305.) An appeal is cited in Spitzer v. St. Mark’s Ins. Co., (6 Duer, 6; opinions of Hoffman and Slosson, JJ.) ' 3. The case now at bar differs, essentially, from the charter of the Brooklyn Eire Insurance Company, passed upon in Trustees of First Baptist Church v. Brooklyn Fire Ins. Co., (ubi supra.) Here there is no general power to make contracts of insurance conferred by the charter; it prescribes the only mode and manner of exercising the power of making insurance; to wit, by policy subscribed and countersigned:
    2. The 14th article of the chapter having required subscription and countersigning, neither the president nor the secretary had the power to dispense with these requisites. (Dawes v. North River Ins. Co., 7 Cowen, 462: McEvers v. Lawrence, Hoffman, Ch. 172.)
    III. It was error to deny the motion to dismiss the complaint renewed on the same, and on additional grounds, at the close of the defendants’ proof.
    1. There was no such agreement proved as would effectuate a verbal insurance of the premises, even if by the charter a verbal insurance were authorized. (Baptist Church v. Brooklyn Fire Ins. Co., 28 N. Y. Rep. 153, 161, op. Judge Denio; p. 164, op. Judge Emott.) Thére was not, in this case, even before the evidence of the defendants was introduced, any such meeting of the minds of Davis and the defendants’ secretary. At the time' the bargain is said to have been made, Davis says the only subject discussed was the rate. There was nothing said as to the premises, or the risk, or the amount insured, or the time the risk should continue, or the premium.
    3. If there was any agreement, it was a conditional one, and never took effect. There was to be no agreement, unless on looking at the diagram the secretary should be satisfied. He never did go to look at it.
    IV. The verdict was grossly against the weight of evidence. The only witness to prove the alleged agreement (Davis) could not remember what was said at the only interview at which it is claimed the bargain was made. On the other hand, the secretary states what was said, and that he declined to take the risk, and this is not denied by Davis.
    
      Geo. 8. Stitt, for the plaintiff, respondent.
    I. The verdict of the jury is supported by the evidence as to the making of the contract.
    II. A verbal contract is valid. 1. The article 14, of the articles of incorporation is merely directory, and cannot be held to apply to a contract of this kind. (5 Wheat. 326. Baptist Church v. Brooklyn Fire Ins. Co., 19 N. Y. Rep. 310. Angell & Ames on Corp. § 254.) 2. Yerbal contracts by incorporations are necessary in insurance business, to stand until the formal policy can be prepared and executed. (See powers of Insurance Companies, in 3 N. Y. 8tat. 202.) 3. Besides this, article 14 does not declare that all other forms of contracting shall be null. It is a provision to signify that the corporation will be bound by the signatures of the president and secretary, without the common • seal. Power to the president and secretary to issue policies is a good ground, and implies a power to make a contract by a policy.
    III. The contract made by the president and secretary is binding on the defendants. 1. The only mode in which a corporation aggregate can act or contract is through the intervention of its agents. (Angell & Ames on Corp. §§ 276, 112, 221.) A contract may be implied from the recognition of the acts of its agents, as if it had been an individual. (Id. § 237. 14 John. 118. 9 Paige, 496. 12 Barb. 496. 15 id. 323.) • 2. The president is an officer elected or appointed to preside ' over a corporation, &c. and to manage their concerns. ( Webster’s Dict. in verb. Angell & Ames on Corp. § 297. 3 Sandf. 176. 179. 14 Barb. 358.) 3. If the act of a corporation be done by one as its agent or attorney, no other proof of authority will be required. (Angell & Ames on Corp. § 282, and cases there cited.) 4. The defendants are estopped by the acts of their agent in this case from denying the contract. (Angell & Ames on Corp. § 238.)
   Robebtson, Oh. J.

Assuming that the defendants could make a contract of insurance without a writing, and that the president or secretary were duly authorized to make one, any agreement, to be binding on them as such, must at least have all the'elements of such a contract. In the case of The First Baptist Church v. The Brooklyn Fire Insurance Co. (28 N. Y. Rep. 161,) the definition given in the court below of what was essential to constitute a valid contract of insurance was approved of by two of the justices of that court (pp, 161, 164,) namely “ That the minds of the parties should meet as to the premises insured and the risk, as to the amount insured, as to the time the risk should continue, and as to the premium.” There are, therefore, at least five ingredients necessary in a contract of insurance, (1.) the subject matter, (2.) the risks insured against,(3.) the amount, (4.) duration of the risk, and (5.) the premium of insurance; a contract of insurance is incomplete which wants any of these.

