Frick v. Millers' Nat. Ins. Co.

• Decision Date: 31 March 1916
• Docket Number: No. 17710.,17710.
• Citation: 184 S.W. 1161
• Parties: FRICK et al. v. MILLERS' NAT. INS. CO.
• Court: Missouri Supreme Court

184 S.W. 1161

FRICK et al. v. MILLERS' NAT. INS. CO.

No. 17710.

Supreme Court of Missouri, Division No. 2.

March 31, 1916.

Appeal from Circuit Court, Henry County; C. A. Calvird, Judge.

Action by J. A. Frick and another against the Millers' National Insurance Company. From a judgment of nonsuit with leave, which nonsuit the court refused to vacate, the plaintiffs appeal. Affirmed.

Fyke & Snider, of Kansas City, O. P. Ergenbright, of Independence, and Parks & Son, of Clinton, for appellants. White, Hackney & Lyons, of Kansas City, W. E. Owen, of Clinton, and Barger & Hicks, of Chicago, Ill., for respondent.

FARIS, P. J.

Plaintiffs sued defendant in the circuit court of Henry county on a policy of insurance for a fire loss. The court nisi sustained a demurrer to the evidence of plaintiffs; whereupon plaintiffs took a nonsuit, with leave, which nonsuit the court refused to vacate and plaintiffs appealed.

Defendant is a mutual fire insurance company, having its chief office in Chicago, Ill., but authorized to do business in Missouri, and we apprehend in Kansas as well, and having in Kansas City, Mo., a department or agency managed by one Charles H. Ridgway. On the 12th day of December, 1911, defendant issued to the Caney Mill & Elevator Company, a corporation (called hereinafter the Caney Company) doing business at Caney, Kan., a policy of fire insurance, insuring for a term of five years the machinery of the assured's flouring mill for $5,000, the building for $3,000, and stock on hand for $2,000. The initial premium was $212.50, which was paid in cash. There was a further provision that the assured should make and deposit, and it did make and deposit, its premium note for the additional sum of $2,125 to cover such assessments as the board of directors of defendant should make against assured under defendant's charter and bylaws. Attached to said policy was what is called in the record a "watchman, with approved watch clock clause." The policy also contained a provision forbidding the mill's remaining idle for a longer period than 10 days, which was by an indorsement modified to read 60 days. Plaintiff Home National Bank (called hereinafter the Bank), had possession of the policy of insurance as mortgagee to secure to it the payment of a $3,500 loan and the interest thereon. On April 20, 1912, finding that the mill would remain idle longer than the 60 days allowed by the terms of the policy, the plaintiff Bank wrote to the agent of defendant, saying that consent of defendant being necessary to continue policy in force after a vacancy of 60 days, asked that consent, and procured the placing on the policy 2 days thereafter of an indorsement allowing the mill to continue idle till the next harvest. This indorsement is as follows:

"In consideration of the full compliance by the assured with the watchman warranty attached to this policy permission is hereby granted to the insured to remain inoperative until next harvest if necessary." (Italics ours.)

The watchman warranty referred to in the indorsement last above is as follows:

"In consideration of a reduction of twenty-five cents (25c.) in the basis rate, at which this policy is written, the assured hereby agrees to maintain a watchman provided with an approved watch clock to watch day and night at all times when the machinery is not running, except when other employés are on duty, and then he is relieved from duty only in the day time while such other employés are actually on the premises; and it is particularly understood and agreed that the first duty of the watchman is the care and examination of the property in his charge, and he shall be required to examine all fast running bearings, commencing immediately after machinery shuts down, and make at least three thorough and careful examinations of machinery and bearings, one each hour after machinery stops running; and there shall be at least one watch clock station on each floor of each building covered by this policy, including the engine and boiler house, whether insured or not, to each of which stations he shall make hourly rounds while on duty; and the assured further agrees to date all watch clock records and file same in a fire proof safe, if kept on the premises, or in some safe place outside the premises not endangered by a fire therein, retaining same for a period of not less than ninety (90) days, subject to examination of inspectors; and at the termination of the ninety (90) days periods ending September 1, December 1, March 1, and June 1, all records to be forwarded to the Mutual Fire Prevention Bureau at Oxford, Mich., for examination and checking, to determine whether or not the service conforms to the requirements for above credit; failure on the part of the assured to furnish records as per this agreement to be prima facie evidence that the assured is not entitled to credit for the service maintained.

"It is hereby warranted by the assured that the conditions herein named shall be observed, and failing to do so, it is agreed that the credit allowed for the service shall be forfeited for a period of six months, the amount so forfeited to be added to the first assessment made after the breach of conditions is established.

"Attached to and made part of policy No. 35949 of the Western Millers' Mutual Fire Insurance Company, of Chicago, Ill."

When this policy was issued the assured, Caney Company, wrote to defendant that some change would occur in the management of the mill about January 1, 1912, and asked that a former policy be extended and kept in force till that time leaving to the new management to insure or not as it saw fit. In reply the defendant wrote to the Caney Company on December 6, 1911, the below letter, formal parts and signature omitted, viz.:

"Your favor of December 5th, explaining that there is likely to be a change in the management of your company after January 1st, is at hand, and we note your request to hold our insurance binding until that time, without issuing a new contract.

"Inasmuch as the new contract can be transferred or even canceled if the new parties do not wish to continue it, my suggestion is that the application be signed, and sent to us for renewal, so that a policy may be issued and in your possession. It is not always satisfactory to the company or the assured to extend a policy by indorsement after it has expired. For this reason, we would suggest that the policy be renewed in the regular form."

Thereafter, and on December 12, 1911, the policy in suit was issued (or perhaps, to be more exact, was renewed). It contained, in addition to the clauses above referred to, some of which are set forth, this provision:

"This entire policy, unless otherwise provided by agreement indorsed hereon or added hereto, shall be void * * * if the subject of insurance be a manufacturing establishment and it be operated in whole or in part at night later than ten o'clock; or if it cease to be operated for more than ten consecutive days; or if the hazard be increased by any means within the control or knowledge of the insured; * * * or if the interest of the insured be other than unconditional and sole ownership; * * * or if any change, other than by the death of an insured, take 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...