Opinion
December 17, 1937.
1. INSURANCE: Oral Contract: Policy. In an action on an alleged contract of fire insurance where plaintiff's amended petition alleged that the contract was evidenced by its instrument "filed herewith" (which instrument was an application for insurance), and plaintiff contended that his petition declared on an oral contract of which the application was evidentiary, when defendant insurance company denied generally the allegations of the petition and that such instrument was a contract and alleged that the application was a request for insurance and that the policy attached to the answer was the contract, under the facts shown the trial court erred in refusing to admit in evidence the policy.
2. INSURANCE: Oral Contract: Policy. While there may be an oral contract of insurance, plaintiff's petition alleging that the contract was evidenced by the application filed with the amended petition, it was a declaration on a written contract.
And if there was a written contract between the parties it could have been only the policy.
3. INSURANCE: Trials: Oral Contract. In an action on an insurance contract where plaintiff tried his case on the theory that his amended petition declared on an oral contract and the court permitted him to proceed on that theory, the court erred in refusing to admit the policy in evidence offered by defendant and oral evidence to prove that such policy was the usual, regular and standard form of fire insurance policy issued by the defendant, as tending to show the terms and conditions of the intended agreement.
Where there has been no insurance certificate issued, but only a parol agreement for insurance entered into, the law will presume, in the absence of proof to the contrary, that the parties intended the insurance contract should contain the usual conditions of such contract.
4. INSURANCE: Oral Contract: Standard Policy. Where an action on an insurance contract was tried on the theory that it was an oral contract when defendant insurance company offered to prove by a qualified witness that the policy attached to its answer was the standard, regular and usual form of fire insurance policy, if defendant had complied with Section 5829, Revised Statutes 1929, by filing "the form of policy for use" in this State, the court erred in refusing to admit such evidence.
The plaintiff waived the objection that such evidence was not the best evidence since on his objection to the policy it had been rejected by the court.
5. INSURANCE: Countersigning Policy. In an action for insurance the petition declaring upon an oral contract where defendant's answer alleged that the contract was shown by the policy attached to its answer, the policy was not inadmissible on the ground that it was not countersigned by the defendant's resident agent, where the policy itself provided that it should not be valid until countersigned by defendant's vice president or the manager of the Farm Department at Chicago, Illinois, and it was countersigned by the latter; the policy was not void for lack of the signature of the resident agent as required by Section 5902, Revised Statutes 1929, for it could have been enforced by plaintiff against the insurer.
6. INSURANCE: Removal to Federal Court. In an action on an insurance policy where defendant filed a petition for removal to the Federal Court, alleging that defendant was a New York corporation and that the plaintiff was a citizen of Missouri, under the facts in the case, the filing of such petition did not deprive the circuit court of jurisdiction.
Appeal from Gentry Circuit Court. — Hon. Thomas A. Cummins, Judge.
REVERSED AND REMANDED.
Hogsett, Murray, Trippe Depping for appellant.
(1) The trial court erred in refusing defendant's demurrer to plaintiff's evidence and defendant's requested peremptory instructions 1, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19 and 21. There was a total failure to prove the cause of action alleged in the amended petition, in that plaintiff pleaded a certain written agreement to insure and did not prove it. Cole v. Armour, 154 Mo. 351; Highland Inv. Co. v. Scales Co., 277 Mo. 375; Koons v. St. Louis Car Co., 203 Mo. 255; Bay v. Wank, 215 Mo. App. 157; Phillips v. Thompson, 225 Mo. App. 865; McDonnell v. Stevinson, 104 Mo. App. 195; Haverstick v. Brookshire, 28 S.W.2d 432; Jones v. Hill, 18 S.W.2d 386. Upon the face of the pleadings the payment defense as to the first fire loss and the vacancy defense as to the last fire loss were admitted, because not denied by the reply. These defenses were not put in issue by the general denial in the reply, because it was followed by pleas of confession and avoidance. State ex inf. Hadley v. Delmar Jockey Club, 200 Mo. 65; Holt v. Hanley, 245 Mo. 360; Howey v. Howey, 240 S.W. 451; Cowell v. Employers' Indemnity Corp., 326 Mo. 1103, 34 