*343 factory was totally destroyed by fire, of | December, 1838, the American Insurance which the company had due notice and proof. The cause came on for trial upon the general issue, and a verdict was found for the defendants. The plaintiff took a bill of exceptions to certain instructions refused, and other instructions given by the court in certain matters of law arising out of the facts in proof at the trial; and judgment having been given upon the verdict for the defendants, the present writ of error has been brought to ascertain the validity of these exceptions. "From the 17th of October, 1836, to the 6th of December, 1837, Henry M. Wheeler and Samuel G. Wheeler continued to own the factory in equal moieties, and transacted business under the firm of Henry M. Wheeler & Co. On that day Samuel G. Wheeler sold his moiety to Jeremiah Carpenter. On the 18th of April, 1838, Henry M. Wheeler sold and conveyed his moiety to Carpenter, who thus became the sole owner of the entire property. The last conveyance declared the property subject to a mortgage on the premises from Henry M. Wheeler and wife, dated in June, 1835, to Epenetus Reed, on which there was then due $6,000, which Carpenter*assumed to pay. There had been a prior policy on the premises in the Washington Insurance office, which, upon Carpenter's becoming the sole owner, the company agreed to continue for account of Carpenter, and in case of loss, the amount to be paid to him. That policy expired on the 27th of September, 1838, the day on which the policy, upon which the present suit is brought, was effected. It is proper farther to state that other policies on the same factory had been effected and renewed from time to time, from December 12, 1836, for the benefit of the successive owners thereof, by another insurance company in Providence, called the American Insurance Company; and among these was a policy effected, by way of renewal, on the 14th of December, 1837, in the name of Henry M. Wheeler & Co., for $6,000, for the benefit of Henry M. Wheeler and Carpenter (who were then the joint owners thereof), payable in case of loss to Epenetus Reed. The sale by Henry M. Wheeler to Carpenter, on the 18th of April, 1838, of his moiety having been notified to the American Insurance Company, the latter agreed to the assignment; and the policy thenceforth became a policy for Carpenter, payable in case of loss to Epenetus Reed. And on the 23d of May; 1838, Carpenter transferred all his interest in the policy to Epenetus Reed. The policy thus effected on the 14th of December, 1837 [in the American Insurance Company was, (as the Washington Insurance Company assert), not notified to them at the time of effecting the policy made on the 27th of September following, and declared upon in the present suit; nor was the same ever mentioned in, or indorsed upon, the same policy; and upon this account the company insist that the present policy is, pursuant to the stipulations contained therein, utterly void. Subsequently, vis., on the 11th of Company renewed the policy of the 14th of December, 1837, for Carpenter, and at his request, for one year. This renewed policy was never notified to the Washington Insur ance Company, nor acknowledged by them in writing; nor does it appear ever to have been actually assigned to Epenetus Reed, down to the period of the loss of the factory by fire. On this account also, the Washington Insurance Company insist that their policy of the previous 27th of September, 1839, is, according to the stipulations therein contained, utterly void. "It seems to have been admitted, although not directly proved, that a suit was brought upon the policy of the 14th of December, 1837, at the American Insurance office, after the loss, by Carpenter, as trustee of or for the benefit of Reed, for the amount of the $6,000 insured thereby; and that at the November term, 1839, of the circuit court, the company set up as a defense that there was a material misrepresentation of the cost and value of the property in the factory insured made to them at the time of the original insurance; and it being intimated by the court that if such was the fact it would avoid the policy, the plaintiff acquiesced in that decision, and discontinued or withdrew the action before verdict. "The instructions prayed and refused, and also the instructions actually given by the court, are fully set forth in the record. It does not seem important to the opinion, which we are to pronounce, to recite them at large, in totidem verbis, since the points on which they turn admit of a simple and exact exposition." After disposing of the first instruction, which does not relate to our present inquir ies, the court said: "The second instruction asked proceeds upon the ground that although the policy of the American Insurance Company of the 6th of December, 1836, was good upon its face, yet if, in point of fact, it was procured by a material misrepresentation by the own ers of the cost and value of the premises insured, it was to be deemed utterly null and void, and therefore, as a null and void policy, notice thereof need not have been given to the Washington Insurance Company at the time of underwriting the policy declared on. tion; and, on the contrary, instructed the "The court refused to give the instruc jury that if the policy of the American Insurance Company was, at the time when that at the Washington Insurance office was made, treated by all the parties thereto as a subsisting and valid policy, and had never, in fact, been avoided, but was still held by the assured as valid, then, that notice thereof ought to have been given to the Washington Insurance Company, and if it was not, the policy declared on was void. We are of opinion that the instruction, as asked, was properly refused, and that given was correct." After discussing the question, the court | fair and reasonable interpretation accord added the following observations: "Indeed, we are not prepared to say that the court might not have gone farther, and have held that a policy-existing and in the hands of the insured, and not utterly void upon its very face, without any reference whatever to any extrinsic facts-should have been notified to the underwriters, even although by proofs afforded by such extrinsic facts it might be held in its very origin and concoction a nullity. ing to their terms and obvious import. The insured has no right to complain, for he assents to comply with all the stipulations on his side, in order to entitle himself to the benefit of the contract, which upon reason or principle, he has no right to ask the court to dispense with the performance of his own part of the agreement, and yet to bind the other party to obligations, which, but for those stipulations, would not have been entered into. "We are, then, of opinion that there is no error in the second instruction. On the contrary, there is strong ground to contend that the stipulations in the policy as to notice of any prior and subsequent policies, were designed to apply to all cases of policies then existing in point of fact, without any inquiry into their original validity and effect, or whether they might be void or voidable. "And this leads us to say a few words upon the nature and importance and sound policy of the clauses in fire policies, respecting notice of prior and subsequent policies. They are designed to enable the underwriters, who are almost necessarily ignorant of many facts which might materially affect their rights and interests, to judge whether they ought to insure at all, or for what premium; and to ascertain whether there still remains any such substantial interest of the "The third instruction prayed the court insured in the premises insured as will guar- to instruct the jury that if the Washington antee on his part vigilance, care, and stren- Insurance Company had notice, in fact, of uous exertions to preserve the property. To the existence of the policy in the American quote the language of this court in the office, that 'was in law a compliance with passage already cited, the underwriters do the terms of the policy.' The court refused not rely so much upon the principles as up- to give the instruction as prayed, but inon the interest of the assured. Besides, instructed the jury that at law, whatever these policies there is an express provision that in cases of any prior or subsequent insurances, the underwriters are to be liable only for a ratable proportion of the loss or damage as the amount insured by them bears to the whole amount insured thereon. So that it constitutes a very important ingre dient in ascertaining the amount which they are liable to contribute towards any loss; and whether there be any other insurance or not upon the property, is a fact perfectly known to the insured, and not easily or ordinarily within the means of knowledge of the underwriters. might be the case in equity, mere parol notice of such insurance was not, of itself, sufficient to comply with the requirements of the policy declared on; but that it was necessary, in case of any such prior policy. that the same should not only be notified to the company, but should be mentioned in or indorsed upon the policy; otherwise the insurance was to be void and of no effect. mention or indorsement as it positively requires, and without which it declares the policy shall henceforth be void and of no effect." Two propositions, then, are clearly established by this decision: (1) That where a policy provides that notice shall be given of any prior or subsequent insurance, otherwise the policy to be void, such a provision is reasonable and constitutes a condition, the breach of which will avoid the policy; (2) that where the policy provides that notice of prior or subsequent insurance must "We think this instruction was perfectly correct. It merely expresses the very language and sense of the stipulation of the policy; and it can never be properly said that the stipulation in the policy is com"The public, too, have an interest in main-plied with, when there has been no such taining the validity of these clauses, and giving them full effect and operation. They have a tendency to keep premiums down to the lowest rates, and to uphold institutions of this sort, so essential in the present state of our country for the protection of the vast interest embarked in manufactures and on consignments of goods in warehouses. If these clauses are to be construed with a close and scrutinizing jealousy, when they may be complied with in all cases by ordinary good faith and ordinary diligence on the part of the insured, the effect will be to discourage the establishment of fire in-be given by indorsement upon the policy or surance companies, or to restrict their operations to cases where the parties and the premises are within the personal observation and knowledge of the underwriters. Such a course would necessarily have a tendency to enhance premiums, and to make it difficult to obtain insurance where the parties live, or the property is situate, at a distance from the place where the insurance is sought. But be these considerations as they may, we see no reason why, as these clauses are a known part of the stipulations of the policy, they ought not to receive a by other writing, such provision is reasonable and one competent for the parties to agree upon, and constitutes a condition, the breach of which will avoid the policy. We are next to inquire whether this decision has been overruled, or whether it remains as an authoritative declaration of the law. Shortly after the case was decided at law, it appears that an effort was made by said Carpenter to invoke the aid of a court of equity to enable him to avoid the effect of his own disregard of the conditions contained in the policy. Carpenter v. Providence Washington Ins. Co. 4 How. 185, 11 L. ed. 931. This