COURT OF APPEAL.

New Zealand Mail, Issue 767, 12 November 1886, Page 10

COURT OF APPEAL.

Monday, November 8. (Before their Honors the Chief Justice and Justices Richmond, Williams, and Ward.) JONHS V. LONDON AND LANCASHIRE EIRE

INSURANCE COMPANY. _ This was an appeal from a decision of Mr Justice Williams. The plaintiff sued the defendant Company, alleging that one G. C Baker was, in June last, the dulyappointed agent in Invercargill of the defendant Company, and, as such, authorised to receive and accept proposals for insurance in the Company ; that on or about tbe 19th June the plaintiff proposed to

Baker to insure in the Company, against loss or damage by fire, certain furniture and property of the plaintiff in the sum of £350; that Baker accepted the proposal, agreed to insure, received the sum of £4 11s fid as premium for such insurance, and informed the plaintiff that the property would be held covered by the Company until the issue of a policy ; that the property was on the 7th August, 1884, destroyed by fife, and that the Company refused to pay. The defendants denied that Baker was their agent for tho purpose of accepting proposals or authorised so to do ; and that. if. he .did accept a proposal as alleged, he did it without the authority of the defendants. The action was tried before Mr Justice Williams, at Invercargill, on the 24th April, 1885. The evidence for the plaintiff showed that there had been an application to insure for £950, altered to £SOO, as the Company would not insure above that amount, on the whole of the plaintiff’s furniture, and the plaintiff paid a premium to and received a cover receipt from Baker. Subsequently the plaintiff refused to insure all the property for £SOO, but agreed, probably with Baker, that only a part of the property should be insured and should be covered for £SOO. Baker denied this agreement. There was no evidence of the nature of the Company’s incorporation, nor any evidence of Baker s authority except the evidence of a witness who had transacted business with the defendants through Baker, that he always got cover-notes from Baker, and subsequently interim receipts or policies from the Company. The jury found a verdict for the plaintiff. On the Ist July, 1885, the defendant moved in terms of leave reserved, and on 29 th July Mr Justice Williams nonsuited the plaintiff on the ground that Baker had no authority to enter into the verbal contract relied on. The plaintiff appealed. Mr Denniston for the appellant : The written proposals were provisional only so as to comply with the cover-note, but when the Company refused to insure for £950, the whole thing fell through, and a fresh insurance was made for £SOO on a part of the furniture. But it was not altogether a verbal agreement, as the covernote still existed, subject to the alteration in the goods insured. Anyhow, a contract of insurance can be entered into verbally. The insurance agreed to by Baker was not in contravention of the Company’s instructions ; they only limited the amount, • not the goods insured. The cover-note remains in force until a policy is issued. The note in red across the note, that it only remains in force, for thirty days, applies only against the insured when the premium has not been paid 5 the insured can do nothing else to complete the matter. Moore v. Halfey, 9 V.L.R., L. 400. The Company held out its agent to the public as haying general authority. Mr Haggitt for the respondent : When Baker entered into the verbal contract he exceeded his authority, and the Companyis not bound; and J ones hadnotice of his want of authority. The plaintiff signed three proposals, and they show on their face that Brown and Co., of Dunedin, were the agents, and not Baker. No evidence was given as to the notice of the Company’s incorporation, nor as to the authority of the agent. It is the duty of a person dealing with such a Company to ascertain its powers. Royal British Bank v. Turquand (6 El. ; and 81. 327, at p. 332). No premium was paid or cover-note given for the alleged verbal contract. As to the necessity of evidence of the power to contract, Mutual As-' surance Co. v. McG-illivray (13 Moo., P.C. 87, at p. 122) ; British Industry Co. v. Ward (17 C. 8., 644, at p. 649). The power in an agent to solicit applications does not imply an authority to accept insurances. Stock, ton v. Firemen’s Insurance Co. (39 Am., Rep. 277). The agent cannot bind the Company nnless authorised to do so. Lindford v Provincial Horse and Cattle Insurance Co., (34, Beav. 291, 11 L.T., N.S. 330.) The cover-note only bound the Company for thirty days, the Company only agreed to insure for £350 on the whole furniture. Mr Denniston in reply. Judgment was reserved. The Court then adjourned till Wednesday morning, when the case of Mansford v Rosb (also from Dunedin) will be taken. There are at present twelve cases on the list.