Clower v. Fidelity-Phenix Fire Insurance Co. of New York

• Decision Date: 07 June 1927
• Parties: F. E. CLOWER, RESPONDENT, v. FIDELITY-PHENIX FIRE INSURANCE COMPANY OF NEW YORK, A CORPORATION, APPELLANT.
• Court: Missouri Court of Appeals

296 S.W. 257

220 Mo.App. 1112

F. E. CLOWER, RESPONDENT, v. FIDELITY-PHENIX FIRE INSURANCE COMPANY OF NEW YORK, A CORPORATION, APPELLANT.

Court of Appeals of Missouri, St. Louis

June 7, 1927

Appeal from the Circuit Court of Audrain County.--Hon. N. M Pettingill, Judge.

Judgment reversed and cause remanded (with directions).

Leahy Saunders & Walther, A. C. Whitson and Lyon Anderson for appellant.

(1) (a) By the acceptance of the policy with the condition against other insurance, plaintiff warranted that there was no other insurance on the car. Harwood v. Insurance Co., 170 Mo.App. 30; Hubbard v. North British & Merc. Ins Co., 57 Mo.App. 1; Mers v. Franklin Ins. Co., 68 Mo. 127. (b) A warranty must be literally complied with. Harwood v. Ins. Co., 170 Mo.App. 30; Hubbard v. North British & Merc. Ins. Co., 57 Mo.App. 1; Mers v. Franklin Ins. Co., 68 Mo. 127; Pawson v. Watson, Cowp. 785; Blackhurst v. Cockrell, 3 Term. R. 360. (c) The fact that Clower knew nothing of the existence of the other insurance makes no difference, since he warranted there was no other insurance. A warranty must be strictly complied with. Kempf v. Farmers Mut. Ins. Co., 41 Mo.App. 27; Holloway v. Dwelling House Ins. Co., 48 Mo.App. 1; Maddox v. Ins. Co., 56 Mo.App. 343; Mers v. Franklin Ins. Co., 68 Mo. 127; Hubbard v. North British & Merc. Ins. Co., 57 Mo.App. 1; Mers v. Ins. Co., 188 Mo.App. 297; Imperial Fire Ins. Co. v. Coos, 151 U.S. 452; Home Ins. Co. v. Boatner (Tex. Civ. App.), 218 S.W. 1095; Rice v. Hartford Ins. Co. (Wash.), 97 P. 238; Cross v. Colonial Assurance Co., 56 Tex. Civ. App. 627, 121 S.W. 517; New Brunswick Fire Ins. Co. v. Morris Plan Bank (Va.), 118 S.E. 236; Arnold v. St. Paul Fire & Marine Ins. Co. (Tenn.), 61 S.W. 1032; Sugg v. Hartford (N. C.), 3 S.E. 732; Zwick v. Phoenix Ins. Co., 60 Iowa 266, 14 N.W. 792; Van Alstyne v. Aetna (N. Y.), 14 Hun. 36; Perry v. Liverpool, etc., Ins. Co., 34 N. B. 380; Dickson v. Provincial Ins. Co., 244 C. C., p. 308. (d) Assuming that the Export policy was taken out without the knowledge or consent of plaintiff, he afterwards ratified it by making claim thereunder and is now estopped to claim that it was not a policy covering his interest. Ferguson v. Pekin Plow Co., 141 Mo. 161; 21 R. C. L., pp. 919, 923. (2) The court erred in giving plaintiff's instruction for the reason that it submitted a question of law to the jury. 1 Randall's Instructions to Juries, page 172, sec. 89; Moody et al. v. Standard Wheel Co., 20 Ind. 422, 425; Turner v. Owen, 122 Ill.App. 501; Stoddart v. Nat'l Liberty Ins. Co., 251 S.W. 398. (3) The court erred in submitting to the jury the question of vexatious refusal to pay. Non-Royalty Shoe Co. v. Phoenix Assurance Co., 277 Mo. 399; Patterson v. Ins. Co., 174 Mo.App. 44; Keller v. Ins. Co., 198 Mo. 440; Aufrichtig v. Columbian Nat'l, 249 S.W. 912; Goldbaum v. Great Eastern Cas. Co., 222 S.W. 868; Lafont v. Home Ins. Co., 193 Mo.App. 543; Zimmermann v. So. Surety Co., 241 S.W. 95; Agee v. Employers Liability Co., 253 S.W. 46; Miller v. Fireman's Fund Ins. Co., 206 Mo.App. 475; State ex rel. v. Allen, 295 Mo. 307.

Clarence A. Barnes for respondent.

