Lumber v. Millers' and Manufacturers' Mutual Insurance Company
| Decision Date | 27 July 1887 |
| Citation | 34 N.W. 35,37 Minn. 300 |
| Parties | Frost's Detroit Lumber and Wooden-Ware Works v. Millers' and Manufacturers' Mutual Insurance Company |
| Court | Minnesota Supreme Court |
The plaintiff brought this action in the district court for Hennepin county, upon an insurance policy issued by the defendant, the property insured having been destroyed by fire. The action was tried before Rea, J., and a jury, who returned a general verdict for plaintiff, and, in answer to questions submitted to them, found specially (1) that the building described in the policy of insurance was added to or enlarged after the making of the insurance, and before the fire, "by permission given as attached to the policy;" (2) that the building was not appropriated to any other purpose than those mentioned in the policy; (3) that the use of the building did not increase the risk of loss by fire; (4) that no dry-kilns were put in the building by the assured except what were in contemplation; (5) that the dry-kilns did not increase the risk of loss by fire; (6) that the amount of machinery was increased with the consent and knowledge of the insurer, as agreed upon or intended; (7) that the increase of machinery did not increase the risk of loss by fire; and (8) that the amount of incumbrance upon the property insured was not misstated by plaintiff's manager in the application for insurance. Defendant appeals from an order refusing a new trial.
For the reason stated in the first part of this opinion the order refusing a new trial is reversed.
Benton & Roberts and M. B. Koon, for appellant.
Torrance & Fletcher, for respondent.
Our decision of this appeal will be based principally upon the construction given to the contract of insurance as respects the enlargement of the building insured. One of the printed clauses of the policy is as follows A by-law indorsed upon the policy, and by the terms of the policy made a part of the contract, contains the provision that "whenever a building insured by this company, or containing the property insured, shall be altered, enlarged, or appropriated to any other purposes than those mentioned, or the risk be otherwise increased * * * without the consent of the company first obtained in writing, such policy shall be void."
About a year and a half after the insurance, the building (which was until then about 53 feet wide and 200 feet long) was extended on one side so as to make it 12 feet wider through its whole length of 200 feet. The jury found specifically that this enlargement did not increase the risk. If the provision first above recited had stood alone, there would have been no doubt that a material enlargement of the building, without the consent of the insurer, would have constituted a violation of the condition of the policy, even though the risk might not have been in fact thereby increased. It was competent for the parties by their contract to thus leave it in the power of the insurers to determine whether in their judgment the risk would be increased, and whether or not they would continue the insurance, if the situation or condition of the property should be changed by any material addition or enlargement. The contract explicitly reserving this right to the insurers to exercise their own judgment in the premises, they are not to be deprived of it, and held bound, notwithstanding the disregard by the insured of the conditions of the contract merely because in the judgment of a jury the change did not in fact increase the risk. The only doubt as to the construction of the contract grows out of the provisions in the by-law, that if a building insured shall be "altered, enlarged, or appropriated to any other purposes than those mentioned, or the risk be otherwise increased," etc. But in view of the distinct unqualified, and apparently complete provision first recited we are of opinion that the words in the by-law, and which we have put in italics, cannot be construed so as to affect the plain meaning of the former provision. The two provisions are consistent, if the qualifying effect of the italicized words be limited to the immediately antecedent clause, "appropriated to any other purposes than those mentioned." The result of this construction is that the policy would be avoided by any material enlargement or alteration of the building without the consent of the insurer, or by...
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