
    Edward L. Lewis, Appellant, v. Guardian Fire and Life Assurance Company (Limited) of London, England, Respondent, and Charles A. K. MacPherson, Appellant.
    
      Fire insurance policy containing a mortgagee clause — the mortgagees right to recover is dependent upon that of the insured — the mortgagee is a necessary party to an action brought by the insured upon the policy —jurisdiction, where the mortgagee is a non-resident — an agent of the insurance company may waive a prohibition as to other insurance — the continuation of existing insurance does not constitute ‘ ‘ other insurance ” — when the question of agency is one of fact."
    Where a policy of fire insurance is made payable to a mortgagee of the insured property, as his interest may appear, if the policy is void as to the insured, it cannot be enforced by the mortgagee.
    The mortgagee is a necessary party to an action brought by the insured to recover upon the policy. He may join with the insured in bringing the action, and, if he refuses to do so, the insured may make him a party defendant.
    Where a foreign insurance corporation authorized to do business in the State of Hew York issues, at its office in Montreal, Canada, a policy of fire insurance to a Hew York corporation upon property located in Canada, containing a provision that the loss, if any, shall be payable to “John Gr. Foster, Esq., agent for mortgagee, as his interest may appear,” and, subsequent to the destruction of the property by fire, the insured corporation assigns its claim to a resident of the State of Hew York, and the latter brings an action in the Supreme Court of the State of Hew York to recover upon the policy, making a resident of Canada,who had acquired the interest of the mortgagee referred to in the policy, a party defendant, he having refused to become a party plaintiff, the court has jurisdiction to entertain the cause of action as to such nonresident defendant.
    Knowledge on' the part of an agent of a fire insurance company, at the time he issues a policy of fire insurance, that there is other insurance on the property, is attributable to his principal, and constitutes a waiver of a provision in the policy that it should be void if, at the time it was issued, the insured had, or thereafter procured, other insurance upon the property.
    
      In such a case the fact that, previous to the happening of a loss under the policy, the insurance existing upon the property at the- time of the issuance of the ■ policy has been continued by means of renewals of the existing policies, or by substituting others therefor, does not constitute a breach of the condition as to i “ other insurance.”
    In an action upon a policy of fire insurance, in which the issue litigated was whether the firm of Paterson & Son, who delivered the policy to the insured, were the agents of the defendant insurance company, it appeared that the policy sued upon contained the words, “Agency Montreal, Paterson & Son,” and that indorsed upon it were the words, “Paterson & Son, agent, Montreal Agency,” and that these were written in and upon the policy by the defendant insurance company; that when the application for the policy was made an interim receipt was issued containing the words, “ Paterson and Son, Agency.”
    A witness for the plaintiff testified that he had known Paterson & Son twelve or thirteen years, during which time ¿hey had been managers of the defendant insurance company. A member of the firm of Paterson & Son testified, on . behalf of the defendant insurance company, that nt the time the policy was issued he was not the agent of the defendant insurance company and had never issued any policies for it. The manager of the defendant insurance company also testified that neither the firm of Paterson & Son nor any member of it was the agent'of the defendant insurance company.
    
      Held, that it was error for the court to determine, as a matter of law, that the firm of Paterson & Son were not the agents of the defendant; that the question was one of fact for the jury to determine.
    Appeal, by the plaintiff, Edward L. Lewis and by the defendant Charles A. K. MacPherson, from a judgment of the Supreme Court in favor of the defendant Guardian Fire and Life Assurance Company (Limited) of London, England, entered in the office of the clerk of the county of New York on the 14th day of January, 1904,, upon the verdict of a jury rendered by direction of the court after a trial at the New York Trial Term.
    
      William B. Ellison, for the appellant Lewis.
    
      Rufus L. Weaver, for the appellant MacPherson.
    
      George A. Strong, for the respondent.
   McLaughlin, J.:

On the 20th of July, 1899, the Owl’s Head Hotel Company, a New York corporation, procured from the defendant the Guardian Fire and Life Assurance Company (Limited), a foreign corporation, a policy of fire insurance in and by which it insured certain property located in Canada against loss or damage by fire, to the extent of $4,000, with the “loss, if any, payable to John G. Foster, Esq., agent for mortgagee, as his interest may appear.” During the term of the policy the property was destroyed by fire and a loss sustained in excess of that covered by the insurance. The' insurance company refused to pay the loss covered by its policy, and thereupon the plaintiff, a resident of the State of New York, as the assignee of the insured, brought this action to recover thereon, making MacPherson, a resident of Canada, who had acquired the interest of the mortgagee referred to' in the policy, a party defendant, he having refused to join with the plaintiff in bringing the action!