court held, affirming the circuit court of the United States for the district of Rhode Island, sitting in equity, that, under the facts disclosed by the pleadings and evidence, the complainant was not entitled to equitable relief. It is a matter of regret that so great a loss, which the plaintiff and those under whom he claims intended to guard against by insurance, should happen entirely without indemnity. But it is to be remembered that the defendants gave abundant and repeated notice to him, in writing and print in the policy itself, as well as other ways, that they would not take any risks on property where it was insured beyond a certain ratio of its full value, unless the circumstances were made known to them, and the additional policy recognized in writing so as to avoid any mistake, or accident, or want of deliberate attention to the subject. If the plaintiff, after all this, omitted to comply with so substantial a provision in the contract itself, as we are bound to be lieve on the evidence now offered, we see no way, equitably or legally, to prevent the consequences from falling on himself, rather than others, being the result either of his own neglect, or that of some of the agents he employed. An adherence to such important rule is peculiarly necessary for the protection of absent stockholders, often interested extensively in insurance companies; and so far from its being unconscientious to enforce them, when their existence is well known, and when the risk has been increased without conforming to them, it is the only and just safeguard of all concerned in such institutions." Carpenter v. Providence Washington Ins. Co. 16 Pet. 495, 10 L. ed. 1044, has been frequently referred to as an authority in subsequent cases on points collateral to the one we are now considering. Taylor v. Benham, 5 How. 260, 12 L. ed. 143; Russell v. Southard, 12 How. 145, 13 L. ed. 929; Oates v. First Nat. Bank, 100 U. S. 246, 25 L. ed. 583; Burgess v. Seligman, 107 U. S. 34, 27 L. ed. 365, 2 Sup. Ct. Rep. 10. In Phoenix Mut. L. Ins. Co. v. Raddin, 120 U. S. 183, 189, 30 L. ed. 644, 646, 7 Sup. Ct. Rep. 500, 502, we find Carpenter v. Providence Washington Ins. Co. cited, per Mr. Justice Gray, as an authority for the proposition that "the parties may by their contract make material a fact that would otherwise be immaterial, or make immate rial a fact that would otherwise be material. Whether there is other insurance on the same subject, and whether such insur ance has been applied for and refused, are material facts, at least when statements regarding them are required by the insurers as part of the basis of the contract." It is not pretended in the opinion of the majority in the circuit court of appeals in the present case that the case of Carpenter v. Providence Washington Ins. Co. has been modified or overruled by this court, but the cases relied on by that court are wholly decisions of several state courts and of some of the circuit courts. Nor is it claimed by the learned counsel for the defendant in error that the Carpenter Case has been formally overruled or modified by this court. He, however, does cite three decisions of this court which, as he views them, should be regarded as abandoning the doctrines of that case, viz., Union Mut. L. Ins. Co. v. Wilkinson, 13 Wall. 232, 20 L. ed. 622; Eames v. Home Ins. Co. 94 U. S. 621, 24 L. ed. 298, and Knickerbocker L. Ins. Co. v. Norton, 96 U. S. 234, 24 L. ed. 689. These cases must, therefore, receive our attention. What, then, was the case of Union Mut. L. Ins. Co. v. Wikinson? That was a case where the agent of a life insurance company had inserted in the application a representation of the age of the mother of the assured at the time of her death, which was untrue, but which the agent himself obtained from a third person and inserted without the assent of the assured. It was held that this untrue statement contained in the application did not invalidate the policy; that permitting verbal testimony to show how this untrue state ment found its way into the application did not contradict the written contract sued on, but proceeded on the ground that this statement was not that of the assured. The trial court said to the jury that if the applicant did not know at what age her mother died, and did not state it, and declined to state it, and that her age was inserted by the agent upon statements made to him by others in answer to inquiries he made of them, and upon the strength of his own judgment, based upon data thus obtained, it was no defense to the action to show that the agent was mistaken. The case, as reported, does not disclose that the plaintiff's testimony as to the way in which the untrue statement was put in the application was contradicted or denied by the company. It may therefore be presumed that the plaintiff's case, in that respect, was made out by undisputed evidence. And it would seem, such being the state of facts, that this court had reason to hold that the untrue statement was not made by the assured, and that it would operate as a fraud on the plaintiff if he were not permitted to show this fact, e which was not a fact or statement contained in*the policy sued on, but an extrinsic fact or statement contained in the application. The defense made upon that statement was, in legal effect a denial of the execution of the statement-a defense that can always be sustained by parol evidence. However this may have been, we are unwilling to have the case regarded as one overthrowing a general rule of evidence. Some of the remarks contained in the opinion might seem to bear that interpretation, but not necessarily so. That Mr. Justice Miller did not intend, in the case of Union Mut. L. Ins. Co. v. Wilkinson, to lay down a new rule of evidence in insurance cases, is clearly shown in the subsequent case of Merchants' Mut. Ins. Co. *349 351 v. Lyman, 15 Wall. 664, 21 L. ed. 246, where the opinion was