S.W.2d 705. These two defenses were also conclusively established by the evidence. The claim for the first fire loss was fully paid and settled. The vacancy clause of the policy was concededly violated, because the insured buildings were vacant, unoccupied and uninhabited for five months and four days before the fire, without notice to defendant. The vacancy clause of the policy is valid and will be enforced according to its terms. Cook v. Insurance Co., 70 Mo. 610; Craig v. Springfield F. M. Ins. Co., 34 Mo. App. 481; Wheeler v. Phoenix Ins. Co., 53 Mo. App. 446; Hoover v. Insurance Co., 93 Mo. App. 111; Walton v. Insurance Co., 162 Mo. App. 328; Dawson v. Insurance Co., 1 Mo. App. 317. The violation of the vacancy clause rendered the policy void whether the vacancy contributed to the fire or not. Kenefick v. Insurance Co., 205 Mo. 294; Hoover v. Insurance Co., 93 Mo. App. 120; Marcus v. Insurance Co., 187 Mo. App. 134; Harwood v. Insurance Co., 170 Mo. App. 307; Mathews v. Modern Woodmen, 236 Mo. 326. At the time defendant made offers of settlement to the Hardings the loss had already occurred and the respective rights and defenses of the parties had become fixed; therefore, said offers of settlement did not constitute a waiver of the violation of the vacancy clause. Doerr v. Natl. Fire Ins. Co., 315 Mo. 275; Curtis v. Indemnity Co., 327 Mo. 368; Guest v. Farmers Mut. Fire Ins. Co., 45 S.W.2d 116; Colonius v. Hibernia Fire Ins. Co., 3 Mo. App. 59; Gerhard Realty Co. v. Northern Assurance Co., 86 Mo. App. 600; Leigh v. Springfield F. M. Ins. Co., 37 Mo. App. 549; Maddox v. German Ins. Co., 39 Mo. App. 204; Card v. Phoenix Ins. Co., 4 Mo. App. 428. These offers were in compromise, and on that ground alone they could not operate as a waiver of the vacancy defense. Doerr v. Insurance Co., 315 Mo. 276; Cook v. Continental Ins. Co., 70 Mo. 615; Fink v. Insurance Co., 60 Mo. App. 677. Defendant's retention of the premium on the policy did not operate as a waiver, because defendant was obliged to and did pay the mortgagee under the standard mortgage clause. Doerr v. Natl. Fire Ins. Co., 315 Mo. 276; 14 R.C.L. 1193; 26 C.J. 326; Harwood v. Ins. Co., 170 Mo. App. 304; Senor Muntz v. Fire Ins. Co., 181 Mo. 114. The taking of an affidavit by defendant from the Hardings was not a waiver. This showed rather an intention not to waive the vacancy defense. Schwab v. American Yeomen, 305 Mo. 155; Allman v. Commercial Travelers, 277 Mo. 691. Defendant's payment of $1500 to the mortgagee was not a waiver, because under the independent contract created by the standard mortgage clause defendant was obligated to pay the mortgagee. Berry v. Ins. Co., 317 Mo. 1129; Mosby v. Ins. Co., 285 Mo. 243. (2) The trial court erred in refusing to admit in evidence the policy of insurance. The omission of the resident agent's counter-signature required by Section 5902, Revised Statutes 1929, did not invalidate the policy or render it inadmissible in evidence. Lumbermen's Mut. Ins. Co. v. Railroad Co., 149 Mo. 180; Shelby v. Conn. Fire Ins. Co., 218 Mo. App. 94; Continental Cas. Co. v. Monarch Transfer Storage Co., 23 S.W.2d 213; Kantrener v. Penn Mut. Life Ins. Co., 5 Mo. App. 581; Continental v. Riggen, 31 Or. 336, 48 P. 477; Mass. Bonding Ins. Co. v. Home Life Acc. Co., 119 Ark. 102, 178 S.W. 316; Phoenix Ins. Co. v. Seegers, 192 Ala. 103, 68 So. 905; State Mut. Fire Ins. Assn. v. Brinkley Stave Co., 61 Ark. 1, 31 S.W. 157, 29 L.R.A. 714; Swing v. Brister Co., 40 So. 146; Violette v. Pa. Ins. Co., 92 Wn. 685, 159 P. 896, rehearing denied 161 P. 343; 1 Couch Cyclopedia of Ins. Law, sec. 99; 26 C.J. 58; Ocean Acc. Guar. Corp. v. Paper Co., 162 Wis. 255, 156 N.W. 156; Hartford Ins. Co. v. Matthews, 102 Mass. 224; Kusnetsky v. Security Ins. Co., 313 Mo. 143. Even on plaintiff's belated theory of recovering upon an oral agreement, the policy was admissible to show the usual form of policy issued by defendant on farm risks. Defendant repeatedly insisted that the oral contract theory of the case was erroneous; but when plaintiff with the approval of the trial court shifted to that theory in the middle of the trial, defendant had the right to offer evidence on that theory. Tremayne v. St. Louis, 320 Mo. 129; First Natl. Bank v. Equipment Co., 221 Mo. App. 739. In a case where no policy is issued and only an oral contract is made, the law presumes that the parties intend the contract shall contain the usual conditions of the regular form policy. Swinney v. Conn. Fire Ins. Co., 8 S.W.2d 1092; Duff v. Fire Assn., 129 Mo. 464, Id., 56 Mo. App. 358; Vining v. Franklin Fire Ins. Co., 89 Mo. App. 322; Eames v. Home Ins. Co., 94 U.S. 629; 1 Cooley's Briefs on Ins. (2 Ed.), 556; 1 Couch's Cyclopedia of Ins. Law, sec. 81; Richards on Ins. (4 Ed.), sec. 67; 26 C.J. 78; Robinson v. Franklin Fire Ins. Co., 35 S.W.2d 638.
