Gosch v. State Mutual Fire Insurance (44 Ill. App. 263, 1892)

Waterman, P. J.

The action of the court below appears to have been based upon the opinion that no liability had been incurred because the premium had not been received by the association, Gay, in the view taken by the court, not being for any purpose an agent of the company.

The policy contains the following among other conditions :

“ It is part of this contract that any person other than the assured, who may have procured this insurance to be taken by this association, shall be deemed to be the agent of the assured named in this policy, and not of this association under any circumstances whatever, or in any transaction relating to this insurance; and no agent is authorized to change or waive any of the conditions of this policy. And in case the cash, premium herein mentioned be not paid in advance, at the time of making or the declaring of this policy, then no insurance or liability under this policy shall attach, but the same shall be null and void, and of no effect. The payment in cash and in advance of the premium herein mentioned is a condition precedent to the validity of this contract.”

“ Clause 12. The insured heretofore named, by accepting this policy, thereby becomes a member of this association, and agrees to pay them the premium annually, in cash and in advance, during the life of this policy; and in addition thereto such sum or sums, in no event to exceed in the aggregate four times the amount of said cash premium, at such time or times, in such manner, and by such installments, as the directors of said association shall assess and order pursuant to its charter and by-laws, and the laws of the State of Illinois.”

It is a familiar rule, resulting almost inevitably from the circumstances of the case, that where an insurance company has delivered its, policy the delivery is prima facie evidence that the conditions in the policy providing that the insurance shall not take effect until the premium is paid, are waived; and an intention to give a short credit for the premium will be presumed. Electric Life Ins. Co. v. Fahrenking, 68 Ill. 463-467; Lebanon Mutual Ins. Co. v. Erb, 112 Penn. State, 149; Boehm v. Williamsburgh City Ins. Co., 35 N. Y. 131; Bodine v. Exchange Fire Ins. Co., 51 N. Y. 117; Young v. Hartford Fire Ins. Co., 45 Iowa, 377; Train v. Hollans Purchase Ins. Co., 62 N. Y. 598. It is not denied that appellee issued this policy; what did it intend and mean when it did so ? And what is the true construction to be placed upon its provisions in view of all that was done by this fire association? Is it possible that when appellee sent out this policy in which it declared that it agreed to indemnify John Gosch against loss or damage by fire from the 2d day of June, 1891, to the 2d day of June, 1892, it meant to- be understood that it had done nothm