Cohen v. Home Insurance Company, a Corporation of State of New York

• Decision Date: 05 June 1916
• Court: Delaware Superior Court
• Parties: DAVID COHEN v. THE HOME INSURANCE COMPANY, a corporation of the State of New York

97 A. 1014

29 Del. 201

DAVID COHEN v. THE HOME INSURANCE COMPANY, a corporation of the State of New York

Superior Court of Delaware, New Castle County

June 5, 1916

Superior Court, New Castle County, May Term, 1916.

SUMMONS DEBT, No. 71, January Term, 1915.

Action by David Cohen against the Home Insurance Company, a corporation of the State of New York. Verdict directed for defendant.

See also, 5 Boyce, 531, 95 A. 238, 912.

In this action David Cohen, the plaintiff, seeks to recover from the Home Insurance Company, the defendant, the sum of eight thousand dollars, with interest from January 6, 1914, alleged to be due him from the company, on two policies of insurance on plaintiff's stock of goods; the property covered by the policies was destroyed by fire on January 6, 1914.

The plaintiff has introduced testimony to show that the defendant company through Mr. Horsey, of the firm of Jones and Horsey the company's agent at Greensboro, on September 15, 1913 issued to the plaintiff, a policy of insurance for four thousand dollars on a stock of goods contained in a building which he occupied as a store, at Greensboro, Caroline County Maryland; that some time prior to October ninth following, when the premium on the policy was paid by Cohen to Horsey, the plaintiff inquired of Mr. Horsey the meaning of the iron-safe clause; that Horsey stated in substance, that he, Cohen, need pay no attention to it and he could disregard it, as in his opinion it was intended only for crooks. Some time subsequent to the ninth of October, the plaintiff applied to Horsey for other insurance of four thousand dollars, on the same stock of goods. Horsey suggested to him that he take an inventory of the stock of goods in his store, which was done and submitted to Horsey on or about November third, next. On November first the company through Horsey, issued the other policy of insurance for four thousand dollars, making eight thousand dollars of insurance he had. The property covered by both policies was destroyed by fire about three o'clock in the morning of January 6, 1914. The firm of Jones and Horsey was the only agent of the defendant company at Greensboro, and through an arrangement with the office of the company in Baltimore, Horsey, to save himself the clerical work of making out policies, would send the data to the Baltimore office, where the policies would be made out and returned to Horsey for him to countersign the firm's name, deliver the policies and collect the premiums. This practice was followed in this instance. The plaintiff introduced into evidence the inventory of November third, which he had kept in his room in the hotel at Greensboro, also a number of sheets of tablet paper of which the following is a specimen:

"Week of Oct. 27/13.

Oct. 27 Mon

$ 49.31

28 Tues

23.15

29 Wed

7.86

30 Thurs

12.71

31 Fri

11.27

Nov. 1 Sat

40.92

$ 145.22"

(Representing cash on hand at the end of each business day.)

"Sat. Nov. 1/13 help 10.00 self 20.00."

(Money paid out of the money drawer.)

"Mon

$ 49.31

Tues

23.15

Wed

7.86

Thurs

12.71

Fri

11.27

Sat

70.92

$ 175.22"

(Representing cash received each day.)

There was also admitted into evidence a passbook of one customer, showing the amount of sales to that customer for credit, also showing payments and date of same, by that customer. The testimony showed that the plaintiff had seven other credit customers having passbooks, and that the amount of money due him on his sales for credit at the time of the fire did not exceed one hundred and twenty-five dollars. He was unable to produce the passbooks of these seven other credit customers.

It was shown that the credit sales to the eight credit customers were entered in a book kept for that purpose on the counter in the store. The fire destroyed this book. The plaintiff did not have an iron safe in his store.

Both policies of insurance were of the kind known as standard fire insurance policy of the State of New York, and both contained the following warranties, provisions and stipulations:

"Warranty to Keep Books and Inventories and to Produce Them in Case of Loss.