At the trial, after the plaintiff and MacPherson had rested, the complaint, in so far as it related to the latter, was dismissed, upon the ground, as appears from the opinion of the trial justice, that the court has no jurisdiction over his cause of action, however asserted, nor can it acquire jurisdiction by indirection, or by any device of pleading, practice or procedure.” Exception was duly taken to this ruling by both MacPherson and the plaintiff. The trial court, however, refused to dismiss the complaint against the insurance company, holding as the case then stood, a question of fact was presented for the jury and that the action could be continued by the plaintiff to recover the difference between- the amount which had been proved to be due MacPherson and the amount of the policy. The action was then continued and at the close of the whole case a verdict was directed for the insurance company, upon the ground that the evidence established a violation by the plaintiff of the terms of the policy which rendered it void, to which an exception was taken by the plainfiff. Judgment was thereafter entered, from which the plaintiff and MacPherson have appealed.

The judgment appealed from, unless erroneous as to the plaintiff, is not as to the appellant MacPherson; in other words, unless the plaintiff had a policy of insurance which he could enforce against the insurance company, then a mortgagee of his assignor could not enforce a provision inserted therein for his benefit, and if a verdict were properly directed as to the plaintiff, then it necessarily follows the judgment could not have injured MacPherson.

The appeal of the plaintiff, therefore, will be first considered. The policy contained a provision that it would be void if at the time it was issued the insured had, or thereafter procured, other insurance upon the property covered by. the defendant company’s policy, unless otherwise provided by agreement indorsed thereon or added thereto, and it was upon' this ground that the verdict was directed. The evidence on the part of the plaintiff bearing upon the other insurance was to the effect that the respondent’s policy of insurance was procured through- Paterson & Son, of Montreal, Canada, by Mr. Watkins, general manager of the Owl’s Head Hotel' Company; that at the time he applied for it he informed a member of the firm of Paterson & Son what insurance was then upon the property and that he desired additional insurance to the amount of $10,000, which it procured-—$6,000 in the Phoenix Insurance Company of London, and $4,000 in the defendant insurance company. In the policy issued by the respondent reference was made to the $6,000 insurance in the Phoenix, but not to the other insurance, amounting to $4,500, which was upon the property at the time the application was made and the policy written.. The fact that Paterson & Son knew there Was $4,500 insurance upon the property at the time Watkins applied for the $10,000 additional insurance was not denied, at least no evidence-was offered to contradict plaintiff’s evidence on that subject, but it was insisted that such information in no way affected the respondent’s liability, inasmuch as Patérson & Son was not its agent and had no power to waive any of the provisions of the policy. Of course, if Paterson ■& Son were the agents of the insurance company, I take it no one would seriously question but what they could — having full knowledge of other insurance — waive the provisions of the policy with reference thereto. The company could do it, and what it could do itself it could do through an agent. This rule seems to be- well settled. (Gray v. Germania Fire Ins. Co., 155 N. Y. 180, Robins v. Springfield Fire Ins. Co., 149 id. 477; Wood v. American Fire Ins. Co., Id. 382; Forward v. Continental Ins. Co., 142 id. 382; McNally v. Phoenix Ins. Co., 137 id. 389 ; Short v. Home Ins. Co., 90 id. 16; Woodruff v. Imperial Fire Ins. Co., London, Eng., 83 id. 133; Richmond v. Niagara Fire Ins. Co., 79 id. 230.) Thus, in the first case cited the court said: It is well settled in this State that where an insurance company issues a policy with full knowledge of facts which would render it void in its inception, if its provisions were insisted upon, it will be presumed that it by mistake omitted to express the fact in the policy, waived the provision, or held itself estopped from setting it up, as a contrary inference would impute, to it a fraudulent intent to deliver and receive pay for an invalid instrument.” The fact being uncontradicted that Paterson & Son were informed as to the insurance upon the property at the time application was made for the additional $10,000, the crucial question is whether Paterson & Son were the agents of the defendant insurance company. If they were, then the information which they had was the information of the respondent. (Robbins v. Springfield Fire Ins. Co., supra; Wood v. American Fire Ins. Co., supra.) Bearing upon this question, it appeared from the plaintiff’s proof that the policy issued by the respondent contained the words, “Agency Montreal, Paterson & Son,” and indorsed upon it were the words, ■“Paterson & Son, agent, Montreal Agency,” all of which was written in and upon the policy when it was issued by the respondent itself before it was sent to Paterson & Son to be delivered to the insured. In addition to this, it appeared that when application was made for the insurance, what is termed an interim receipt was issued, which contained the words, “ Paterson and Son, Agency,” and the manager of the respondent testified that the agent of the company “ issues an interim contract or risk,” but “ no agent with us issues a policy. All of our policies are issued upon application.” Plaintiff’s witness Watkins testified that he had known Paterson & Son twelve or thirteen years, during which time they had been managers of the respondent. On its part the defendant company called as a witness a member of the firm of Paterson & Son, who testified that at the time the policy was issued he had no relation with the company, was not its agent, and had never issued any policies for it. It is to be noticed, however, that this witness nowhere stated that the firm of Paterson & Son was not the agent or representative of the respondent when the policy was issued. The respondent’s manager, Heaton, however, who was subsequently called, did testify that neither the firm of Paterson & Son, nor any member of it, was the agent of the defendant company and that neither had anything to do with it.

