Clark v. ÆTna Ins. Co.

• Citation: 179 A. 352
• Parties: CLARK v. ÆTNA INS. CO. SAME. v. NIAGARA FIRE INS. CO.
• Decision Date: 04 June 1935
• Court: Supreme Court of New Hampshire

179 A. 352

CLARK

v. ÆTNA INS. CO.

SAME.

v. NIAGARA FIRE INS. CO.

Supreme Court of New Hampshire. Grafton.

June 4, 1935.

Transferred from Superior Court, Grafton County; James, Judge.

Actions by Helen M. Clark against the Ætna Insurance Company and against the Niagara Fire Insurance Company. Transferred to the Supreme Court without ruling on the question of defendants' rights to directed verdicts upon evidence presented at trial.

Judgments for plaintiff.

Actions, on fire insurance policies. The court (James, J.) transferred without ruling the question of the defendants' rights to directed verdicts upon the evidence presented at the trial; the parties agreeing to judgments according to decision of the question. The facts sufficiently appear in the opinion.

Fred S. Wright, of Woodsville, and George W. Pike, of Lisbon, for plaintiff.

Thorp & Branch and F, W. Branch, all of Manchester, for defendants.

ALLEN, Chief Justice.

Two defenses against liability are claimed. One is that the acceptance of the assignment of one of the policies and the issuance of the other were obtained by fraud. The other is that the plaintiff had no insurable interest in the property.

Soon after the plaintiff's husband bought the property of which the buildings insured were a part, he conveyed it to her. It was agreed that he was to have sole charge and responsibility for it; her only interest being to share equally in the profits realized on any sale he might make.

When he conveyed to her, he wrote the insurers' agent requesting that the policy then in force be assigned to her, saying that he had sold and deeded the property to her. In the letter he also applied for additional insurance for her, commenting that he expected to have some painting done forthwith. The agent on receipt of the letter assented to the assignment of the existing policy and issued one for the increase of insurance. Some weeks later the plaintiff's husband wrote the agent about some intended improvements, saying their installation was delayed because of lack of funds to pay for them. In another letter the agent was informed that the improvements might be still further postponed. The plaintiff's husband testified that when he obtained the additional insurance he represented to the agent that he intended to make improvements and alterations. In view of the correspondence it may be inferred that his reference to the time of the representations was after the policy was issued. The insured property was destroyed by fire within four months of the conveyance to the plaintiff, and no improvements had been made.

The statement that the property had been sold as well as deeded to the plaintiff was not fraudulent as matter of law. If there was not a sale in a definite and technical sense, there was, in a popular sense, a trade between the parties. The plaintiff's husband owed her money, and it was with that fact in mind that he conveyed the property to her. He might, without being dishonest, say he had sold to her. He is not chargeable, as matter of law, with knowledge that the assignment of his policy would be unacceptable if the insurer had notice of the arrangement between him and his wife. It is not improbable that he considered the insurance risk no different whether the title to the property stood in his name or in hers. Believing there was need of having the policy insure the person in whose name the title did stand, he may have had no thought that the insurer would be concerned about the terms of the transaction with the grantee. As it may be found that he did not appreciate any increase of the hazard, if under the circumstances there was one in fact, it may be found that he had no dishonest purpose to mislead.

Nor is the evidence of fraud conclusive in respect to the new policy. It was issued with the insurer's knowledge that no improvements had been made. The promise of them was not necessarily fraudulent, and no definite promise was made until subsequently. If the expectation of raising money for them was unreasonable, yet it may have been honestly entertained. Whether the unreasonableness pointed to dishonesty or to visionary optimism is an inquiry of fact. That the improvements were never contemplated, intended, or planned, is not a compelled finding.

As it would be a reasonable conclusion that no statements were fraudulently made to induce either assent to the assignment of the policy in force or the issuance of the new one, the defense of fraud has not been established. The insurers have not demonstrated that they were led by deception to assent to assign or to issue insurance and continue it in force to its aggregate amount.

The defense that the plaintiff had no insurable interest in the property is asserted on the strength of two assumptions; one is that her title was in every respect nominal, and one is that she had no interest for the loss or impairment of which she might be indemnified.

Any interest of pecuniary benefit from the existence of the property insured or of...