Aetna Insurance Company of Hartford, Connecticut v. Norman
| Decision Date | 07 June 1895 |
| Docket Number | 1,577 |
| Parties | AETNA INSURANCE COMPANY OF HARTFORD, CONNECTICUT, v. NORMAN |
| Court | Indiana Appellate Court |
From the Morgan Circuit Court.
Judgment reversed, with directions to overrule the demurrer to the third paragraph of the answer.
W. H Parks and W. S. Sherley, for appellant.
O Matthews, for appellee.
This is an action on a fire insurance policy. In the court below the appellee recovered judgment on the policy.
One of the errors complained of is the sustaining of a demurrer to the seventh paragraph of the answer in which the appellant sets up an alleged breach of warranty. The appellee was asked in his application: "Do you agree to keep merchandise and cash accounts?" To which he answered "Yes." It is alleged in this paragraph of answer that in truth and in fact no merchandise account was kept by the appellee as he warranted and agreed to do in the application.
To determine whether the policy contains a warranty in the particular here relied upon, we must look to the instrument itself, and construe it and the application together. The application contains the following statement at its close: "And the said applicant hereby warrants, covenants and agrees to and with said company, that the foregoing is a full and true exposition of all the facts and circumstances, conditions, situation, and value of, and title to, the property to be insured, and is offered as a basis of the insurance requested, and is made a special warranty, the same as if written on the face of the policy." There is no other statement in the application in the nature of a warranty.
The policy contains the following clause: "This entire policy shall be void if the insured has concealed or misrepresented, in writing or otherwise, any material fact or circumstance concerning the insurance or the subject thereof; or if the interest of the insured in the property be not truly stated herein; or in case of any fraud or false swearing by the insured touching any matter relating to the insurance or the subject thereof, whether before or after the loss."
It is not claimed that the appellee "concealed or misrepresented" anything in his application, or that he committed any "fraud or false swearing" in connection therewith, and hence there is nothing in the policy itself, in the way of condition, representation, or warranty which can be said to have been violated. The only warranty contained in the application is that the statements made therein by the appellee contain "a full and true exposition of all the facts and circumstances, condition, situation and value of and title to the property to be insured," thus showing that such warranty has relation not to anything which the appellee will do in the future to preserve the identity of the property, or to keep an invoice of such property as remains in hand and an account of the cash realized on sales, but to the property insured, as respects its condition, situation, value, and title, and all the facts and circumstances pertaining to the same.
Certainly it can not be claimed that there is any language either in the application or in the policy which amounts to a warranty of the agreement "to keep merchandise and cash accounts." The question, "Do you agree to keep merchandise and cash accounts?" and the answer "yes," referred to the conduct of the appellee in the future on the subject of book-keeping, and not the property insured, regarding its condition, title, etc. If all the statements of the application had been made warranties, we might be forced to a different conclusion, but as this is not the case, and there is no special warranty as to this particular question and answer, we do not think the claim of a warranty can be maintained.
Nothing is better settled than the rule that a mere representation does not amount to a warranty, and that in case of doubt as to whether a statement is a warranty or a mere representation, the latter construction will be given. 11 Am. and Eng. Encyc. of Law, 294.
Both warranties and representations are of two kinds, viz., affirmative and promissory. A promissory warranty is of course as valid and binding as any other kind, and it is not important whether the fact or statement warranted to be true be material or immaterial to the risk. But a mere promissory representation amounts to nothing if not material to the risk, and even then its violation does not vitiate the policy unless it was made with a fraudulent purpose. 11 Am. and Eng. Encyc. of Law, 299.
Forfeitures are not favored in law, and where the contract is equally susceptible of two interpretations, or is doubtful, the courts will resolve the doubt in favor of averting a forfeiture, always giving the strictest construction in favor of the insured. Continental Ins. Co. v. Vanlue, 126 Ind. 410, 26 N.E. 119; Indiana...
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