The foregoing is a summary of all the evidence bearing upon the question of agency, and upon this the trial court held, as a matter of law, that Paterson & Son was not the agent of the respondent, and, therefore, had no power' to waive any of the provisions of the policy, and he accordingly directed a verdict in favor of the respondent, as hereinbefore stated. In this, I think, he erred. I am of the opinion that upon this evidence it was a question of fact for the jury to determine whether or not, as between the plaintiff’s assignor and the defendant insurance company, the firm of ' Paterson & Son was its agent in relation to this policy. (Sundheimer v. City of Néw York, 176 N. Y. 495; McDonald v. Metropolitan St. Ry. Co., 167 id. 66.) The fact is undisputed that the respondent inserted in and indorsed upon the policy a statement which would at least lead a person of ordinary understanding to believe the firm was its agent. This, taken in connection with the statement to the same effect contained in the interim receipt and the testimony of the witness Watkins, was certainly some evidence to go to the jury, and this was the view entertained,by the learned trial justice at the close of plaintiff’s case. He then said, in denying respondent’s motion to dismiss the complaint: Whether Paterson & Son were or were not the agents of the defendant corporation is a question of fact ujion the case as it now stands.” This evidence certainly was not so far overcome by the testimony of the witness Heaton that the court could hold, as a matter of law, that such agency did not exist. But it is urged that even though it be conceded that Paterson & Son were the agents of the respondent, it did not appear that that firm had information at least as to some of the other insurance which was upon the property at the time the fire occurred; and in this connection attention is called to the fact that some of the insurance which was upon the property at the time the manager of the plaintiff’s assignor applied for the $10,000 additional- insurance had, before the fire, expired and the same had been continued either by renewal or substitution of other insurance. I do not, think this changed the legal rights of the parties. When the plaintiff’s assignor applied to Paterson & Son that firm was then informed there was $4,¡500 insurance upon the property and that $10,000 additional insurance was desired. The continuation of the $4,500 insurance, either by renewals of policies already thereon, or by substituting others therefor din-ing the life of the respondent’s policy, was not other insurance ” within the meaning of its policy. It was, at most, but a continuation'of the existing insurance. (Pitney v. Glens Falls Ins. Co., 65 N. Y. 6; Brown v. Cattaraugus County Mut. Ins. Co., 18 id. 385.) Therefore, upon this branch, it seems to me the case should have been submitted, to the jury.

This brings us to the consideration of the remaining question, and that is, whether the courts erred in dismissing the action as to the defendant MacPherson. The policy, as already indicated, provided that the loss, if any, should be payable to one Foster, agent for the mortgagee, as his interest might appear, and it was conceded upon the trial that the defendant MacPherson had succeeded to all the-rights and interest in the policy which Foster had at the time the fire occurred. The defendant MacPherson resided in Canada. The respondent was a foreign corporation, authorized, however, to do business in this State. The policy was issued at its office in Montreal and the property insured was located in Canada. The learned trial justice was of the opinion that the court did not have jurisdiction of the subject-matter of the action so far as MacPherson was concerned, he and the respondent being non-residents; that if MacPherson, as mortgagee, had instituted the action in this State to assert his rights under the policy, the court would not have had jurisdiction and that jurisdiction could not be obtained by “indirection, or by any device of pleading, practice or procedure.” This, to me, seems to be ah erroneous conception as to the rights of the parties. The plaintiff was a resident of the State and his assignor was a domestic corporation. He was, therefore, entitled to bring the action, and it was just as much for his interest as for that of the defendant MacPherson to have the rights of all of the parties determined, to the end that the mortgage referred to might be satisfied. Not only this, but in an action by the plaintiff to enforce the policy, MacPherson was a necessary party (Kent v. Ætna Ins. Co., 84 App. Div. 428; Ennis v. Harmony Fire Ins. Co., 3 Bosw. 516), and with his consent could have joined with the plaintiff in bringing it, but having refused to do that he was properly made a defendant. ( Winne v. Niagara Fire Ins. Co., 91 N. Y. 185 ; Besant v. Glens Falls Ins. Co., 72 App. Div.276:) The fact that MacPherson was a non-resident and the respondent a foreign corporation is of no importance, inasmuch as the contract was made with plaintiff’s assignor, a resident of this State, arid the plaintiff, as its representative, has the right to enforce that contract in the courts of this State, and to that end have the proper parties before the court.

It follows, therefore, that the judgment appealed from must be reversed and a new trial ordered, with costs to each appellant to abide the event. "

Van Brunt, P. J., Patterson, Ingraham and Hatch, JJ., concurred. .

Judgment reversed, new trial ordered, costs to each appellant to abide event.  