
    Emory M. Van Tassel, Respondent, v. The Greenwich Insurance Company, Appellant.
    
      Hire insurance—'validity of a "binding slip," either as a renewal of a former policy or as an independent complete contract —proof of a custom substituting a different liability for that expressed by the slip, is inadmissible — a denial by the insurer of all liability excuses the insured from making tender of the premium ■— effect of knowledge by the insurer that a building stands on leased ground — construction of a statement that the insured, a tenant of the land, is the sole owner of the building insured.
    
    An insurance company which had issued to a person who had erected a building upon leased land, and paid for it, a policy insuring the building against loss by fire for one year from January, 1889, which policy was renewed for the year 1890, about the 1st of January, 1891, delivered to the agents of the insured a binding slip upon the building in question in the following form:
    “ Beecher & Benedict.
    “New York, 89 .
    “Insure E. M. Van Tassel.
    “ §10,000 for 12 months, at
    “ On Building N. E. corner 13th Av. and W. 11 St.
    “ N. Y. City.
    “ In Store.
    “Binding this 1 day of Jany., at noon.
    “ (this memo, to be void on delivery of the policy
    “ at the
    “ Office of Beecher and Benedict).
    “ Company: Amount. Accepted..
    “ Greenwich. 10000. 'A.
    “ Renewal.
    “ 559298 not in force.
    “WM. ADAMS.”
    In an action brought to recover for a loss which had occurred January 13-14, ' 1891, it was
    
      Held, that the binding slip constituted a valid contract of insurance, either as an independent contract of insurance, in which view it was subject to the terms and conditions of the usual policy issued by the company, or as a renewal of the former policy, in which event it was subject to the terms and conditions of such former policy;
    That the instrument was unambiguous, containing all the elements of a valid and enforcible contract of insurance; and hence that proof that the binding slip was issued in accordance with a custom prevailing in the insurance business to issue such instruments merely as temporary gratuitous insurance, to be operative only until the underwriter could determine whether he would accept ór reject the proffered risk, was properly excluded, as the effect of such evidence would he to vary its terms and to substitute another and different liability in the place of that which appeared plainly upon its face;
    That as the insurer had absolutely repudiated all liability for the loss, a tender by the insured of the premium was unnecessary, as the law does not require the performance of, an idle ceremony;
    That as the insurer knew, from a statement made in the application for the former policy, that the insured building stood upon leased ground, it could not successfully resist payment of the loss upon the ground that there had been a violation of a condition of the New York standard policy (upon the conditions ■ of which policy the plaintiff’s rights depended), providing that, if the interest of the insured be other than unconditional and sole ownership, the policy shall be void;
    That, assuming that the plaintiff had made a declaration that he was the sole owner of the building, such declaration only related to a description of the plaintiff’s insurable interest in the building, arising from the fact that he had . erected and paid for it.
    Appeal by the defendant, The Greenwich' Insurance Company, from a judgment of the Supreme Court in favor of. the plaintiff, entered in the office of the clerk of the county of New York on the 8th day of November, 1897, upon the verdict of a jury rendered by direction of the court, and also from an order entered in said clerk’s office on the 11th day of November, 1897, denying the defendant’s motion for a new trial made upon the minutes.
    
      Henry G. Ward, for the appellant.
    
      George Richards, for the respondent.
   Patterson, J.

This cause has been tried three times. On the last trial it was presented on amended pleadings. ■ The trial judge directed a verdict for the plaintiff, and from the judgment entered thereon this appeal is taken.

The action was brought upon a contract purporting to be one of insurance, and by which, the plaintiff claimed, the full relation of assured and insurer vyas established between him and the defendant. That contract consisted of an instrument called a binding slip, which, was delivered by the defendant to insurance brokers employed by the plaintiff, and is in these words:

“Beecher & Benedict
“New York, 189
“Insure E. M. Van Tassel
“ $10,000 for 12 months, at “ On Building N. E. corner 13th Av. and W 11 St.,
“N. Y. City “ In Store.
“Binding this 1 day of Jany., at noon “ (this memo, to be void on delivery of the policy “ at the
“ office of Beecher & Benedict).
“Company Amount. Accepted.
“ Greenwich 10000 A.
“ Renewal
“ 559298 not in force
“WM. ADAMS.”

