provision to refer differences over the amount of loss and damage which was adequately drafted as a “condition precedent.” Caledonian Ins. Co. v. Gilmour 118931 A.C. 85. In Wright v. Susquehanna Mut. Fire Ins. Co., 110 Pa. 29, 20 AtI. 716 (1885) the court appears to have concluded that the provision was effectively drafted as a “condition precedent,” but that the insurer had failed duly to invoke it and so the insured could sue. The appraisers were not named. Sec also, Fritz v. British American Assur. Co.,
Pa. 268, 57 AtI. 573 (1904).

None of the foregoing Pennsylvania cases indicates that the Court gave any substantial consideration to the decision of the House of Lords in Avery or to the American cases cited in the last preceding notes. (1882).Wyo. See Kahn v. Trader’s Ins. Co., 4 Wvo. 419, 34 Pac. 1059 (1893).

3. See the cases cited supra, notes 1 and 2. Also, the opinion of Mr. Justice Stone in the more recent case of Hardware Dealers’ Mut. Fire Ins. Co. v. Glidden provision meets the required condition. See Lamson Co. Prudential Fire Ins. Co., 171 Mass. 433, 50 N.E. 943 (1894). 5. Blodgett Co. v. Bebe Co., 190 Cal. 665, 214 Pac. 38 (1923); Aaberg v. Minnesota Com. Men’s Ass’n 152 Minn. 478, 189 N.W. 434 (1922). When a provision in a fire insurance policy is construed to cover disputes generally which may arise under the policy (rather than being limited to differences over the amount of loss and damage) it has been held revocable according to the provision is contained in a fire insurance policy rather than in some other commercial contract does not appear to be of consequence. provision was contained in a policy covering loss or damage to an automobile resulting from “accidental upsets.” h’lie court identified the provision according to the text of the defendant’s answer pleading the provision as including “not only the quantum of the plaintiff’s damages, but her right of action-the cause of action-and so
Amsterdam Cas. Co. v. Blackshear, 116 Fla. 289, 156 So. 695 (1934).
Robinson v. Georges Ins. Co., 17 Me. 131 (1840). The provision in the former case applied in the event “any difference or dispute shall arise in relation to any loss sustained or alleged to be sustained.” It was regarded
the court as providing that, “in case differences shall arise under it [the policy), the whole subject, including both the right to recover and the amount of damages shall be determined by referees,” and therefore revocable. MiN. Aaberg v. Minnesota Com. Mens’ Ass’n, the provision was contained in a health and accident policy and read “if any difference should arise at anytime respecting the validity or adjustment of any claim thereunder, it should submitted .to arbitrators, and that such submission . . should be a condition precedent to the right to maintain a suit in court.” Compare the subsequent Minnesota decision in Park Constr. Co. v. Independent School Dist., Minn. 182, 296 N.W. (1941). 6. For such disclaimers see the opinions of Justice Coleridge, the Lord Chancellor and Lord Campbell in reported below. Like views against common law revocability of arbitration provisions generally also had been voiced in widely known cases decided prior to most of the American cases ruling irrevocability of these appraisal provisions. See Allen, J. in President of Delaware & H. Canal Co. c. Pennsylvania Coal Co.,
Lans. 250 (N.Y. Sup. Ct., 1872); Chapman, C. J. in Hood v. Hartshom,
Mass. 117 (1868).

8. These matters are the subiect comments in Randall v. American Fire
Misc. 656, Ct. 190 App. 943 (1st Dep’t 192t1).
11. Ex. 497, 155 Eng. Rep. 1447 (1853).

12. One may wonder how remote this thesis may have been from the insurer’s day-by-day sales promotion. they ascertain that there was no loss damage. See F.kirt Co. v. Rhode Island Ins. Co., 316 Mass. 314, 55 N.E.2d 461 (1944) (under Massachusetts standard policy then in effect). Said the court: The plaintiff’s position is that by submitting the matter to arbitration the defendant is estopped to deny that a loss was sustained; that it may heard only the question of the amount of loss; and that an award that determined that no loss was sustained was not within the scope of the reference. think that this construction of the policy is not sound. Obviously the referees must have judgment. There also was the case of Thompson v. Chamock, 8 139, 101 Eng. Rep. 1310 (K.B. 1799) in which the defendant, in an action brought on a charter party, pleaded a provision that “in case any difference should arise between the parties touching the agreement, or anything relating thereto, the same shall be settled and adjusted by three arbitrators to be chosen, …. ” Upon demurrer to the plea and joinder, the demurrer was sustained. Lord Kenyon, C.J,, observed that “it is not necessary now to say how this point ought to be determined if it were it having been decided again and again that an agreement to refer all matters in their jurisdiction.” For further British cases involving general arbitration provisions and decided before
see Williams, 60 L.Q.REv. 69, 70, 71 (1944).
Justice Coleridge in the Court of Exchequer Chamber expressed like opinion on this point as follows: But supposing any observation might be made upon the generality of one or two of the expressions in the rule [Rule 25], it is important to observe, that, only (Italics supplied). The provision in the policy in the first case, supra note 1, which the Supreme Court of the United States held irrevocable, embraced differences “as to the amount of any loss or damage, and that the award should be binding “as to the amount of such loss or damage, or or (Italics supplied.) No consideration appears to have been given to the point whether or not the provision was so broad as to constitute it a provision to arbitrate differences beyond those over the amount of loss. The Court appears to have considered the provision as one covering differences over the amount of loss or damage. Compare Stephenson v. Piscataqua F. & M. Ins. Co., 54 Me. 55 (1866). In Liverpool & London & Ins. Co. v. Wolff, 50 N.J.L. 453, 14 AtI. (1888) the provision was of broad coverage embracing differences “as to the amount of any loss or damage, or or concerning or It was argued for the plaintiff that this provision related not merely to the amount of the loss or damage, “but to the whole matter of the controversy growing out of the policy, and is therefore void, as it is an attempt to oust the courts of their jurisdiction.” But the court ruled that the first part of the provision referring the question of the amount of loss “is distinct and several from the latter and more comprehensive provision; them  consequence being that, although the latter would not be enforced, the former will be.” See also, Pioneer Co. Phoenix Assur. Co.,
N.C. 28, 10 S.E. 1057 (1890). Compare Maryland Gas. Co.-v._May~fild, 225 Ala.:.449, 1.43 So.

the given provision to refer it being adequately Act of 1889 was, of course, in effect when these cases were decided.) Trainor v. Phoenix Fire Assur. Co., 65 L.T.R. 825 (Q. B. 1892); Scott v. Mercantile Ace.
Spurrier v. LaCloche [19021 A.C. 446; Woodall v. Pearl Assur. Co. [19191 1 KB. 593. revocability of arbitration provisions was no longer, if ever it had been, sustained by any considerations of public policy. I-Se said:
forum which I can neither sympathize with nor account for; but the Legislature has recently in The Common Law Procedure Act, 1854, § 11 made a provision in such cases not that the agreement to refer shall
pleadable in bar, but that the Court may stop the action. This shows the opinion of the Legislature that such agreements are not contrary to public policy. Livingston v. Ralli, 5 El. & RI. 132, 119 Eng. Rep. 430 (Q.B. 1855).
Home Ins. Co.,
note 2.
pay a sum at a time (or upon an event) or to pay only what sum, if any,
See further the following British cases decided after v. Avery; Viney v. Bignold, 20 Q.B.D. 172 (1887); Braunstein v. Accidental Death Ins. Co., 1 B. & S. 782, 121 Eng. Rep. 904 (Q.B. 1861) (policy covering accidental injury or death). Also: Reed v, Washington F. & M. Ins. Co., 138 Mass. 572 (1885) (under the Massachusetts standard form then in effect); Gasser v. Sun Fire Office, 42 Minn.