Crossan Hall, F.P. Stapleton and DuBois, Miller Beavers for respondent.
(1) The trial court did not err in refusing the peremptory instructions requested by defendant. Sec. 817, R.S. 1929; Fogle v. Fidelity Phenix Fire Ins. Co., 99 S.W.2d 521; Devore v. Franklin Ins. Co., 25 S.W.2d 132; Pritchard v. Conn. Fire Ins. Co., 203 S.W. 223; Harrison v. Lakenan, 189 Mo. 581; Pattison (2 Ed.), Mo. Pleading, sec. 121, p. 140; Hughes v. Abraham Lincoln Life Ins. Co., 84 S.W.2d 973; Tynes v. Terrill, 19 S.W.2d 505; Porter v. Equitable Life Assur. Co., 71 S.W.2d 766; Furren v. Haupt, 49 S.W.2d 53; Walton v. Carlisle, 281 S.W. 402; Bammert v. Kenefick, 261 S.W. 78; Young v. Levin, 31 S.W.2d 978; Ridenhour v. K.C. Cable Co., 14 S.W. 760; Wolfe's Execx. v. Lauman, 34 Mo. 575. The payment defense as to the first fire loss and the vacancy defense as to the last fire loss were not admitted, but were denied by the reply. 1 Houts Mo. Pleading Practice, sec. 104, p. 180; Excelsior Steel Furnace Co. v. Smith, 17 S.W.2d 378; Woodson v. Williams, 204 S.W. 183; Sullivan v. Bank of Harrisonville, 293 S.W. 129; Adair v. K.C. Terminal Ry. Co., 282 Mo. 133; Fleming v. McMahon Contracting Corp., 45 S.W.2d 952. The evidence conclusively established a waiver of the vacancy defense. Senor v. Ins. Co., 181 Mo. 104; Wild Rice Lbr. Co. v. Royal Ins. Co., 108 N.W. 871; Fidelity Phoenix Ins. Co. v. School Dist., 174 P. 513; Security Ins. Co. v. Baldwin, 234 P. 348; Pallatine Ins. Co. v. Commerce Trust, 175 P. 930; Block v. Fid. Guar. Co., 316 Mo. 278; Morrison v. Fidelity Ins. Co., 71 S.W.2d 816; Francis Hunter v. A.O.U.W., 150 Mo. App. 347; Keys v. Knights Ladies, etc., 174 Mo. App. 671; Daniel v. Aetna Life Ins. Co., 36 S.W.2d 688; Springfield Fire Marine Ins. Co. v. Cockrell Holding Co., 169 P. 1060. (2) The trial court did not err in refusing to admit in evidence the policy of insurance. (a) An oral contract of insurance is valid. Edwards v. School Dist. No. 73 of Christian County, 29 S.W. 1001; Bailey v. James School Dist., 77 S.W.2d 1017; Bailey v. St. Joseph Fire Marine Ins. Co., 73 Mo. 371; Bird v. Moore, 66 Me. 337; Devore v. Franklin Ins. Co., 25 S.W.2d 131; Robinson v. Franklin Ins. Co., 35 S.W.2d 635. (b) The policy, defendant's Exhibit F not being countersigned, as required by Section 5902, Revised Statutes 1929, was not admissible in evidence. Cravens v. Insurance Co., 148 Mo. 583; McKinney v. Insurance Co., 270 Mo. 316; Head v. New York Life Ins. Co., 241 Mo. 406; Ward v. Iowa State Ins. Co., 4 S.W.2d 895; McNab v. Niagara Fire Ins. Co., 22 S.W.2d 364; Shelby v. Conn. Fire Ins. Co., 218 Mo. App. 84; Royal Exchange v. Almon, 202 Ala. 374, 80 So. 456; Badger v. American Poplar Co., 103 Mass. 244; Newcombe v. Provident Fund Society, 38 P. 61; Rogers v. American Natl. Ins. Co., 145 Ga. 470: Sparks v. Maux, 148 P. 926; Grady v. Am. Central Ins. Co., 60 Mo. 117; Home Ins. Co. v. Moberly, 157 P. 324. Under Section 5774, Revised Statutes 1929, a life insurance company is required to insert in or attach to each policy issued by it a copy of the application for the insurance. Under this statute, the courts have uniformly held that unless the statute is complied with, and the application, or its substance attached to the policy, the application will be excluded as evidence. Hicks v. Met. Life Ins. Co., 196 Mo. App. 162; Schulen v. Met. Life Ins. Co., 191 Mo. App. 62; Clay v. Insurance Co., 216 Mo. App. 299. Under the Statute of Frauds, no action can be maintained unless some memoranda is signed by the party to be bound, and this is a rule of evidence. Heath v. Beck, 231 S.W. 657. Failure to comply with Section 774, Revised Statutes 1929, makes the sale of a motor vehicle void. State ex rel. Conn. Fire Ins. Co. v. Cox, 306 Mo. 537, 268 S.W. 87. (c) The policy was not