Agricultural Ins. Co. v. Montague

• Decision Date: 03 April 1878
• Court: Michigan Supreme Court
• Parties: Agricultural Insurance Company of Watertown, New York v. Charles Montague

38 Mich. 548

Agricultural Insurance Company of Watertown, New York v. Charles Montague

Supreme Court of Michigan

April 3, 1878

Submitted February 1, 1878

Error to Tuscola.

Assumpsit on insurance policy. Defendant brings error.

Judgment reversed with costs and a new trial ordered.

B. W Huston and Hatch & Cooley for plaintiff in error. Where a policy is made void by a misstatement of the interest of the insured, it is void if he has only a legal or an equitable interest in property which he claims, Lowell v. Middlesex Ins. Co., 8 Cush. 127; Smith v. Bowditch F. Ins. Co., 6 Cush. 448; Falis v. Conway Ins. Co., 7 Allen 46; Eminence Ins. Co. v. Jesse, 1 Metc. (Ky.), 523; notice of the actual facts may cure misstatement but it is where the error was not in essential facts, AEtna Live Stock Co. v. Olmstead 21 Mich. 246; N. A. Ins. Co. v. Throop, 22 Mich. 146; Van Buren etc. F. Ins. Co. v. St. Joseph Ins. Co., 28 Mich. 398; Amer. Ins. Co. v. Gilbert, 27 Mich. 429.

Timothy E. Tarsney for defendant in error.

OPINION

Cooley, J.

The action in this case was upon a policy of insurance issued to one Graves and assigned bye him after a loss to Montague, the plaintiff below. The plaintiff recovered judgment and the case is before us on error.

It appeared on the trial that Graves did not pay the premium when he received his policy, but was allowed a credit by the agent who transacted the business. The defendant insisted that the delivery of the policy before the premium was paid was unwarranted; there being evidence that the agent had no authority to give credit. It was shown, however, that the agent accounted to the insurers for the premium, and we think it was too late afterwards to make any objection to the credit. When the agent had accounted to the principal, the latter was no longer concerned with the dealings between the agent and the insured.

The property insured included an organ. The evidence showed that this organ was purchased by Graves on credit, and that by the contract of purchase the title was not to pass from the vendor until the price was fully paid. When the fire occurred only about one-half the amount had been paid, and this was less by $ 20 or $ 25 than the sum for which the organ was insured. By one of the conditions of the policy the insured was required to state whether any other person had an interest in the insured property, and if so, what was its nature; and it was declared that "any neglect to comply with these provisions, or any misrepresentation or concealment or fraud, or false swearing in any statement or affidavit in relation to loss or damage shall forfeit all claim upon the company by virtue of this policy, and shall be a full bar to all remedies upon the same." The defendant offered to show that the vendor had brought suit for the purchase price of the organ, and had recovered judgment, but the court excluded the evidence, but then, as if it were in instructed the jury that in view of this fact Graves "had an insurable interest in the organ." This instruction was probably correct, but it fails to meet the difficulty in the case. The defendant requested the court to instruct the jury that the insurance upon the organ, under the facts in proof, was void; but this was refused. The request did not raise the question of an insurable interest; the insured may have had that, and yet, because of his concealment of facts, failed to obtain a valid insurance. And we do not...