London & L. Fire Ins. Co. v. Fischer

• Decision Date: 07 March 1899
• Docket Number: 615.
• Parties: LONDON & L. FIRE INS. CO. v. FISCHER.
• Court: U.S. Court of Appeals — Sixth Circuit

92 F. 500

LONDON & L. FIRE INS. CO. v. FISCHER.

No. 615.

United States Court of Appeals, Sixth Circuit.

March 7, 1899

Action on insurance policy. For former report, see 83 F. 807.

This was an action by John Fischer, upon an insurance policy, to recover the value of a stock of goods in the city of Louisville, upon which the defendant insurance company had issued a policy of $3,000. The defense of the company rested upon alleged violations of three conditions of the policy. The conditions were as follows:

'This entire policy, unless otherwise provided by agreement indorsed hereon or added hereto, shall be void (1) if the insured now has, or shall hereafter make or procure, any other contract of insurance, whether valid or not, on property covered in whole or in part by this policy; * * * or (2) if the subject of insurance be personal property and be or become incumbered by a chattel mortgage; or (3) if (any usage or custom of trade or manufacture to the contrary notwithstanding) there be kept, used, or allowed on the above-described premises benzine, benzole, dynamite either, fireworks, gasoline. Greek fire, gunpowder exceeding twenty-five pounds in quantity, naphtha nitroglycerine or other explosives, phosphorus, or petroleum, or any of its products, of greater inflammability than kerosene oil of the United States standard.'

The cause was tried before a jury. Upon the issue whether the first and second of the foregoing conditions had been broken, the trial court instructed the jury as follows:

'Then the next inquiry is whether at the time of the delivery of the policy there was a chattel mortgage. The provision of the policy is that if the subject of insurance is personal property,-- and it is personal property here,-- and be or become incumbered by a chattel mortgage, the policy shall be void. The plaintiff says in regard to that, by his evidence, by his pleading by statement of counsel, that there was a chattel mortgage on it; that the plaintiff had previously bought that stock of goods, or a stock, part of which, perhaps, remained, and that he owed some $2,900 on it, or $3,000, and to secure that he had taken out policies in his own name,-- two policies,-- one of $2,500 and the other of $500, and had assigned them to the person from whom he purchased, and that that was known and communicated to Mr. Rehkopf, who was the agent of the insurance company, and that he had full knowledge of it before he delivered the policy sued on. If that be true, from the evidence, if you find that to be true, this provision of the policy is not effectual as a defense because he is estopped,-- the company has waived, through him (to rely on such breach of), that provision of the policy; and, if the fact be that there was one or more chattel mortgages on it, it makes no difference, the policy is good, the evidence being that he had the right and had the authority, as the agent, to deliver or not to deliver this policy. Now, if he delivered this policy with the knowledge of the existence of those several mortgages, then the knowledge under such circumstances precluded the insurance company from making such a defense. It is a waiver. It is estopped now from making any such defense. If, however, he delivered the policy, made the contract complete as the agent of this defendant, and the knowledge was communicated to him afterwards, the fact that he knew it afterwards would not release the plaintiff from this obligation, because by the very terms of the contract between the parties any agent was precluded from waiving the provision of the contract, except where it was indorsed in writing upon the paper,-- the contract itself.'

Upon the remaining condition (3) cited above, the charge of the court was as follows:

'Did the plaintiff in this case, between the 7th of October, 1895, and the 31st of May (the time of the fire), 1896,-- did he, in the language of the policy, 'keep use, or allow in the premises, to wit, the main building, gasoline'? If you conclude that he did 'keep, use, or allow' to be used, or kept, gasoline in the premises, thus described, why, then, you should find for the defendant, because by the very terms of the policy the plaintiff agreed that the policy should be void, if he did thus thing, which was prohibited. You must keep in mind, now, this proposition refers only to the main building, which excludes the shed behind. Now, this language here is not used in any technical sense,

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