admissible for the purpose of showing the usual standard form of policy issued by defendant on farm risks. Sweeney v. Connecticut Ins. Co., 8 S.W.2d 1090; Robinson v. Franklin Fire Ins. Co., 35 S.W.2d 635; Vining v. Franklin Fire Ins. Co., 89 Mo. App. 311; Duff v. Fire Ins. Co., 129 Mo. 460; National Ins. Co. v. Milligan, 10 F.2d 483. (3) The trial court did not err in submitting the case to the jury upon the theory of an oral contract of insurance. (4) The trial court did not err in submitting the issue of vexatious refusal to pay the loss and in approving an award of $1000 attorney's fee to plaintiff. (5) The evidence of plaintiff's witness, Charles E. Harding, to the effect that its agent, Lancaster, told Harding that Exhibit 2 was a duplicate of the policy was clearly admissible and said Exhibit 2 of the plaintiff was likewise admissible. 26 C.J. 78; Parr v. Insurance Co., 178 Mo. App. 155; Sanford v. Orient Insurance Co., 54 N.E. 883.
Action to recover for loss and damage by fire, based upon an alleged contract of fire insurance. Plaintiff, Fogle, suing as assignee of the insured, Charles E. and Minnie A. Harding, husband and wife, owners of the burned property, recovered judgment for $3175.32. Appeal was granted defendant to the Kansas City Court of Appeals, where, on a rehearing, the judgment was reversed and the cause remanded, but by a divided court, one judge dissenting. On request of the dissenting judge the cause was certified to this court, pursuant to constitutional mandate, and is here for determination on the merits. The majority and minority opinions of the Court of Appeals appear in 99 S.W.2d 518 et seq.
The case was tried upon an amended petition which, after alleging in substance that plaintiff was a resident citizen of the State of New York and that defendant was a fire insurance corporation organized under the laws of that State, licensed to do business in Missouri, and that Charles E. and Minnie A. Harding owned the insured property, alleged that on December 20, 1931, the defendant, in consideration of $158.79 paid to it by the Hardings "did agree to insure and did insure Charles E. and Minnie A. Harding against all direct loss or damage by fire in the total sum of fifty-five hundred dollars ($5500.00) and on . . . (property described, giving amounts on each of a number of items), said insurance being for a period of three years, beginning on December 20th, 1931, and terminating December 20th, 1934; that said agreement was evidenced by defendant by its instrument in writing, filed herewith and marked Exhibit A." (Italics ours.)
Defendant, by its verified answer, denied generally the allegations of the amended petition and specifically denied having executed the contract or a contract such as pleaded by plaintiff, averring that the exhibit attached to plaintiff's petition was not a contract of insurance but only a portion of an application for insurance and that the actual contract was the policy described in and attached to the answer, a verified copy of which was attached to and filed with the answer. Said policy is numbered 0133466 and was offered in evidence as defendant's Exhibit F — but on plaintiff's objection was rejected by the court. The answer pleaded at length the provisions of said policy, including a provision that if the insured buildings should become "vacant, unoccupied or uninhabited and so remain for a period exceeding ten days, without written consent hereon . . . this entire policy shall be null and void." The answer also pleaded a "mortgage clause," attached to the policy, in favor of the Northwestern Mutual Life Insurance Company, which held a $4500 first deed of trust on the insured property. The answer pleads breaches by the insured of conditions of the policy, especially of the vacancy clause.
