Hanover Fire Ins. Co. v. Eisman

• Decision Date: 09 January 1915
• Docket Number: Case Number: 6076
• Citation: 146 P. 214,1915 OK 14,45 Okla. 639
• Parties: HANOVER FIRE INS. CO. et al. v. EISMAN et al.
• Court: Oklahoma Supreme Court

1915 OK 14

146 P. 214

45 Okla. 639

HANOVER FIRE INS. CO. et al. v. EISMAN et al.

Case Number: 6076

Supreme Court of Oklahoma

Decided: January 9, 1915

Syllabus

¶0 1. INSURANCE--Inventory--Sufficiency. Where in an inventory taken under the terms of a policy of insurance providing that, "The assured will take an itemized inventory of stock hereby insured. * * * it appears that approximately one-ninth of a stock of merchandise covered by the policy was not invoiced in a proper or approved manner, in that some of the articles were set down in lots or groups, and not by items, but that the remainder of such stock was described therein item by item, with the value set opposite, held, that such deficiency did not pervade the whole inventory or constitute its controlling feature. Held, further, that inasmuch as the greater proportion of the stock, properly inventoried, amounted in value to approximately $ 42,000,000, and recovery was had for but $ 23,000.00, the inventory in the instant case substantially meets the requirements of the policy.

2. INSURANCE POLICY--Requirement to Keep Books--Substantial Compliance. The provision of a policy of insurance that "the assured will keep a set of books, which shall clearly and plainly present a complete record of the business transacted, * * * is substantially complied with by the assured keeping a set of books clearly showing such matters to men of ordinary intelligence. Evidence examined, and held sufficient to show a substantial compliance with such provisions.

3. INSURANCE POLICY--Construction--"Stored." Gasoline was not "stored," within the meaning of the terms of the policies of insurance involved, by keeping a small quantity thereof in a closed metallic container on the premises for the purpose of occasionally cleaning the wearing apparel of the assured; and the use of a candle in a room where such gasoline was found did not avoid the policy.

4. APPEAL AND ERROR--Discretion of Trial Court--Harmless Error--Submission of Issues--Special Findings. Instructions given and refused examined. Held, there was no prejudicial error therein.

Error from District Court, Oklahoma County; W. R. Taylor, Judge.

Action by Leon Eisman, survivor of John Eisman and another, partners doing business as "Eismans" and another, against the Hanover Fire Insurance Company, a corporation, and others. Judgment for plaintiffs, and defendants bring error. Affirmed.

Scothorn, Caldwell & McRill, for plaintiffs in error.

Ames, Chambers, Lowe & Richardson and G. A. Paul, for defendants in error.

BLEAKMORE, J.

¶1 This case presents error from the district court of Oklahoma county. John Eisman and Leon Eisman, partners, doing business under the firm name of "Eismans," commenced actions against 14 fire insurance companies on a large number of policies. Pending the cases John Eisman died, and the same were prosecuted by Leon Eisman, as surviving partner. The 14 separate cases were, by agreement of parties, upon order of the court, consolidated and tried to a jury as one case, resulting in a verdict for plaintiff in the sum of $ 23,000, upon which judgment was rendered against each company for its pro rata share of the amount of the verdict. From this judgment the insurance companies (defendants below) have brought the proceedings here for review. The parties will be referred to as plaintiff and defendant, as they appeared in the trial court.

¶2 For some time before the issuance of the policies sued on the plaintiffs were part owners of, and had been conducting, a wholesale business at 1 to 3 West Grand avenue, in Oklahoma City, under the name of Gerson, Eisman & Co., and later became the sole owners of said business. Plaintiffs discontinued the wholesale business, and engaged in the sale of their stock at retail, and at the time of the loss in question, on January 6, 1913, were located at 118 and 120 West Main street, in Oklahoma City. The fire occurred, and the stock of merchandise insured was partially destroyed. The total value of the stock at the time of the fire was approximately $ 47,000. The total amount of insurance was $ 43,000, and the amount of the loss and damage was approximately $ 30,000. Immediately after the fire a representative of the defendant companies entered into negotiations with plaintiffs looking to an adjustment of the loss. No adjustment was reached, and on March 3, 1913, proof of loss was made, and on March 8, 1913, upon the request of defendant, additional proofs of loss were submitted. On the 12th of March plaintiffs appointed an appraiser in writing, and requested that defendants do likewise. This request was refused, and shortly thereafter the suits were instituted. The defendants answered, admitting the execution of the policies, but denying liability thereunder, for the reason that plaintiff had not substantially complied with the terms and conditions of said policies, and alleged, among other things:

"The following covenants and warranties on the part of the assured and conditions on the part of the insurance company are hereby made part of the policy to which this clause is attached:

"(1) The assured will take an itemized inventory of stock hereby insured at least once in each calendar year, and, unless such inventory shall have been taken within twelve (12) calendar months prior to the date of this policy, the same shall be taken in detail within thirty (30) days after said date, or this policy shall be null and void from and after the expiration of said thirty (30) days, and upon demand of the assured, within three months from the date of this policy, the unearned premium for the unexpired term of this policy shall be returned.

"(2) The assured will keep a set of books which shall clearly and plainly present a complete record of the business transacted, including all purchases, sales, and shipments of such stock, both for cash and credit, from the date of the inventory provided for in the first section of this clause, and during the continuance of this policy.

"The assured will keep such books and inventory, and also the last preceding inventory, securely locked in a fireproof safe at night, and at all times when the building mentioned in this policy, or the portion thereof containing the stock described therein, is not actually open for business, or, failing in this, the assured will keep such books and inventories at night, and at all such times, in some place not exposed to fire which would ignite or destroy the aforesaid building, and, in case of loss, the assured specifically warrants, agrees, and covenants to produce such books and inventories for the inspection of said company.

"In the event of failure on the part of the assured to keep and produce such books and inventories for the inspection of said company, this entire policy shall become null and void, and such failure shall constitute a perpetual bar to any recovery thereon."

¶3 The defendant later amended its answer as follows:

"Answering further, and for a fifth defense to plaintiff's petition herein, defendant alleges and states that the insurance policy upon which plaintiffs bring and prosecute this action is the regular Oklahoma standard form of fire insurance policy, and contains written therein and constituting a valid and binding part thereof, the following provision, to wit:

"'This entire policy, unless otherwise provided by agreement indorsed herein or added hereto, shall be void * * * if (any usage or custom of trade or manufacture to the contrary notwithstanding) there be kept, used, or allowed on the above-described premises * * * gasoline. * * *'

"And defendant further alleges and states that there was indorsed upon said policy of insurance a gasoline permit which was and is in words and figures as follows:

"'Gasoline Permit.--Permission for the use of gasoline stoves and lamps, the reservoirs to be filled by daylight or closed incandescent electric lights only, and when the stoves and lamps are not in use. Warranted by the assured that no artificial light except closed incandescent electric lights shall be permitted in the rooms when the reservoirs are being filled. Also permission granted for gasoline, naphtha, benzine, or any other of the light products of petroleum to be kept on the premises in quantities in all not exceeding ten gallons, the same to be kept in a closed metallic can free from leak. Warranted by the assured that the drawing shall be done by daylight or closed incandescent electric lights only, and that no artificial lights except closed incandescent electric lights shall be permitted in the rooms where such fluids are stored.'

"And defendant further alleges and states that in violation of said terms of said insurance policy as revised and amended by the indorsement thereon of said gasoline permit, and in violation of the express warranties contained in said gasoline permit, plaintiff had used and permitted artificial lights other than closed incandescent electric lights in the rooms where gasoline was kept and stored at the time of said fire."

¶4 Numerous assignments of error are made, and it is urged that a reversal of the judgment of the trial court should be had for the following reasons: (1) The insured failed to substantially comply with the iron safe and book warranty clauses of the policies. (2) The policies were forfeited by the use of artificial light other than closed incandescent lights in a room where gasoline was kept and stored. (3) Error in refusing to submit to the jury nine special findings requested by defendant. (4) Error in refusing requested instruction No. 2 of defendant in giving instruction No. 6 by the court.

¶5 All the policies of insurance were not issued at the same time. Four or five were issued prior to March 29, 1912, on which date the plaintiff took an inventory of the property covered thereby, which was produced and exhibited to the representative of the defendant shortly after the fire. Another inventory of said property was also...