Cornelius v. Farmers' Ins. Co.

• Citation: 113 Iowa 183,84 N.W. 1037
• Parties: CORNELIUS v. FARMERS' INS. CO.
• Decision Date: 28 January 1901
• Court: United States State Supreme Court of Iowa

113 Iowa 183

84 N.W. 1037

CORNELIUS

v.FARMERS' INS. CO.

Supreme Court of Iowa.

Jan. 28, 1901.

Appeal from district court, Clayton county; A. N. Hobson, Judge.

Action on an insurance policy. Defense, that the property was used for other purposes than stipulated, thereby forfeiting the contract. It appeared that plaintiff's decedent signed the application for insurance February 5, 1894; that shortly afterwards a policy of that date, for the term of five years, was issued and accepted; and that the building covered was destroyed by fire August 3, 1896. It was insured as a dwelling house, but when burned was occupied as a storehouse for machinery. The plaintiff pleaded that defendant was estopped from claiming a forfeiture because of this change. Upon the introduction of plaintiff's evidence the court directed a verdict for the defendant. From judgment thereon, the plaintiff appeals. Affirmed.D. D. Murphy, for appellant.

Deacon & Good, for appellee.

LADD, J.

One of the conditions of the policy was that it should become void if the premises were used for any purpose other than mentioned therein; and another, that liability should cease during the vacancy of the building. Unless, then, the defendant is estopped from claiming a forfeiture of the policy because of the use of the building as a storehouse, rather than a dwelling, as insured, there can be no recovery. The application was procured by a soliciting agent, and the policy thereon issued directly from the home office. Among others, it contained these questions, “For what occupied? By whom?”--which were answered, “Pri. Frm. Dwg., by me or tenant.” The evidence tended to show that the deceased said to the agent that, while the building was then occupied by a tenant, he was not certain how long it would be, and he did not want the insurance unless it would be good whether he had a tenant in the house or not; that the agent responded that it would not hold good as written, but for an additional $2.50 he could make it so the building could be used for a storehouse or granary when not occupied as a dwelling, though not when vacant; that the deceased accepted the proposition, and paid the extra premium; that thereupon the agent did some scratching and writing upon the application, and declared that it was as desired, whereupon the deceased, who could not read English, signed it. It thus appears that the application contained no misstatement of any existing fact or past transaction, nor did it omit any. What was said related solely to an anticipated, though not settled, use of the property. It was an arrangement as to conditions of the policy, with which a soliciting agent had nothing to do, rather than a representation of the existing or past conditions of the property to be insured. That such an agent has no authority to make a binding contract for insurance, or what shall be the provisions of a policy, is too well settled to require any citations. The scope of his authority is limited to taking applications, and as, within this, it is his duty to see that the condition of the property is truly and fully disclosed when he undertakes to prepare them for the assured, the company may not take advantage of omissions or misstatements of facts or conditions affecting the risk. Fitchner v. Association, 103 Iowa, 280, 72 N. W. 530. But whatever he may say as to the effect of the policy or what it shall cover, or of its conditions, is mere opinion on his part, pertaining to matters wholly without the scope of his employment. Talks and agreements in reference to matters of future performance are merged in, and presumed to be expressed in, the policy, which, as in the case of other written contracts, becomes effective as the consummation of their wishes and intentions by its delivery on the part of the company and acceptance by the assured. Moore v. Insurance Co., 72 Iowa, 416, 34 N. W. 183;Baldwin v. Insurance Co., 60 Iowa, 497, 15 N. W. 300;Stephens v. Insurance Co., 87 Iowa, 283, 54 N. W. 139; Ostr. Ins. 186. Nor can anything he may impart...