The only witness whose testimony tended to prove any kind of an agreement, in this case, was the insurance broker (Davis.) He testified that in pursuance of an employment by Mr. Tyler he applied to the defendants “ for a policy of $2500 on stock in the Franklin Mills, at a premium of two per cent, in the name of John Tyler, * * in a few days he called again * * and the risk was accepted at two per cent.” He however explained what he meant by such acceptance by stating that the rate of insurance “was the only matter of discussion between the secretary and” himself “and he consented to take the risk,” The witness then “handed in a policy to be copied * * they were to make a like policy in order that the various policies might correspond.” That policy was not produced in evidence, nor was any evidence given as to its contents, except as to the description of the subject of insurance, on which alone being read to the witness he stated “ that a policy like that, in those particulars, he (the secretary) agreed to give.” On his cross-examination the witness stated that he could not say any thing more” (of what was said) “ than that the risk was taken for $2500, at two per cent,” and that he had stated all that had occurred at the second interview. This was all the evidence of any contract between the parties ; the testimony of the only- other witnesses, as to any negotiation, is adverse to the making of any agreement.

At the close of the evidence the defendants’ counsel asked to have the complaint dismissed, on the grounds that no cause of action in favor of the plaintiff had been proved, and that there was no evidence to warrant a verdict in favor of the plaintiff, which was denied, and exceptions were taken to such denial. The court “ charged the jury that if they should find, upon the evidence that this contract of insurance, as testified to by Mr. Davis, was made with ‘the defendants’ the plaintiff was entitled to a verdictto which charge the defendants’ counsel excepted. This fairly brings up the question whether such an agreement or transaction, as testified to by the broker, formed a valid contract of insurance.

Admitting that the subject, amount and premium of insurance were agreed upon, there is no evidence of what either the risks insured against, or the duration of insurance were to be. Eothing appears to have been said of either fire or other elements, and certainly nothing of the exceptions, conditions and provisions usually contained in all policies of insurance. Eor was any time specified. The previous contract had been for one or two days only. It does not appear by the testimony given by Davis of the conversation, that both parties meant to have a permanent contract of insurance for a definite time, entered into without any written policy. On the contrary it was, if made at all, apparently made temporarily, like the preceding engagement, until a policy could be made out. Mr. Davis states “ they (the defendants or their officers) were to make out a like policy” with one he handed them, yet with the contents of that one we are wholly unacquainted, as they were not proved, except as to the subject matter. The president of the defendants (Manners) testified that “ Mr. Davis threw a policy down on the secretary's desk and said ‘ There is a policy, if you take it.’ ” It would not necessarily follow that a temporary contract, orally made, to last until a policy could be made out, would extend to the time when the, fire actually occurred. Davis said he first applied early in July, and three or four days after the first interview, had the second. He never applied for a policy, although the fire did not take place until the 12th of July, after which the premium was for the first time offered. It would he extraordinary if parties could, after procuring an oral contract of insurance to last until a policy could he made out, lie by and wait until a fire, before paying the premium and claiming the benefit of it. - At all events, the promise, if made, was deficient in the elements of a contract in respect to the risks insured against, and its duration, and such appears by the sole testimony on which the case was submitted to the jury. It was therefore too vague and indefinite to he binding.

The judgment should be reversed with costs to the defendants on the appeal, to abide the event of the suit.

Jones, J. concurred.

McCunn, J.

(dissenting.) I cannot agree in this case in opinion with the majority of the court.

There were but two questions in this case ; first, is a verbal agreement, to insure for one year, valid' in law ? and, secondly, does the charter of the defendants forbid such verbal contracts of insurance?

The action is brought to recover $2500, on a parol agreement to insure the property of a Mr. Tyler. The facts are as follows : A Mr. Davis, an insurance broker, and agent for Mr. Tyler, called at the office of the defendants, and saw the president- of the company. He stated to the president that he wanted a policy on the Franklin mills. The president looked at the property, and said, in the absence of the secretary, he would make the risk binding until the secretary’s return; and he slipped a memorandum to that effect in the secretary’s desk. In a few days Mr. Davis called again; saw the secretary and president, and, after some conversation, the risk was accepted at two per cent. Mr. Davis handed a policy to the secretary, asking that a, like one be given. It gave a description of the property, showing that other companies had risks on the property, and Mr. Davis called their attention to the fact that the company had this same risk the year previous. A day or two after the premises were destroyed by fire Davis called and tendered the premium, $50, to the company. The secretary refused to receive the same.

The above facts were testified to by Mr. Davis, and corroborated, in a measure, by the president of the company. The secretary of the company, (Dusenbury,) denied the statement of Davis, and testified that he did not accept the risk. The learned justice, who tried the case, left the question to the jury as to whether there was a verbal contract of insurance, such as was testified to by Davis. If so, then, and in that case, the plaintiff was entitled to recover. Under this charge, the jury rendered a verdict for the full amount. I hold that such charge was quite correct in law, and the verdict rendered by the jury, accordingly, was a just and correct verdict.

