Home Fire Ins. Co. v. Gurney

• Decision Date: 05 October 1898
• Citation: 76 N.W. 553,56 Neb. 306
• Parties: HOME FIRE INS. CO. v. GURNEY.
• Court: Nebraska Supreme Court

56 Neb. 306

76 N.W. 553

HOME FIRE INS. CO.

v.GURNEY.

Supreme Court of Nebraska.

Oct. 5, 1898.

Syllabus by the Court.

1. Evidence stated, and held sufficient to sustain a decree reforming a policy of fire insurance.

2. An agent of an insurance company, empowered to receive and transmit applications and to receive payment of the premium, binds the company by knowledge acquired in and about the preparation of the applications and by representations made to the insured while so doing and concerning the same.

Error to district court, Merrick county; Sullivan, Judge.

Action by Elijah H. Gurney against the Home Fire Insurance Company to recover on a policy and to reform the contract. From a judgment for plaintiff, defendant brings error. Affirmed.Byron G. Burbank, for plaintiff in error.

W. T. Thompson, for defendant in error.

IRVINE, C.

This was an action to recover on a policy of fire insurance coupled with a proceeding to reform the policy. The policy, as issued, contained a promise on the part of the insured that he would take an inventory of the stock of goods insured at least once a year; that he would keep books of account showing all purchases and sales, and would keep the inventories and books locked in an iron or fire-proof safe or vault at night, and at all times when the building described as containing the insured goods was not open for business, or in some secure place not exposed by fire which would destroy the building. The stock of goods insured was destroyed by fire. The plaintiff had taken and kept an inventory and books as required by the provision referred to, but he did not preserve them in a safe or other secure place. On the contrary, he kept them in his store, with the goods, and they were destroyed. The reformation asked was the elimination of the provision referred to from the contract of insurance. In the district court there was a trial of the issues without a jury, followed by special findings, and a judgment for the plaintiff in accordance with the averments and prayer of the petition. The whole controversy here relates to the correctness of this action in reference to the prayer for reformation as regards the special clause mentioned, and by the parties styled the “iron-safe clause.”

Plaintiff had formerly a safe in his office, and had a policy in the defendant company containing the “iron-safe clause.” The safe had, however, been removed before the present policy was negotiated. Plaintiff testified that an agent of defendant, one Gue, called on him with reference to a renewal of his policy. Gue is shown to have been merely a soliciting agent, with power simply to receive and transmit applications, and it seems, also, to receive payment of premiums. When the application was made out, plaintiff told Gue that he no longer had a safe, and that he had no place to keep his books. Gue said that would be all right, and made out the application accordingly. Plaintiff did not promise as stated in the policy. Plaintiff's wife heard the conversation, and testified that she heard plaintiff state that he had no safe, and Gue reply that it made no difference in case the company accepted the application; that plaintiff then told Gue he kept his books in the building, and Gue said that made no difference,--it was all right to keep them there. Gue denied that there was any talk as to the place of keeping the...