Ladd v. Aetna Ins. Co.

• Decision Date: 26 November 1895
• Parties: LADD et al. v. AETNA INS. CO.
• Court: New York Court of Appeals Court of Appeals

147 N.Y. 478

42 N.E. 197

LADD et al.

v.AETNA INS. CO.

Court of Appeals of New York.

Nov. 26, 1895.

Appeal from supreme court, general term, Third department.

Action by Eugene H. Ladd and William E. Smallman against the Aetna Insurance Company. From an order of the general term (24 N. Y. Supp. 384), reversing a judgment for defendant, defendant appeals. Affirmed.

This is an appeal from an order of the general term, Third department, reversing a judgment in favor of the defendant entered upon a verdict directed by the court at the close of the evidence at the Franklin county circuit, and ordering a new trial.

A. H. Sawyer, for appellant.

John P. Kellas, for respondents.

BARTLETT, J.

This action was brought to recover on a policy of insurance covering a frame water power sawmill building, and machinery contained therein. The policy was issued to plaintiffs as owners of the property, and ran for one year from February 26, 1891. The property was totally destroyed by the January 9, 1892. On June 29, 1891, the plaintiffs entered into a written contract to sell the property to King & Trushaw, and the latter at once entered into possession and occupancy, and operated the property, as plaintiffs claim, until its destruction by fire. On the 30th of June, 1891, an indorsement was made on the policy by the agent of the defendant, to the effect that title was in King & Trushaw, and loss, if any, payable to the plaintiffs as their interest might appear.

It was one of the questions litigated on the trial whether the plaintiffs gave defendant such notice of the change of interest as was required by the terms of the policy, in view of the fact that the legal title was not vested in King & Trushaw at the time of the fire, although the indorsement on the policy stated that it was. Prior to the commencement of this action, King & Trushaw assigned to plaintiffs all their claims under the policy. As it is a well-settled rule that in determining the correctness of a nonsuit the plaintiff is entitled to the most favorable inferences deducible from the evidence, and all contested facts are to be deemed established in his favor, it will be assumed, for the purposes of this appeal, that the plaintiffs fully complied with the provisions of the policy as to change of interest, and were authorized to bring this action to recover any amount due from defendant by reason of the loss. Rehberg v. Mayor, etc., 91 N. Y. 141;Weil v. Railroad Co., 119 N. Y. 152,23 N.E. 487.

The Aetna Insurance Company defends this action mainly on the ground that the plaintiffs were conducting a manufacturing establishment, and that for more than 10 consecutive days they had ceased to operate it as such, and had allowed it to become vacant or unoccupied. The material portions of the policy now to be construed read as follows, viz.: ‘This entire policy, unless otherwise provided by agreement indorsed hereon or added hereto, shall be void * * *ifthe subject of insurance be a manufacturing establishment, and * * * it cease to be operated for more than ten consecutive days; * * * or if a building herein described, whether intended for occupancy by owner or tenant, be or become vacant or unoccupied, and so remain for ten days.’ The facts, as the plaintiffs are entitled to claim them by the record as now presented, are as follows, viz.: After King & Trushaw entered into contract to purchase the insured property, they took possession at once, and made extensive repairs; King lived near the property, and was the sawyer, and Trushaw resided some 10 miles away. King, with an assistant, ran the mill until about December 11, 1891, when he was taken ill, and compelled to discontinue work. It further appears by the testimony of Trushaw that he was at the mill on Tuesday, three or four days before the fire, and observed that there was considerable lumber piled up in and around the mill, and there were also logs there. The witness testified that on this occasion he sawed two logs, planed them, and drew them...