Mancini v. Yorkshire Ins. Co., Ltd.

• Decision Date: 10 January 1934
• Docket Number: Nos. 1162, 1163.,s. 1162, 1163.
• Citation: 170 A. 82
• Parties: MANCINI et al. v. YORKSHIRE INS. CO., LIMITED, OF YORK, ENGLAND. SAME v. UNITED STATES FIRE INS. CO. OF NEW YORK.
• Court: Rhode Island Supreme Court

170 A. 82

MANCINI et al.

v. YORKSHIRE INS. CO., LIMITED, OF YORK, ENGLAND.

SAME

v. UNITED STATES FIRE INS. CO. OF NEW YORK.

Nos. 1162, 1163.

Supreme Court of Rhode Island.

Jan. 10, 1934.

Appeal from Superior Court, Providence and Bristol Counties; Alexander L. Churchill, Judge. *

Suits by Pietro Mancini and others against the Yorkshire Insurance Company, Limited, of York, England, and against the United States Fire Insurance Company of New York. From adverse decrees, respondents appeal.

Appeals denied and dismissed, decrees affirmed and case remanded.

Wm. A. Gunning, of Providence, for appellants.

Knauer & Fowler and Luigi De Pasquale, all of Providence, for appellees.

HAHN, Justice.

These are bills in equity brought to reform two policies of fire insurance issued by respondents to complainants. The causes were heard by a justice of the superior court, first on the prayer for reformation on the ground of mutual mistake, and later as to the amount of the damages. The court granted the prayer to reform the policies and at the subsequent hearing assessed complainants' damages at the total amount of each policy, and decrees were entered in accordance with these decisions. The causes are here on respondents' appeals from said decrees.

The insured property consisted of a "frame icehouse and additions * * * occupied as an icehouse" and, although not so described in the policies, stood upon leased land. The policies contained the usual clause that "if the subject of insurance be a building on ground not owned by the insured in fee simple," the entire policy should be void unless otherwise provided by agreement indorsed upon and added to the policy.

It appeared in evidence that on October 31, 1925, two of the complainants leased the land in question for a period of eleven years; that on December 15, 1926, together with Mancini, the third complainant, to whom they assigned a one-third interest in said lease, they formed a partnership to carry on a general ice business; that Mancini, in behalf of the partnership, conducted all negotiations with one Olivo, the respondents' agent, to obtain two policies insuring complainants' property for direct loss or damage by fire for one year, which policies were issued on February 27 and March 3, 1931; that the complainants paid their premiums as required; and that on October 25, 1931, the building and equipment were destroyed by fire.

Mancini testified that at the time Olivo interviewed him about insuring the icehouse he told the agent he "had the icehouse * * * on Mr. Whipple's property" and that later the agent assured him the policies were valid. He further testified that after the fire and respondents' refusal to pay the loss, Olivo, stated to him that at the time he issued the policies he knew the icehouse was on leased land but did not know that respondents would not insure such property. The two other complainants testified that Olivo had made the same statement to them, and this evidence was corroborated by two more witnesses.

Olivo testified that when Maneini approached him about insuring the icehouse Maneini said the building was "on Whipple Court," which in no way suggested to him that it was located on leased land. The agent admitted his ignorance that such a fact affected the validity of the policies and that a rider was necessary on an insurance policy of this type. It also appeared that he did not know the meaning of the term "fee simple" and that he and another agent of the respondents inspected the property before the policies were issued.

There is no evidence indicating that complainants at any time voluntarily concealed from said agent any facts about which they were interrogated, nor is there any charge of fraud on the part of any one. The trial justice found as a fact that "Olivo knew when '* * * he agreed to issue the policies to the complainants insuring the icehouse that it stood on leased land and that neither he nor the three partners knew of the policy condition * * * in respect to the ownership in fee simple of the land on which the building stood." He further found that because of a mutual mistake the policies did not correspond to the intentions of the parties, and he ordered the policies to be reformed and at a subsequent hearing awarded damages.

The respondents' appeal is based upon the grounds: (1) There was no meeting of the minds of the parties regarding the complainants' real interest in the building and the ground upon which it was located; (2) complainants' proof of a mutual mistake is not full, clear, and satisfactory; (3) damages, if any, should not be awarded on the basis of the sound value of the icehouse. It is necessary to consider the question of the extent of the agency of Olivo. It appears from the records of the state insurance department that he was the duly appointed "agent" of both companies. As was testified to, "general agency" is a matter of contract between the companies and their agents. The only...