Bledsoe v. Farm Bureau Mut. Ins. Co., 23150

• Decision Date: 05 December 1960
• Docket Number: No. 23150,23150
• Citation: 341 S.W.2d 626
• Parties: Laurence M. BLEDSOE, Appellant, v. FARM BUREAU MUTUAL INSURANCE COMPANY, Respondent.
• Court: Missouri Court of Appeals

Page 626

341 S.W.2d 626

Laurence M. BLEDSOE, Appellant, v. FARM BUREAU MUTUAL INSURANCE COMPANY, Respondent.

No. 23150.

Kansas City Court of Appeals, Missouri.

Dec. 5, 1960.

Falzone & Falzone, Moberly, for appellant.

Alexander, Welliver & Wayland, and John M. Cleaveland, Columbia, for respondent.

HUNTER, Presiding Judge.

Laurence M. Bledsoe, plaintiff-appellant, sued Farm Bureau Mutual Insurance Company, defendant-respondent, on its insurance policy for the loss by fire on August 20, 1956, of his rental dwelling. The verdict and judgment were for appellant for $1,500. The trial court, declaring it should have sustained defendant's motion for a directed verdict at the close of the evidence, sustained defendant's motion to set aside the verdict and to enter judgment for defendant in accordance with the motion for a directed verdict. Plaintiff has appealed from the resultant judgment for defendant.

The appeal raises questions concerning (1) whether the insured premises were vacant within the meaning of the policy for more than 60 days before the fire; (2) whether there was either waiver or estoppel to claim the benefit of the vacancy provision of the policy; and (3) whether plaintiff had released his claim or had acted under mutual mistake in regard to a purported release he signed. Since the contention is the trial court erred in setting aside the jury's verdict for plaintiff and in directing a verdict for defendant, on appeal it is our duty to review the pertinent evidence in the light most favorable to plaintiff; giving him the benefit of every inference reasonably deductible therefrom, and disregarding evidence favorable to defendant.

Plaintiff owned an eighty acre tract of land in Randolph County upon which there were two dwellings. With his wife and children he lived in one dwelling, which his counsel and we refer to as plaintiff's residence. The other dwelling, with a summer kitchen, will be referred to as the rental dwelling.

Defendant's agent, Robert Liesman, a regular customer of plaintiff and his wife at their service station knew that plaintiff had insurance coverage from another company on the two dwellings and that it would soon expire. He had been trying to sell plaintiff this insurance for sometime and frequently discussed it with them. At the time he wrote the policy, September 26, 1955, Liesman knew that there was no tenant in the rental dwelling; that it had been vacant since February, 1955; and that plaintiff had been trying to rent the property since February, 1955, but as yet had not been successful and had no particular tenant in mind. He also knew that plaintiff had in the rental property stored furniture worth $407.00 from plaintiff's residence.

Plaintiff was asked:

'Q. What did Mr. Liesman tell you about that situation? A. I remember he said as long as there was furniture and I was figuring on renting the house, had planned to rent it again, that it would be permissible.

'Q. Did he also know that you were using the house some at that time? A. Yes. * * *

'Q. Now Mr. Bledsoe, I think you said on direct examination that you and Mr. Liesman had a conversation concerning the fact that the place was vacant, in which conversation he told you that he considered as long as you were using it as frequently as you were and had furniture and articles in it that the company did not consider it to be vacant? A. That's right.

'Q. He also knew you had had unsatisfactory tenants when they moved in 1955. A. That's right.

'Q. And he also knew you would not rent it to anyone that was unsatisfactory? A. Yes.'

Mrs. Bledsoe testified:

'Q. And what did you tell Mr. Liesman as to the place being vacant, as far as there being no tenant there? A. Well, there hadn't been one in it since early in the year and we had been trying to rent the place, but it was very hard to find anyone who was a suitable tenant, as we had had so much trouble with the last ones, that we didn't want to rent it to just anyone, but we intended to rent it.

'Q. Did Mr. Liesman know that? A. Yes.

'Q. What did Mr. Liesman do insofar as trying to find you a tenant? A. Well, he and a lot of other people offered to try and help us find one; that in the business we were in we came in contact with quite a few people and he'd be on the lookout for a suitable tenant.

'Q. Including Mr. Liesman? A. Yes.

'Q. Now, did you have any discussions with Mr. Liesman as to whether or not the company considered that you and Laurence occupied this house? A. Well, I don't know how the company felt about it, but he did say since we intended to rent it and we had furniture in it that he would go ahead and write up the insurance.'