44 N.W. 252 (1890); McNees v. Southern Ins. Co., 61 Mo. App. 335 (1895); Gibbs v. Continental Ins. Co., 13 Ilun. 611 (Sup. Ct. App. Div. 1878); Chapman v. Rockford Ins. Co., 89 Wis. 572, 62 N.W. 422 (1895). 21. 1 Ex.
257 (1876). See also, Liverpool & London & Globe Ins. Co. v. Creghton,
(1874); Read v. State Ins. Co.,
Iowa 307, 72 N.W. 665 (1897).undertaking to pay. While they are composed of different words, they appear to be of common purport, namely, in event of differences over the amount, to condition and postpone the obligation of the insurer to pay anything
the amount is determined by appraisal. It has been pointed out that if by the one set of words there is no duty to pay anything until the amount, if any, is ascertained by appraisal, it is redundant, “absurd,” to require further text to the effect that no action shall lie until award. See Severns,
in Connecticut Fire Ins. Co. v. Hamilton,
Fed. 258 (6th Cir. 1893).
also George
& Sons Co. v. Key Fire Ins. Co., 104 Iowa 167, 73 N.W.
(1897). (It may not be denied, however, that niceties of “construction’ in some cases indicated the need of both the “no loss payable” postponement and the “no action” until award condition.) See Swan, J. in the Connecticut Fire Ins.
Mutual Fire Ins. Co. v. Alvord, 61 Fed. 752 (1st Cir. 1894). Consult also, Second Society of Universalists v. Royal Ins. Co., 221 Mass. 518, 109 N.E. 384 (1915) (provision under standard policy then in effect); Badenfeld v. Massachusetts Ace. Ass’n, 154 Mass. 77, 27 N.E.
(1891) (accident policy). Under the British decisions since
Avery it appears that either type of text will do, namely, words
payment of anything
or those providing that no
shall be brought before award.
60 L.Q.REv. 69, 75-76 (1944).

It will be recalled that the text the appraisal provision in Scott
Avery embraced both types of text. See Part [C] reprinted, p. 10 supra. 23. Concerning the development of the standard policy movement see,
(1927). insurance policy was first arranged and spelled out under its present headings in the statutes in 1942. N.Y. Sess. Laws 1942
900 § 6. It was re-enacted in 1943. N.Y. Sess. Laws 1943, c. 671, § 6. Prior to these enactments the Legislature had adopted, in 1917, effective January 1, 1918, a standard form of policy which had been approved in 1916 by the National Convention of Insurance Commissioners. The policy was incorporated by reference; it was not written out in the statute. The policy was declared to be the “Standard fire insurance policy of the state of New York.” The appraisal provision contained in this policy as made effective January 1918 was substantially identical with that in present statute N.Y, Sess. Laws 1917, c. 440 § 121. The 1917 enactment substituted its foregoing standard policy for an earlier “‘standard fire insurance policy of the state of New York.” This earlier policy in turn, was originally planned in 1886. N.Y. Sess. Laws 1886, c. 488. By the 1886 enactment the Superintendent of the Insurance Department was directed to prepare a standard fire policy form and to file it with the Secretary of State. This policy had been designated as the “standard fire insurance policy of the state of New York.” N.Y. Sess. Laws 1892, c. 690, § 121. The appraisal provision in this policy as brought out pursuant to the 1886 legislation varied considerably from the present provision (§ 168) both in text and in the manner of its integration with the insurer’s undertaking today. It seems, however, to have been so drafted as to qualify
irrevocability under The policy form with its appraisal provision is reprinted in The provision here reported is taken from the New York statutory standard (provision under standard policy per statute of 1896). 27. 138 Mass. 572 (1885)(standard pblicy per Pub. Sts. c. 119 & 139). 28. By the course of time and legislative changes it appears that the Massachusetts appraisal provision has reached the required condition precedent and irrevocability. See Lamson Co. v. Prudential Fire Ins. Co., 171 Mass. 433,
N.E. 943 (1898) (provision under standard policy per St. 1887, c. 214); Second Society of Universalists v. Royal Ins. Co., 221 Mass. 518, 109 N.E. 384 (1915)(provision under standard policy per St. 1907, c. 576); F. M. Skirt Co. v. Rhode Island Ins. Co., 316 Mass. 314,
(1944) (provision under standard policy per General Laws (Ter. Ed.)
the form of policy with the provisions therein, it is still to be regarded as the voluntary contract of the parties; that it is no more effective for or against either party than before; and that “it is not to be presumed that the Legislature intended, by prescribing the form of contract, and prohibiting any other, to give it effect in depriving a party rights which, as a contract, it would not have.” To like effect see Chauvin v. Superior Fire Ins. Co., 283 Pa. 397, 129 Atl. 326 (1925)(provision under standard policy per 1915 statute); Gratz v. Insurance Co., 282 Pa. 224, 127 Atl. 620 (1925) (same); also Dunton v. Westchester Fire Ins. Co., 104 Me. 372, 71 At. 1037 (1908) (provision under standard policy per Rev. Stat. Maine c. 49).
Opinion of Justices, 97 Me. 590, 55 Atl. 828 (1903). Opinion related to Ch. 18, P. L. 1895. It is reported in connection with the order of the State Senate requesting this opinion that the commissioners in Maine for the promotion of uniformity of legislation “had reported to the Governor that the statute in question was deemed to deprive insurers of the right of a jury trial upon the question of the extent of loss or damage arising under fire insurance policies; also that the constitutionality of the statute could well be questioned.”
upon all fire insurance companies, domestic and foreign, without attempting any discriminations, and does not deprive any person of life, liberty, or property without due process of law.” The Supreme Court of Minnesota was of like mind with respect to its standard policy form and its irrevocable provision for appraisal of loss and damage. Glidden Co. v. Retail Hardware Mut. Fire Ins. Co., 181 Minn. 518, 233 N.W. 310 (1930). The Supreme Court
the United States sustained this decision in Hardware
Mut. Fire Ins. Co. v. Glidden Co., 284 U.S. 151 (1931). The views of the Justices of the Supreme Court of Maine were not mentioned by the courts in these cases.
Fire Ins. Co. v. Hon, 66 Neb. 555, 92 N.W. 746 (1902). 33. The court
Schrandt v. Young, 62 Neb. 254, 86 N.W. 1085 (1901); Home Fire Ins. Co. v. Kennedy, 47 Neb. 138, 66 N.W, 278 (1896); Insurance Co. v. Bachelor, 44 Neb. 549, 62 N.W. 911 (1895); National Masonic Ace. Ass’n v. Burr, 44 Neb. 256, 62 N.W. 466 (1895); Home Fire Ins. Co. v. Bean, 42 Neb. 537, 60 N.W. 907 (1894); Union Ins. Co. v. Barwick, 36 Neb. 223, 54 N.W. 519 (1893); German-American Ins. Co. v. Etherton, 25 Neb. 505, 41 N.W. 406 (1889). A study of this group of cases permits a conclusion as to the establishment of the rule of revocability of provisions to refer loss and damage about the same as that declared by the court in the Ion case, namely, that the question “was more or less directly involved” in the cases. The further observation in the opinion that “the doctrine has been assumed to be firmly established in the body of our law” is without any supporting documentation. It remains to note that none of the American cases ruling appraisal provisions to refer loss and damage irrevocable by action
is cited or discussed in the opinion of the court in the above Nebraska cases.