Plaintiff's reply denied generally the "new matter" (without other designation) set out in the answer, and denied that any written contract ever existed "as alleged in defendant's answer" but averred if the provisions of "such contract as alleged in defendant's answer were a part of such contract" plaintiff had fully performed them. If further reference to the pleadings is necessary it will be made in the course of the opinion.
The Hardings owned a farm of 175 acres in Johnson County on which were a dwelling house, barn and a number of appurtenant outbuildings. Part of the farm, 135 acres, on which were said buildings, was covered by a deed of trust securing $4,500 to the Northwestern Mutual Life Insurance Company. On December 20, 1931, Mr. Harding applied to Charles E. Lancaster, defendant's local agent, for insurance on said buildings. He (individually) signed and delivered to Lancaster a partially filled out printed form of application. It stated the amount of insurance requested on each building and that the insurance was to be for a period of three years from December 20, 1931, and contained this clause: "Loss, if any, payable to Northwestern Life Insurance Company . . . as interest may appear." Plaintiff introduced this application as his Exhibit 1. As introduced in evidence it bore at the top the notation "0133466" and had attached to it a paper headed "to attach to policy No. 0133466, name of assured C.E. and Minnie A. Harding, State of Mo. Date Chicago, 10-1-32, 19__, Endorsement," which paper made some changes in certain items of the coverage, not here material. As introduced in evidence said Exhibit I also had attached to it a "standard mortgage clause," which by its terms was to be attached to and form part of "policy No. 0133466," and was dated December 20, 1931. It also bore this endorsement:
"Name of Assured C.E. Harding.
"Notice is hereby taken that the within described property is owned jointly by C.E. Harding and his wife Minnie A. Harding.
"Loss, if any, payable accordingly.
"Attached to and subject to all conditions of Policy No. 0133466 of the Fidelity-Phenix Fire Insurance Co. of New York. Chicago 2-29-32."
It appears from Harding's testimony that these endorsements were made after he had signed the application. The last one above mentioned was made at his request. He testified that he had nothing to do with attaching the "mortgage clause." He further testified that at the time of making the application Lancaster examined, with him, the buildings and determined the amount to be written upon each and promised to write the insurance, for a period of three years from December 20, 1931; that the premium was to be $158.79, which he paid; that Lancaster said he would take "these papers" (evidently the application), fill them out and "return my duplicate policy to me and send the policy direct to Northwestern Mutual Life Insurance Company as they held the loan against the land;" that Lancaster filled out the blanks in the application, so far as they were filled at all, later, and after he, Harding, had signed the application. He testified that Lancaster said he would send or bring him a duplicate of his policy, and later did give him what he, Lancaster, said was "a duplicate of my contract, that is what I understood it was." Plaintiff was handed his Exhibit 2, which is the Exhibit A referred to in and attached to the petition. It is substantially the same as Exhibit 1 (application) above referred to. This followed:
"Q. He said it was a duplicate of your insurance contract? A. Yes, sir.
"By Mr. HOGSETT: Just a moment. We object. That is calling on the witness to vary the terms of the instrument, which on its face shows it is on a printed form and headed `application' and shows that it is an application and not a policy and no insurance contract. It is a printed form of application and shows on its face. It is an attempt to vary the terms of the printed instrument."
The court overruled the objection, defendant excepting. Plaintiff then, over defendant's objection, introduced in evidence said Exhibit 2. Harding also testified that on December 20, 1931, Lancaster told him his insurance would take effect "right now;" that said Exhibit 2 was the only writing he had received. When said Exhibit 2 was introduced defendant's counsel asked "may the record show that the exhibit you are passing to the jury is an exhibit which was attached to the amended petition and upon which the suit is predicated?" to which plaintiff's counsel replied, "Yes, sir."
The application (Exhibit 1) above referred to, as well as Exhibit 2, contains a direction "mail policy to agent," and it clearly appears from Harding's testimony that he understood and intended that if his application was accepted a written policy would be issued and by his approval and direction was to be sent to the mortgagee. Pursuant to such understanding the policy was issued and was mailed by the insurer to Lancaster, and by the latter transmitted to the insurance company, mortgagee. Harding himself did not actually see the policy prior to the fire, though, as stated, he contemplated and intended that a written policy would be issued and understood that such had been done. After the fire in question he made proof of loss, referring therein to policy No. 0133466.
