Fireman's Fund Ins. Co. v. Barker

• Decision Date: 10 June 1895
• Citation: Fireman's Fund Ins. Co. v. Barker, 41 P. 513, 6 Colo. App. 535 (Colo. App. 1895)
• Parties: FIREMAN'S FUND INS. CO. v. BARKER. [1]
• Court: Colorado Court of Appeals

41 P. 513

6 Colo.App. 535

FIREMAN'S FUND INS. CO. v. BARKER. ^[1]

Court of Appeals of Colorado

June 10, 1895

Appeal from district court, Montrose county.

Action by Franklin C. Barker against the Fireman's Fund Insurance Company. Judgment for plaintiff, and defendant appeals. Reversed.

On August 20, 1892, appellant insured appellee for one year for the amount of $500 on household furniture, $875 on alfalfa in stack, and $125 on wheat and oats in stack; alfalfa estimated at 700 tons and oats 600 bushels. Appellee paid for such insurance $55. On the 4th day of December, 1892, the entire alfalfa hay crop and 400 bushels of grain were destroyed by fire. Notice and proof of loss was made. Other insurance companies had additional risks on the same property. One E.E. Beard, who designated himself as "independent adjuster," was sent to adjust the loss by the appellant, and its liability was fixed at $935. Beard at about the same time made the discovery that appellee had made two chattel mortgages upon the burned property,--one to Thomas A. Mostyn, who owned the ranch occupied by appellee for the sum of $844.70, dated January 1, 1892 (prior to the insurance); the other to Goldsmith & Co. for $375, November 10, 1892 (subsequent to the insurance),--and notified appellant of the fact, whereupon appellant refused to pay the losses. Appellee brought suit. A trial to a jury was had resulting in a verdict for the plaintiff for $958.20 and $54.65 interest, making $1,012.85. A motion for a new trial was overruled, judgment entered upon the verdict, and an appeal prosecuted to this court.

Thos J. Black, for appellant.

Sherman & Twitchell, for appellee.

REED P.J. (after stating the facts).

The following provisions occur in the policy of insurance delivered to appellee: "This entire policy shall be void if the insured has concealed or misrepresented, in writing or otherwise, any material fact or circumstance concerning this insurance or the subject thereof; or if the interest of the assured in the property be not truly stated herein; or in case of any fraud or false swearing by the insured, touching any matter relating to this insurance or the subject thereof, whether before or after a loss." "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, 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 the death of the insured, takes 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." The complaint was in the ordinary form. The allegations were denied, and defendant specially pleaded the above provisions of the policy, and alleged that appellee had concealed the fact of the existing chattel mortgage to Mostyn, misrepresented facts in regard to the ownership by him of the property, and subsequently, without the consent of appellant, executed the chattel mortgage to Goldsmith & Co., of which appellant had no notice until after the bringing of the suit, and that for those reasons the policy was void. Plaintiff replied, alleging knowledge of the defendant of the Mostyn chattel mortgage, and that the mortgage to Goldsmith & Co. was a renewal; was upon other property; that the hay was embraced in it without his knowledge; that he executed it, and had no knowledge until long after; that the hay was embraced in it. The plaintiff was not present at the trial, consequently did not give evidence, nor was any given in his behalf in support of the allegations in his replication. L.F. Twitchell, attorney for plaintiff, testified that plaintiff had agreed to be at the trial, "but they had lost track of him"; did not know where he was. Witnesses for the defendant testified to want of knowledge of the existence of the mortgages. The agent, Upton, who made the insurance, testified that plaintiff stated at the time the insurance was effected that the property was not incumbered. The members of the firm of Goldsmith & Co. testified to plaintiff's knowledge that the hay was embraced in their chattel mortgage.

The language of the contract of insurance is plain and unmistakable. The failure to notify the company of the existence of the Mostyn mortgage at the time the insurance was effected, and the subsequent mortgage to Goldsmith & Co. rendered the policy void. Courts cannot reform contracts, nor relieve contractors from the effects of foolish or improvident contracts, except when obtained by fraud. Where there is no ground for construction, contracts must be enforced as made. The Mostyn mortgage was of record, as required by statute. The object of the statute is to afford notice, and such record is held in law to be constructive notice to all. No good reason can be given why insurance companies should not be embraced in the general law, and be considered as having the notice, nor why, with the public record existing, the validity of the contract should depend upon the failure of the insured to state the existence of the mortgage; but such was the contract. It would, in justice and reason, seem, where insured personal...