Howard v. The North River Insurance Company

• Decision Date: 06 May 1922
• Docket Number: 23,531
• Citation: 111 Kan. 225,207 P. 205
• Parties: EMMETT H. HILL and R. F. HOWARD, doing business under the firm name of the HILL-HOWARD MOTOR COMPANY, Appellees, v. THE NORTH RIVER INSURANCE COMPANY, Appellant
• Court: Kansas Supreme Court

207 P. 205

111 Kan. 225

EMMETT H. HILL and R. F. HOWARD, doing business under the firm name of the HILL-HOWARD MOTOR COMPANY, Appellees, v. THE NORTH RIVER INSURANCE COMPANY, Appellant

No. 23,531

Supreme Court of Kansas

May 6, 1922

Decided January, 1922.

Appeal from Cowley district court; OLIVER P. FULLER, judge.

Judgment affirmed.

SYLLABUS

SYLLABUS BY THE COURT.

INSURANCE--Against "Theft, Robbery or Pilferage"--Obtaining Property by Impersonation, Fraudulent Representation and Fraud--Loss Covered by the Insurance Policy. Under a contract of insurance issued to protect a dealer in automobiles against "theft, robbery or pilferage," the act of a swindler who deprived the insured of an automobile by means of a preconceived plan which involved impersonation misrepresentation and fraud was a species of theft for which the insurance company was liable.

Ellis Fink, of Winfield, C. C. Crow, and James W. Broaddus, both of Kansas City, Mo., for the appellant.

W. L. Cunningham, of Arkansas City, for the appellee.

OPINION

DAWSON, J.:

The question in this case is whether the holder of an insurance policy "against theft, robbery or pilferage" of his automobile may recover on such policy in a case where he was deprived of his car by a preconceived scheme of impersonation, misrepresentation and fraud. The facts were as follows:

A reputable mechanic in Arkansas City named Ben Cole, who was a member of the Boilermakers' Union, employed by the Santa Fe railway, and who had money in the bank, was robbed of his union card and bank check book by a rogue named Montgomery who afterwards appeared at the plaintiff's place of business. Plaintiff was engaged in selling automobiles on easy payments to Santa Fe workmen. Montgomery pretended that he was Ben Cole, and said he desired to purchase an automobile on periodical payments. He gave his name as Ben Cole, showed Cole's union card and check book, and made a bargain to buy a car from plaintiff on payments, $ 100 cash, etc., and contracted in writing that the ownership of the car should remain in plaintiff and that the car would not be removed from Cowley county without plaintiff's written consent. The swindler haggled with plaintiff until after banking hours, and then proffered a check for a hundred dollars drawn on Cole's bank and signed in the name of Ben Cole. The plaintiff called the bank by telephone and was assured that Ben Cole had an account with it, and that Cole's check was good for that sum. Led by these inducements, plaintiff parted with the car and accepted the check. The swindler took the car, got his personal belongings from his boarding house, and he and the car vanished.

Action on the insurance policy; judgment for plaintiff, defendant appeals.

Was plaintiff's loss within the terms of the insurance policy? Our criminal law defines stealing and obtaining property by false pretenses as distinct offenses, although the punishment for each is the same. (Gen. Stat. 1915, § 3467; Laws 1920, ch. 38, §§ 1, 2.) It may well be that in a prosecution for the crime narrated the strict rules of our criminal law would require that the swindler be charged with the latter offense rather than the former. But it cannot be said that the contract of insurance was drawn to fit the narrow limitations of the Kansas crimes act. In the analogous case of Grain & Supply Co. v. Casualty Co., 108 Kan. 379, 195 P. 978, 16 A. L. R. 1488 and note, where the action was against a fidelity company to reimburse plaintiff "for such loss of money, securities and personal property . . . which the employer shall have sustained by reason of any act or acts constituting larceny or embezzlement, committed by the employee," it was held that acts constituting embezzlement were not to be construed under the strict rules of local criminal law, but that--

"The bond is to be interpreted in the light of its nature as a contract of insurance, in view of its purpose as such, and with a considerable degree of liberality in favor of the insured and against the insurer by reason of its having framed the contract. A risk fairly within its contemplation is not to be avoided by any nice distinction or artificial refinement in the use of words. The term 'embezzlement' must be deemed to have been used in its general and popular sense rather than with specific reference to the precise definition of the local statute." (p. 382.)

The prevailing rule is that any scheme whether involving false pretenses or other fraudulent trick or device whereby an owner of property is swindled out of it with the preconceived intent of the swindler not to pay for it, is classed as larceny and is punished accordingly. Here the swindler planned to fraudulently get possession of the plaintiff's property with intent to deprive him of it without his consent. The swindler's pretense that he was Ben Cole, and the exhibition of Cole's union card and check book, his delaying the deal until after banking hours, etc., were merely the means which he used to obtain possession of the car and deprive the owner of it. So, too, the taking of the car out of Cowley county was a fraudulent taking of possession with intent to deprive the owner of it. Plaintiff never freely consented to sell the automobile to any person except the real Ben Cole. He never consented to part with his title without full payment. He never consented to anybody's possession of the car except within the limits of Cowley county.

Under these circumstances, the plaintiff was deprived of his property by a species of theft, and such an offense is generally so defined.

In 3 Bouvier (Rawle's 3d Rev.) 3267, theft is thus defined:

"A popular term for larceny.

"It is a wider term than larceny and includes other forms of wrongful deprivation of property of another.

"Acts constituting embezzlement or swindling may be properly so called."

In 25 C. J. 657, the distinction is drawn between the closely allied crimes of obtaining property by false pretenses and larceny, but there, supported by many authorities, it is said:

"The distinction between the crimes of obtaining by false pretense and larceny lies...