In September, 1932, an old building called a smokehouse was burned and some slight damage was done to the dwelling and another building. That loss was adjusted and defendant gave Harding a check for $10 in settlement thereof, though Harding says he never cashed the check. Defendant claimed that the smokehouse was not covered. In the present suit there was a claim for $100 on that smokehouse, for which plaintiff recovered. For details concerning this see dissenting opinion in Fogle v. Fidelity-Phenix Fire Insurance Co., supra, 99 S.W.2d 518, l.c. 524, et seq. In March, 1933. there was a group of fires, of apparently incendiary origin, involving several of the insured buildings. These were extinguished by the Hardings. No substantial loss occurred and no claim was presented on account thereof. Thereafter, about April, 1933, the Hardings leased the premises to a tenant, Casey, and moved to Worth County. This fact was reported to defendant's agent and an endorsement was issued by defendant consenting thereto. Casey, on account of crop failure, etc., abandoned the premises in September, 1933. Thereafter and until the fire here in question, a period of some five months, the premises, including the insured buildings, were vacant and unoccupied, as the Hardings knew. No notice of such vacancy was given defendant, and such fact was unknown to it until after the fire here in question, and of course, therefore, no consent was given by defendant for such vacancy. Defendant asserted at the trial herein that it would not have issued a vacancy permit on mortgaged farm property.
About midnight on February 12, 1934, while the buildings were still vacant, seven fires, of apparently incendiary origin, broke out at about the same time, in seven separate buildings, all covered by the insurance in question. It is not contended and there is no evidence tending to show that the Hardings had anything to do with any of these incendiary fires.
After the fires of February 12, 1934, defendant paid the mortgagee $1500, pursuant to the "mortgage clause" attached to the policy. The Hardings thus obtained credit for that amount on their debt to the insurance company. After the fire defendant's adjuster attempted to settle with Mr. Harding, first offering $1133.33 in settlement, later $1775, — "one half of the loss" — which offers Harding declined, saying he did not know what would be satisfactory to the mortgagee.
Defendant offered in evidence the policy it had issued, No. 0133466 (its Exhibit F), three times in the course of the trial, and upon the following theories: (1) That the application was not a contract of insurance but a mere offer or request for insurance and that said Exhibit F was the real contract: (2) that even if there was an oral contract the law presumes that the parties intended the contract should embrace the usual policy conditions, and in that connection it offered to prove that said policy did embrace such usual conditions; and (3) that the policy was competent evidence showing that the Hardings had collected a loss thereunder, — the $1500 paid to the mortgagee. The court rejected all of said offers. A more detailed statement of the facts appears in the two opinions in Fogle v. Fidelity-Phenix Fire Ins. Co., supra. If deemed necessary to state further facts in our disposition of this appeal same will be done hereinafter.
We think the trial court erred in refusing to admit in evidence defendant's Exhibit F, the policy issued by it, and that the error was material and prejudicial, necessitating reversal of the judgment. Plaintiff contended at the trial that his petition declared upon an oral contract of insurance and that the application, his Exhibit 1, and his Exhibit 2 (the Exhibit A referred to in and attached to the petition), were evidentiary of the oral contract he relied upon. [Devore v. Franklin Fire Ins. Co., 223 Mo. App. 1162, 25 S.W.2d 131.] Plaintiff's case on his part, was tried and submitted to the jury on the theory that he was suing on an oral contract of insurance, and his recovery was upon that theory. That there may be a valid oral contract of insurance seems not to be seriously disputed, and need not be discussed. But see, in effect so holding, Baile v. St. Joseph Fire Marine Ins. Co., 73 Mo. 371; Devore v. Franklin Fire Ins. Co., supra; McNabb v. Niagara Fire Ins. Co. (Mo. App.), 22 S.W.2d 364. [2] In our opinion plaintiff's petition can only be construed as declaring on a written contract and not upon an oral contract. It alleges that defendant agreed to and did insure the Hardings and that said agreement was evidenced by its instrument in writing, referred to in and filed with the amended petition. Plaintiff argues that by such allegation he meant only that said exhibit was evidence — some evidence — of the oral contract relied upon and which, as we understand him, he contends was otherwise sufficiently pleaded. He did not, however, rely upon said exhibit as, of itself, fully "evidencing" his claimed oral contract, but introduced oral evidence in addition. It is not usual or necessary to plead what amounts merely to evidence by which a pleaded cause of action is to be sustained. Plaintiff's amended petition (as his original petition, which was introduced in evidence), was in form appropriate to declare upon a written contract and we agree with the majority opinion of the Court of Appeals that it did so declare. The defendant so understood and construed it and framed its answer accordingly. It first offered its Exhibit F on that theory. If there was a written contract between the parties it could only have been said policy. It is conceded that neither plaintiff's Exhibit 1 (the application) nor his Exhibit 2 constituted a contract of insurance. Each, on its face, was and purported to be only a partially filled in application for insurance. Each contemplated, as shown on the face thereof, that, if accepted, a written policy would be issued.
