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DAVID BROCK V. THE DWELLING HOUSE INSURANCE

COMPANY.

Fire insurance-Conditions of policy-Appraisal-Right to bring suit.

1. After proofs of loss have been made, it is the duty of a fire insurance company, within a reasonable time, to make manifest its disagreement with the amount claimed by such proofs. 2. A condition in a fire insurance policy that a loss thereunder shall not become payable until 60 days after the notice, ascertainment, estimate, and satisfactory proof of the loss required in the policy have been received by the company, including an award by appraisers when appraisal has been required, makes such appraisal, when required, a condition precedent to the right to sue; and the company has a reasonable time within the 60 days after proofs of loss have been furnished in which to move with respect to the ascertainment or estimate of the loss.

3. A policy-holder made his proofs of loss, and, without waiting for any action by the company, asked for the appointment of appraisers, and they were appointed. And it is held that the insured cannot be heard to say that, inasmuch as no effort had been made by the parties looking to an adjustment, the appointment of appraisers was premature, and that an appraisal must be regarded as having been required within the languageof the policy.

4. Where the conduct of the appraiser appointed by the company in refusing to agree on an umpire is inexcusable, and virtually amounts to a refusal to proceed with the appraisement, the fact that the appraisement was not concluded before suit. was brought will not bar an action on the policy. So held, where the company selected as its appraiser an insurance adjuster who resided in a city 135 miles distant from the city where the fire occurred, and where the appraiser selected by the insured resided. The two appraisers disagreed as to the selection of the third appraiser. The company's appraiser suggested the names of three persons, residing at a distance from the place where the fire occurred, and the appraiser for the insured offered the names of 12 residents of the locality from which the jury, in case of a suit, would be drawn. The

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appraiser for the company assigned no valid reason for a refusal to accept one of the 12, the only reason given being that he did not care to take the chances of getting an appraiser that would be partial

Error to Bay. (Maxwell, J.) Submitted on briefs October 24, 1894. Decided December 7, 1894.

Assumpsit. Defendant brings error. Affirmed. The facts are stated in the opinion.

Shepard & Lyon, for appellant.

Pratt, Van Kleeck & Gilbert, for plaintiff.

MCGRATH, C. J. The policy upon which suit is brought contains the following provisions:

"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 deduction 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 60 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. It shall be optional, however, with this company to take all or any part of the articles at such ascertained or appraised value, and also to repair, rebuild, or replace the property lost or damaged with other of like kind and quality within a reasonable time, on giving notice, within 30 days after the receipt of the proof herein required, of its intention so to do; but there can be no abandonment to this company of the property described.

"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 separately sound value and damage, and, failing to agree, shall submit their differences to the umpire; and the award in writing of any two shall be prima facie evidence of the amount of such loss. The parties thereto shall pay the appraiser respectively selected by them, and shall bear equally the expenses of the appraisal and umpire.

"This company shall not be held to have waived any provision or condition of this policy, or any forfeiture thereof, by any requirement, act, or proceeding on its part relating to the appraisal, or to any examination herein provided for; and the loss shall not become payable until 60 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.

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No suit or action on this policy, for the recovery of any claim, shall be sustainable in any court of law or equity until after full compliance by the insured with all the foregoing requirements, nor unless commenced within 12 months next after the fire."

The property insured consisted of a dwelling-house. The loss occurred July 25, 1892. After the fire, the company's agent visited the locality, and had a conversation relative to the loss. An offer was made by the agent, which, in view of the subsequent correspondence, must be regarded as an offer of compromise, rather than an acknowledgment of liability on the part of the company, or an estimate of the amount of the loss. At this interview, a proposition was made to have an appraisal, but the company's agent said that he didn't propose or didn't care to arbitrate the

matter.

On August 16, 1892, the company wrote to plaintiff as follows:

On the 6th inst., instead of receiving a call from you, I had one from Mr. Van Kleeck, who said he was your

attorney in the matter of your claim under policy 731,375. That there be no misunderstanding in this matter, I would remind you that in my conversation with you I did not state what position the company would take in the matter, and did neither admit nor deny liability on the part of the company in your favor. Neither did I in my conversation with Mr. Van Kleeck admit or deny such liability. serving to the company all its rights under the policy, I remain."

Again, on August 30, the company wrote:

Re

"Yours of the 17th inst. at hand, inclosing affidavit of David Brock in re claim under policy 731,375. Whether the policy was valid or void at the time of the fire, I do not wish to be understood as expressing any opinion, either directly or by implication. In case of a policy void at time of the fire, no form of affidavit, however fully it might set forth the facts, would be operative to inject validity into the claim; whereas, if it were valid at time of fire, an affidavit in manner and form like the one referred to would not be a compliance with the requirements of the policy, to which I refer you. As this affidavit, therefore, could in neither contingency have any force or effect, I return the same without either demanding or waiving full compliance on the part of the insured with the requirements of the policy.

Neither admitting nor denying liability on the part of the company, nor waiving or extending any of the terms, provisions, conditions, or requirements of the policy, I remain."

On September 1, 1892, plaintiff sent on proofs of loss, and in the letter suggested an appraisal of the property. On September 9 plaintiff wrote again, asking for a reply to the letter of the 1st. On September 12, defendant wrote as follows:

"I would say that the company is willing to have the value of the building at the time of the fire appraised, as per the terms of the policy, with the understanding that in so doing it reserves all its rights in the matter, and that nothing so far done is to be construed as a waiver of its rights under the policy, nor an acknowledgment of any liability on its part in favor of Mr. Brock."

On September 13 plaintiff replied, naming one Callender as appraiser. On September 16 defendant wrote, objecting to Callender, and saying:

"If you want an appraisal, you must, in accordance with the policy, select a competent and disinterested man."

On January 12, 1893, plaintiff wrote as follows:

"Messrs. Shepard & Lyon, on inquiry from them yesterday, say that they have done all, in the insurance matter of David Brock's claim under policy 731,375 against your company, that they are authorized to do. We have furnished all information we have in regard to the loss. Mr. Brock has presented himself for examination under oath, at your request. It seems to us that the only thing necessary to make this matter complete is for you to send us draft and take up your policy. As to the matter of appraisal suggested to you in ours of September 13, we desire to say that, so far as Brock is concerned, he has no desire to insist or oppose an appraisal. We have waited since that date for you to act in that matter if you desire so to do. We now say, as we understand the matter, Brock is entitled to his money, and if we do not hear from you at once, with draft inclosed, we shall conclude that you are in possession of some fact which you conclude is a complete bar to his right to make such claim. As to such matters, if any, others than us must decide." In reply defendant wrote:

"I would say that an appraisal was demanded by Mr. Brock, agreed to by the company with the understanding that it would not in any event prejudice its rights under the policy, and should not be a waiver of any of the conditions of the policy, or of a forfeiture thereof (see the conditions of the policy, lines 92 and 93, Mich. Stand., cited in a former letter to you), and we have for some time been waiting for Mr. Brock to name an appraiser, some person possessing the attributes required of him by the policy. We are still waiting for Mr. Brock to name his appraiser, and prefer that he abide by his election to submit the matter to appraisal, as provided by the policy."

On January 18, 1893, plaintiff wrote nominating one