Masonic Ace. Ass’n v. Burr, supra note 33. 35. The validity of awards is generally assured although they are rendered under arbitration provisions which are declared to be against public policy and void as contracts to oust the courts of their jurisdiction. Rueda v. Union P. R. Co., 180 Ore. 133, 175
778 (1946) with note, 26 ORE. L. Rrv. 280 (1947). But see the rulings of the Supreme Court of Puerto Rico,
note 65.
44-501 (Reissue of 1952) (1943).
For the appraisal provision in this policy, see
Supreme Court of Maine,
590, 55
(1921); Marine
Corp. v. Dreyfus, 284 U.S. 263 (1931).
statement of facts. The parties went to appraisal, but before it was completed, the appraiser appointed by the insured withdrew and refused to participate further. Three days later the insured served notice upon the company’s agents and upon the remaining two appraisers of refusal to proceed further with the proceeding and brought suit to collect on the policy. The insurer petitioned for court appointment of appraisers pursuant to the appraisal provision. that the submission was effectively revoked by the notice as well as by the withdrawal of the insured’s
without regard for the provision to refer. The company’s petition for appointment of arbitrators was denied. ‘To like effect see the opinion in Marvas v. American Equitable Assur. Corp., 82 N.H. 533, 136 At. 364 (1927). See also, Salganik v. United States Fire Ins. Co., 80 N.H. 450, 118 AtI. 815 (1922). Said the court in the case: “The parties are not compelled to adopt this procedure, and it is optional with the insured whether he will submit his claim to arbitration or bring an action at law to collect his damages tinder the fire insurance statute.” Search of the statutes has failed to reveal any subsequent legislative revision pertinent to these rulings. The standard policy legislation appears in the latest com- pilation of the New Hampshire statutes in c. 407, “The Fire Insurance Contract and Suits Thereon,
LAws (1955). This legislation dates back to 1885, Laws 1885,
93, amended in 1890 by Pub. St. c. 170, and the latter was the legislation involved in the
case of 1900. the parties go forward with an appraisal of the amount of loss and damage and a valid award is returned, it is conclusive and binding on tboth parties as to the amount. Salganik v. United States Fire Ins. Co.,
43. See the terms of the policy and appraisal provision as reported in the
case, supra note 42. That a provision and its setting in a policy may plausibly be construed as optional-merely permissive-and, therefore, as nut constituting the required condition precedent for irrevocability, see Hansell v. Farmers’ Mut. Hail Ins. Co. v. Wilson, 45 Kan. 250, 25 Pac. 629 (1891).
(next issue), Enforcement of
48. Gratz v. Insurance Co., 282 Pa. 224, 127 AtI. 620 (1925). Accord,
435, §
(Vernon 1949) “Arbitration.” It was originally enacted (Laws of 1909, p. 347) as an amendatory addition to the Chapter of the Rev. Stats. of 1899 relating to contacts and promises generally. In the Rev. Stats. of 1909, however, the amendment was carried to the chapter on Arbitration, and it so appears in the present compilation of the Missouri Statutes. 51. Dworkin v. Caledonian Ins. Co., 285 Mo. 342, 226 S.W. 846 (1920). Two judges dissented on the grounds
that the majority view belied the intent of the legislature and
that this court already had determined the issue to the contrary in Young v. Insurance Co., 269 Mo. 1, 187 S.W. 856 (1916). On the latter point see further, Security Printing Co. v. Connecticut Fire Ins. Co., 209 Mo. App. 422, 240 S.W. 263 (1922). In his article,
Courts, 1954 WASn.
L.Q. 49, 60, Professor Foster points out that the words
as used in the 1909 Act were the very words which had been used in the opinion of the court in Murphy v. Northern British & Mercantile Co., 61 Mo. App. 323 (1895), which (with the companion case of
Co. in the same court in the same year), first ruled that the given provisions to refer loss and damage were irrevocable by action. The court, in the Murphy case found that the policy made it a condition precedent to the liability of the company to pay any loss or damage in case of difference as to the amount, “that there should have been
arbitration of
(Italics supplied). In McManus v. Farmers’ Mut. Hail Ins. Co., 239 Mo. App. 882, 203 S.W.2d 107 (1947), the by-laws of the insurer provided for the reference of differences over the amount of loss and damage. An agreement of submission, supplied by the insurer for the occasion, provided that the arbitrators were to determine whether or not it was
liable at all to this insured, and (2) if so, the amount of the loss.
distinguishing the Dworkin case, the provision (plus the submission agreement, it seems) was one for arbitration of the liability of the insurer as well as of the amount of loss and was, therefore, subject to the 1909 Act. The court also relied upon the point that the terms “appraisal” and “appraisers” were not used in the by-laws or submission; the words “arbitration .and arbitrators are used throughout.”
(1914). Consult also, White v. Village of Soda Springs, 46 Idaho 1953, 266 Pac.
P.2d 910 (1936). Compare, \Vortman v. Montana Cent. Ry., 22 Mont. 266, 56
60. ARK. STAr. ANN.
Policies-Premiums–Actions” (1947). 61. Insurance Co.
Kempner, 132 Ark. 215, 200 S.W.
(1918); Fircmen’s Ins. Co. v. Davis, 130 Ark. 576, 198
127 (1917); See also, Papan v. Resolute Ins. Co., 219 Ark. 907, 245 S.W.2d 565 (1952) (policy covering damage to automobile). But compare, Miller v. American Ins. Co., 124 F. Supp. 160 (W.D. Ark. 1954)(issue as to effect of the statute upon a ‘1’exas fire policy covering personal property in Arkansas). 62. VT. Rav. STAT. § 9187 c. 387 “Insurance Companies” (1947). 63. A similar provision of early origin in the statutes of Iowa wvas repealed in 1947. A standard form of fire policy, including the appraisal provision, like that of New York was enacted at the same time. Acts 1947, c. 263, Code (Annotated) c. 515, “Insurance Other Than Life,” § 515.138.
Parga & Frontera v. Royal Ins. Co., 32 P.R. 73 (1923). See further, George
Salganik v. United States Fire Ins. Co.,
note 42.
the defendant to trial on the truth of its answer and to his claim of non-suit or of a directed verdict. See, for example, Hamilton v. Liverpool & London & Globe Ins. Co., supra note
of loss and damage
party” the courts are in accord that the insurer must duly make the request or demand. U.S. Wallace v. German-American Ins. Co., 2 Fed. 658 (C.C.D.Iowa 1880), motion
41 Fed. 742 (1882). In the second decision of this case the court observed as follows: The condition did not absolutely require an arbitration; it only authorized either party to require it by a request in writing. The inference is reasonable that, if neither party requested it in writing, the usual remedies by suit were to remain. It may reasonably be inferred that the parties had in view the possibility that in some cases both would prefer a suit in a court of justice to an arbitration, and therefore left it optional with either party to request in writing an arbitration; intending that, if both declined to make such request. legal proceedings might be resorted to. If this was not the intention of the parties, it is difficult to understand what purpose they had in view in using the words, ‘at the written request of either party.’
it was their purpose to require that, in every case the damages should be ascertained by arbitration, they could have said so in plain terms. And as for the further clause of the provision that no suit to recover any loss “shall be sustained
shall have been obtained, fixing the amount of such claim in the manner above provided,’ the court commented:
this provision stood alone, it might well
claimed that, in the absence of an arbitration and award, no suit could be maintained; but it refers to the prior condition respecting arbitration, and the two must be read together. So read, there is ground for holding that the two provisions together authorize eithei party to demand an arbitration, but do not absolutely require either to do so; and that, where either does demand such arbitration, no suit can be maintained until after the amount of damages shall have becn in that matter ascertained. See also, Harrison v. German-American Fire Ins. Co., 67 Fed. 577 (C.C.S.D. Iowa 1895).
