Klemens v. Badger Mut. Ins. Co. of Milwaukee

• Decision Date: 01 December 1959
• Citation: 8 Wis.2d 565,99 N.W.2d 865
• Parties: Evelyn KLEMENS, Appellant, v. BADGER MUTUAL INSURANCE CO. OF MILWAUKEE, Respondent.
• Court: Wisconsin Supreme Court

Page 865

99 N.W.2d 865

8 Wis.2d 565

Evelyn KLEMENS, Appellant, v. BADGER MUTUAL INSURANCE CO. OF MILWAUKEE, Respondent.

Supreme Court of Wisconsin.

Dec. 1, 1959.

Jack J. Schumacher, Shawano, Howard N. Lehner, Oconto Falls, Adolph P. Lehner, Oconto Falls, of counsel for appellant.

Benton, Bosser, Fulton, Menn & Nehs, Appleton, Peter S. Nelson, Appleton, of counsel, for respondent.

BROWN, Justice.

Mr. and Mrs. Klemens owned a dwelling as joint tenants. They insured it in their joint names against loss by fire for $9,000 by a policy written by defendant Badger Mutual Insurance Company of Milwaukee. The policy contained a provision that the Company is not liable for loss caused by neglect of the insured to save and preserve the property at and after a loss.

Then Mr. and Mrs. Klemens mortgaged the property for $6,500 to Shawano Savings & Loan Association. The said insurance policy contained a 'loss payable' clause protecting the mortgagee.

After the policy and the mortgage had been executed Mr. Klemens intentionally set fire to the insured property and loss resulted. He was convicted of arson. Mrs. Klemens was not implicated in her husband's act. She is the sole plaintiff and brings this action to recover the indemnity named in the policy. She submits that as an assured, innocent of all wrong-doing, her right to recover under the policy is unaffected by the act of her husband.

The law is settled to the contrary. Counsel for respondent has correctly stated it as follows:

'Under the Wisconsin Standard policy, the insurer is not liable for loss caused by neglect of the insured to save and preserve the property at and after a loss. This provision was held in the leading and much cited, case of Bellman v. Home Ins. Co., 1922, 178 Wis. 349 [189 N.W. 1028, 27 A.L.R. 945] to be a joint obligation of the coinsureds with each agreeing that he and the other insured will not neglect to use all reasonable means to save and preserve the property. Intentional destruction of the property constitutes a breach of the agreement not to neglect to save and protect the property. Because this agreement is joint with each insured promising that he and the other would not commit this neglect, the breach of the policy caused by intentional destruction is chargeable to both insureds and precludes recovery by the innocent joint insured.

'The Wisconsin Standard policy states it shall be void in any case of fraud by the insured. As was the case with the neglect provision, this also is a joint obligation of the co-insureds with each agreeing that he and the other insured will not commit fraud. Intentional destruction of the property constitutes fraud and voids the policy. Because the agreement not to commit fraud is joint, with each insured promising that he and the other would not commit fraud, the breach caused by intentional destruction is chargeable to both insureds and precludes recovery by the innocent joint insured.'

Appellant attempts to avoid the rule of the Bellman case (Bellman v. Home Ins. Co.), 1922, 178 Wis. 349, 189 N.W. 1028, 27 A.L.R. 945, pointing out that the coownership of the property arose in Bellman from a partnership, whereas in the instant case it arose from joint tenancy. That is immaterial. What is material is the fact that the insurance was written in the joint names of Mr. and Mrs. Klemens and they have a joint obligation to comply with the terms of the policy. The Bellman principle has been applied in numerous cases regardless of the origin of the common ownership of the insured property. Thus Bellman was cited and the principle applied in Jones v....