Hessen v. Iowa Auto. Mutual Insurance Co.

• Decision Date: 24 October 1922
• Docket Number: 34971
• Parties: CHARLES HESSEN, Appellee, v. IOWA AUTOMOBILE MUTUAL INSURANCE COMPANY, Appellant
• Court: Iowa Supreme Court

190 N.W. 150

195 Iowa 141

CHARLES HESSEN, Appellee, v. IOWA AUTOMOBILE MUTUAL INSURANCE COMPANY, Appellant

No. 34971

Supreme Court of Iowa, Des Moines

October 24, 1922

REHEARING DENIED FEBRUARY 6, 1923.

Appeal from Woodbury District Court.--MILES W. NEWBY, Judge.

ACTION to recover on policy of insurance covering an automobile against theft. Verdict of the jury finding for plaintiff. Defendant appeals.

Reversed.

Jepson Struble & Anderson, for appellant.

C. R Jones, for appellee.

DE GRAFF, J. STEVENS, C. J. WEAVER and PRESTON, JJ., concur.

OPINION

DE GRAFF, J.

On the 13th day of October 1920 a policy of insurance was issued by the defendant company to the plaintiff insuring against theft a certain Buick touring automobile, Model 1919, factory number 321311. The policy was issued for a term of one year and it is alleged by plaintiff that the automobile therein described was stolen on the 9th day of October, 1921 resulting in a loss to plaintiff in the sum of $ 1,350. The defendant in answer inter alia alleged that the plaintiff never had an insurable interest in the automobile referred to in plaintiff's petition, and that he never owned or had an insurable interest in an automobile of the description set forth in the policy and, therefore, there was no liability under the policy. Defendant further denies that the plaintiff complied with the provisions of the policy in giving to the company a sworn statement of loss within 60 days from the date of loss and under the terms of the policy his claim is null and void.

Upon the conclusion of the testimony defendant moved for a directed verdict and again upon its motion for new trial urged the following primary propositions; (1) That the record is without dispute that the automobile claimed to have been owned by the plaintiff was a stolen automobile and the plaintiff did not and could not have acquired ownership thereof by reason of his purchase of the same from anyone other than the true owner and that at the time the policy of insurance issued plaintiff had no insurable interest in the automobile described in said policy. (2) That the property covered by the insurance policy is described as a Buick touring car, 1919 model, factory number 321311, whereas the proof in this case shows that he owned no car of any such description and this being an action at law the plaintiff can only recover on proof of the theft of the property set out and described in the policy and cannot recover upon proof of the loss or theft of any other property than that described. (3) That the record affirmatively shows that the plaintiff did not comply with all the conditions of the policy required to be done and performed by him as conditions precedent to his right to recover thereunder in that he did not prepare and file with the company the necessary proofs of loss containing the necessary data and facts as required by the terms of the policy.

I. An insurable interest is necessary to the validity of a policy regardless of its subject-matter. If no insurable interest exists the contract is void, and no recovery can be had thereon in case of loss either by the insured or his assignee and notes given for the premium upon such insurance are void for want of consideration. In the instant case the defendant tendered to plaintiff the premium paid on the policy and deposited same in the hands of the clerk of the district court for his benefit.

Did the insured have an insurable interest in the automobile described in the policy of insurance in suit? It is unnecessary to detail the evidence in relation to the history of the insured automobile. Sufficient to state our conclusion that the automobile when purchased and insured by the plaintiff was a stolen car. This is unmistakably shown by the evidence. By the terms of the contract of insurance it is provided that the entire policy shall be void if the interest of the insured in the property be other than "unconditional and sole ownership."

If a person has no interest, legal or equitable, in the thing insured it is viewed in law as a mere wager and the courts will not enforce such a contract. Warren v. Davenport Fire Ins. Co. 31 Iowa 464; Bartling v. German Mut. L. & T. Ins. Co. 154 Iowa 335, 134 N.W. 864. A person has no insurable interest in a thing where his only right arises under a contract which is void or unenforceable either at law or in equity.

Whatever interest plaintiff had in the insured property must have been derived under his contract of purchase. His vendor is not shown to have had anything more than the possession of a stolen car. Through his purchase plaintiff acquired no title and clearly never had such ownership as was required and defined by the terms of the policy. No one can convey a valid title to goods or chattels unless the vendor is the owner thereof or lawfully represents the owner. It is the duty of a vendee to determine whether he is securing good title to the thing purchased, and if title fails and loss ensues, the purchaser must look to his vendor. In general no one can transfer a better or higher title to a chattel than he...