Pac. 63 (1911);
further, Case v. Manufacturers Fire & Marine Ins.
82 Cal. 266, 21 Pac. 843,
1083 (1889). ILL. German-Anserican Ins. Co. v. Steiger, 109
254 (1884),
Davis v. Anchor Mut. Fire Ins. Co., 96 Iowa 70, 64 N.W. 687 (1895); Cere v. Council Bluffs Ins. Co., 67 Iowa 272, 23 N.W. 137, rehearing
(1885). In the former case the court observed as follows: ,
we eliminate the words, “at the written request of either party,” we have, in terms, a provision for arbitration as a condition precedent to a right of action. If we restore the words, the provision is so modified that the arbitration is only to be had on request. Until there is a written request, neither party is compelled to arbitrate. Appellant’s [the insurer’s] construction is that plaintiff [the insured] must request arbitration, and then, if he desires, defendant may waive it. That would be the same as if the policy provided that such differences should be arbitrated unless defendant waived the right. The language of the policy cannot be tortured into such a meaning. When a difference arises it gives either party a right to enforce arbitration by requesting it.
neither requests it, the provision for arbitration is not made
because of its language,-that no action shall be maintained until the award provided for in the preceding section shall have been obtained. That language means no more than this: That when arbitration, provided for in section 9, is invoked, as by its terms provided, no action can be maintained until the award is had. Section 10 merely saves to the party desiring it the right to the award under section 9; but, if he desires it, he must take the steps agreed upon to obtain it.
MicH. Nurney v. Firemen’s Fund Ins. Co., 63 Mich. 633, 30 N.W. 350 (1886). Consult also, Blake
Farmers’ Mut. Lightning Protected Fire Ins. Co., 194 Mich. 589, 161
890 (1917). Mo. Probst v. American Ins. Co., 64 Mo. App. 408 (1896). See also, Hawkinson Tread Tire Co. v. Indiana Lumbermens’
Co., 362 Mo. 823, 245 S.W.2d 24 (1951
covered “use and occupation” loss, which was at issue in this litigation).
Randall v. American Fire Ins. Co., 10 Mont. 340, 25 Pac. 953 (1891).
Fire Ass’n v. Agresta, 115 Ohio St. 426, 154 N.E. 723 (1926). The Court distinguished the earlier Ohio decisions in
Carnahan and
Co. (cited below in (B) of this note) on the ground that in the policies involved in those cases “there was an unqualified requirement that the amount of the loss in the event of disagreement, be ascertained by appraisement.” In the present case, on the other hand, appraisal was made optional upon the “written request
either party.” Compare Madison v. Caledonian-American Ins. Co., 43 N.E.2d 245 (Ohio App. 1940).
(1885). The position of the court on the point at hand was of little consequence because of the general view as it seems to
in Pennsylvania Courts, namely, that appraisal provisions are revocable unless they “name” the appraiser. See note 2
See Phoenix Ins. Co. v. Badger, 53 Wis. 283, 10 N.W. 504 (1881). (B) In cases involving an appraisal provision which did not contain (1), the clause
party,” but did contain (2) providing that the loss should not become payable until a stated time (usually sixty days) after proof of loss etc.,
the decisions are not in accord. But a majority have held, in line with the above cases, that the insurer nust call for appraisal and that the last quoted clause implies the requirement of demand by the insurer. COLO. Norwich Union Fire Ins. Co. v. Rayor, 70 Colo. 290, 201 Pac. 50 (1921).
Atlas Assur. Co. v. Williams, 158 Ga. 421, 123 S.E. 697 (1924); Goldberg v. Provident Washington Ins. Co., 144 Ga. 783, 87 S. E. 1077 (1916).
Concordia Ins. Co. v. Bowen, 121
App. 35 (1905); but see contra, Phoenix Ins. Co. v. Norton
Co., 109 II. App. 63 (1902). IowA. Lesurc Lumber Co. v. Mutual Fire Ins. Co., 101 Iowa 514, 70 N.W. 761 (1897).
Pac. 620 (1911). Ky. See Continental Ins. Co. v. Vallandingham & Gentry, 116 Ky. 287, 76 S. 22 (1903). Miei. National Ilome Bldg. & L. Ass’n v. Dwelling House Ins. Co., 106 Mich. 236, 64 N.W. 21 (1895). N.Y.
Chainless Cycle Mfg. Co. v. Security Ins. Co., 169 N.Y. 304, 62 N.E. 392 (1901).
Rochester German Ins. Co. v. Rodenhouse, 36 Okla. 378, 128 Pac. 508 (1912); American Ins. Co. v. Rodenhouse, 36 Okla. 211, 128 Pac. 502 (1912). TEX. Virginia F. & M. Ins. Co. v. Cannon, 18 Tex. Civ. App. 588, 45 SV. 945
The Supreme Court of Ohio championed the minority view in 1907 as follows:
difference or disagreement the ‘ascertainment’ of the amount for which the insurer shall be liable ‘shall be made’ by appraisers, and the amount ‘having been thus determined,’ the same, not some other sum, shall be payable ‘sixty
received by the insurer in accordance with the terms of the policy,’ not in accordance with demand or request of the insurer. Beyond all reasonable dispute, this is an agreement to pay only after an award. But this is not all of the contract on this subject.
additional part of the contract to which the court referred was that providing that a loss should not become payable until
days “after the notice, ascertainment, estimate and satisfactory proof of the loss herein required have
received by this company,
required.” (Italics supplied) “It is true” said the court,
‘required’ may mean ‘requested’ or ‘denanded’; but it may also mean ‘made necessary’ or ‘made an essential condition,’ and the word ‘requirements,’ as used in these policies, may mean ‘essential conditions’ or ‘things made necessary’ (see Century Dictionary), and that meaning should be adopted which would seem to be most in harmony with the other language of the contract. This phrase ‘when appraisal is required’ is so strikingly different from the policies in reported cases which expressly provide for appraisal upon ‘the written request of either party,’ or ‘when appraisal has been permitted,’ that
may assume that it was intended to avoid the construction placed on such policies, and when we consider the painstaking care with which the obtaining of an award is defined as a precedent condition,
through the contract, we are not at liberty to adopt a meaning for this one word ‘required’ and the word ‘requirements’ which would destroy the effect of everything else that is written in the contract on this subject and entirely reverse its meaning. Graham v. German-American Ins. Co, 75 Ohio St. 374, 79 N.E. 930 (1907).
also Phoenix Ins. Co. v. Carnahan, 63 Ohio St. 258, 58 N.W. 805 (1900). Also Madison v. Caledonian-American Ins. Co., 43 N.E.2d 235 (Ohio App. 1940). Accord.
German-American Ins.
50 Minn. 341, 52 N.W. 932 (1892). Mo. McNees v. Southern Ins, Co., 69 Mo. App. 232 (1897); Murphy
Northern British & Mercantile Co., 61 Mo. App. 323 (1895). See also, Southern Mut. Ins.
v. Turnley, 100 Ga. 296, 27 S.E. 975 (1897); but consult Atlas Assur. Co. v. Williams, 158 Ga. 421, 123 S.E. 697 (1924). In the following Missouri
it likewise was ruled that the insured must offer and seek arbitration before suit. But the report of the case does not disclose any of the above clauses (1), (2) or (3) in the provision as set forth. Lance v. Royal Ins. Co., 259 S.W.