However, as we have said, plaintiff tried his case upon the theory that his amended petition declared upon an oral contract and the court permitted him to proceed upon that theory. Without going into detail we think it sufficient to say that it appears from the record that defendant combatted that theory, contending that the suit was founded upon a written contract, but, when overruled by the court on that proposition attempted to meet plaintiff on that battle front, and on that issue again offered its Exhibit F as evidence of the usual conditions of policies issued by it, and in this connection offered to prove, by oral evidence, that said Exhibit F was the usual, regular, ordinary, standard form of fire insurance policy on farm property being used and issued by defendant at the time in question. These offers were refused.
In this connection it may be stated that when plaintiff indicated that he was trying the case on the theory of an oral contract and the court indicated that it was permitting trial on that theory, defendant did not file an affidavit of surprise, under Section 817, Revised Statutes 1929 (Mo. Stat. Ann., p. 1070), providing that no variance between pleading and proof shall be deemed material unless it shall have misled the adverse party to his prejudice and that when it is claimed that a party has been so misled such fact must be proved to the satisfaction of the court by affidavit showing in what respect such party has been misled. Plaintiff contends that even if his petition be construed to declare upon a written contract the proof of an oral contract was merely variance and that defendant's failure to file the statutory affidavit precludes it from urging that matter on appeal. Contra, defendant argues that it constituted a complete failure of proof of the cause of action pleaded and that said statute has no application. We deem it unnecessary to decide that question because if the case is retried it will doubtless be on amended pleadings under which such question will not arise.
We think that even on the theory that the contract was oral the policy should have been admitted as tending to show the terms and conditions of the intended agreement. In Swinney v. Conn. Fire Ins. Co. (Mo. App.), 8 S.W.2d 1090, 1092 (2-3) it is said:
"It is also well settled that, if there had been no insurance certificate issued in this case, but only a parol agreement for insurance entered into, the law would presume, in the absence of proof to the contrary, that the parties intended that the insurance contract should contain the usual conditions of such contracts. [Vining v. Franklin Fire Ins. Co., 89 Mo. App. 311; Duff v. Fire Association, 129 Mo. 460, 30 S.W. 1034.]"
In Duff v. Fire Association, supra, 129 Mo. l.c. 464, the court quotes with approval from 1 May on Insurance (3 Ed.), section 23: "The terms of the agreement for a policy not specified are presumed to be those of the ordinary policies issued by the same insurers on similar risks." The suit was upon an alleged oral contract, it being further alleged that the defendant's agent promised to deliver a policy to the plaintiff but did not do so. It was contended that the petition was defective in that it failed to set forth the terms and conditions of the policy that was to have been issued and aver performance of such conditions. This court denied that contention, holding the petition sufficient, and saying, 129 Mo. l.c. 466, 30 S.W. 1034:
"Facts raised by merely legal implication cannot be constitutive facts necessary to be averred, in order to state a cause of action, under our system of pleading. Such constitutive facts are the actualities of the transaction. A legal implication, from those actualities, of other facts, may authorize the use of such implied facts to defeat a recovery, but cannot be essential to the statement of a cause of action which arises, if at all, upon the statement of the actual facts.
"If such implied facts need not be averred in order to state a cause of action, much less need they be averred for the purpose of making an anticipatory plea discharging their force and effect. It was for the defendant to show that the actualities of the transaction in this case are subject to the implication, the protection of which it seeks, which it could only do by producing the form of policy which the association issues upon similar risks, containing conditions which must be performed before recovery can be had, and showing a breach of some such conditions. Unless such form, containing such conditions, be pleaded and produced by the defendant on the trial, no implication could arise that plaintiff's contract was made with reference to the particular conditions therein contained, and the plaintiff may recover on the actual completed oral contract of insurance without conditions, just as it was in fact made and set out in the petition."
In the case before us the defendant did not plead the usual terms and conditions of policies issued by it, but in this respect we think this case is distinguishable from the Duff case. In the Duff case the petition declared upon an oral contract, pleading sufficient facts to constitute such contract. In the instant case the petition declared upon a written contract. Defendant was called upon to meet that pleading. It could hardly be expected to anticipate that plaintiff would present his case, or be permitted to present it, on the theory of an oral contract and to file an anticipatory answer to meet issues not presented by plaintiff's petition.
