Kellogg v. German American Ins. Co.

• Decision Date: 05 October 1908
• Citation: 113 S.W. 663,133 Mo. App. 391
• Parties: KELLOGG v. GERMAN AMERICAN INS. CO.
• Court: Missouri Court of Appeals

113 S.W. 663

133 Mo. App. 391

KELLOGG v. GERMAN AMERICAN INS. CO.

Kansas City Court of Appeals. Missouri.

October 5, 1908.

Rehearing Denied November 16, 1908.

1. INSURANCE (§ 126)—"PROPERTY" INSURABLE — INTOXICATING LIQUORS.

Intoxicating liquors, being recognized as property in Missouri, are insurable.

For other definitions, see Words and Phrases, vol. 6, pp. 5693-5728; vol. 8, pp. 7768-7770.]

2. INTOXICATING LIQUORS (§ 238)—KEEPING LIQUORS—INTENT.

The presence of a quantity of intoxicating liquors in a drug store is not necessarily indicative of a purpose on the owner's part to violate the liquor law by making illegal sales thereof.

3. INSURANCE (§ 138)—ILLEGAL CONTRACT— INSURANCE OF LIQUORS—VIOLATION OF LAW.

If when plaintiff, a druggist, insured his drug stock, containing a quantity of beer and whisky, he intended to conduct an unlawful business and sell the liquor contrary to law, the insurance would be void as directly protecting plaintiff in his illegal purposes; but if plaintiff, when he procured the insurance, was actuated by an intent to conduct a legitimate drug store and use the liquors only in connection with that business in the usual and lawful manner, the insurance was valid.

4. INSURANCE (§ 668)—DRUGGISTS—ILLEGAL BUSINESS.

The presence in a drug stock of 10 barrels of beer and 70 gallons of whisky and the fact that plaintiff occasionally made unlawful sales and had a thriving trade in whisky and beer did not establish as a matter of law that the plaintiff's business and practices were unlawful, rendering a policy on the stock void.

5. INSURANCE (§ 668)—PAYMENT OF LOSS— VEXATIOUS REFUSAL—PENALTIES—QUESTION FOR JURY.

In an action on a fire policy, whether defendant has been guilty of vexatiously refusing to pay the loss, so as to entitle plaintiff to recover the penalty authorized under such circumstances by Rev. St. 1899, § 8012 (Ann. St. 1906. p. 3808), is for the jury.

Appeal from Circuit Court, Buchanan County; William D. Rusk, Judge.

Action by W. E. Kellogg against the German American Insurance Company. Judgment for plaintiff, and defendant appeals. Affirmed.

Fyke & Snyder and W. B. Pistole, for appellant. Mytton, Parkinson & Crow, for respondent.

JOHNSON, J.

Action on two policies of fire insurance, which covered merchandise and fixtures in a drug store owned and operated by plaintiff in the town of Athelstan, Worth county. The policies were duly issued, plaintiff paid the premiums demanded, and the property was destroyed by fire during the period of insurance; but defendant refused to acknowledge liability and endeavors to justify its position on ground thus pleaded in the answer: "At the time said policy was issued, said plaintiff made application to defendant in writing for the policy sued on, in which said application plaintiff represented and stated over his signature the said insurance was wanted upon such goods as are usually carried and kept for sale by a drug store, and warranted in said application that the building described and within which the insured property was located and insured was occupied, first story, `Drug store, and proprietor sleeps in small room,' and that the basement was used as a storage room, and warranted that such statement was a just, true, and full exposition and statement concerning the property to be insured, and the basis upon which the insurance was to be effected, and a continuing warranty on the part of the applicant, said plaintiff, which said statements and warranties defendant alleges were untrue and were a misrepresentation and concealment of material facts and circumstances concerning the insurance and subject thereof and a fraud upon defendant, in this: That the risk to be insured was not a drug store, but was or became a saloon and place where intoxicating liquors were sold, not for medicinal purposes, but in violation of law for use as beverages, and plaintiff's principal business was the unlawful sale of intoxicating liquors. That the merchandise for the loss of which plaintiff makes claim was not such goods as are usually kept for sale in a drug store, but were supplies for a saloon, consisting principally of whisky, beer, and other intoxicating liquor. That plaintiff did not apply to defendant for insurance upon a saloon or a place conducted as a saloon, and defendant did not issue its policy to cover such risk, nor to insure against such conditions, and, had it known the facts as they existed, would not have issued its said policy. * * * At the time the policy sued on was issued, and at the time of the fire mentioned in plaintiff's petition, and for a long time prior thereto, the sale of intoxicating liquors, wine and beer, was forbidden by law in Worth county, Mo., where the property in question was situated. That on the _____ day of _____, an election of the qualified voters of said county outside of cities of 2,500 population had been held, and, all as provided by law, the sale of intoxicating liquors in said county had been prohibited, and that plaintiff in keeping for sale intoxicating liquors, wine and beer, and selling the same, was acting in violation of law and conducting a business unlawful and forbidden by law, in all of which the property destroyed was used and was a part. That plaintiff was forbidden by law to keep and sell such merchandise, which consisted of intoxicating liquors, wine and beer, and other things to promote the sale thereof, and by reason thereof is not entitled to enforce a claim for their loss in a court of justice."

The policy on which the cause pleaded in the first count of the petition is founded was issued June 16, 1906, for a period of one year. It provided for insurance of $900 on plaintiff's "stock of merchandise, consisting principally of patent medicines, drugs, paints, oils, liquors, and such other goods not more hazardous as are usually kept for sale in a drug store," and for $175 "on store furniture and fixtures, including iron safe, counters and shelving," and recites that it is made and accepted subject to the following stipulations and considerations: "It is a part of the consideration of this policy and the basis upon which the rate of premium is fixed that, in the event of loss, this company shall not be liable for an amount greater than three-fourths of the actual cash value of the property covered by this policy at the time of such loss, and in case of other insurance * * * then for only its pro rata proportion of such three-fourths value. * * * This entire policy shall be void if the insured has concealed or misrepresented in writing or otherwise any material fact or circumstance concerning this insurance or the subject thereof. * * * This policy is made and accepted subject to the foregoing stipulations and considerations. * * *" The policy pleaded in the second count, issued August 26, 1906, for one year, placed $300 on the stock of merchandise "consisting principally of drugs, patent medicines, notions, stock food, paints and such other goods not more hazardous as are usually kept for sale in a drug store." It is in the same form as the other policy. The application made by plaintiff for the first policy contains questions and answers as follows: "(6) Occupation. First story drug store, and proprietor sleeps in small room. Basement as storage room." "(10) Is the property steadily profitable? A. Yes. (11) Are there any other facts or circumstances affecting the risk? A. None." The applicant then covenants and agrees "that the foregoing is a just, true and full exposition and statement concerning the property to be insured, being the basis on which the insurance is to be effected, and a continuing warranty on the part of the applicant."

Plaintiff testified that in June, 1905, he purchased two stocks of drugs, etc. (in which were very little intoxicating liquors), consolidated them into a single stock, and opened a drug store in Athelstan. A year later, and just before the first policy in suit was issued, he took an inventory, from which it appears that the fixtures in the store were of the value of $246.30, and the merchandise $1,612.72. The merchandise included 10 barrels of beer and perhaps 70 gallons of whisky, the value of which is not stated. The fire occurred March 13, 1907, and the total purchases of merchandise made by plaintiff between June 16, 1906, the date of the inventory, and the day...