Cole v. Germania Fire Ins. Co.

Citation1 N.E. 38,99 N.Y. 36
PartiesCOLE, Assignee, etc., v. GERMANIA FIRE INS. CO.
Decision Date14 April 1885
CourtNew York Court of Appeals

OPINION TEXT STARTS HERE

ANDREWS J.

The original policy, dated January 14, 1881, insured the firm of C. F. Dielmann & Co. against loss or damage by fire ‘on their brick building occupied for planing and wood-working purposes, situate Nos. 547 to 555 West Twenty-first street,’ in the city of New York, for one year from January 19, 1881, in the sum of $1,000, ‘loss, if any, payable to W. C. Herrick, mortgagee,’ and contained a special clause known as the ‘mortgage clause.’ Among the conditions in the policy was one making it void in case of ‘increase of hazard’ by the erection of neighboring buildings. During the life of the original policy (as was assumed on the trial, and as the evidence, we think, clearly established) Dielmann & Co. erected on the premises, at a distance of six or seven feet from the main building, a drying-house, constructed of wood, one story high, intended for the drying of lumber, and in which they placed a large amount of lumber, using therein steam introduced by pipes connecting with a boiler in the main building.

Mr. Hamlin, an insurance broker who acted as agent for Dielmann & Co., and also for Herrick, the mortgagee, in procuring the original policy and in making the alleged renewal agreement, testified that ‘a a frame building is more hazardous than a brick building; the close proximity of a frame building to a brick building ordinarily increases the hazard of a brick building.’ Upon this testimony, which was undisputed, and the uncontroverted facts as to the construction, location, and use of the drying-house, the court was fully justified in assuming that there had been an increase of hazard. It is self-evident, and a contrary finding by a jury could not stand. It follows that if the fire had occurred during the running of the original policy, Dielmann & Co. could not have maintained an action; the increase of hazard would have been a conclusive answer to their suit on the policy. But Herrick, the mortgagee, would have stood in a different position. By the express terms of the mortgage clause, his interest in the policy would not be invalidated by any act or neglect of the mortgagor or owner of the property. Hastings v. Westchester Fire Ins. Co. 73 N. Y. 141.

The fire occurred February 11, 1882, after the expiration of the original policy, and the plaintiff, who stands in the right of Herrick, the mortgagee, rests his action upon the claim that the policy was renewed, and continued for the period of a year from January 19, 1882, by a valid oral agreement made at that date between Herrick's agent, Hamlin, and the defendant. It was not denied on the trial that there was an oral negotiation between Hamlin and the defendant to continue the policy, but the latter insisted that it did not result in a final and definite agreement, and also that the premium on the renewal was not paid; payment of which, by the clause providing for a renewal, is made a condition precedent to any liability for an extended term. It is unnecessary to pass upon these questions, as we have reached the conclusion that the complaint was properly dismissed on the ground that Hamlin did not, when the alleged renewal agreement was made, disclose to the company the fact that the drying-house had been erected on the premises.

The renewal clause in the original policy contains this provision: ‘This insurance may be renewed by the payment of premium for extended term, duly receipted for, but in case there shall have been any increase...

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15 cases
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