(1) (a) The policy in suit did not make plaintiff a warrantor that there was no other insurance on the car. The following clause as to warranties, doubtless an oversight of defendant in not setting it out in its abstract, reads: "The assured's occupation or business where the subject of this insurance is used in connection therewith, the description of the automobile insured, the facts with respect to the purchase of same, the uses to which it is and will be put, and the place where it is usually kept, as set forth and contained in this policy, are statements of facts known to and warranted by the assured to be true, and this policy is issued by the Company relying upon the truth thereof." (b) Stipulations in policies in the nature of warranties or conditions are not to be captiously or literally construed, but are to be reasonably construed with reference to the subject-matter. Wilson & Co. v. Hartford Fire Ins. Co., 254 S.W. 266. (c) Clower did not have other insurance, as well as did not know of other insurance, and the so-called other insurance was a certificate issued under a master policy and which was not forwarded to Clower until long after the loss of his automobile, and consequently was not a warranty, was not intended by him as a warranty; and if a warranty was not such a warranty as required strict compliance. Lieberman v. American Bonding & Casualty Co., 244 S.W. 102; Federal Ins. Co. v. Purvis Bros., 278 S.W. 581, 212 Ky. 107; Allen v. St. Paul Fire & Marine Ins. Co., 208 N.W. 816. (d) There was no ratification of the issuance of the Export Policy prior to the loss and there could not possibly be any estoppel growing out of it for the reason that the defendant appellant has not in any manner changed its position and it was not pleaded. Federal Land Bank of Columbia v. Atlas Assurance Co., 188 N.C. 747, 125 S.E. 631; Turk v. Newark Fire Ins. Co.. 4 F.2d 142. There was no "other insurance" within a proper meaning of the policy. It was not taken out in the name of plaintiff, but in the name of a third party namely, "Commercial Credit Trust" and others. And if taken out in the name of the assured without his authority is not "other insurance" within the meaning of this clause. Church of St. George v. Sun Fire Office, 54 Mo. 162, 55 N.W. 909; Nelson v. Atlanta Home Ins. Co., 120 N.C. 302, 27 S.E. 38; Thompson v. National Fire Ins. Co., 203 N.W. 464. Defendant's three answers waived the clause against other insurance by pleading the co-insurance clause common to the standard form of policy but not contained in the policy sued on. Twice did they seek not only to Phoenixize the Export Insurance Co.'s liability, but reduce their own liability by reason thereof. It operated not only as a permit had it been part of the policy, but a ratification according to defendant's understanding of ratification, of co-insurance by plaintiff. (Although co-insurance in fact does not appear to exist). Richards on Insurance (3 Ed. ) p. 324, sec. 254. (2) The instruction given on behalf of plaintiff was proper and did not submit a question of law to the jury. It merely was more favorable to defendant than it should have been, in that it permitted the certificate to be termed a contract of insurance, or the policy to be so designated. The jury never attempted to interpret the law of insurance, they understood contract of insurance to mean policy or certificate of insurance. If they were passing on a question of law they passed upon it as the trial court should have determined it, and the error if one was in favor of defendant. In any event it does not appear to be an error requiring a reversal and remanding of the case. (3) The court did not err in submitting to the jury the question of vexatious refusal to pay.

BENNICK, C. Daues, P. J., and Becker and Nipper, JJ., concur.

OPINION

BENNICK, C.

This is an action on a policy of fire insurance, issued by defendant, insuring plaintiff's automobile against loss by fire and theft. The verdict of the jury was in favor of plaintiff, and assessed the amount of his recovery on the policy at the sum of $ 500, together with the sum of $ 50 as a penalty for vexatious delay, and the sum of $ 100 for attorney's fees. From the judgment rendered on such verdict, defendant, after an unavailing motion for a new trial, has duly perfected this appeal.

The petition was in conventional form, alleging that the policy was issued on August 1, 1924, whereby plaintiff's automobile was insured against loss by fire and theft to the amount of $ 500, for a term of one year; that on December 21st following, the said car was totally destroyed by fire; and that the car at the time was of the value of $ 500 or more.

Defendant's answer, in addition to a general denial, pleaded that, by the terms of the policy, plaintiff warranted that there was no other insurance covering the insured property, and that it was provided therein that no recovery could be had if, at the time of the loss, there was any other insurance covering such loss that would attach if such prior insurance had not been effected. It was then alleged that, at the date of the issuance of the policy in suit, and at the time of the fire, there was a policy covering the said automobile, issued by the Export Insurance Company, and that by reason thereof the policy in suit had become void. It was further averred that the policy had been avoided by reason of the concealment by plaintiff of the fact of this other insurance.

Although no reply was filed, it appears that the case was tried as though the new matter in the answer was at issue.

The evidence disclosed that on June 26, 1924, plaintiff purchased from the J. E. Lyon Motor Car Company, of Mexico, Missouri, a Star coupe, the list price of which was $ 735, which sum included certain extra equipment, consisting of bumpers and an extra tire. It developed, however, that the total purchase price of the car was $ 781, the sum of $ 46 in excess of the list price representing a service charge covering the interest on the unpaid balance, and the premium on insurance to be taken out in conformity to certain provisions in the chattel mortgage. Plaintiff paid part cash, and gave his note to the J. E. Lyon Motor Car Company for $ 390.50, for the balance due with interest, and at the same time executed to such company a chattel mortgage on the car to secure payment of the note. By the terms of such chattel mortgage it was provided that the mortgagor should keep the automobile insured against loss or damage by fire and theft, the loss to be payable to said mortgagee, as the mortgagee's interest might appear, and...