When, after vainly protesting that the petition declared upon a written contract, defendant attempted to meet plaintiff's contention that the suit was on an oral contract, it offered to prove, by a witness qualified to testify thereto, that the policy (Exhibit F) was the standard, regular and usual form of fire policy used by the defendant and other insurance companies writing farm policies in Missouri, and further offered and attempted to introduce the policy. To these offers plaintiff made this objection, which was sustained by the court, viz.:
"The plaintiff objects to the answer sought by this question for the reasons following: That the policy shows for itself its terms and is the best evidence. Second — the policy has already been excluded by the court. Third — that in any event this plaintiff could not be bound by any customary policy. That this case from the plaintiff's standpoint is based on an oral contract of insurance, complete in every respect, and containing all terms essential to make a valid and legal oral contract and could not be in any way affected by the customary policy or customary form of the defendant. In other words we have a complete oral contract of insurance, like any other contract. Not a thing lacking."
The statute, Section 5829, Revised Statutes 1929 (Mo. Stat. Ann., p. 4459), requires fire insurance companies doing business in this State to file "the form of policy for use" by them in this State. Assuming that defendant had complied with that statute it is argued that such filed form or a certified copy thereof was the best evidence. But the objection to the offer of proof as to the usual terms and conditions of fire insurance policies was not made upon that ground. The only objection along that line, as being best or secondary evidence, was that the policy, not the form presumably filed pursuant to statute, was the best evidence. Defendant was offering and trying to introduce in evidence that policy. We think it clear that a party may waive the objection that offered evidence is not "the best" evidence. Certainly, in the circumstances, plaintiff cannot urge that what he claimed was the best evidence — the policy — was not introduced when said policy was offered by defendant and upon plaintiff's objection was rejected by the court.
It appears that one reason, perhaps the reason, why the court refused to admit the policy in evidence was that it was not countersigned by Lancaster, defendant's resident agent, as required by Section 5902, Revised Statutes 1929 (Mo. Stat. Ann., p. 4501). Lancaster testified that he "overlooked" countersigning the policy. The policy itself provided that it should not be valid until countersigned by defendant's vice president or "the manager of the Farm Department at Chicago, Illinois." It was countersigned by the latter. When the policy was first offered plaintiff objected on the ground, in substance, that because the policy was not countersigned by the resident agent it was not a legal contract and not binding on plaintiff — in effect that it was void, at least as to plaintiff. The objection was sustained. The policy was not void for lack of countersignature by the resident agent. It could have been enforced by plaintiff against the insurer. [See Shelby v. Conn. Fire Ins. Co., 218 Mo. App. 84, 262 S.W. 686; Lumbermen's Mut. Ins. Co. v. Railroad Co., 149 Mo. 165, 50 S.W. 281; State ex rel. Chorn v. Hudson (Mo. App.), 222 S.W. 1049.] Whether or not the insurer could assert the validity of the policy as a contract, notwithstanding its failure to comply with the statute, we shall not here undertake to determine. When the policy was offered the second time it was in response to plaintiff's then asserted theory of a suit on oral contract and for the purpose of showing the usual terms and conditions of policies issued by defendant and other companies insuring farm properties in Missouri. Whether countersigned by the resident agent or not we think it should have been admitted for that purpose.
Defendant timely filed petition and bond for removal to the Federal Court. The petition alleged that defendant was a New York corporation and a citizen and resident of that State; that the Hardings were citizens and residents of Missouri; that plaintiff was a citizen and resident of New York; that the assignment of the cause of action to plaintiff was made for the sole purpose of fraudulently attempting to prevent removal of the cause to the Federal Court. The trial court denied the petition for removal. On facts analogous to those presented in the instant case the United States District court, Western District of Missouri (by OTIS, J.), upon review of the authorities, denied a petition for removal. Under that decision the filing of the petition for removal herein did not deprive the circuit court of jurisdiction. [See also, Mecom v. Fitzsimmons Drilling Co., 284 U.S. 183, 52 Sup. Ct. 84, 76 L.Ed. 233.]
Other alleged errors are assigned in briefs of counsel which we think need not be discussed herein. In the event of another trial if such questions arise they can best be ruled under the pleadings and issues then presented.
The judgment should be reversed and the cause remanded. It is so ordered. Westhues and Bohling, CC., concur.
The foregoing opinion by COOLEY, C., is adopted as the opinion of the court. All the judges concur.