Leisen v. St. Paul Fire & Marine Insurance Co.
| Citation | 127 N.W. 837,20 N.D. 316 |
| Decision Date | 28 May 1910 |
| Court | North Dakota Supreme Court |
Rehearing denied September 10, 1910.
Appeal from District Court, Cass county; Hon. Charles A. Pollock, J.
Action by John Leisen against the St. Paul Fire & Marine Insurance Company. From an order overruling a demurrer to the complaint, defendant appeals.
Affirmed.
Geo. A Bangs, for appellant.
V. R Lovell, for respondent.
OPINION
This is an action to recover on an insurance policy. The complaint is in the usual form, alleging that, in consideration of $ 51 paid by the plaintiff to defendant, the latter issued its policy of insurance, a copy of which is annexed to and made a part of the complaint, whereby defendant insured the plaintiff against loss or damage by fire in the sum of $ 1,000 on a certain frame building situated on lots 9 and 10, block 21 of the village of Leonard, Cass county, for the term of one year from January 6, 1906. That plaintiff duly performed all of the terms of said contract of insurance on his part to be performed, and that on January 29, 1906, said building was totally destroyed by fire, which fire did not occur by reason of any of the causes enumerated in said policy exempting the Insurance Company from liability in case of fire or loss, and that plaintiff's loss by reason of such fire exceeded the sum of $ 1,500. That the destruction by fire, as aforesaid, was complete and the loss total, and that there was no disagreement between the plaintiff and defendant as to the amount of said loss, but that shortly after defendant was notified of the loss it denied any liability under the policy on the ground that plaintiff's title to the property insured was not truly stated in the policy or the application therefor. Plaintiff, in his complaint, anticipates the defense that the policy never attached or became effective by reason of the fact that plaintiff's title to the property insured was not that of unconditional and sole ownership, etc., and in this respect alleges the following facts: "That at and during the said month of January, 1906, plaintiff was and still is the owner and holder of a certain sheriff's certificate of mortgage foreclosure sale of and upon the said frame building and the lot or parcel of land on which the same was situated, and at the time of the destruction of such building by fire hereinafter referred to, and there was due and unpaid on the said certificate of mortgage foreclosure sale an amount exceeding the total amount of such insurance, and that at the time of the plaintiff's application for the insurance aforesaid, and at the time of the execution and delivery of the policy aforesaid, the plaintiff notified and informed the defendant company and its agent the nature and character of plaintiff's insurable interest in the frame building aforesaid, and that plaintiff was the owner and holder of a sheriff's certificate of mortgage foreclosure sale as aforesaid, but the defendant and its said agent, though it then and there knew, as aforesaid, the character and extent of plaintiff's insurable interest in the frame building and premises aforesaid, carelessly and negligently stated and caused to be stated in the said policy of insurance and application therefor that plaintiff was the owner in fee simple of said premises and the whole thereof, and thereby waived the conditions of said policy of insurance exempting the defendant company from liability in case the plaintiff's interest in the premises insured be not truly stated in such policy or in the application therefor."
The policy is the standard form adopted in this state and contains, among others, the following stipulation: "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; or if the interest of the insured in the property be not truly stated therein . . . this entire policy, unless otherwise provided by agreement indorsed hereon or added hereto, shall be void . . . if the interest of the insured be other than unconditional and sole ownership; or if the subject of insurance be a building on ground not owned by the insured in fee simple. . . .
"This policy is made and accepted subject to the foregoing stipulations and conditions, together with such other provisions, agreements, or conditions as may be indorsed hereon or added hereto; and no officer, agent, or other representative of this company shall have power to waive any provision or condition of this policy except such as by the terms of this policy may be the subject of agreement indorsed hereon, or added hereto, and as to such provisions and conditions no officer, agent, or representative shall have such power or be deemed or held to have waived such provisions or conditions unless such waiver, if any, shall be written upon or attached hereto, nor shall any privilege or permission affecting the insurance under this policy exist or be claimed by the insured unless so written or attached."
A demurrer was interposed to the complaint upon the ground that the complaint fails to state facts sufficient to constitute a cause of action. Such demurrer was overruled and the appeal is from the order overruling the same.
In brief, appellant's contention on this appeal is that under the facts alleged in the complaint the policy is and was void at its inception, for the reason that the interest of the insured was not that of "unconditional and sole ownership," and the nature and extent of his interest in the property was not stated in, nor indorsed upon, the policy. In other words, notwithstanding the fact that plaintiff, in applying for the insurance and at the time of the execution and delivery of the policy, expressly notified and informed defendant and its agent of the nature and character of his interest in the property, and that defendant, with such notice and knowledge, executed and delivered to plaintiff such policy and collected the premium thereunder, defendant may, nevertheless, urge that such policy was void at its inception and no liability ever attached thereunder; that the doctrine of implied waiver and estoppel cannot be successfully invoked, because the parties, by their contract, have otherwise stipulated and the legislature by statute, in effect, otherwise declared.
If appellant's contention be sound, the result would be most harsh and inequitable. We cannot countenance such a doctrine unless imperatively required so to do by plainly established principles of law. We are entirely clear that we are confronted with no such situation. On the contrary we are entirely clear that appellant's contention is without support on principle or reason, and is contrary to the overwhelming weight of authority in this country. In support of this broad assertion we proceed to give our reasons, but in the main shall adopt the reasoning of other courts upon the questions involved.
We will first notice the present status of the adjudications of this court and its predecessor, the territorial court, so far as material to the question here involved. In Lyon v. Insurance Co. 6 Dak. 67, 50 N.W. 483, the court unanimously held that defendant's agents had the power to waive the matter of encumbrances which were known to them at the time of negotiating and accepting the risk. In that case, as the case at bar, it was contended that the policy was never in force on account of the omission of the insured to comply with a condition requiring him to inform the company of encumbrances on the property. Such condition was as follows: "If the property hereby insured, either real or personal, or any part thereof, be or shall become encumbered by mortgage, judgment, or otherwise, and it be not so stated in the written application or indorsed in writing on the policy, this policy and every part thereof shall be void." The proof showed that the property was encumbered by mortgage at the time the application for insurance was made, and at the time the loss occurred, but that the agents of the insurance company knew such fact, but nevertheless issued the policy and collected the premium. Plaintiff contended there as here, that the stipulation in the policy above quoted had been waived, and such contention was sustained.
Again in the case of Waterbury v. Dakota F & M. Ins. Co. 6 Dak. 468, 43 N.W. 697, the territorial court in speaking on this point said: "It is too well settled to be now questioned that the company, or its agent acting within the scope of his authority, may waive any of the conditions of the policy, and if at the time of issuing the policy the company or such agent knows the falsity of a representation made by the applicant in procuring the insurance, the company is estopped from asserting its falsity in order to avoid liability." Citing numerous cases.
During the early history of this court, and over twenty years ago it was called upon to consider a similar question in the case of Johnson v. Dakota F. & M. Ins. Co. 1 N.D. 167, 45 N.W. 799. In speaking upon the question of estoppel the court, among other things, there said: ...
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