Thomas v. the Fame Ins. Co..

• Decision Date: 20 November 1883
• Parties: DAVID J. THOMASv.THE FAME INSURANCE COMPANY.
• Court: Illinois Supreme Court

108 Ill. 91

1883 WL 10360 (Ill.)

DAVID J. THOMAS

v.THE FAME INSURANCE COMPANY.

Supreme Court of Illinois.

Filed at Ottawa Nov. 20, 1883.

OPINION TEXT STARTS HERE

APPEAL from the Appellate Court for the First District;--heard in that court on appeal from the Superior Court of Cook county; the Hon. SIDNEY SMITH, Judge, presiding.

Mr. PHILIP STEIN, for the appellant:

The plea of limitation presented no defence. The amendment introduced no new cause of action. It was immaterial to whom the appellee might pay, if liable on the policy.

A warranty in the law of insurance is never created by construction. It must appear in express terms, affirmatory or promissory, or must necessarily result from the nature of the contract. Jefferson Ins. Co. v. Cotheal, 7 Wend. 80; Mutual Benefit Life Ins. Co. v. Robertson, 59 Ill. 123.

Warranties are construed strictly against those for whose benefit they are made, and so, if possible, as to avoid a forfeiture. Hyde v. Bruce, 3 Doug. 213; World Mutual Life Ins. Co. v. Schultze, 73 Ill. 586; Saylor v. Insurance Co. 2 Curtis' C. C. 613; Blood v. Howard Fire Ins. Co. 12 Cush. 472; Catlin v. Springfield Fire Ins. Co. 1 Sum. 434; Ripley v. Ætna Ins. Co. 29 Barb. 552; May on Insurance, secs. 162, 171; Flanders on Fire Insurance, (2d ed.) 292; Wood on Fire Insurance, sec. 167; Morse v. Insurance Co. 30 Wis. 540; Carter v. Humboldt Fire Ins. Co. 17 Iowa, 456. The fact that the application was submitted as a warranty does not make it one, unless the policy adopts the application, by apt and proper language, as a part of the contract, and not always even then. Boardman v. N. H. Mutual Ins. Co. 20 N. H. 551; Owens v. Holland Purchase Ins. Co. 56 N. Y. 565; Hartford Protection Ins. Co. v. Harmer, 2 Ohio St. 461; American Popular Life Ins. Co. v. Day, 39 N. J. 89; Howard Fire and Marine Ins. Co. v. Cornick, 24 Ill. 455; Trench v. Chenango Ins. Co. 7 Hill, 122; Farmers' Ins. Co. v. Snyder, 16 Wend. 481; Wood on Fire Insurance, secs. 138, 144; May on Insurance, sec. 159, et seq.

Although a policy refers to and makes the application a part of it, yet only statements made strictly in answer to the inquiries contained therein can be regarded as warranties. Flanders on Fire Insurance, (2d ed.) 236, 237; Wood on Fire Insurance, secs. 144, 160; Howard Fire and Marine Ins. Co. v. Cornick, 24 Ill. 455; Hartford Protection Ins. Co. v. Harmer, 2 Ohio St. 461.

The description of the risk in the policy is not a warranty. It simply names and identifies the premises. Gerhauser v. North British Ins. Co. 7 Nev. 185; Schultz v. Merchants' Ins. Co. 57 Mo. 331; Browning v. Home Ins. Co. 71 N. Y. 508; Maher v. Hibernian Ins. Co. 6 Hun, 353; Billings v. Tolland Ins. Co. 20 Conn. 139.

Messrs. GRANT, SWIFT & BRADY, for the appellee:

By the amendment a different plaintiff sued, but his suit was not brought within one year, and no recovery could be had by the present plaintiff. Dunphy v. Riddle, 86 Ill. 22; Crowl v. Nagle, Id. 437; McGraw et al. v. Bayard et al. 96 Id. 154; Miller v. McIntyre, 6 Pet. 61; Illinois Central R. R. Co. v. Cobb, 64 Ill. 140; King v. Avery, 37 Ala. (N. S.) 173; Woodward v. Ware, 37 Me. 564.

There was a breach of warranty by the plaintiff, which renders the policy null and void. The answers did not disclose the fact that shingles were made upon the premises, and the diagram was incorrect, and failed to show that part of the building where the shingles were made, etc. These omissions were fatal to the right of recovery, whether accidental or intentional. De Hahn v. Hartley, 1 Term Rep. 343; Fowler v. Ætna Fire Ins. Co. 6 Cow. *673; Ripley v. Ætna Fire Ins. Co. 30 N. Y. 136; Burritt v. Saratoga County Mutual Fire Ins. Co. 5 Hill, 188; Ætna Ins. Co. v. Grube, 6 Minn. 82; Blumer et al. v. Phœnix Ins. Co. 45 Wis. 622; Dewees v. Manhattan Ins. Co. 34 N. J. 244; Forbush v. Massachusetts Ins. Co. 4 Gray, 337.

Where the application is referred to as forming a part of the contract, the statements therein are held to have the force and effect of warranties. May on Insurance, (2d ed.) sec. 159.