(Mo. App. 1924). (C) In a few cases apparently the appraisal provision contained neither (1), the clause, “at the written request [or “demand”] of either party,” nor (2), the clause, “including
but did have (3), the clause that no action will lie “until
In Kahnweiler v. Phenix Ins. Co., 67 Fed, 483 (8th Cir. 1895), it was ruled that the insurer must duly ask for appraisal if it wants it; that the insured can sue to collect without first offering or seeking it. The court stated its position as follows: When there is a difference between the company and the insured as to the amount of the loss the policy declares: ‘The same shall then be submitted to competent and impartial arbitrators, one to
selected by each party ….
It will be observed that the obligation to procure or demand an arbitration is not by this clause, in terms imposed on either party. It is not said that either the company or the insured shall take the initiative in setting the arbitration on foot. The company has no more right to say the insured must do it than the insured has to say the company must do it. The contract in this respect is neither unilateral nor self-executing. . .
The clause is to be construed the same as if it read “upon the request of either party.” See also, Gauche v. London & Lancashire Ins. Co, 10 Fcd. 347 (C.C.E.D.La, 1881). Contra.
See Southern Mut. Ins. Co. v. Turnley, 100 Ga. 296, 27
975 (1897). ILL. Phenix Ins. Co. v. Stocks, 149
319, 36 N.E. 408 (1893). MAss. See Lamson Consol. Store Service Co. v. Prudential Fire Ins. Co., 171 Mass. 433, 50
943 (1898) (provision in standard policy form per
1887, c. 214, § 60); insured must plead performance or excuse for non-performance, but his f(ilure to do so must be taken by demurrer;. the defect in such case can be
setting forth that under the provision in the standard form per
LAWS c. 175, the insured is required to make demand for the appraisal. Micn. Chippewa Lumber Co. v. Phenix Ins. Co.,
Mich. 116, 44 N.W. 1055
The decisions in the following cases required the insurer to call for arbitration; the insured was not required to do so before initiating suit on the policy. It does not appear that the appraisal provisions included (1), the “request” clause, or (2), the clause, “including an award by appraisers
Clause (3) that no action will lie “until after an award” appeared more or less distinctly in some of them, but seems not to have been relied upon as of controlling significance. Ky. Sun Mut. Ins. Co. v. Crist, 19
L. Rep. 305, 39 SAy. 837 (1897). Miss. Sykes v. Royalty Cas. Co., 111 Miss. 746, 72 So. 147 (1916). See also Mississippi Fire Ins. Co. v. Dixon,
Miss. 570, 98 So. 101 (1923). N.Y. See Edwards v. Maryland Motor Car Ins. Co., 204 App. Div. 174, 197 N.Y. Supp. 460 (1922)(theft policy on automobile). S.D. Botte
Jansen v. Equitable Fire Ass’n,
S.D. 240, 121 N.W.
(1909); Nerger v. Equitable Fire Ass’n, 20 S.D. 419, 107 N.W. 531 (1906); Norris v. Equitable Fire Ass’n, 19 S.D. 114, 102 N.W.
Tilley v. Continental Fire Ins. Co., 86 Va. 811, 11 S.E. 120 (1890). Wis. See Vangindertaelen v. Phenix Ins. Co., 82 Vis. 112, 51 N.W. 1122 (1892). 68. See
p. 21. 69. U.S. Kahnweiler v. Phenix Ins. Co.
note 67 (C). ILL. Concordia Fire Ins. Co. v. Bowen, 121
Liverpool Ins. Co., 94 Minn. 141, 102 N.W. 380 (1905).
Wis. See Vangindertaelen v. Phenix Ins. Co., 82 Wis. 112, 51 N.W. 1122 (1892). Even if the provision were a “condition precedent” of more common kind, the general pleading would be sustained under modem code provisions.
70. Such provisions were enacted at an early date in some jurisdictions to permit such general pleading, the policy, or copy thereof, being filed with the declaration or complaint. See Tilley v. Connecticut Fire Ins. Co., 86 Va. 811, 11 S.E. 120 (1890); compare Southern Mut. Ins. Co. v. Tumley, 100 Ga. 296, 27 S.E. 975 (1897). 71. U.S. Kahnweiler v. Phenix Ins. Co.,
note 67 (C). Phoenix Fire Assur.
v. Murray, 187 Fed. 809 (3rd Cir. 1911).
ILL. Maltby v. Empire Auto Ins. Ass’n, 239 Ill. App. 532 (1926); Concordia Fire Ins. Co. v. Bowen, supra note 69.
See Sun Mut. Ins. Co. v. Crist,
note 67 (C).
Consult American Ins. Co. v. Rodenhouse, 36 Okla. 211, 128 Pac. 502 (1912). S.D. Nerger v. Equitable Fire Ass’n, 20 S.D. 419, 107 N.W. 531 (1906).
See Davis v. Atlas Assur. Co., 16 Wash. 232, 47 Pac. 436 (1896). \Vis. Vangindertaclen v. Phenix Ins. Co.,
note 69. The Supreme Court of Florida appears to require, in addition to the demand for appraisal, an admission by the insurer of some liability on the policy in order to qualify its demand for appraisal. This is because “the law does not require the insured to submit to a purely speculative appraisal of damages as to which it may be contended no liability at all exists.” New Amsterdam Cas. Co. v. Blackshear,
Fla. 289, 156 So. 695 (1934). The effect of the insurer’s “denial of liability” upon the appraisal provision is considered below. 72. For a remarkable (and dubious) refinement as to when the plea is in bar and when it is in abatement as undertaken by the Supreme Court of Alabama, see McCullough v. Mill Owners’ Mut. Fire Ins. Co., 243 Ala. 67, 8 So.2d 404 (1942); Maryland Cas. Co. v. Mayfield,
Ala. 449, 143 So. 465 (1932). 73. 67 Fed. 483 (8th Cir. 1895), also reported supra note 67 (C).
La. 1881); Concordian Fire Ins. Co. v. Bowen, 121
App. 35 (1905); Aetna Ins. Co. v. Cowan, 111 Miss. 453, 71 S.W. 746 (1916); McNees v. Phoenix Ins. Co. 69 Mo. App. 232 (1897); CLARK,
601-603 (1947). 75. Concerning such motions and proceedings thereon see, for example, the New York arbitration statute, Article 84, N.Y. CIv. PRAc. AcT § 1451; the United States Arbitration Act, 9 U.S.C. § 3 (1952). See also the amended answer of the appellant in Kulukundis Shipping Co. v. Amtorg Trading Corp., 126 F.2d 978 (2nd Cir. 1942), which the court translated into an application under §3 of the United States Arbitration Act. for stay of trial of the action pending arbitration. (Compare the unfortunate process involved in Litrell v. Allemania Fire Ins. Co, 224 App. Div. 523, 231 N.Y.Supp. 520 (1928) as reversed in 250 N.Y, 628, 166 N.E. 350 (1929). That the plea of the provision came to be effective under the British Common Law Procedure Act of 1854 and the Arbitration Act of 1889 to stay trial pending appraisal, see Lord Campbell, supra note 17, and Trainor v. The Phoenix Fire Assor. Co.,
note 16. 76. These are pleas going to jurisdiction, capacity and joinder of parties, joinder of causes of action, and pendency of another action upon the same matter. See
79. See Southern Mut. Ins. Co. v. Turnley,
Ga. 296, 27 S.E. 975 (1897); Molea v. Aetna Ins. Co., 326 Mass. 542, 95 N.E.2d 749 (1950); Lamson Co. v. Prudential Fire Ins. Co., 171 Mass. 433, 50 N.E. 943 (1898) (provision in standard policy form per St. 1887); Chippewa Lumber Co.
