Diehl v. Adams Co. Mutual Ins. Co.

• Decision Date: 02 July 1868
• Citation: 58 Pa. 443
• Parties: Diehl <I>versus</I> The Adams County Mutual Insurance Company.
• Court: Pennsylvania Supreme Court

58 Pa. 443

Diehl versus The Adams County Mutual Insurance Company.

Supreme Court of Pennsylvania.

May 8, 1868.

July 2, 1868.

May 8th 1868.

Before THOMPSON, C. J., STRONG, READ, AGNEW and SHARSWOOD, JJ.

Error to the Court of Common Pleas of Adams county: To May Term, 1868. No. 41.

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D. Wills and D. Smyser, for the plaintiff in error.—The examination and declaration by the agent was authority to go on with the alterations: Perry County Insurance Company v. Stewart, 7 Harris 48; Girard Fire Insurance Company v. Stephenson, 1 Wright 298; Paley on Agency 145, 215; Loudon Saving Fund v. Hagerstown Saving Bank, 12 Casey 498; Seiple v. Irwin, 6 Casey 513. The act of a corporation when doubtful is to be taken most strongly against it: Stacey v. Insurance Company, 2 W. & S. 544; Franklin Fire Insurance Company v. Updegraff, 7 Wright 350; Western Insurance Company v. Cropper, 8 Casey 351.

The evidence of the acts of treasurer should have been permitted to go to the jury on the question of waiver: Lycoming Insurance Company v. Stocklomn, 3 Grant 207; Garrett v. Gonter, 6 Wright 143; Franklin Fire Insurance Company v. Updegraff, 7 Id. 350; Lycoming Insurance Company v. Schollenberger, 8 Id. 259; Coursin v. Penna. Insurance Company, 10 Id. 323, 330; Buckley v. Garrett, 11 Id. 204, 211; Lycoming Insurance Company v. Mitchell, 12 Id. 368; Boyd v. McNaughton, 1 P. F. Smith 225; Frost v. Saratoga Mutual Insurance Company, 5 Denio 154; Carroll v. Charter Oak Insurance Company, 38 Barbour 402; Vial v. Genesee Mutual Insurance Company, 19 Id. 440; Inland Ins. and D. Company v. Stauffer, 9 Casey 397; Bateman on Commonwealth Law, § 1141.

The amendment of the replication was, at most, a cumulative traverse: Robinson v. Raley, 1 Burr. 316; Stephen on Pleading 262.

The question in the plaintiff's point was for the jury: Grant v. Howard Insurance Company, 5 Hill 10; Bateman on Commercial Law, sect. 1139, note. A warrant is to be construed according to its ordinary meaning: Shaw v. Robberds, 6 Ad. & Ell. 75; Stetson v. Insurance Company, 4 Mass. 330; Cumberland Valley Mutual Prot. Company v. Schell, 5 Casey 31.

R. G. McCreary, for defendants in error.—The minute book was evidence, the plaintiff being a member of the company: Com. v. Woelpper, 3 S. & R. 29; Fleming v. Wallace, 2 Yeates 120. The land in the alley belonged to Diehl, although used by the public, and he could have prevented the erection: Chambers v. Furry, 1 Yeates 167; Lewis v. Jones, 1 Barr 336; Sanderson v. Haverstick, 8 Id. 294. The authority of the agent was limited by the instrument to which the plaintiff was a party, and he was bound to know its extent: Mitchell v. Lycoming Insurance Company, 1 P. F. Smith, 402. Only the material allegations of the plea were put in issue by the replication: 1 Chitty's Pleading 436, 611.

The opinion of the court was delivered, July 2d 1868, by THOMPSON, C. J.

