Kellogg v. German-American Ins. Company

• Decision Date: 05 October 1908
• Citation: 113 S.W. 663,133 Mo.App. 391
• Parties: W. E. KELLOGG, Respondent, v. GERMAN-AMERICAN INSURANCE COMPANY, Appellant
• Court: Kansas Court of Appeals

113 S.W. 663

133 Mo.App. 391

W. E. KELLOGG, Respondent, v. GERMAN-AMERICAN INSURANCE COMPANY, Appellant

Court of Appeals of Missouri, Kansas City

October 5, 1908

Appeal from Buchanan Circuit Court.--Hon. W. D. Rusk, Judge.

Judgment affirmed.

Fyke & Snyder and W. B. Pistole for appellant.

(1) The property insured was not a drugstore. Defendant's policies were issued to insure a drugstore and such goods as are usually kept for sale in a drugstore. They do not purport, and were not intended to insure any other class of property and the fact plaintiff conducted a saloon and saloon business in the place created a new risk and condition not insured against. Ross-Langford v. Insurance Co., 97 Mo.App. 79; Mensing v. Insurance Co., 36 Mo.App 602; Gannet v. Albree, 103 Mass. 372; Kyte v Insurance Co., 148 Mass. 116, 21 N.E. 361, 3 L. R. A 508; Garretson v. Insurance Co., 81 Iowa 727, 45 N.W. 1047; Allen v. Insurance Co., 133 Cal. 29, 65 P. 138; Insurance Co. v. Brehen, 88 Ind. 578. (2) The stock destroyed was accumulated for an illegal purpose. It was at least auxiliary to and promoted violations of law, and it was necessary for plaintiff to show his illegal transactions in order to prove his loss--to enforce such claim the law will not lend aid. Kelly v. Insurance Co., 97 Mass. 284; Kelly v. Insurance Co., 97 Mass. 288; Johnson v. Insurance Co., 127 Mass. 555; Erb v. Insurance Co., 98 Iowa 606, 67 N.W. 583, 40 L. R. A. 845; Corrington v. Insurance Co., 53 Vt. 48; DeGroff v. Insurance Co., 12 Mich. 124; Friend v. Porter, 50 Mo.App. 89; Parsons v. Randolph, 21 Mo.App. 353, 360; Cranson v. Goss, 107 Mass. 440; Harrison v. McCluney, 32 Mo.App. 481; Turley v. Edwards, 18 Mo.App. 676. (3) The testimony being all in accord, it was the trial court's duty to direct a verdict. Cogan v. Railroad, 101 Mo.App. 190; Holmes v. Leadbetter, 95 Mo.App. 419; Sharp v. Railroad, 161 Mo. 214; Tanner v. Railroad, 161 Mo. 497. (4) It being admitted now plaintiff is not entitled to recover all the claim made and sued for; the allowance of penalty and attorneys fee was improper; it should have been remitted, and for failure to do so the judgment should be reversed. Blackwell v. Insurance Co., 80 Mo.App. 75.

Mytton & Parkinson and Charles C. Crow for respondent.

(1) The sole question submitted is whether or not the alleged illegal use of property owned and insured by respondent rendered the policies void. Clearly such is not the law. Insurance Co. v. DeGraff, 12 Mich. 124; Erb v. Insurance Co., 98 Iowa 606, 67 N.W. 583, 40 L. R. A. 845; Insurance Co. v. Evans, 64 Kan. 770, 68 Pa. St. 623. (2) The question as to whether or not respondent was conducting a drugstore or a saloon was submitted to the jury by instruction No. 3 asked by appellant, and the finding of the jury was against it on the evidence. This was merely a question of fact submitted to the jury by instructions very strongly in favor of appellant and against respondent and the verdict is conclusive. (3) The question of whether or not a penalty should be assessed under the evidence in this case is a jury question. Blackwell v. Insurance Co., 80 Mo.App. 75; Brown v. Assurance Co., 45 Mo. 227; Keller v. Insurance Co. (Mo.), 95 S.W. 908.

OPINION

JOHNSON, J.