Plaintiff and his family would take lunch to the rental dwelling and eat it. They used it for picnics and recreation. He kept stock there. He averaged going to the rental dwelling 'three or four times a week. Sometimes every day.' His wife and children went there six days out of the week. The house had electricity and a well, and they cooked there.

Two policies of insurance were issued at the same time by defendant, and both had the effective date of September 26, 1955. Policy No. G-15230 insured plaintiff's residence and its contents. Policy No. G-15229 insured plaintiff's rental dwelling, and contained the mentioned vacancy clause, '* * * this company shall not be liable for loss occurring * * * (b) while a described building, whether intended for occupancy by owner or tenant, is vacant or unoccupied beyond a period of sixty consecutive days.'

On August 20, 1956, the rental dwelling was totally destroyed by fire caused by lightning striking it.

With this evidence before us, we must decide: Was the evidence such as to permit a jury to find waiver by defendant of the benefit of the sixty day vacancy provision; and, if not, was it such that a jury could decide only that the rental dwelling was vacant or unoccupied rather than occupied and not vacant, within the meaning of the sixty day policy provision.

We are convinced that there is evidence from which the jury could find that the defendant insurance company had waived its occupancy requirement.

An insurer is bound by the information gained by its agent in taking the application, and constructively knows what he knows. It is the established law in this state and elsewhere that where the insurer's agent knows that the insured building is not and is not likely to be occupied, or will not be occupied, within the prescribed time and yet issues the policy the insurer thereby waives the insured's compliance with the vacancy clause of the policy.

In the case of Heindselman v. Home Insurance, Mo.App., 282 S.W.2d 191, the insurance agent knew not only that the building was then unoccupied but also that there was no intention to complete and occupy the building as a dwelling and that it would not be completed and occupied within the 90 day period, yet issued its policy excusing itself from liability in such event. The court ruled that issuance of the policy with that knowledge was a waiver of the policy provision. In the case of Chamberlain v. British-American Assur. Co., 80 Mo.App. 589, the defendant issued to plaintiff a policy containing a ten day vacancy clause, although the agent well knew the dwelling was then vacant and undergoing prolonged repairs. Two months later the building was destroyed while still unoccupied. The court upheld the plaintiff's contention that the defendant had waived the ten day vacancy clause by issuing the policy with such knowledge. In Thackery Mining & Smelting Co. v. American Fire Ins. Co., 62 Mo.App. 293, the fire insurance policy covering the buildings of a mining plant provided the policy shall be void '* * * if it cease to be operated for more than ten days.' The court held this provision was waived saying, loc. cit. 298, 'it is enough * * * that the defendant's agent, at the issuance of the policy, knew not only that the plant was not then being operated, but in all probability that it would not be operated for some time to come. The risk was clearly taken for a non-operated machine or plant.' See, also, Tiller v. Farmers' Mutual Fire Ins. Co., 220 Mo.App. 1337, 296 S.W. 464(10); Annotation, 96 A.L.R. 1259; 29 Am.Jur., sec. 917, p. 121, and sec. 1072, p. 238. In line with these authorities, we conclude the evidence was such as to present a jury question on the issue of waiver.

We turn to the question of whether the premises were vacant or unoccupied. The term 'vacant' is generally construed to mean empty and without inanimate objects. It implies entire abandonment, non-occupancy for any purpose. 45 C.J.S. Insurance Sec. 556a, p. 303; 29A Am.Jur., sec. 907, p. 112; 4 Couch on Insurance, sec. 970c, p. 3411, Florea v. Iowa State Ins. Co., 225 Mo.App. 49, 32 S.W.2d 111. In Norman v. Missouri Town Mut. Fire, etc., Insurance Co., 74 Mo.App. 456, 460, it is stated, 'We think the building was not at the time vacant in the ordinary meaning of the word. The word vacant primarily signifies 'deprived of contents; empty; not filled; as a vacant room. A thing is vacant when there is nothing in it. Webster's unabridged dictionary. Vacant and unoccupied are not synonymous--though sometimes so used. * * * A house filled with furniture (such as the one then under consideration) can not be said to be vacant, the primary and ordinary meaning of which is empty.' Our conclusion is that there was evidence to support a jury finding that the rental dwelling was not 'vacant'.

The portion of the exclusion clause, 'unoccupied beyond a period of sixty consecutive days' presents a closer question. It is a fundamental rule that conditions in a fire insurance policy against allowing the insured premises to become vacant or unoccupied are to be construed with reference to the species of property insured and the use contemplated for this particular type of property. Annotation--Insurance--Vacancy, 158 A.L.R. 894. One frequently stated definition of 'occupancy'...