Where parties by express agreement make certain matters inquired into material, it will not be open to question whether or not they were actually so. Williams v. N. E. Mutual Fire Ins. Co. 31 Me. 219; Ripley v. Ætna Ins. Co. 30 N. Y. 136; Gahagan v. Union Mutual Ins. Co. 43 N. H. 176; Commonwealth Ins. Co. v. Monninger, 18 Ind. 352; Abbott v. Shawmut Ins. Co. 3 Allen, 213; Wilson v. Conway Fire Ins. Co. 4 R. I. 141; Dewees v. Manhattan Ins. Co. 34 N. J. 247.

Where the application is prepared, signed and presented by the owner, the company have a right to rely upon its correctness, and if it is incorrect in any material part, it avoids the policy. Atlantic Ins. Co. v. Wright, 22 Ill. 474; Andes Ins. Co. v. Fish, 71 Id. 622; Lycoming Ins. Co. v. Rubin, 79 Id. 403; Burritt v. Saratoga County Mutual Fire Ins. Co. 5 Hill, 188; Marshall v. Insurance Co. 7 Foster, 157; Cumberland Valley Mutual Protection Co. v. Schell, 5 Casey, 31; Carpenter v. American Ins. Co. 1 Story, 57; Gould v. York County Mutual Fire Ins. Co. 47 Me. 409. Mr. JUSTICE MULKEY delivered the opinion of the Court:

Some time in the month of June, 1875, one T. M. Taylor, a general insurance agent and broker, having an office at Minosha, Wisconsin, called upon David J. Thomas, the appellant, at his place of business in the town of Colby, same State, for the purpose of procuring Thomas' insurance on his factory at that place, Taylor representing at the time that he was the agent of the Fame Insurance Company, the appellee, and other companies, naming them. The interview resulted in appellant giving to Taylor an application for $2000 insurance on the property, to be taken in such of the companies represented by him as he might select. The factory in question was used for the manufacture of clothes-pins, broom-handles and shingles, though there was nothing in the name of the establishment to indicate that shingles were made in it, it being simply called “Clothes-pin and Broomhandle Factory.” It appears, though, Taylor was well acquainted with the factory, and knew that one department of it was used for the manufacture of shingles. The application was made out by Taylor on one of the printed forms of the Planters' Insurance Company, and was addressed to the Mercantile Insurance Company of Chicago, and the answers to some of the interrogatories were written down by him from his own knowledge of the business and premises, while the others were given by Thomas himself. The questions in the printed blank, which were answered partly by Taylor and partly by Thomas, as just stated, had the following caption: “The applicant will answer particularly the following questions, and sign the same as descriptive of the premises, and forming a part of the contract of insurance, and a warranty on his part.” The questions and answers following this caption, so far as deemed material to the controversy, are as follows: “I. Name of property.

A. Clothes-pin and broom-handle factory.

Building. How long and how wide is it?

A. 54x40, two-story; engine-room, 24x36.

Boiler-house. Where is it located?

A. West side of building.

[Show on diagram.]

What is the precise kind of goods made, and of what material?

A. Clothes-pins and broom-handles.”

Whether the application was either read to or by the appellant previous to his signing or to the issuing of the policy, is a fact not clearly settled by the evidence. While on its face the application contemplates, and in express terms requires, a diagram to be made out as a part of the same, showing the size, form, etc., of the building, and its relation to the surrounding property within a hundred and fifty feet distance, yet no such diagram was made out previous to appellant's signing the application, nor did he ever see one till after the policy was issued, though one was prepared and annexed to the application as a part of it, presumably by Taylor, before it was submitted to the company. The diagram, as made out and presented to the company, fails to truly represent the character, shape or extent of the factory, particularly that part of it which is used for the manufacture of shingles.

The application, with the diagram annexed, being thus prepared, was forwarded to one Eastman, an insurance broker of Chicago, with directions to obtain the required insurance. Eastman submitted the application to Southwick & Berne, who were, respectively, the general insurance agents of appellee and the Empire Fire Insurance Company. Upon a conference between these agents the risk was agreed to be taken and equally divided between the two companies, and policies were issued accordingly. The one issued by appellee (being the same now in suit) was, at the time of its execution, to-wit, on the 26th of June, 1875, delivered by Southwick to Eastman, the former paying to him at the time the customary brokerage fee. Eastman forwarded the policy to Taylor, who subsequently delivered it to the assured. In August following, appellant paid the premium ($50) to Taylor, who forwarded it to Eastman, and the latter paid it to the company. On the 26th of May, 1876, the insured premises were totally destroyed by fire, and the loss was regularly adjusted by the two companies, through Berne, the general agent of the Empire Fire Insurance Company. By the terms of the policy the loss, if any, was made payable to the Mann Brothers, of Milwaukee, as their interest might appear. The appellee having declined to pay the loss, this suit was originally commenced on the 26th of September, 1876, in the name of appellant, for the use of Joseph and Henry Mann, but appellant's name as plaintiff was subsequently, on the 18th of November following, by permission of the court, stricken out, and the names of the Manns substituted as plaintiffs, and thereafter the suit was prosecuted in their names until the 4th of February, 1881, when, by leave of the court, the name of appellant was restored as plain...