Action on two policies of fire insurance which covered merchandise and fixtures in a drugstore owned and operated by plaintiff in the town of Athelstan, Worth county. The policies were duly issued, plaintiff paid the premiums demanded and the property was destroyed by fire during the period of insurance, but defendant refused to acknowledge liability and endeavors to justify its position on ground thus pleaded in the answer:

"At the time said policy was issued said plaintiff made application to defendant in writing for the policy sued on, in which said application plaintiff represented and stated over his signature the said insurance was wanted upon such goods as are usually carried and kept for sale by a drugstore; and warranted in said application that the building described and within which the insured property was located and insured was occupied; first story 'Drugstore and proprietor sleeps in small room,' and that the basement was used as a storage room, and warranted that such statement was a just, true and full exposition and statement concerning the property to be insured, and the basis upon which the insurance was to be effected and a continuing warranty on the part of the applicant, said plaintiff; which said statements and warranties defendant alleges were untrue and were a misrepresentation and concealment of material facts and circumstances concerning the insurance and subject thereof and a fraud upon defendant in this: That the risk to be insured was not a drugstore, but was or became a saloon and place where intoxicating liquors were sold, not for medicinal purpose, but in violation of law for use as beverages; and plaintiff's principal business was the unlawful sale of intoxicating liquors; and that the merchandise for the loss of which plaintiff makes claim was not such goods as are usually kept for sale in a drugstore, but were supplies for a saloon, consisting principally of whiskey, beer and other intoxicating liquor. That plaintiff did not apply to defendant for insurance upon a saloon or a place conducted as a saloon, and defendant did not issue its policy to cover such risk nor to insure against such conditions, and had it known the facts as they existed would not have issued its said policy; . . . at the time the policy sued on was issued and at the time of the fire mentioned in plaintiff's petition, and for a long time prior thereto, the sale of intoxicating liquors, wine and beer was forbidden by law in Worth county, Missouri, where the property in question was situated. That on the day of an election of the qualified voters of said county outside of cities of 2,500 population had been held, and all as provided by law, the sale of intoxicating liquors in said county had been prohibited, and that plaintiff in keeping for sale intoxicating liquors, wine and beer, and selling the same, was acting in violation of law and conducting a business unlawful and forbidden by law, in all of which the property destroyed was used, and was a part. That plaintiff was forbidden by law to keep and sell such merchandise which consisted of intoxicating liquors, wine and beer and other things to promote the sale thereof and by reason thereof is not entitled to enforce a claim for their loss in a court of justice."

The policy on which the cause pleaded in the first count of the petition is founded was issued June 16, 1906, for a period of one year. It provided for insurance of $ 900 on plaintiff's "stock of merchandise, consisting principally of patent medicines, drugs, paints, oils, liquors and such other goods not more hazardous as are usually kept for sale in a drug store" and for $ 175 "on store furniture and fixtures including iron safe, counters and shelving," and recites that it is made and accepted subject to the following stipulations and considerations: "It is a part of the consideration of this policy and the basis upon which the rate of premium is fixed, that in the event of loss, this company shall not be liable for an amount greater than three-fourths of the actual cash value of the property covered by this policy at the time of such loss, and in case of other insurance . . . than for only its pro rata proportion of such three-fourths value. . . . This entire policy shall be void if the insured has concealed or misrepresented in writing or otherwise any material fact or circumstance concerning this insurance or the subject thereof. . . . This policy is made and accepted subject to the foregoing stipulations and considerations. . . ."

The policy pleaded in the second count, issued August 26, 1906, for one year, placed $ 300 on the stock of merchandise "consisting principally of drugs, patent medicines, notions, stock food, paints and such other goods not more hazardous as are usually kept for sale in a drugstore." It is in the same form as the other policy. The application made by plaintiff for the first policy contains questions and answers as follows:

"6. Occupation. First story drugstore and proprietor sleeps in small room. Basement as storage room.

"10. Is the property steadily profitable? A. Yes.

"11. Are there any other facts or circumstances affecting the risk? A. None."

The applicant then covenants and agrees "that the foregoing is a just, true and full exposition and statement concerning the property to be insured, being the basis on which the insurance is to be effected, and a continuing warranty on the part of the applicant."

Plaintiff testified that in June, 1905, he purchased two stocks of drugs, etc. (in which were very little intoxicating liquors) consolidated them into a single stock and opened a drugstore in Athelstan. A year later, and just before the first policy in suit was issued, he took an inventory from which it appears that the fixtures in the store were of the value of $ 246.30, and the merchandise $ 1,612.72. The merchandise included ten barrels of beer and perhaps seventy gallons of whiskey, the value of which is not stated. The fire occurred March 13, 1907, and the total purchases of merchandise made by plaintiff between June 16, 1906, the date of the inventory, and the day of the fire amounted to $ 1,625 of which $ 682.80 was for beer, $ 579.50 for whiskey, $ 16.53 for alcohol, $ 101.05 for tobacco and pipes and the remainder for drugs and drugstore articles. Plaintiff states, and there is no direct proof to the contrary, that he sold no spirituous liquors except on prescription, but that generally he sold beer without prescriptions. He was indicted and convicted on five different...