"The following covenant and warranty is hereby made a part of this policy:

"1st. The assured will take a complete itemized inventory of stock on hand at least once in each calendar year, and unless such inventory has been taken within twelve calendar months prior to the date of this policy one shall be taken in detail within thirty days of issuance of this policy, or this policy shall be null and void from such date, and upon demand of the assured the unearned premium from such date shall be returned.

"2d. The assured will keep a set of books, which shall clearly and plainly present a complete record of business transacted, including all purchases, sales and shipments, both for cash and credit, from date of inventory as provided for in the first section of this clause, and during the continuance of this policy.

"3d. The assured will keep such books and inventory, and also the last preceding inventory, if such has been taken, securely locked in a fireproof safe at night, and at all times when the building mentioned in this policy is not actually open for business; or failing in this, the assured will keep such books and inventories in some place not exposed to a fire which would destroy the aforesaid building.

"In the event of failure to produce such set of books and inventories for the inspection of this company, this policy shall become null and void, and such failure shall constitute a perpetual bar to any recovery thereon. * * *

"This policy is made and accepted subject to the foregoing stipulations and conditions, and to the following stipulations and conditions printed on back hereof, which are hereby specially referred to and made a part of this policy, together with such other provisions, agreements, or conditions as may be indorsed hereon or added hereto; and no officer, agent or other representative of this company shall have power to waive any provision or condition of this policy except such as by the terms of this policy may be the subject of agreement indorsed hereon or added hereto; and as to such provisions and conditions no officer, agent or representative shall have such power or be deemed or held to have waived such provisions or conditions unless such waiver, if any, shall be written upon or attached hereto, nor shall any privilege or permission affecting the insurance under this policy exist or be claimed by the insured unless so written or attached. * * *

"This entire policy, unless otherwise provided by agreement indorsed hereon or added hereto, shall be void if the insured now has or shall hereafter make or procure any other contract of insurance, whether valid or not, on property covered in whole or in part by this policy; or if the subject of insurance be a manufacturing establishment and it be operated in whole or in part at night later than ten o'clock, or if it cease to be operated for more than ten consecutive days; or if the hazard be increased by any means within the control or knowledge of the insured; or if mechanics be employed in building, altering or repairing the within described premises for more than fifteen days at any one time; or if the interest of the insured be other than unconditional and sole ownership; or if the subject of insurance be a building on ground not owned by the insured in fee simple, or if the subject of insurance be personal property and be or become incumbered by a chattel mortgage; or if, with the knowledge of the insured, foreclosure proceedings be commenced or notice given of sale of any property covered by this policy by virtue of any mortgage or trust deed; or if any change, other than by the death of an insured, take place in the interest, title, or possession of the subject of insurance (except change of occupants without increase of hazard) whether by legal process or judgment or by voluntary act of the insured, or otherwise; or if this policy be assigned before a loss; or if illuminating gas or vapor be generated in the described building (or adjacent thereto) for use therein; or if (any usage or custom of trade or manufacture to the contrary notwithstanding) there be kept, used, or allowed on the above described premises, benzine, benzole, dynamite, ether, fireworks, gasoline, greek fire, gunpowder exceeding twenty-five pounds in quantity, naptha, nitro-glycerine or other explosives, phosphorus, or petroleum or any of its products of greater inflammability than kerosene oil of the United States standard (which last may be used for lights and kept for sale according to law, but in quantities not exceeding five barrels, provided it be drawn and lamps filled by daylight or at a distance not less than ten feet from artificial light); or if a building herein described, whether intended for occupancy by owner or tenant, be or become vacant or unoccupied and so remain for ten days. * * *"

The plaintiff claims that the provisions of the iron-safe clause in both policies were waived by reason of Horsey's statement to him, and as the agent of the company knew that he had not taken an inventory within thirty days of the issuance of the first policy and had issued the second policy with the knowledge of this fact, together with the knowledge that he, Cohen, did not keep books in compliance with the provisions of the iron-safe clause, the knowledge of the agent Horsey was the knowledge of the defendant company and therefore the company was estopped from setting up a breach of the conditions of the iron-safe clause on the part of the plaintiff.

The plaintiff also claims a substantial compliance with the provisions of the iron-safe clause.

At the conclusion of the plaintiff's case, counsel...