It appeared in evidence that the plaintiff, in the year 1889, held a policy of insurance issued by the defendant, which covered the premises mentioned in the binding slip and rah for one year from the 1st of January, 1889, and that that policy was renewed for the year 1890. Thereafter, and about the 1st of January, 1891, the binding slip was delivered by the defendant to the plaintiff’s brokers. No policy in form was issued subsequent to January 1, 1891, upon the risk mentioned in the binding slip. On the 13th or 14tli day of January, 1891, there was a total destruction by fire of the building mentioned in the contract.. It was held by the-General Term of the Supreme Court on a former appeal in this action (72 Hun, 145) that the binding slip was the equivalent of a renewal of the prior policy; that by that instrument the defendant contracted to continue its policy in force for $10,000 during, the year 1891; that the -slip bound the company as effectually as the usual renewal receipt issued by insurers, and that there was no way by which the -defendant could, without the plaintiff’s consent, terminate its contract, except in the mode provided in the policy. Upon an appeal to the Court of Appeals from the decision of the General Term, above mentioned, definition was not distinctly given to the full contract relations existing between the parties and arising upon this

binding slip; that is to say, it was not expressly determined whether the binding slip was a renewal of the policy or an independent contract of insurance. It is very evident, however, that it was either one or the other. If it were a renewal, as held by the General Term, then the insurance effected by it became subject to all the conditions of the policy. If it were an independent arrangement, then it amounted to a contract of insurance, subject to the terms and conditions of the usual policy issued by the Greenwich Insurance Company. (Lipman, v. Niagara Fire Ins. Co., 121 N. Y. 454; Karelsen v. Sun Fire Office, 122 id. 545.) It was conceded on the argument that the usual policy of that company was the standard form of New York policy, which was also the form of- the policy either continued or superseded by the insurance effected by the binding slip, so in either respect the full contract between the parties was the same. It is- not to be doubted that such a binding slip constitutes valid insurance. It was so held in this case, and in the two cases last cited. But it was made an affirmative defense in the answer herein that the binding slip was, as matter of factj not a completed contract of insurance; that it was issued in accordance with a custom prevailing in the insurance business, to the effect that such instruments are merely temporary gratuitous insurance, to be operative only until the underwriter can determine whether he will accept or reject a proffered risk; and it was claimed that in this case notification was given by the defendant to the plaintiff’s brokers, on the 7th of January, 1891, that it would not accept the risk for a larger sum than $5,000. The legal effect of that notice, either as a. cancellation of the insurance or as a limitation of the amount of insurance, was determined by the Court of Appeals (151 N. Y. 133), and it was héld that it was only a proposition of the defendant -for reduced insurance, which was unaccepted by the plaintiff, and, therefore, was inoperative for any purpose in the case. But under the affirmative defense respecting the nature of the binding slip, the defendant offered evidence at the trial to prove its contention in that-regard. That evidence was rejected, and, as we think, properly so. There was no concealment of its purpose. It was not to explain ambiguities, but was clearly to deprive the instrument of the effect of its express terms, and so to vary it and .to substitute. ■another and different obligation in the place of that which appeared plainly upon its face. It is true there are certain abbreviations which might be amplified appearing in this instrument, but there is nothing further requiring explanation. It states the name of the insured; it specifies the amount of insurance; it names the time for which the insurance is granted; it designates the property which is to be covered, and declares the time at'which the insurance shall begin; it was accepted by the person admitted to have authority to bind the defendant and it names the insurance company. These are the elements that constitute a valid and enforcible contract of insurance, and when it is read in connection with the rule of law that such an instrument is operative in connection with the terms of the usual policy of the underwriter issuing it, there is nothing obscure; there is nothing requiring explanation, but everything is before the court to enable it to determine what legal, relations were constituted between the underwriter, and the assured.' There was no error, therefore, in the refusal of the trial, judge to allow evidence of a custom that would vary the relations and substitute new terms of an agreement between the parties to the contract evidenced by this binding slip. It would simply have permitted the' defendant to contradict its own contract and to substitute a new one.