Phenix Ins. Co., 80 Mich. 116,
932 (1892); McNees v. Soutbern Ins. Co., 69 Mo. App. 232 (1897). Compare Kelly v. Liverpool Ins. Co., 94 Minn. 141, 102 N.W. 380 (1905); Madison v. Caledonian-American Ins. Co., 43 N.E.2d 245 (Ohio App. 1940). Consult also Garretson v. Merchants’ & Bankers’ Fire Ins. Co., 114 Iowa 17, 86 N.W. 32 (1901). 80.
crusade and its consequences are critically examined in the next succeeding sections of this article. Attention also will be called to the frustration of the provision even with respect to the stay of trial as to the question of the amount of loss and damage. 81. 41 Fed. 742 (C.C.N.D. Iowa 1882); also quoted above, note 67 (A).
than, or more than, of the insured) is best based on the fact that the insurer can invoke it and thereby, indirectly, but in a very real sense, enforce it, while the insured can do no more in most jurisdictions than ask the insurer to go forward with an appraisal. If the insurer refuses or does not respond, the insured generally has no other recourse than to sue to collect what he claims. (In so far as the thought back of the proposition may have been that appraisal, as a method of settling the amount of loss, is more beneficial to the insurer than to the insured, it must be
It would have been more consistent with the intent of the appraisal provision if more enforcement of it had been provided in behalf of insured and insurer alike. See below,
It may be noted that the solicitude for the insured as voiced in the foregoing early cases, related to provisions in policies antedating the statutory standard form. The point about the unilateral making of the insurance contract by the insurer is less plausible with respect to the standard form because the Legislature has written it. But emphasis upon the one-sided service of the appraisal provision-in favor of the insurer-still is plausible because of want of legislative or other remedies for general enforcement of the provision in behalf of insured and insurer alike.
95 N.E.2d
note 79, it is indicated that the burden of proof
the “waiver” in suih
rests upon the insured. But as in the proof of other
168; appraisal provwision reprinted
p. 22.
86. MASS.
LAws 5-A, c. 175,
(Stipp. 1955).
Supreme Court has commented as follows: Section
of c. 175 provides for the mechanics for such reference, and imposes on the insured the burden of making a written demand on the company for the reference of the alnount of loss to three referees, if the parties fail to agree as to the amount of loss. Mola v. Aetna Ins. Co., 326 Mass. 542, 95 N.E.2d 749 (1950). 87. NlMrN.
§ 65.01 (Supp. 1955). As is pointed out in a later section the Minnesota statute provides a little more enforcement for the appraisal provision than is provided in other standard policy legislation.
Where the appraisal provision calls for a written demand, a written demand it must be. Probst v. American Ins. Co., 64 Mo. App. 408 (1896); Walker v. German Ins. Co., 51 Kan. 725, 33 Pac. 597 (1893). If
demand is not designated in the provision, apparently an oral one is legally adequate. But the insurer should realize the hazard of persuading the jury that its unwritten words constituted a demand for appraisal pursuant to the appraisal provision and that the insured so understood them.
Palatine Ins. Co. v. Morton-Scott Robertson Co., 106 Tenn. 558, 61 S.W. 787
In Hamilton v. Liverpool & London & Globe Ins. Co., 136 U.S. 242 (1890), the Supreme Court indicated the role of the trial court, and, by implication, a limitation upon the role of the jury, in making
the legal construction of an alleged demand for appraisal, as follows: Upon the evidence in this case, the question whether the defendant had duly requested, and the plaintiff had unreasonably refused, to submit to such an appraisal and award as the policy called for, did not depend in any degree on oral testimony or extrinsic facts, but wholly upon the construction of the correspondence in writing between the parties, presenting a pure question of law, to be decided by the court. See also, Pioneer Mfg. Co. v. Phoenix Assur. Co., 106 N.C. 28, 10 S.E. 1057 (1890). Compare Madison v. Caledonian-Anserican Ins. Co., 43 N.E.2d 245 (Ohio App. 1940).
Co-insurers may not join in a single demand for a joint appraisal, especially when there are variations in the provisions of their policies. Connecticut Fire Ins. Co. v. Hamilton, 59 Fed.
(6th Cir. 1893); Dee & Sons v. Key City Fire Ins. Co., 104 Iowa 167, 73 N.W. 594 (1897); Palatine Ins. Co. v. Morton-Scott Robertson Co,, 106 Tenn. 558, 61
787 (1901). Compare Westenhaver v. German-American Ins. Co.,
Iowa 726, 84 N.W, 717 (1900)(the several insurers made separate demands for appraisal under their respective policies; they selectd the same appraiser; no waiver), see also Hamilton & Phoenix Ins. Co., 61 Fed. 379 (6th Cir. 1894). Consult the view when all of the insurers have used the same standard policy. Wicking v. Citizens’ Mut. Fire Ins. Co., 118 Mich. 640, 77 N.W. 275 (1898). 90. The demand may not be directed to an appraisal of part of the property, such as, for example, appraisal of salvage separately or alone. Schusterman v. Hartford
Robertson Co., note
see also Stephens
Union Assur. Co., 16 Utah 22, 50 Pac. 626 (1897) (insurer refused demand for appraisal in so far as it applied to the part of the property totally destroyed). In Dee & Sons v. Key City Fire Ins. Co., 104 Iowa 167, 73 N.W. 594 (1897), the insured claimed that the submission should cover
by the policy; the insurer claimed it should cover only that
waiver against insurer. To like effect, see American Fire Ins. Co. v. Bell, 33 Tex. Civ. App. 11, 75 S.W. 319 (1903). In Mechanics Ins.
v. Hodge, 149 Ill. 298, 37 N.E.
(1894) loss was sustained in two successive fires. After the second, the insurer demanded arbitration of the amount of loss and damage in the first and denied liability for the loss in the second. The demand was ruled invalid on the ground that the losses from the two fires constituted one loss under the policy; the demand for appraisal could not be split.
See Vera v. Mercantile F. & M. Ins. Co., 216 Mass. 154, 103 N.E. 292 (1913); Chippewa Lumber Co. v. Phenix Ins. Co., 80 Mich. 116, 44 N.W. 1055 (1890); Pioneer Mfg. Co. v. Phoenix Assur. Co., 106 N.C. 28, 10 S.E. 1057 (1890); Madison v. Caledonian-American Ins. Co., 43 N.E.2d 245 (Ohio App. 1940). 92. While accrual of disagreement or failure to agree is widely recognized as a prerequisite to the demand, apparently there is some diversity of view in the cases as to what items of conduct transpiring between the parties after loss are sufficient to establish the existence of the required disagreement or failure to agree. (A).
one view, a showing that the insured reported the amount of his claim (whether by formal proof of loss, or otherwise) and that the insurer, without more, made its demand for appraisal, is not enough. Want of objection by the insurer to the anount as claimed by the insured affords the conclusion at this juncture that the insurer does not disagree. Evidence of objection by the insurer to the amount, and, apparently, further evidence of “bona fide” endeavor to gain agreement with the insured (and failure thereof), is necessary to the make-up of the required pre-demand situation of disagreement or failure to agree.
