Continental Ins. Co. v. Cummings

• Citation: 81 S.W. 705
• Parties: CONTINENTAL INS. CO. v. CUMMINGS et al.
• Decision Date: 23 June 1904
• Court: Texas Supreme Court

Page 705

81 S.W. 705

CONTINENTAL INS. CO. v. CUMMINGS et al.

Supreme Court of Texas.

June 23, 1904.

Error to Court of Civil Appeals of First Supreme Judicial District.

Action by O. S. Cummings and others against the Continental Insurance Company. Judgment in the Court of Civil Appeals (78 S. W. 378) affirming a judgment for plaintiffs, and defendant brings error. Reversed.

Alexander & Thompson and E. P. Stockwell, for plaintiff in error. H. Gross and Bryan, Tod & McRae, for defendants in error.

BROWN, J.

O. S. Cummings, as assignee of the policies, brought this suit against the Continental Insurance Company to recover on three policies of insurance against fire issued by the defendant company to J. R. Kimmins upon his stock of hardware and other goods, store fixtures, and storehouse, situated in the town of Alvin. The first policy was issued on the 7th day of December, 1901, for a sum not exceeding $900—on the stock of merchandise, $600; on the building, $200; and on the fixtures, $100. On the 14th of December, 1901, the company issued to the said Kimmins another policy for $400 on the same stock of goods, and on the 15th day of February the company issued a third policy to the said Kimmins for $500 on the merchandise in the store. Each of the policies was payable to J. R. Kimmins, as the sole owner of the property. All of the policies were alike in their terms, except as to amounts. Each insured against fire for one year from date. On the 6th day of August, 1902, all of the property embraced in the policies was destroyed by fire. The petition alleged that the property insured was in fact owned by the Kimmins Hardware Company, a corporation composed of J. R. and H. R. Kimmins, and that the true ownership of the property was known to W. R. Stockwell, the agent who issued the policies, at the time they were issued; that, as agent of the company, Stockwell was empowered to issue the policies, and, notwithstanding his knowledge of the fact to the contrary, wrote into said policies that J. R. Kimmins was the sole owner of the property. The petition contained all of the allegations necessary for recovery, which it is not necessary for us to set out in this connection. The original petition also alleges, in substance, that J. R. Kimmins gave notice of the destruction of the property by fire, on the next day after it occurred, to W. R. Stockwell, the agent of the defendant company who issued the policies sued upon. Afterwards, on the 25th day of August, 1902, I. Jalonick, who was the agent of the defendant company, and its adjuster of losses, with full power to ascertain the amount of the loss and the liability of the company, "came to the town of Alvin, where the said loss had occurred, and the said Kimmins on, to wit, the 25th day of August, 1902, furnished to said agent of defendant à full statement concerning said loss, stating the knowledge and belief of the insured as to the time and origin of the fire, and the said Kimmins offered to produce his books for the inspection of said adjuster, and to do or perform any other acts or things which were required by the terms of the said policies to be done by said insured; and the said agent of defendant stated to and advised the insured that he was satisfied as to the evidence and statements of loss that had occurred, and that the insured need take no further steps or make any further effort to make proofs of loss, or do anything else to establish their claim against the defendant, and admitted that the company was liable to the said insured for the loss, and thereafter, on or about September 15, 1902, offered, for the defendant, to pay fifty per cent. of the face of said policies in full satisfaction of said loss by reason of said fire, which offer of fifty per cent was refused by the insured and plaintiff, and payment in full was demanded of defendant by them."

Among other pleadings, the defendant filed a special answer in which it set up the following clause of the policy: "This entire policy shall be void if the interest of the insured in the property be not truly stated herein, and this entire policy, unless otherwise provided by agreement endorsed hereon or added hereto, shall be void, if the interest of the insured be other than unconditional and sole ownership." The answer alleged that at the time the policies were issued the property belonged to the Kimmins Hardware Company, of which H. R. Kimmins was a member, and that J. R. Kimmins was not the sole owner, but was the owner of only a half interest in it, and therefore claimed the forfeiture of the policy on account of the breach of that clause. The answer also set up the following clauses of the policy:

"(1) 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.

"(2) 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 first section of this clause, and also from date of last preceding inventory, if such has been taken, and during the continuance of this policy.

"(3) 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, and unless such books and inventories are produced and delivered to this company for examination, this policy shall be null and void, and no suit or action shall be maintained hereon; it...