delivered by the same learned justice, and who used the following language: "But it is also true that when there is a written contract of insurance it must have the same effect as the adopted mode of expressing what the contract is, that it has in other classes of contract, and must have the same effect in excluding parol testimony in its application to it that other written instruments have. are negotiations and verbal statements merged and excluded when the parties assent to a written instrument as expressing the agreement." "Undoubtedly a valid verbal contract for Eames v. Home Ins. Co. 94 U. S. 621, 24 insurance may be made, and when it is re- L. ed. 298, is another case relied on as show. lied on, and is unembarrassed by any writing that the general rule of evidence was not ten contract for the same insurance, it can applicable in insurance cases. But that was be proved and become the foundation of a the case of a bill in equity filed against an recovery as in all other cases where con- insurance company of New York to require tracts may be made either by parol or in said company to issue to the complainants writing. a policy of insurance against loss or damage by fire, in pursuance of a contract for that purpose alleged to have been made with their agents in Illinois. It was made to appear that the terms of a contract for insurance upon property which was destroyed by fire before the policy was received had been agreed upon. This agreement was manifested by an application signed by the*com-* "Counsel for the defendants in error here plainant, and in several letters which had relies on two propositions, namely, that the passed between the local agent and the genpolicy, though executed January 5th, is real-eral agent of the company, and between the ly but the expression of a verbal contract, complainant and the local agent. The remade the 31st day of December previous, port of the case states that there was an and that the loss of the vessel between those agreement as to certain facts by the attortwo dates does not invalidate the contract, neys in the cause, but what those facts were though known to the insured and kept se does not distinctly appear in the report. cret from the insurers; and, secondly, that However, all that can be claimed for the they can abandon the written contract al- case is that this court considered, from the together and recover on the parol contract. agreement as to facts between the attorneys, "We do not think that either of these and from the application and the several letpropositions is sound. Whatever may have ters between the agents and the complainbeen the precise facts concerning the nego-ant, that a case was made out justifying tiations for a renewal of the insurance pre- a court of equity to decree that complainant rious to the execution of the policy, they was entitled to a policy of insurance to be evidently had reference to a written contract, to be made by the company. When the company came to make this instrument they were entitled to the information which the plaintiffs had of the loss of the vessel. If then they had made the policy, it would have bound them, and no question could have been raised of the validity of the instrument or of fraud practiced by the insured. On the other hand, if they had refused to make a policy, no injury would have been done to the plaintiffs, and they would then have stood on their parol contract, if they had one, and did not need a policy procured by fraudulent concealment of a material fact at the time it was executed and the premium paid. issued for the amount and at the premium shown by the proofs. What was the scope of the authority of the agents who prepared the application and conducted the correspondence does not appear, but the court seems to have assumed that it sufficiently appeared that the agents had authority to act as they did. It is not perceived that this case has any valid application to the case now before us, beyond apparently holding, with Union Mut. L. Ins. Co. v. Wilkinson, in 13 Wall. 232, 20 L. ed. 622, that it may be shown by parol that a statement which purports to have been made by an applicant for insurance was not, in point of fact, his statement, but was really that of the agent. The next case relied on is Knickerbocker "To permit the plaintiffs, therefore, to L. Ins. Co. v. Norton, 96 U. S. 234, 24 L. prove by parol that the contract of insurance ed. 689, and in which it was held by a mawas actually made before the loss occurred, jority of this court that an insurance comthough executed and delivered and paid for pany may waive any condition of a policy afterward, is to contradict and vary the inserted therein for its benefit. As to this terms of the policy in a matter material to proposition there was, and could have been, the contract, which we understand to be op-no disagreement among the judges, but the posed to the rule on that subject in the law of Louisiana as well as at the common law. "We think it equally clear that the terms of the contract having been reduced to writing, signed by one party and accepted by the other at the time the premium of insurance was paid, neither party can abandon that instrument, as of no value in ascertaining what the contract was, and resort to the verbal negotiations which were preliminary to its execution, for that purpose. The doctrine is too well settled that all previous difference arose over the sufficiency of the evidence to show the waiver. The question really was whether the company's agent had authority to extend the payment of a premium note, notwithstanding a provision in the policy that a failure to pay the note at maturity would incur a failure of the policy, and a declaration that the agents of the company were not authorized to make, alter, or abrogate contracts or waive forfeit ures. It was held by the majority that a waiver by the company of both these condi *354 tions might be shown