Famnum v. Phoenix Ins. Co., 83 Cal. 246, 23 Pac. 869 (1890).
See Baker v. Continental Auto Ins. Ass’n, 111 Kan. 425, 207 Pac. 828 (1922. Kr. Continental Ins. Co. v. Vallandingharn & Gentry, 116 Ky. 287, 76 S.W. 22 (1903). The Court observed in passing: That the insurers merely declined to pay the sum fixed in the schedule and
contemplated by the contract, so as to authorize a demand of appraisal. It should have been a real difference, based upon the facts which should have been candidly and fully submitted for acceptance by the other side. The Court let the matter pass, however, since the parties had progressed toward an appraisal on the basis that there was the necessary difference between them. Mxcii. See Zimeriski
Ohio Farmers’ Ins. Co., 91 Mich. 600, 52 N.W. 55 (1892). But compare, Kershey v, Phoenix Ins. Co., 135 Mich.
97 N.W. 57 (1903).
(1900); Kelly v. Liverpool Ins. Co., 94 Minn, 141, 102 N.V. 380 (1903). A “controversy
fact” must exist between the parties; the parties must “actually disagree.” (The appraisal provision used the words “a failure of the parties to agree.”)
Randall v. Phoenix Ins. Co., 10 Mont. 362, 25 Pac. 960 (1891). PA. Boyle v. Hamburg-Bremen Fire Ins. Co., 169 Pa. 349, 32 Atl. 553 (1895). There must
“actual effort to agree.”
Springfield F. & M. Ins. Co. v. Barnett, 213 S.W.
(Tex. Civ. App. 1919). Said the Court: The disagreement must be one in fact, evidenced by an attempt in good faith on the part of the party demanding arbitration to agree as to the loss. A mere arbitrary refusal to pay the amount demanded, and offering a less amount, does not constitute such a disagreement as is contemplated by the policy. See also, Alamo Casualty Co. v. Trafton, 231 S.V.2d 474 (‘ex. Civ, App. 1950). Compare, American Central Ins. Co. v. Terry, 298 SAX. 658 (Tex. Civ. App. 1927). Wrs. Vangindertaelen v. Phenix Ins. Co., 82 Wis. 112, 51
1122 (1892). See also, Phoenix Ins. Co. v. Badger, 53 Wis. 283, 10
504 (1881). A special refinement upon the nature of the required “disagreement” was voiced by the Supreme Court of Colorado in Insurance Co. of North America v. Baker, 84 Colo. 53, 268 Pac. 585 (1927). After reviewing the insured’s version of what the insurers adjuster [one \Vebster] said to the insured after the loss, the Court concluded that his “entire attitude indicates, not an earnest, bona fide effort on Webster’s part to reach an agreement as to the amount of the loss, but an attempt to create a disagreement with reference thereto. The provision of the contract relative to appraisement does not contemplate that kind of ‘disagreement’.” When the insurer admits loss to the full extent of the coverage, but denies liability on the policy, there is no “disagreement” over the amount. Harwood v. U. S. Fire Ins. Co., 136 Me. 223, 7 A.2d 899 (1939). Consult also, Radwanski v. Scottish
Ins. Co., 100 N.J.L. 192, 126 Atl. 657 (1924). Following demand by the insurer the parties have, from tune to time, entered upon an appraisal which fails before award. Concerning the probative value of this fact in determining whether or not there was the required disagreement or failure to agree at the time of the demand see British American Assur. Co.
Darragh, 128 Fed. 890 (5th Cir. 1904); Continental Ins. Co. v. Vallandingham, 116 Ky. 287, 76
22 (1903); Kersey v. Phoenix Ins. Co.. 135 Mich. 10, 97 N.W. 57 (1903); Carp v. Queen Ins. Co., 104 Mo. App. 502, 79
(1904). (B). By the second view, it seems that less evidence will do to make up the pre-demand disagreement or failure to agree. Apparently almost any communication between the parties whereby the insurer indicates its dissatisfaction with the amount of the insured’s claim is adequate to repel inference of acquiescence. Offer of payment of a smaller sum in a tenor of its being a more reasonable valuation of the loss and refusal of it by the insured, quite clearly establish the required situation. Mo. Murphy v. Northern British & Mercantile Co., 61 Mo. App. 323 (1895). Said the Court: “The plaintiff and defendant’s adjusting agent were unable to agree on the amount of the loss, that is to say, on the value of the property destroyed. The adjuster made an offer which was rejected by plaintiff. ‘l’his sufficiently envinced a disagreement so as to bring into operation the provisions of the policy as to arbitration.”
Pioneer Mfg. Co. v. Phoenix Assur. Co., 106 N.C. 28, 10 S.E. 1057 (1890). ‘rexAs. See American Central Ins. Co. v. Terry, 298
658 (Tex. Civ. App. 1927). Compare Springfield F. &
Ins. Co. v. Barnett, 213 S.\V. 365 (Tex. Civ. App. 1919). VA. North British & Mercantile
Co. v. Robinett & Greenl, 112 Va. 754, 72 S.E. 668 (1911).
The Supreme Courts of Michigan and Virginia, however, singled out this very situation and declared the demand to have been adequately prefaced with disagreement. Nict. Kersey v. Phocnix Ins. Co., 135 Mich. 10, 57 (1903). The court cmmen ted: It is said that there was no disagreement as to the amount of loss, and therefore that the defendant had no right to an award by appraisers. We cannot agree with this contention. It appears that defendant knew the amount claimed
plaintiff. Its demand for the arbitration, with this knowledge, indicated its dissatisfaction with and unwillingness to pay that amount. VA. North British & Mercantile Ins. Co. v. Robinctt & Green, 112 Va. 754, 72 S.E. 668 (1911). “It will not do,” said the court, “to say that there was no disagreement as to the loss, and therefore no reason for an appraisal, when the letter of July 2, 1909, demanding the appraisal, distinctly stated that the writer, as the agent of the insurer to adjust the loss, considered the claim made in the proof of loss
94. Under this view requiring the insured to niake demand, it seems that, when the insured pleads generally his perforsance of the conditions of the policy, the insurer must, in order to invoke the appraisal provision and put the insured to proof of his compliance (or the insurer’s waiver of the provision), plead and prove the accrual of disagreement over the amount of loss and damage. See Kelly v. Liverpool Ins. Co., 94 Minn. 141, 102 N.W. 380 (1905); Ohio Farmers’ Ins.
Mahoney v. Minnesota Farmers’ Mut. Ins. Co., 136 Minn. 34, 161 N.W. 217 (1917) (policy covered crops against loss from hail; the dispute centered
different interpretations as to the terms of the policy; held, not one over the amount
(1901) is most frequently (and approvingly) cited in the other cases ruling
of the foregoing
which were packaged with the insurer’s delay in demanding appraisal and sent to the jury on the question of waiver. Insured notified
occurred, August 16,
insurer referred the adjustment of the claim
an adjuster; various negotiations followed; and, as requested by the adjuster, the insured filed proof of loss on August
1899. Insured pressed for quick settlement so that it might dispose of the salvage without
loss was so large and advised the insurer that the amount claimed in the proof of
he did not want an appraisal but wanted to settle. A figure
a proposed settlement
formally demanded appraisal. Total elapsed time: August 16, 1899, date of loss, to September 12 or 13, 1899, date of demand. Insured commenced suit on November 2, 1899. The jury found waiver. The Court observed that “the main question that we are called upon to decide is whether there was any
(italics supplied). Thc jury was sustained. The Court, after reviewing the foregoing course of conduct on the part of the insurer and insured, concluded:
Under these circumstances, we cannot say, as matter of law, that the demand of the defendant for an appraisal was reasonable; for it was bound to act in good faith, and not to remain silent when it was its duty to speak.” (italics supplied). By lse way of further comment upon the required course of conduct of the parties, including the making of demand for appraisal in such cases, the Court observed as follows:
It is not a weapon of attack, but of defense, and a party who intends to use it must give reasonable notice of such intention; for its omission to do so will be evidence of waiver, more or less conclusive according to the circumstances.
