Hartford Fire Ins. Co. v. Young

• Citation: 129 S.E. 129,132 S.C. 34
• Decision Date: 03 September 1925
• Docket Number: 11826.
• Parties: HARTFORD FIRE INS. CO. v. YOUNG.
• Court: United States State Supreme Court of South Carolina

129 S.E. 129

132 S.C. 34

HARTFORD FIRE INS. CO. v. YOUNG.

No. 11826.

Supreme Court of South Carolina

September 3, 1925

Appeal from Common Pleas Circuit Court of Aiken County; J. K. Henry Judge.

Action by the Hartford Fire Insurance Company against L. M. Young. Judgment for plaintiff, and defendant appeals. Reversed, and new trial ordered.

Williams Croft & Busbee, of Aiken, for appellant.

T. R Morgan, of Aiken, for respondent.

MARION J.

The exceptions assign error in the direction of a verdict for the plaintiff in an action upon a premium (fire insurance) note.

The following facts appear to be undisputed:

The defendant was visited by agents of the plaintiff who solicited him to take out a policy of fire insurance. As the result of this solicitation defendant signed an application in writing for insurance and two promissory notes. The application contained provisions to the effect (1) that it was an application "for indemnity against loss or damage by fire and lightning * * * by the Hartford Fire Insurance Company * * * in the sum of $20 (error, apparently for $2,000) on property as below specified, commencing on the 23d day of June, 1921," etc.; (2) "that insurance shall be predicated on such statement, agreement, and description" as were "contained on both sides of this application," if the "application is approved"; (3) that if any promissory note, "given for the whole or any portion of the premium of the policy that may be issued upon this application, shall not be paid promptly, when due, then said policy shall be suspended * * * until such premium is paid"; and (4) that the company shall not be bound by any act done or statement made, by or to any agent, * * * which is not contained in this my application." One of the notes, dated June 23, 1921, due October 15, 1921, was for $37.84, and contained this provision:

"Being first payment for insurance premium based upon application made this day to Southern Farm Department (Atlanta) the Hartford Fire Insurance Company, Hartford Conn. This note shall not be valid, unless policy is issued by said company."

That note was paid prior to maturity. The other note--here sued upon--was of the following tenor:

"151.36. For value received in policy No. F. I. 720, T. I. 3574, dated the 23d day of June, 1921, issued by the Hartford Fire Insurance Company * * * I promise to pay to said company, or order, * * * one hundred fifty-one and 36/100 dollars, payable in installments as follows: Thirty-seven and 84/100 dollars upon 1st day of July, 1922, and thirty-seven and 84/100 dollars upon 1st day of July, 1923 (same amount payable on July 1, 1923, and July 1, 1924). And it is hereby agreed that in case any one of the installments herein named shall not be paid at maturity * * * this company shall not be liable for loss during such default, and the said policy shall lapse until payment is made * * * and the whole amount of installments or notes remaining unpaid on said policy may be declared earned, due, and payable, and may be collected by law," etc.

The defendant failed to pay the installment due under the terms of the foregoing note on July 1, 1922, and thereafter in July, 1923, this action was brought for the aggregate of all of the installments, included in the note, amounting to $151.36.

The defendant pleaded fraud based, substantially, upon allegations to the effect that the note was executed by him in reliance upon a fraudulent misrepresentation by the defendant's agent that the application or contract and note referred to embodied a provision "that should he become dissatisfied he could notify the plaintiff at any time before any installment was due, * * * and that the company would cancel the insurance and return the note to the defendant duly canceled, the defendant being required to pay only the insurance due for the time the policy ran, plus not exceeding $3," etc.; and that he would not have signed said note "had it not been for the said representation, for the truth of which he relied upon such agent's representation and was compelled to rely upon him because of defendant's inability to read and understand said contract and note."

The defendant's testimony, introduced without objection, was to the effect that when solicited to take the insurance he was working in his cornfield, about a quarter of a mile from his house; that the plaintiff's agents told him that it was a five-year policy and that if he didn't care for it at the end of the year he could cancel it, and that to cancel at the end of the year after paying for the first year "would be $3"; that the agents "pulled the policy out" and he told them he "didn't understand such policies"; that he did not have his glasses in the field, and the sun was hot, and he could not read it; that he could make out part of it and read a little bit, and one of the agents said, "There is so much it would take you a year to read it, and a man without a good education don't understand that thing then"; that they told him "what was in it" and he "signed it"; that he is a man of limited education and with his glasses could not have read and understood "that thing"; that he paid the note representing the first year's premium and wrote the company that he did not want the insurance longer than the one year and asked them to let him know what the difference was between the long rate and the short rate, and the...