Lewis v. State Auto. Mut. Ins. Co.

• Decision Date: 02 October 1934
• Docket Number: (No.7826)
• Citation: 115 W.Va. 405
• Court: West Virginia Supreme Court
• Parties: W. M. Lewis v. State Automobile Mutual InsuranceCompany

115 W.Va. 405

W. M. Lewis

v. State Automobile Mutual InsuranceCompany

(No.7826)

Supreme Court of Appeals of West Virginia.

Submitted September 25, 1934.

Decided October 2, 1934.

Insurance

Where facts regarding a risk are correctly stated to the agent of an insurance company in an oral application for a policy, and the company makes erroneous insertion of such facts in the warranty in the policy, upon which the same is issued, the company is estopped to assert their falsity as a defense to the policy, in the absence of knowledge of such erroneous insertion on behalf of the insured.

Error to Circuit Court, Cabell County.

Action by W. M. Lewis against the State Automobile Mutual Insurance Company. Judgment for defendant, and plaintiff brings error.

Judgment reversed; verdict set aside; new trial awarded.

Thomas West, for plaintiff in error. Fitzpatrick, Brown & Davis and Edmund A. Marshall, for defendant in error.

Woods, President:

This is an action on a contract of insurance for damages to a certain Auburn automobile, due to theft. Upon the conclusion of the introduction of plaintiff's evidence, the court directed a verdict for the defendant. A writ of error was awarded the plaintiff.

Prior to the law action, the plaintiff had instituted a suit in equity for the purpose of reforming the policy declared on and recovering damages thereunder. A demurrer to the bill having been sustained, the case, on motion of the plaintiff, was transferred to the law side of the court, and a statutory declaration filed. Since no objection was taken to the court's action in the equity suit, and no appeal sought, that phase of the proceeding is not properly before us.

Specifications of defense were filed denying plaintiff's right to maintain his action on the ground that he had, in his application, represented the car to be "New" and the purchase price as "$1,750," when in fact it was a second-hand car, and purchased for $800.00 cash; and, further, that by reason of his acceptance of the policy, he had, under "Schedule of Warranties," specifically warranted such facts to be true.

It appears from plaintiff's evidence that the car was purchased on May 24, 1932, from the Bruce Perry Motor Company, through one Carson, agent, for $800.00 cash. At that time plaintiff informed Carson, "I do not like to drive it without it being insured." The latter replied that he would make the matter right, and called a Mr. Southworth, agent for defendant company, over the 'phone, and told him in effect, in the presence of plaintiff, that he (Carson) was selling Lewis a car, a used 1931 Model Auburn (giving the motor serial number); that Lewis had paid $800.00 cash for it; that it was worth at least $1,350.00 or $1,400.00; and that Lewis desired $1,000.00 insurance on the car. To this conversation the agent replied, "It is covered right now." The foregoing conversation was testified to by Lewis and Carson. Lewis says that he never got the insurance policy personally. A nurse at his hospital says that some man came in one day thereafter and handed her a paper, which she placed in one of the drawers of the doctor's desk. Sometime thereafter Lewis' wife noting that the paper seemed "to be an insurance policy" put it with the doctor's papers. The plaintiff, however, does not remember anything about its delivery. After refusal of the company to recognize claim, he asked his wife to get the policy. Max Hockenberry, an automobile mechanic, who saw the car a few days prior to the theft placed its value at that time at $1,250.00 to $1,300.00. And, according to plaintiff's testimony, the car was not worth more than $350.00 to $400.00 to him after its recovery. It appears that the car was stolen on August 11, 1932, by a band of desperadoes, who used it that same night in a hold-up of a filling station in the neighborhood. The evidence is to the effect that when returned, the top was off, the axles bent, and the car otherwise very badly treated.

It is apparent, in the absence of testimony to the contrary, that the evidence submitted on behalf of plaintiff is sufficient to establish the correctness of the...