Hartford Fire Ins. Co. v. Johnson

• Decision Date: 28 January 1927
• Citation: 290 S.W. 673,217 Ky. 826
• Parties: HARTFORD FIRE INS. CO. v. JOHNSON.
• Court: Kentucky Court of Appeals

290 S.W. 673

217 Ky. 826

HARTFORD FIRE INS. CO. v. JOHNSON.

Court of Appeals of Kentucky.

January 28, 1927

Appeal from Circuit Court, Fulton County.

Action by E. D. Johnson against the Hartford Fire Insurance Company. Judgment for plaintiff, and defendant appeals. Reversed, and new trial granted.

B. T Davis, of Hickman, and Myers & Snerly, of Chicago, Ill., for appellant.

Hester & Stahr, of Hickman, for appellee.

DRURY C.

The appellant, whom we shall refer to as the fire insurance company, has made a motion for an appeal and asked for the reversal of a judgment for $300 recovered against it by the appellee, whom we shall refer to by name. In 1923, Johnson made application for a policy of fire insurance, which the fire insurance company issued to him, and upon which this suit was instituted. At that time Johnson had a lien on this property in favor of the New York Life Insurance Company, and there was executed and attached to this policy a mortgage clause containing the following provision:

"And this insurance as to the interest therein of the said mortgagee (or trustee), only, shall not be invalidated by any act or neglect of the mortgagor or owner of the within described property, nor by the commencement of foreclosure proceedings, nor the giving of notice of same relating to the property, nor by any change in the interest, title, or possession of the property, nor by any increase of hazard; provided that in case the mortgagor or owner shall neglect to pay any premium due under this policy the mortgagee shall on demand pay the same."

When the policy was issued, Johnson paid $24.96 and executed a note by the terms of which he agreed to pay the fire insurance company $24.96 on the 1st day of September, 1924 and a like sum on that day in each of the years 1925, 1926, and 1927. This note, the application for this insurance, and the policy in question each contained a condition that in substance provided that the fire insurance company should not be liable for any loss or damage that might occur to the property insured while any installment of this note was past due and unpaid. The first installment became due on September 1, 1924. It was not paid on that date, but on September 11, 1924, Johnson paid it. The company sent to Johnson in August, 1925, a notice of the approaching maturity of the second installment, which notice Johnson received about August 16, 1925. It contained the following:

"As the policy by its provisions lapses and remains suspended during the time in which this installment remains unpaid prompt attention is necessary to keep your insurance in force."

Johnson failed to pay this installment on September 1, 1925, and 20 days thereafter a house which was insured in the sum of $300 under the policy was destroyed by fire. Thereafter Johnson sent to the fire insurance company a check for this $24.96 which was returned to him. On December 12, 1925, he instituted this suit, by the New York Life Insurance Company and E. D. Johnson, for the use of New York Life Insurance Company, plaintiffs against the fire insurance company. On January 18, 1926, the New York Life Insurance Company moved that its name be stricken from the petition as one of the plaintiffs, which motion was sustained. Thereupon Johnson amended his petition and moved that the New York Life Insurance Company be made a defendant, but it was never brought before the court on that amended petition. The answer of the fire insurance company set up the failure of Johnson to pay the $24.96 due September 1, 1925, and pleaded the terms of the note, the policy and the application, by which it was provided that the fire insurance company should not be liable for a loss sustained while a premium...