by admitting evidence |ther considered in the case of Globe Mut. L. as to the practice of the company in allow- Ins. Co. v. Wolff, 95 U. S. 326, 24 L. ed. ing its agents to extend the time for pay- 387, when the unanimous opinion of the ment of premiums and of notes given for court was delivered by Mr. Justice Field: premiums, as indicative of the power given to those agents, and that error was not committed by submitting to the jury, upon such evidence, to find whether the defendants had or had not authorized its agent to make an extension in this case. In speaking for the majority, Mr. Justice Bradley said: "The written agreement of the parties, as embodied in the policy and the indorsement thereon, as well as in the notes and the receipt given therefor, was undoubtedly to the express purport that a failure to pay the notes at maturity would incur a forfeiture of the policy. It also contained an express declaration that the agents of the company were not authorized to make, alter, or abrogate contracts, or waive forfeiture. And these terms, had the company so chosen, it could have insisted on. But a party always has the option to waive a condition or stipulation made in his own favor. The company was not bound to insist upon a forfeiture, though incurred, but might waive it. That it [the company] did authorize its agents to take notes, instead of money for premiums, is perfectly evident from its constant practice of receiving such notes when taken by them. That it authorized them to grant indulgence on these notes, if the evidence is to be believed, is also apparent from like practice. It acquiesced in and ratified their acts in this behalf." Mr. Justice Strong, speaking for the dissenting parties, said: "By the residence of the insured within the prohibited district of country during the period designated in the policy without the previous consent of the company, and the failure of the assured to pay the annual premium when it became due, the policy, by its express terms, was forfeited, and the company released from liability, unless the forfeiture was waived by the action of the company, or of its agents authorized to represent it in that respect. "The waiver of the forfeiture for the nonpayment of the premium due on the 1st of November, 1872, is alleged on the ground that the premium was subsequently paid to an agent of the company, he delivering its receipt for the same, signed by its secretary and countersigned by the manager and cashier of the local office, the plaintiff contending that the company, by its previous general course of dealing with its agents, and its practice with respect to the policy in suit, had authorized the premiums to be paid and the agent to receive the same after they became due, and thus had waived any right to a strict compliance with the terms of the policy as to the payment of premiums. "The waiver of the forfeiture arising from the residence within the prohibited district between the 1st of July and November, without the previous consent of the company, is also alleged from the subsequent payment of the premium and its receipt by the local agent, the plaintiff contending that the premium was received with knowedge by the agent of the previous residence of the insured within the prohibited district. . "The insurance effected by the policy became forfeited by the nonpayment ad diem of the premium note. The policy then ceased to be a binding contract. It was so "The conditions mentioned in the policy expressly stipulated in the instrument. could, of course, be waived by the company, Admitting that the company could after- either before or after they were broken; wards elect to treat the policy as still in they were inserted for its benefit, and it de force, or, in other words, could waive the pended upon its pleasure whether they forfeiture, the local agent could not, unless should be enforced. The difficulty in this he was so authorized by his principals. The case, and in nearly all cases where a waiver policy declared that agents should not have is alleged in the absence of written proof of authority to make such waivers. And there the fact, arises from a consideration of the is no evidence in this case that the company effect to be given to the acts of agents of gave to the agent parol authority to waive the company in their dealings with the asa forfeiture after it had occurred. They sured. Of course, such agents, if they bind had ratified his acts extending the time of the company, must have authority to waive payment of premium notes, when the exten-a compliance with the conditions upon the sion was made before the notes fell due. But no practice of the company sanctioned any act of its agent, done after a policy had expired, by which new life was given to a dead contract." breach of which the forfeiture is claimed, or to waive the forfeiture when incurred, or their acts waiving such compliance or forfeiture must be subsequently approved by the company. The law of agency is the same, whether it be applied to the act of an agent undertaking to continue a policy of insurance or to any other act for which his principal is sought to be held responsible. Whatever may be thought of these divergent views, it is clear that the facts of that case are widely different from those here under consideration, where there is no evidence whatever of a waiver by the company, or of authority to the agent, express or im"The company, notwithstanding the proplied, from a course of practice by the com- vision in the policy that its agents were not pany. Here, the company "has chosen," in authorized to waive the forfeitures, sent to the language of Mr. Justice Bradley, "to in- them renewal receipts signed by its secre sist upon the terms of the written con- tary, to be used when countersigned by itstract." local manager and cashier, leaving their useThe subject of waiver by agents was fur-subject entirely to the judgment of the lo |