Action on policy of fire insurance..
To the' complaint the defendant interposed the plea of the general issue and a number of special pleas. Plea 8 to which a demurrer was sustained neither denies nor confesses and avoids the allegations of the complaint. The demurrer was properly sustained to it.
Plea 9 was also faulty in not setting out the terms of the policy sued on, so that the court could determine the right of defendant to cancel it and thereby terminate *656its liability thereon. Whether the cancellation asserted was in accordance with the terms of the policy was a question of law, and the court could not decide that question unless the terms of the policy under which defendant asserted its right of cancellation were set out in the plea. Hardy v. Br. Bank, 15 Ala. 727; Mead v. Hughes, Ib. 141.
Plea 10 was in substance and legal effect a plea of non est factum and urns not sworn to. The complaint is in Code form and implies an action in the name of the assured mentioned in the policy issued to the plaintiff.— Feibelman v. M. F. I. Co., 108 Ala. 180.
It appears from the averments of the fifteenth plea that by the terms and conditions of the policy the defendant reserved the right to cancel it upon giving the assured five days notice. It is also shown by the plea that the property insured was the property of the plaintiff, and that she was named in the policy as the assured, and it is not averred that notice of cancellation was given to her by. defendant. On the contrary the notice was only given to Janette Mauchlin Avho was named as mortgagee to whom “loss Avas payable as her interest might appear.” It does not appear what Avas the amount of her mortgage •debt, if that were important, or that defendant had the right under the policy to give the notice to Mrs. Mauchlin as the representative of the assured, the plaintiff, or that she had the right to surrender it for cancellation without the consent or authority of plaintiff. For clearly the facts alleged cannot be construed that Mrs. Mauchlin Avas plaintiff’s agent in respect to- surrendering the policy or receiving the notice.
The fact that she had possession of the policy, we apprehend, did not confer upon her the right to surrender it for cancellation without the consent of plaintiff.
It is true the text in 16 Am. & Eng. Ency. Law (2nd ed.) p. 873, relied upon by appellant as sustaining the sufficiency of the plea lays down broadly the rule that “when by the terms of the policy the loss is made payable to a mortgagee of the insured premises, notice to such mortgagee of the cancellation of the policy is sufficient and it is also not necessary to notify the owner.” The only authority cited to support this prouosition is the case of Meuller v. S. F. I. Co., 87 Pa. 309. An examination of *657that case discloses that it does not support the proposition. There the policy authorized the defendant to give the notice to the “assured or his representatives.” The court held that under the policy the mortgagee' was the “representative” of the assured and that defendant had the right to give the notice to him, which in no wise contravenes the principle universally recognized, that the right in the defendant to cancel the policy is strictly construed and the condition imposed upon it with respect to giving notice of cancellation must be strictly performed. — 1 Biddle on Insu. 368; 1 May on Insu. 367, et soq; 16 Am. & Eng. Eney. Law (2nd ed.), p. 873; 2 Joyce on Insu. .§ 1660.
The 13 land 14 replications were amended so as to meet ilie demurrers interposed to each of them. After amendment they were not demurred to.
The 3rd plea sets up that plaintiff did not, before the commencement, of the suit, give notice to the defendant in writing of the loss as required by a term of the policy; and the 4th, that plaintiff did not give immediate notice to defendant in writing of filie loss as required by the policy. The provision of the policy with respect to notice, is in this language: “If a fire occur the insured shall give immediate notice of any loss thereby in writing to tin' company,” etc.
The 16th replication to these pleas simply avers that defendant had actual notice of the loss within forty-eight hours after the fire. It will be observed that it is not averred how the actual notice was by the defendant acquired, whether by information given by the assured in writing or otherwise or by acquiring the information from a stranger or by an agent of the company visiting the “scene of the fire” or in some other way. Construing the replication most strongly against the pleader, as we must do, it cannot be held that the notice was acquired in the manner provided by the policy, but as ascertaining broadly that knowledge on the part of the defendant of the loss in whatever manner acquired, excused the giving of the written notice of the loss by the assured, it does not attempt, to set up a waiver by defendant of the notice which the assured bound itself to give. The fact that the company knew of the loss did *658not excuse the giving of the notice within a reasonable time. — 2 Ward on Fire Insu. p. 939; 1 Joyce on Insu. § 576. The replication was clearly insufficient and the demurrer interposed to it should have been sustained.
It is however insisted by appellee that the overruling of the demurrer was inocuous. This seems to be predicated upon the theory that the averments of the 13th and 14th replications, as amended, were, as a matter of law, undisputedly established by the evidence.
