Franklin v. Va. Fire & Marine Ins. Co

• Decision Date: 31 October 1905
• Citation: 51 S.E. 922,139 N.C. 390
• Court: North Carolina Supreme Court
• Parties: BRAT & FRANKLIN. v. VIRGINIA FIRE & MARINE INS. CO.

139 N.C. 390

51 S.E. 922

BRAT & FRANKLIN.

v.VIRGINIA FIRE & MARINE INS. CO.

Supreme Court of North Carolina.

Oct. 31, 1905.

1. Insurance—Construction of Policies— Ambiguous Phrases.

A clause in an insurance policy which is ambiguously worded, or the interpretation of which is in doubt, should be construed so as to effectuate the intention of the parties, if ascertainable; but any doubt should be resolved in favor of the insured.

[Ed. Note.—For cases in point, see vol. 28, Cent. Dig. Insurance, §§ 292, 295.]

2. Same—Fire Policies—Iron Safe Clause.

An "iron safe clause" in an insurance policy required insured to make an inventory "within 30 days after the date of the policy, " unless such inventory had been taken within the 12 calendar months preceding such date, and further required him to keep a set of books representing a complete record of business transacted "from the date of the inventory." Held, that insured was not required to keep a set of books until after the taking of the inventory, for which purpose 30 days was allowed, so that the failure to keep such books did not defeat a recovery on the policy, where the loss occurred within 30 days from the date of the policy and no inventory had been taken.

Appeal from Superior Court Person County; Ward, Judge.

Action by A. J. Bray and another, doing business under the firm name of Bray & Franklin, against the Virginia Fire & Marine Insurance Company. From a judgment for plaintiff, defendant appeals. Affirmed.

Watson, Buxton & Watson, for appellant.

Kitchin & Carlton, for appellees.

WALKER, J. This action was brought by the plaintiffs to recover the amount of a policy of insurance for $500 issued to them on the 19th day of December, 1904, and by which the defendant agreed to insure their stock of merchandise from loss by fire. The only defense pleaded was that the plaintiffs had not observed and kept the provisions of what is know in such policies as the "iron safe clause, " in that they had not taken an inventory or kept books as therein directed. The clause in this policy is in the usual form, and requires of the assured (1) that he shall take a complete itemized inventory of his stock on hand at least once in each calendar year, and one shall be made within 30 days after the date of the policy, unless such an inventory has already been taken within the 12 calendar months next preceding said date, the policy to become null and void if the inventory is not taken, and the unearned premium to be returned on demand; (2) that he shall keep a set of books, which must clearly and plainly present a complete record of business transacted, including purchases, sales, and shipments for cash and credit from the date of the inventory as provided in the first section of the clause, and during the continuance of the policy; (3) that he shall keep such books and inventory securely locked in a fireproof safe at night, and at all times when his building is not actually open for business, or, failing in this, in some place not exposed to a fire which would destroy the building. In the event of failure to produce such set of books and the inventory for the inspection of the company, the policy to become void, and such failure to be a perpetual bar to any recovery thereon. We have reproduced the material portions of the clause, as the decision of the case must turn upon its true construction. The counsel for the defendant in an able argument and well-prepared brief maintained that the clause in question is a valid one, as containing a promissory warranty which, if not complied with, will defeat a recovery upon the policy, and a large majority of the courts, it seems, have so held; but we do not deem it necessary to enter upon a discussion of the proposition, or to undertake to decide the same, as the validity of the clause was not seriously contested by counsel for the plaintiffs, who presented his...