Fowle v. Springfield Fire & Marine Insurance Co.

• Decision Date: 07 March 1877
• Citation: 122 Mass. 191
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: George E. Fowle & another v. Springfield Fire and Marine Insurance Company

122 Mass. 191

George E. Fowle & another v. Springfield Fire and Marine Insurance Company

Supreme Court of Massachusetts

March 7, 1877

Argued November 20, 1875; March 18, 1875

Suffolk. Contract upon a policy of insurance, by which the defendant insured the plaintiffs in the sum of $ 2500 "on their two story brick and gravelled roof building occupied by them for a carpet store, situate on leased land in rear of No. 166 Washington Street, Boston, Mass," from January 10, 1871, to August 23, 1873. The policy contained the following provisions:

"The interest of the assured, whether as owner, consignee, factor, lessee or otherwise, in the property to be insured, shall be truly stated in the policy, otherwise the same shall be void; and such interest shall also be set forth in the proofs of loss, with the names of the true owners of the property."

"All persons insured by this company, and sustaining loss or damage by fire, are forthwith to give notice thereof to the company; and, as soon after as possible, to deliver in a particular account of such loss or damage, signed with their own hands, and verified by their oath or affirmation; they shall also declare on oath, whether any and what other insurance has been made on the same property; what was the whole value of the subject insured; what was their interest therein; in what general manner (as to trade, manufactory, merchandise or otherwise,) the building insured or containing the subject insured, and the several parts thereof, were occupied at the time of the loss, and who were the occupants of such building; and when and how the fire originated, so far as they know or believe; and also, if required, shall produce their books of account and other proper vouchers, and until such proofs are furnished the loss shall not be deemed payable. Also, if there appear any fraud or false swearing, the insured shall forfeit all claim under this policy."

The case was submitted to the Superior Court, and, after judgment for the defendant, to this court, on appeal, on an agreed statement of facts in substance as follows:

The building alleged by the plaintiffs to have been covered by the policy was damaged to a greater amount than the sum named in the policy, by the great fire of November 9, 1872. It stood on land owned by one Callender, and was leased, with other land lying between it and Washington Street, to one Herman, for the term of ten years and six months from September 1, 1862; the indenture of lease providing that the lessee might remove the existing buildings on the site afterward occupied by the building alleged to have been covered by the policy, and build others in their stead; and the lessee covenanting that such future erections and buildings should be kept insured for the benefit of the lessor, and should be delivered up to him at the end of the term. The indenture contained a clause permitting the lessee to underlet, and was dated May 10, 1859, and acknowledged May 14, 1859, and duly recorded.

Herman, by indenture of May 24, 1862, underlet to the plaintiffs, for the term of ten years and eight months, from July 1, 1862, the land on which the building in question was erected, being the premises in rear of the store known as numbers 166 and 168 Washington Street; the lessees covenanting, among other things, to quit and deliver up the premises, with all future erections and additions thereon, to the lessor or his attorney, peaceably and quietly at the end of the term, in good order, fire and other unavoidable casualties excepted.

The plaintiffs removed the buildings standing at the date of the original lease, and erected the building in question. The building was of brick, with stone foundations and underpinning, and with a cellar under it. No insurance on the building was effected by any of the lessees for the benefit of or payable to Callender.

In the proofs of loss, the plaintiffs stated under oath that the building belonged to them, and that no other person or party had any interest therein.

If on the foregoing facts the plaintiffs were entitled to recover, judgment was to be rendered for them accordingly; otherwise, for the defendant.

This case was argued in March, 1875, and reargued in November, 1876.

Judgment for the plaintiffs.

B. F. Thomas, for the plaintiffs.

A. L. Soule, for the defendant.

Endicott, J., Colt, J. Lord, J., absent.

OPINION

Endicott, J.

The plaintiffs were sub-lessees of the land on which the building insured stood, and their lease, which was for ten years and eight months, expired on March 1, 1873. During the term, and before obtaining this policy, they had removed a building standing on the premises, and on its site had erected the present building. This they had a right to do under their lease, which also provided that at its expiration they should quit and deliver up the premises, with such buildings and additions as they had erected thereon. No question is made by the plaintiffs, that the building thus erected, and insured by this policy, attached to the land, became part of the real estate, and would pass to the owner of the soil at the end of the term. The policy was issued January 10, 1871, more than two years before the expiration of the lease, and the loss occurred within the term.

The policy contains the provision that "the interest of the assured, whether as owner, consignee, factor, lessee or otherwise, in the property to be insured, shall be truly stated in the policy, otherwise the same shall be void." The insurance, as stated in the policy, is on "their two story brick and gravelled roof building, occupied by them for a carpet store, situate on leased land in rear of No. 106 Washington Street, Boston." The defendant contends that the description does not truly state the interest of the assured in the property, and the policy is therefore void.

The plaintiffs had an insurable interest in this building. They had erected it at their own expense, and used and occupied it, in their business, as a carpet store. They might wish to rebuild it, or to indemnify themselves for their expenditure, in the event of its loss by fire. In either case, it was proper for them to procure insurance, and they might lawfully do so to the extent of the value of the building. It is clear that they would derive benefit from its continuing to exist, and would be injured by its destruction.

Having this insurable interest, in the absence of inquiry by the defendant, or of any provision in the policy calling for a statement of the nature of their interest, the description in the policy would have been sufficient. The words "their two story brick and gravelled roof building" do not necessarily import an absolute legal title in the building itself. The words "his" or "their" used in a policy, as descriptive of the property of the assured, do not render the policy void, if the insured has an insurable interest, although the interest may be a qualified or defeasible, or even an equitable interest. Fletcher v. Commonwealth Ins. Co. 18 Pick. 419. Strong v. Manufacturers' Ins. Co. 10 Pick. 40. Curry v. Commonwealth Ins. Co. 10 Pick. 535. King v. State Ins. Co. 7 Cush. 1. Hough v. City Ins. Co. 29 Conn. 10. Clapp v. Union Ins. Co. 7 Foster 143. Swift v. Vermont Ins. Co. 18 Vt. 305. Tyler v. AEtna Ins. Co. 12 Wend. 507. See Niblo v. North American Ins. Co. 1 Sandf. 551; Irving v. Excelsior Ins. Co. 1 Bosw. 507. The words may therefore be properly applied to property in which the insured have a valuable interest, which is in their possession and control, the right to which they may protect and enforce at law, and by the destruction of which they may sustain a serious loss.

As the description of the building as "their" building was not in itself such an inaccurate description as to avoid a policy containing no provision that the interest of the assured shall be truly stated, the question arises whether the further statement that the building is "situate on leased land" is a sufficient compliance with the provision of this policy that requires a true statement of the interest of the assured in the property, "whether as owner, consignee, factor, lessee or otherwise." This clause, being in the body of...