It is true the evidence does show that plaintiff’s husband, acting as her agent gave verbal notice of the loss to the local agent of defendant who issued the policy, and that in a conversation between them on that occasion something was said by defendant’s agent about the policy having been cancelled. But what was said was a matter of dispute between them on the trial. If the agent’s version of that conversation be the true one, clearly neither of the replications can be said, as matter of law, to have been proven. — Queen Insu. Co. v. Young, 86 Ala. 431. Nor do we mean to here affirm that if plaintiff’s husband’s version be the correct one that the replications were proved. If his statement be taken as true, and as showing an unqualified denial of liability of the company on the paid of the agent, whether this constituted a waiver by defendant of the notice required to be given depends upon the authority of "the agent to bind it by his statement, which will be adverted to later on in this opinion.
It is not insisted that the other replications to these pleas to wit; 15, 17, 19 and 20 were proven beyond adverse inference. It folloivs, therefore, that'it cannot be declared that the error complained of ivas not injurious to defendant, since it is impossible to affirm'upon which of the issues of fact presented by the several replications, that the verdict of the jury was responsive to.
The 19th and 20th replications present substantially the same issue, viz; that defendant was not entitled to notice or proof of loss on account of its violation of section 2619 of the Code, by belonging to or being' connected with a tariff rate mailing association. The objection urged against the sufficiency of these replications is that the statute is unconstitutional. The statute does not *659create an absolute liability on an unoffending insurance company, nor does it impose a penalty for making a defense in the courts. It deprives all persons and corporations alike engaged in the business of fire insurance from demanding certain proof to be made by the insured and imposes a penalty as a consequence of its violation. The manifest purpose of the statute was to prevent monopoly and to encourage competition. The evil thus intended to be remedied was one violative of public policy as defined by the common law.- The statute only imposes a penalty on what ivas already offensive to public policy. It did not make that which was innocent an offense, but simply provided a punishment for doing that which was already prohibited. In other words, it is a legitimate exercise of the police power of the State. — 1 Tiedeman on State & Federal Control of Persons and Property, § 105. Nor is it violative of the constitutional provision for singling out particular persons or corporations and discriminating against them. It applies alike, as said above, to all persons or corporations, domestic or foreign, engaged in the business of fire insurance.- — Youngblood v. B. T. & S. Co., 95 Ala. 521; O. Insu. Co. v. Daggs, 136 Mo. 382; S. C. 172 U. S. p. 557.
Nor is it of consequence that the defendant is a foreign corporation. The state has the power to prevent foreign corporations from making contracts within its borders altogether or to impose such terms as it may deem expedient, provided they do- not conflict with the exclusive powers of congress.
That foreign insurance companies are not engaged in inter-state commerce is too well settled to admit of dispute.
As said by the Supreme Court of the United States in Paul v. Virginia, 8 Wall. 168: “The policies are simple contracts of indemnity against loss by fire, entered into between the corporation and the assured, for consideration paid by the latter. These contracts are not articles of commerce in any proper meaning of the word. They are not subjects of trade and barter offered.in the market as something having an existence and value independent of the parties to them. They are not commodities to be shipped or forwarded from one state to another *660and then put up for sale. They are like other personal contracts between parties which are completed by their signatures and the transfer of the consideration.
“Such contracts are not interstate transactions, though the parties may be domiciled in different states-.” The demurrer to the replication was properly overruled.
This disposes of all assignments- of error insisted on relating to rulings on pleadings.
Many written charges refused to defendant are assigned as error, and several of these assignments are insisted upon. But we will not undertake to pass upon them in detail. Suffice it to say that under the evidence, it was a question for the jury to determine Avhether the Birmingham underAvriters agency had authority to Avaive notice and proof of loss. — Robinson v. Aetna Insu. Co., 128 Ala. 477.
That agency, it seems, had the authority, among other things-, to cancel policies of insurance issued by it for defendant; from this, and other acts, done by the agency, not expressly conferred by the instrument appointing it as agent, and recognized by its principal as having authority to do, it Avas open to the jury to* find that its agent had authority to deny the defendant’s liability on account of the policy having* been cancelled. And if it, through its president Smith, made a distinct denial of defendant’s liability (a fact to be ascertained by the jury), because the policy had been cancelled, this Avould be a waiver of-the notice and proof of loss as required of the assured by the policy.
Again, under the evidence AAdiether the defendant was in any wise connected with a traffic rate making association, in violation c-f the statute, Avas also a question for the jury.
Reversed and remanded.
McClellan, C. J., Simpson and Anderson, J.J., concurring.