94
THE GREEN BAG
the premiums from the apparent assured, it would be readily admitted that there was no contract in existence. The insurer might possibly have a remedy against the person who deceived it, and persuaded it to issue the policy by representing that he was the agent of the assured, but there could be no contractual right be cause no contract had ever come into being. It may be said, however, that all this dis cussion is fanciful, and that an unauthor ized, person will not take out insurance on another's property in that other person's name except in the inconsiderable number of cases where the proper relief is a commis sion in lunacy for the unauthorized agent, rather than litigation between the ostensi ble parties to the contract. But this is not true, for there are at least three distinct instances of this sort of unauthorized action that are daily occurences in the insurance world. Perhaps the one most frequently seen is where an agent or broker takes out a policy as a renewal of one just expiring. He was authorized to take out the original one, and having kept the date of its expira tion on his books, he assumes that the as sured will desire a renewal. He accord ingly takes out the new policy and offers it to the assured, who in almost every instance will ratify- the act and take the insurance. Another instance is where the broker arms himself with a policy on a person's property as a preliminary to asking that person for the privilege of acting as his agent in plac ing his insurance — the idea being that his claims for the business will have greater force by reason of being backed up by a policy already prepared and actually issued. The last of the three instances that I shall mention is that apparently involved in the decision of the New York Supreme Court above quoted. That is, where the agent's authority has been exhausted by having taken out, and delivered to the assured, policies for the full amount that he was
required to obtain. Thereafter he is no more an agent of the assured than a total stranger would be,1 and yet, upon learning that one company desires to get off the risk, he promptly applies for and obtains insur ance in the name of his former principal to take the place of that which is to be can celled. Usually, of course the assured learns of the supposed agent's acts and either ratifies or repudiates them before loss and before the position of the parties has changed. But in the exceptional case loss happens before he learns of the insurance and consequently before he has become a party to the contract. And the question is, can he then ratify and take the benefit of his quasi-agent's acts? The position of the parties has changed, insurance could no longer be granted by the company or obtained by the property owner — can he nevertheless by some retroaction and ratification do what he could not at present do? There was no completed con tract of insurance between the parties before the loss and none could be made after the loss — will the insurer nevertheless be com pelled, solely at the option of the other party, to pay for the loss, just as if there had been a binding contract? No very satisfactory answer to these ques tions can be found in the authorities. As far back as the early year books and in the old Roman law we find the maxim "ratihabitio retro turahitur et mandato comparator," and we find the courts down to the present day continually reiterating the doctrine that ratification of an agent's acts amounts to the same thing as an original authoriza tion. Even if this maxim is sound without qualification, still it and the decisions to like effect merely go to show the effect or result of ratification and do not even pretend to ' Wilson v. New Hampshire Fire Ins. Co., 140 Mass. 210; Herman v. Niagara Fire Ins. Co. 100 N. Y. 411; Stebbins v. Lancashire Ins. Co.' 60 N. H. 65.
