Home Fire Ins. Co. v. Wood

• Decision Date: 19 January 1897
• Citation: 50 Neb. 381,69 N.W. 941
• Parties: HOME FIRE INS. CO. v. WOOD ET AL.
• Court: Nebraska Supreme Court

50 Neb. 381

69 N.W. 941

HOME FIRE INS. CO.

v.WOOD ET AL.

Supreme Court of Nebraska.

Jan. 19, 1897.

Syllabus by the Court.

1. To justify the reformation of a written contract for mistake, the mistake must be mutual, and be established by clear, convincing, and satisfactory evidence.

2. Evidence examined, and held insufficient to authorize the reformation of the policy in suit.

3. Where an insurance company issues a policy with knowledge of other insurance on the same property, it cannot escape liability on the ground that no memorandum of the prior insurance was indorsed on the policy.

4. A statement by the insured to the agent of the insurer that the former intends to procure additional insurance on the property is not notice of the existence of such additional insurance when obtained.

5. A fire insurance policy provided that it should be void if other insurance was subsequently obtained without the consent of the company. The insured did thereafter procure other insurance on the same property without such consent or knowledge of the insurer of its existence. Held, that there was a breach of the condition of the first policy, and a recovery cannot be had thereon.

Error to district court, Douglas county; Ferguson, Judge.

Action by Richard Wood and others against the Home Fire Insurance Company. There was a judgment for plaintiffs, and defendant brings error. Reversed.

J. Fawcett and B. G. Burbank, for plaintiff in error.

Charles B. Keller, for defendants in error.

NORVAL, J.

This was a suit to reform a policy of fire insurance, and for judgment on the policy when so corrected and reformed. The court found for plaintiffs, reforming the policy, and entering judgment for the full amount of insurance, with interest and costs. The only assignment urged for a reversal is the one which challenges the sufficiency of the evidence to sustain the finding and judgment.

The facts may be briefly summarized thus: Wright Bros., on and for some time prior to June 27, 1891, were and had been engaged in the mercantile business at Fairfield, and B. F. Hyde was the soliciting agent at said place for the Home Fire Insurance Company of Omaha, with power to solicit applications for insurance, transmit them to the home office at Omaha, where the policies were written, and on the receipt of the policies by Mr. Hyde, he delivered the same to the insured, and collected the premiums. On the date aforesaid Hyde solicited insurance of Wright Bros. on their stock of merchandise and store fixtures in the sum of $1,000 for the period of one year. The policy was prepared and executed by the proper officers of the defendant company in Omaha, after which it was transmitted to Mr. Hyde, who thereupon delivered the same to Wright Bros., and collected the premium thereon. The policy contained a provision that “this policy shall be void * * * if there is now, or shall hereafter be obtained, any other insurance (whether valid or not) on said property or any part thereof,” and, further, that “no agent or employé of this company, or any other person or persons, have power or authority to waive or alter any of the terms or conditions of this policy, or make any indorsements thereon, except only the secretary of this company, and any waiver or alteration by him must be in writing, and must be signed by him.” The property covered by the policy was wholly destroyed by fire on December 8, 1891, and at that time the insured were carrying a total insurance of $5,500, $2,000 of which was in force when this policy was given, and Hyde then knew it; but the policy in suit contained no stipulation permitting other concurrent insurance. After the loss, the policy was assigned to plaintiffs. The company defends on the ground of the obtaining of additional insurance subsequent to the issuance of the policy, without notice thereof to it, or making any request that consent therefor be given. On the other hand, plaintiffs alleged in their petition, in effect, that at the time the insurance was written it was agreed between Wright Bros. and the company that plaintiffs were to be permitted to carry $5,500 total insurance on the property; that, without any fault or neglect of theirs, but through design or mistake of the defendant or its agent, the company omitted to write in the policy, or to indorse thereon, any provision for concurrent insurance; and that said policy was received and the premium paid by Wright Bros. in good faith, without reading the same, believing that the policy contained the proper and necessary provisions permitting concurrent insurance. This averment was put in issue by the answer. The question involved is whether the evidence was sufficient to justify the reforming of the policy relative to additional insurance.

The only testimony adduced on that branch of the case by plaintiffs was given by B. J. Wright, one of the insured, and is as follows: “Mr. Hyde came to me several times before we made out the policy, or gave him a right to make it out, and wanted to take out a policy in the Home for $1,000, and tried to get us to take out more in that company. Mr. Fawcett: State what he said. Don't give your conclusion. A. Well, he said he wanted us to take out more insurance,--make the policy larger; and at that time I told him that I did not see fit to do that, but we intended to replenish the stock, and take out more insurance afterwards, which we did, and stated to him about the amount that we intended to carry, which at that time I told him that we intended carrying about $5,500; and, a few days after he had been several times, I told him to make out a policy for $1,000, and told him the amount of insurance we had then, and what we intended to get. Q. How much insurance did you then have upon that stock at the time this policy was written? A. $2,000. Q. State whether or not you told Mr. Hyde what companies that...