It is now settled, beyond a doubt, that a verbal agreement for insurance is valid and obligatory on both the parties to the contract. In support of this proposition, cases in nearly all the states, and in England, are to be found. (2 Pars, on Cont. 5th ed. p. 350, and eases cited in the notes a, 5, c and d.)

A few prominent authorities only have to be examined, in order to convince us of this doctrine. Take, for instance, the latest case, The Baptist Church v. The Brooklyn Pire Insurance Company, (28 N. Y. Rep. 153.) That eminent jurist, Mr. Justice Denio, thus holds: That to constitute a valid contract of insurance, the minds of the parties should meet as to the premises insured, the risk, the amount insured, the time the risk should continue, and the amount of the premium, and that the contract might be verbal. Now, in this case, Davis testifies that the risk was shown the president and the secretary; the amount of insurance asked and agreed upon was $2500 ; the rate of premium fixed at two per cent; and a policy handed to the secretary, he agreeing to that form of policy. Moreover, the officers knew that this company had taken a risk, for one year, on the same premises and property, the year previous. Surely, under such circumstances, the minds of the parties must have met and agreed upon all these points. If they did, then I have no hesitation in saying that the contract was complete. If any thing more was required to constitute a valid verbal agreement of insurance, I am at a loss to conceive what it could be.

But, to make the case more clear, it is conceded by all, by the counsel on both sides, and by the witnesses, and even the court is unanimous on the point, that the agreement made by Davis with the president, to the effect that he, the president, would make the risk binding until the secretary should return, was a good and valid agreement to insure. The terms of that contract were not, it is true, by any means as clear and definite as the one made by the secretary a few days after. The president testifies that he told Davis the books were locked up, and he could not take the risk that day. Davis then showed him a respectable list of other companies he had with him, which companies covered the property with insurance, and he, the president, said, when he saw the list of risks, he would, and he did, make it binding until the secretary's return. ■ Compare this testimony on the first agreement with the testimony on the second, and it will be seen, at once, that the latter is much the stronger. Therefore the second agreement was, at least, as binding as the first. Moreover, it is a well established custom with insurance companies, that, if other respectable companies have insured the risk, a second company, insuring the same property, never look at the risk. All they ask, or seek, is the amount of their premium, and then they consult the other companies.

But, as I have stated, this company had this risk before, and knew well all about it.

The Supreme Court of the United States held, unanimously, in the case of The Mutual Marine Insurance Co. v. The Union Mutual Insurance Co. (19 How. 318,) “ that a parol agreement, to make and deliver a policy of insurance, need not be in writing,” and I do not hesitate to adopt that conclusion. The same clear rule was laid down by Mr. Justice Comstock, of the Court of Appeals, in the case of The Brooklyn Fire Insurance Company v. The First Baptist Church in Brooklyn, (19 N. T. Rep. 308.)

We have no law in this state requiring the contract of insurance to be in writing. .The agreement of insurance had its origin in mercantile law and usage, and has become so thoroughly incorporated with our municipal system, that a construction which denies the power and capacity of entering into such agreements in the nature of insurance, except in writing, rests upon no foundation.

The common law concedes to every person the general capacity of entering into contracts ; and this capacity relates alike to all subjects concerning which contracts may be made. It exists under no restraints in the mode of contracting, except those imposed by legislative authority. There is nothing in the nature of insurance which requires written evidence of the contract. I have merely commented on a few of the leading cases, and am unable to find any case holding a contrary doctrine. Indeed, these verbal agreements to insure, or to renew insurances, which is the same thing, are made, to a very great extent, every day, in this commercial community, and to hold them invalid would completely upset our present system of insurance, and would place at hazard an immense amount of property.

The remaining question to be disposed of is, whether the charter of this company forbids such verbal agreements.

As I read the charter of the defendants, it clearly does not forbid verbal contracts to insure. The second article declares, “ That the business of the company shall be to make insurance on dwelling houses, stores, and all kinds of buildings, * * * * and other property against loss or damage by fire, and the risk of inland navigation and - transportation.” How, this is the only section or article contained in their charter touching this question, and certainly there is nothing in that article precluding the company from entering into such parol agreements for insurance. The 14th article says : “ That all policies of insurance shall he subscribed by the president, or, in case of his absence or inability, by such of the board of directors, &c.” But this section does not say there shall be no verbal agreements for insurance. It only declares that policies made out under these verbal contracts shall be signed by the president, &c. How, we all know the agreement to insure is made days, and sometimes weeks, before the policy is made out.

This was held to be the rule in the case in 19 N. Y. Rep. cited above. .In that'case, the policy sued on contained two articles precisely similar to the ones cited as contained in the policies issued by the defendants ; and Mr. Justice Comstock puts the question entirely at rest. To the able and learned opinion in that case, I most respectfully defer.

The judgment below should be affirmed, with costs.

Judgment reversed.  