It is contended, however, on the part of the appellant that the plaintiff was not entitled to recover because he failed to allege or prove that before suit brought he had either paid or tendered to the defendant a premium of insurance for $10,000. This point is urged, not as affecting the validity of the contract, but as' going to the right of the plaintiff to maintain an action upon the contract without actual payment or tender of- payment of the premium, as a condition precedent to his right to sue. In the complaint credit is given for the amount of premium on $10,000 (which was $75), and the recovery is for the amount of the insurance less that -premium. The defendant is not in a position to urge that objection, even if it were one that can be taken in any event. It is quite clear from the evidence that if any premium had been tendered, it would have been rejected by the-defendant. It does appear that immediately after the loss occurred, the plaintiff tendered a premium upon a risk assumed to be to the extent of $5,000 only, and that that was rejected, not on the ground of its insufficiency in amount, but on the specific ground that the defendant did not insure the building referred to in the communication in which the check for the amount tendered was contained. On the 17th. of January, 1891,; the defendant expressly repudiated any liability, saying it had no insurance on the building referred to. Again, on the 21st of February, 1891, it declined to accept any papers purporting to be proofs of loss, on the express ground that it had no insurance on the property referred to. There were, therefore, three distinct disclaimers of any connection of the defendant with the plaintiff’s loss. It is well settled that where- a liability is repudiated altogether and the defendant takes the position that no contract relations exist or will be ■ recognized, the plaintiff seeking to enforce an obligation is relieved from the mere performance of an idle ceremony which would result in nothing. (Stokes v. Mackcay, 147 N. Y. 235, and cases cited.)

It' is further urged that there can be no recovery by the plaintiff because he did not show that he owned the building mentioned in the contract of insurance, and the rule is invoked that a breach of warranty of ownership or a false representation as to the ownership avoids the policy. It is alleged in the complaint that at the time the loss occurred the plaintiff was the absolute owner in fee of the property and the building erected on the premises. That allegation of the complaint is denied.. There is no proof that the plaintiff owned the land Upon which the building was erected, but it does appear that that building stood upon leasehold ground/ In the absence of any proof of misrepresentation or concealment it was not necessary for the plaintiff to prove that he was the absolute owner in fee of the land; it was only necessary for him to show an insurable interest in the building. There was nothing in the binding slip, nor 'anything, so far as appears, stated at the time that slip was issued, concerning the plaintiff’s ownership of the property; but it does distinctly appear that the defendant knew that the plaintiff was not the owner in fee of the land and that the policies previously issued by it to the plaintiff were so issued with that knowledge. In other words, the defendant knew the building was on leased ground, and assuming that in some former application (which, however, does not appear) the statement was made that the plaintiff was the owner in tee of the property, all that- was-waived by the defendant. ( Van Schoick v. Niagara F. Ins. Co., 68 N. Y. 438.) It appears from - the policy issued for the year-1889 that the building insured stood upon leased ground, and that the policy was issued with reference to that situation of the building. It contains this memorandum: “April 14th, 1890. It is understood that said building stands on leased grounds.” It was, therefore, known to the defendant that the plaintiff was not the owner in fee of the property. But the defendant contends that it still remains that the plaintiff asserted he was the owner of the building, and that there is nothing in the lease in evidence, and under which the plaintiff was in possession of the property, that showed that as between the landlord and the plaintiff the latter owned the building. It appears that the buildings destroyed were large and valuable, vrere erected by the plaintiff and paid for by him. We do not find anything in the evidence of any representation that would avoid this insurance on the ground of misrepresentation or concealment as to the ownership of the building. The argument is made that all of the plaintiff’s rights depend upon the conditions of the New York standard policy, and we are not disposed to differ with that view. One of the conditions of such a policy is that if the interest of the insured be other than unconditional and sole ownership, the policy shall be void. But as before stated, this defendant knew when it made the contract sued upon that there was no unconditional and sole ownership of the premises. The relation of the plaintiff to the property was distinctly stated when the memorandum was made in the policy of 1889 that the property stood upon leased ground. The legal relation of tenant and landlord was as well known to the underwriter by that phrase as it was to the plaintiff, and when the declaration was made (if it were made) that he was the sole owner of the building, it is something which related to a description of the plaintiff’s insurable interest in the building arising from the fact that he had erected and paid for that building.

It is further contended that the trial judge erred in refusing to allow the case to go to the jury upon the question whether or not the plaintiff consented to a cancellation of the insurance by acquiescence in the letter of June seventh of the defendant to the brokers. That matter was disposed- of by the Court of Appeals. The same circumstances and situation -with reference to the sending and receipt of that letter appeared on the former trial as are now before us. No new feature is introduced concerning- it, and no further consideration of .that subject is’ required. No other matter suggested by the appellant as a ground for reversing this judgment requires consideration.'

The judgment must be affirmed, with costs.

Van Brunt, P. J., Barrett, Rúmsey and McLaughlin, JJ., concurred.

Judgment affirmed, with costs.  