(italics supplied). See further the views advanced in Provident Washington Ins. Co. v. Volf, 168
690, 80 N.E. 26 (1907).
To like effect: U.S. See Hamilton v. Phoenix Ins. Co., 61 Fed. 379 (6th Cir. 1894).
Consult also, Covey v. National Union Fire Ins. Co., 31 Cal. App. 579, 161 Pac. 35 (1916).
Micu. See Brock v. The Dwelling House Ins. Co., 102 Mich. 583, 61 N.W. 67 (1894).Miss. See Sykes v. Royal Cas. Co., 111 Miss. 746, 72 So. 147 (1916). N.Y. Langsner v. German Alliance Ins. Co., 67 Misc. 411, 123 N.Y. Supp. 144 (1910).
See American Central Ins. Co. v. Heath, 29 Tex. Civ. App. 445, 69
Consult further, Ilays v. Milford Mut. Fire Ins. Co.,
Mass. 492, 49 N.E. 754 (1898). It seems that the Florida Supreme Court starts the 60 days loss-payable provision from the date when the insurer admits liability for some amount. Insurer’s demand after said 60 days is too late. Bear v. New Jersey Ins. Co., 138 Fla. 298, 189 So. 252 (1939). Suppose that the insurer makes demand for appraisal within the 60 days, but not until the very last days of the period. Arrangements for the appraisal are not likely to be concluded until after “the right to payment of the amount due, if any,” to quote the Oklahoma Court “becomes absolute”
at 276, 156 Pac. at 676) There is some authority indicating that, as a matter of law, such demand is too late. See Zimeriski v. The Ohio Farmers’ Ins. Co., 91 Mich. 600, 52 N.W. 55 (1892); also Langsner v.
Alliance Ins. Co.
And in Fireman’s Fund Ins. Co. v. Caye, 14 Ky. L. Rep.
(1893), it is written that “where the policy provides that the loss shall be payable within a certain time after the proofs of loss are received, the request for arbitration must be made within that time, and not only within that time,
to permit arbitration to be had before the expiration of the time.” See also the views expressed in Hamilton v. Phoenix Ins. Co., supra. Even if the delay until the last hours of the 60 day period in making the demand is not fatal as a matter of law, it seems probable that a verdict of waiver based only upon such delay (without evidence tending to establish any of the “other matters”) will be sustained. See Boston Ins. Co. v. Kirby, 281 S.W. 275 (Tex. Civ. App. 1926). Said the Court: In this case appellants waited for 58 days on one policy and 59 on the other, after receiving proof of loss, before making demand. It being a question of fact as to what would constitute a reasonable time, and the jury having found against appellee on that issue, it cannot be said that appellants were within their contractual rights at the time their demand was made. 99. North British & M. Ins. Co. v. Robinett, 112 Va. 754, 72 S.E. 668 (1911). In truth, the 60 day period had not expired when the demand was made; proof of loss was received by the insurer on May 18, 1909; the demand, a letter, was received by the insured on July 5, 1909. Compare the views as voiced in Tilley v. Connecticut Fire Ins. Co., 86 Va. 811, 11 S.E. 120 (1890) with which compare, in turn, those advanced in Bratley v. Brotherhood of American Yeomen, 159 Minn. 14. 198 N.W. 128 (1924).
(1900)(issue as to whether or not
demand served on one who was an agent of the insurer was binding on the insurer); Madison v. Caledonian-American Ins. Co.,
N.E.2d 245 (Ohio App. 1940) (issue as to whether the communication was a demand for appraisal, or something else); Morley v. Liverpool Ins. Co., 85 Mich. 210, 48 N.W.
(1891)(issue as to proper pleading by insurer of want of appraisal).
v. Phoenix Ins. Co.,
Mo. App. 226 (1897); Ciapanna v. Lincoln Fire Ins.
of N.Y., 153 Ore. 395, 56 P.2d 1113 (1936). See also Schripfer v. Rockford Ins. Co.,
Minn. 291, 79 N.W.
(1890); Nlesser v. Williamsburg City Fire Ins.
42 R.1, 460, 108 Atl. 832 (1920). Compare the views and rulings in Graham v. German-American Ins. Co., 75 Ohio St. 374, 79 N.E. 930 (1907).
“would be in such condition that an appraisal would be an idle ceremony,” perhaps it would be too late. See Reilley v. Agricultural Ins. Co., 311
App. 562 (1941); also the McNees and Johnson cases,
note 101. Consult further, Morley v. Liverpool Ins. Co.,
note 100; Schrepfer v. Rockford Ins. Co., 77 Minn. 291, 79
1005 (1890); Hartford Fire Ins. Co. v. Conner, 79 So.2d 236 (Miss. 1955). Compare Ciapanna v. Lincoln Fire Ins. Co. of N.Y.,
note 101.
suit to collect on the policy? Two general combinations of circumstances have come to pass involving this general question.
until after he had commenced suit to collect on the policy; the insurer refused because of this delay. judicial opinion on this situation appears to favor excusing the insured’s delay and holding the insurer’s refusal a waiver.
by the insured for the first time while his action was pending. Insurer refused. It had pleaded the appraisal provision against the actiou. That action was dismissed. The insured was allowed to maintain his second action over insurer’s plea of
appraisal provision. The insurer’s foregoing refusal was held to
a waiver. To like effect see Gragg v. Northwestern Ins. Co., 140 Mo.
and the dissenting opinion in Schweir v. Atlas Assur. Co.,
Mich. 104, 198 N.W.
In the second situation the insurer had duly demanded appraisal
appraisal and the insurer refused or disregarded them. In Schrepfer v. Rockford Ins. Co., 77 Minn. 291, 79 N.W.
(1890) the Court held that the insured could maintain his action; that the insurer’s refusal constituted waiver of its right to appraisal. “There is no evidence,” said the Court, “that the defendant has, by reason of the delay, been deprived of any legal right or suffered any damage; not even the loss
evidence. . . It is not particularly the length of the delay, but the prejudicial consequence of it, that is material.” On the other hand, in Zalesky v. Home Ins. Co., 102 Iowa 613, 71 N.W.
(1897), the insured started suit after refusing insurer’s demand for appraisal.
error to grant insured (over objection by insurer) a continuance to allow him to offer appraisal; also that refusal
the insurer of the insured’s demand, made after his action was commenced, was not waiver. Nor could the insured use a supplemental petition to escape insurer’s plea of the appraisal provision. In Schwier v. Atlas Assur. Co. supra, the insured also started suit after refusing insurer’s demand. While the action was pending the insured tendered an offer or demand for appraisal; insurer refused. The majority of the court ruled that the insured could not maintain the action; that the insurer’s refusal was not waiver; that a party litigant may not “sue first and obtain his cause of action afterwards.” Consult also, Barton v. Automobile Ins. Co., 309 Mass. 128, 34 N.E.2d 516 (1941); Goldstein v. National Fire Ins. Co., 106 Wash, 346, 180 Pac. 409 (1919).