Home Insurance Company v. Driver

Citation112 S.W. 200,87 Ark. 171
PartiesHOME INSURANCE COMPANY v. DRIVER
Decision Date13 July 1908
CourtSupreme Court of Arkansas

Appeal from Madison Circuit Court; J. S. Maples, Judge; reversed.

Reversed and remanded.

Harris & Ivie and C. P. Harnwell, for appellant.

1. Appellee is not entitled to recover because of failure to comply with the terms of the policy requiring him to keep a set of books and an itemized inventory which would clearly show a complete record of the business transacted with reference to the property insured, including all purchases sales and shipments, both for cash and credit. 53 Ark. 358; 58 Ark. 565; 1 May on Ins. §§ 1, 5, 6, 7; 61 Ark 207; 62 Ark. 43.

2. The policy was rendered void because the property insured was incumbered by a mortgage, which appellee failed to make known to the appellant in his application for insurance. The so-called oral release of the mortgage by Routh, president of the bank, was not binding, was without consideration and void. Appellee was not the unconditional owner of the property insured, and the policy by its own terms is void. Story on Eq. Pl. § 797; 31 Ark. 730; 72 Ark. 47; 77 Ark 57; 62 Ark. 348.

3. The policy is forfeited because of the failure of appellee to prepare and file with appellant within sixty day after the fire a proof of loss in accordance with the requirements of the policy. The so-called notice given is at most a mere notice that a fire had occurred; it is in no sense a proof of loss. 77 Ark. 484; 84 Ark.

Walker & Walker, for appellee.

1. A substantial compliance with the "iron safe clause" of the policy with reference to keeping books, is sufficient under the statute. Kirby's Digest, § 4375a; 81 Ark. 92. And the evidence clearly shows a substantial compliance with the terms of the policy.

2. The mortgage incumbrance was released. The question whether or not the mortgage was released and as to the consideration therefor is not for the appellant to raise, but for the Madison County Bank.

3. Appellee by his notice served on the president of the company substantially complied with the terms of the policy with reference to proof of loss, etc., and that is sufficient under the statute. With full knowledge of the facts, appellant asked for no additional proof of loss, but offered to compromise.

OPINION

MCCULLOCH, J.

This is an action to recover the amount of loss under a fire insurance policy issued by appellant company to appellee on his stock of merchandise situated at the village of Witter in Madison County. The policy is a standard form.

Appellant relies on three grounds of defense, viz.:

1st. A breach of warranty in the iron safe clause with reference to keeping a set of books and preserving the same in an iron safe or other safe place.

2nd. A breach of the warranty against incumbrances of the insured property.

3rd. Failure to furnish proof of loss within sixty days after the fire.

The evidence establishes the fact that the insured property formerly composed a part of a stock of merchandise at Aurora, Arkansas, which appellee purchased and removed to Witter about two months before the issuance of the policy sued on. The policy was issued July 21, 1906, and the fire occurred in September of the same year. Appellee's bookkeeper testified that when the goods were moved from Aurora to Witter an inventory of same was taken and items afterwards added thereto from time to time, as goods were purchased and placed in the store. He further testified that said inventory was a complete one of all goods placed in the store at Witter, and that he kept the same until after the fire and produced it at the trial. He testified that he kept a pocket memorandum book, which was preserved until after the fire, in which itemized accounts of all credit sales and the amount of each day's cash sales were kept. This book, it appears from the evidence, had become worn out from use after the fire, but its contents were copied in full into another book which was produced at the trial. This evidence, according to recent decisions of this court, war-wanted a finding by the jury that appellee had complied with the terms of the policy with reference to keeping books. People's Fire Ins. Assn. v. Gorham, 79 Ark. 160, 95 S.W. 152; Security Mutual Ins. Co. v. Woodson, 79 Ark. 266, 95 S.W. 481; Ark. Mutual Fire Ins. Co. v. Stuckey, 85 Ark. 33, 106 S.W. 203; Arkansas Mutual Fire Ins. Co. v. McManus, 86 Ark. 115, 110 S.W. 797.

It was not essential that the identical book of account should be presented at the trial. Preservation until after the fire and production on demand of the company was all that was required by the terms of the policy. Pelican Ins. Co. v. Wilkerson, 53 Ark. 353, 13 S.W. 1103; Ark. Mut. Fire Ins. Co. v. Woolverton, 82 Ark. 476, 102 S.W. 226.

The record shows that the stock of merchandise at Aurora was mortgaged, with other...

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