American Fire & Cas. Co., Inc. v. Archie
| Decision Date | 23 December 1981 |
| Citation | 409 So.2d 854 |
| Parties | AMERICAN FIRE & CASUALTY COMPANY, INC., a Corporation v. Yvonne ARCHIE. Civ. 2913. |
| Court | Alabama Court of Civil Appeals |
Jerry E. Stokes, Andalusia, for appellant.
Gareth A. Lindsey, Elba, and Griffin Sikes, Andalusia, for appellee.
Yvonne Archie's home was destroyed by fire in the early morning hours of June 19, 1978. Neither Mrs. Archie nor her two children were at home when the incident occurred. Testimony at trial indicated that neighbors were awakened by a "loud boom," observed flames coming out the windows and notified the fire department. The cause of the fire was not determined. The home was insured against fire loss by American Fire & Casualty, appellant herein. The Farmer's Home Administration held a first mortgage on the property.
The insurance policy included the following pertinent coverage limitations:
Dwelling-$15,000
Unscheduled personal property-$7,500
Following the fire, Mrs. Archie contacted her agent and later talked with an adjuster. At the request of the adjuster and with the aid of an attorney, Mrs. Archie prepared an inventory of personal items lost in the fire, listing both the approximate original cost and age of each item. She also executed a sworn proof of loss statement required by the insurer which set out her total loss as $25,647.57, including the dwelling and personal property. The American Fire & Casualty Company paid the $14,606.70 balance owed on the mortgage to FHA and received an assignment thereof. Mrs. Archie's claim was not honored.
Upon the insurer's refusal to pay, Mrs. Archie sued in the Circuit Court of Covington County for $22,500, the maximum liability under the policy terms. The company defended by generally denying the complaint and raising the defenses of (1) intentional burning by the insured, and (2) misrepresentation in the application and in the proof of loss as to the value of the personal property insured.
At the conclusion of a jury trial, a verdict was returned against defendant for $7,894, an amount equal to the difference between the $15,000 dwelling and the $14,606.70 paid FHA, plus the $7,500 coverage of the contents. From that judgment, defendant appeals.
On appeal, the defendant contends that the trial court erred (1) in its instructions to the jury regarding misrepresentation; (2) in several evidentiary rulings, (3) in its failure to grant a directed verdict, and later a judgment notwithstanding the verdict; and (4) by commenting on the evidence.
The policy contained the following provision:
This entire policy shall be void if, whether before or after loss, the insured has willfully concealed or misrepresented any material fact or circumstance concerning this insurance or the subject thereof, or the interest of the insured therein, or in case of any fraud or false swearing by the insured relating thereto.
Defendant contends that plaintiff made misrepresentations both in her application for the policy and in the claim of loss.
There is a difference in the required elements of misrepresentation before loss and misrepresentation after loss. Before loss, a misrepresentation must be material to an increase in the risk of loss and must be relied on by the insurer to its prejudice. See, Hartford Fire Insurance Co. v. Clark, 258 Ala. 141, 61 So.2d 19 (1952); National Union Fire Insurance Co. v. Schwab, 241 Ala. 657, 4 So.2d 128 (1941). After loss, a misrepresentation need only be made with the actual intent to deceive and be related to a matter which is material. Hartford, 258 Ala. at 151, 61 So.2d 19; National Union, 241 Ala. at 659, 4 So.2d 128. Risk of loss is not at issue after the loss has occurred since it cannot be increased at that point. Hartford, 258 Ala. at 150, 61 So.2d 19; National Union, 241 Ala. at 659, 4 So.2d 128. Proof of loss misrepresentations are specifically referred to in § 27-14-28, Code (1975), which provides that:
No misrepresentation in any proof of loss under any insurance policy shall defeat or void the policy unless such misrepresentation is made with actual intent to deceive as to a matter material to the insured's rights under the policy.
The trial judge refused written charges requested by defendant as to misrepresentation in the application and in proof of loss. However, he charged as follows in his oral charge:
(F)or the defendant to sustain its plea of misrepresentation, the defendant has the burden of reasonably satisfying the jury, from the evidence, that there was a misrepresentation by the plaintiff. That the matter misrepresented was material to the risk of loss. That the misrepresentations were false and made with either actual intent to deceive and that the representations were relied on by the defendant to its prejudice.
At the close of the oral charge, out of the presence of the jury, defendant's counsel spoke to the court concerning the charge. As relevant, he said as follows:
Just a couple of things, your honor. I also think the charge covered just about everything. But I do want to object for the record for the failure of the court to give all of our requested charges. (He then spoke to an aspect of the case not in issue on appeal).... The other objection of substance that I had is on our charge on the misrepresentation where you indicated that the misrepresentation would have to increase the loss. I understand that misrepresentation after the loss can void the policy, if it is done with intent to deceive, and, the insurance company was prejudiced and it is in the policy that it won't increase the loss. But it would be grounds to void the policy.
The court responded:
I thought I said or I thought I put it in. Anyway I hope I did.
Counsel responded:
That's all I have.
The defendant claims error in that the court's charge referred only to misrepresentation prior to loss and ignores the elements of misrepresentation after loss.
We have set out all aspects of the charge and objections of counsel referrable to the defenses of misrepresentation. We first comment that the recorded objection that the court failed "to give all of our requested charges" is not sufficient under Rule 51, A.R.C.P., which requires specific objection and statement of grounds therefor. Wright v. Waters, 367 So.2d 960 (Ala.1979). We next comment that the second referenced objection appears to apply to the oral charge and complains of the absence of certain terminology which the court did in fact use. Thus the complaint appears to be without foundation. However, the compelling reason for our holding of absence of reversible error is that our review of the evidence fails to discern any factual support for the defenses of misrepresentation either before or after loss. Therefore, we conclude that any defect in the charge as given has not affected the substantial right of the defendant and is therefore subject to Rule 45, A.R.A.P.
Defendant also assigns as error several evidentiary rulings of the trial court.
First, defendant contends that the following between Mrs. Archie and her attorney, Mr. Lindsey, was erroneously allowed:
Q. Mrs. Archie, at any time, did anybody from this insurance company come to you or communicate with you or say to you that they disagreed with the value of ten thousand six hundred and forty-seven dollars and fifty-seven cents ($10,647.57)-
Mr. Stokes: We object.
Q. That you put on your personal property.
Mr. Stokes: We object. Unless there is some...
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