1. The answer of the defendant to the first assignment of error in this case is very complete, viz: that its act of incorporation, by adopting the 8th section of the Act incorporating the Bradford County Insurance Company, Pamph. L. 1838, p. 365, rendered its members competent witnesses for the company, when not individually interested. The objection that the witnesses were managers did not alter the case. They are managers because members, and it is only as members in this case, that they could be supposed to have any interest. No conduct of theirs as managers is involved in any issue in the case. By the act of incorporation they were clearly witnesses, therefore, in a case of this kind. Had there been any question of negligence, or recklessness on part of the managers involved, the objection might have been effectual — but that was not the case. The result under the pleadings could only affect the company.

2. The second assignment was equally well answered. The plaintiff below became a member of the company by the act of being insured in it. It was a mutual insurance company. The books were, therefore, in law, as much his as they were the books and minutes of the other members constituting the company: 3 S. & R. 29; 4 Barr 185; 1 P. F. Smith 402. This error is not sustained.

3. The third assignment of error is to the rejection of an offer to prove that the tannery, the principal subject of insurance, consisting of several buildings, had been leased before the erection and application of steam to its operations, and that the furnace and boilers to propel the engine were erected on a public alley, and were so constructed and situated, as not to increase the risk to the insured premises, and that the erection was in no wise the cause of the fire, but that it originated in, and was communicated from property not covered by the policy.

The court admitted that portion of the offer to show that the location of the furnace, boilers, and engine, were on the alley, but rejected the balance, deeming it inadmissible under the pleadings.

That the erection was by a tenant was no excuse if it was violative of any covenants in the policy. The possession was that of the insured, if it was by his tenant. The lessor, the plaintiff in this case, continued to be the insured party, and the covenants which he entered into in becoming insured remained, whether he occupied, personally or by tenant. We need not spend time on this.

The defendant went to trial on a single plea, which averred that in violation of the terms and conditions of the policy, the plaintiff had erected and set up a steam-engine to be used, and used the same in operating his tannery, up to the date of the injury to the establishment by fire, and by this means changed the property into a class of risks not covered by the policy. The replication of the plaintiff, was a simple traverse of the fact averred. The rule that the allegata and probata must agree, contains the principle which justified the rejection of the proposed testimony. It did not in any manner sustain the plaintiff's allegation, that no such erection had been made as averred in the plea.

The plaintiff contends that it was evidence to show that the erection did not increase the risk, and therefore ought not to avoid the policy. The answer to this is, that the contract of insurance accepted by the plaintiff, stands upon the condition that if the insured premises "shall be so altered, or be appropriated, applied or used, to or for the purpose of carrying on, or exercising therein, any trade, business or vocation, which, according to the by-laws and conditions, class or hazard, or rates hereunto annexed, would increase the hazard, unless it be by consent, and agreement in writing, endorsed upon the policy," the policy shall cease and be void.

In the by-laws we find a list of rates of insurance for the classes therein enumerated, and in it are "Tanneries without steam, 8 per cent." Tanneries with steam are not in the list. "The above rates," say the by-laws, "are for insurance of the safest kind." And "such classes as are not named may be insured at such rates as the board of managers or executive committee may determine." The safest risks are the classes named and declared in the policy as enumerated. Other risks may be insured by the special action of the managers or executive committee, at such rates as they may determine upon. That is the meaning of these clauses undoubtedly.

The plaintiff's tannery and other property, are insured according to the class and rates set down in the by-laws, and the policy was, by express stipulation, "made and accepted subject to, and in reference to the terms, by-laws and conditions therein contained and thereunto annexed." The application of steam to the tannery changed and put the property out of the class and rates enumerated, and in which it was insured. Steam-tanneries are not on the list, while tanneries without steam are. The list was a mode of fixing what should be regarded as an increase of hazard. It is declared, if the property insured should be so changed or used as, according to the by-laws and conditions, class or hazard, of rates "hereunto annexed," the hazard would be increased and unless by consent, the policy should be avoided. On the face of the policy and by-laws made a part of it, a steam-tannery was not insured and not insurable at the rates mentioned. The offer therefore, to prove as proposed, was an offer to ignore what the parties had agreed upon as the test of increased hazard, and was properly rejected. There are cases in which such offers have been made and the testimony admitted, but I find none in which...