McKinney v. Providence Washington Ins. Co.

• Decision Date: 16 June 1959
• Docket Number: No. 11039,11039
• Citation: 144 W.Va. 559,109 S.E.2d 480
• Parties: Kermit McKINNEY v. PROVIDENCE WASHINGTON INSURANCE COMPANY.
• Court: West Virginia Supreme Court

Page 480

109 S.E.2d 480

144 W.Va. 559

Kermit McKINNEY v. PROVIDENCE WASHINGTON INSURANCE COMPANY.

No. 11039.

Supreme Court of Appeals of West Virginia.

Submitted May 5, 1959.

Decided June 16, 1959.

Syllabus by the Court

1. A condition in a policy of insurance respecting the vacancy of property is for the benefit of the insurer and may be waived by it or its authorized agent or the insurer may be estopped to rely upon the condition as a defense to an action on the policy.

2. When a duly authorized agent of the insurer knows at the time the policy is issued that the building is vacant, and it was later destroyed by fire while vacant but had been occupied between the time of the issuance of the policy and the time of the loss, the provision of the policy that the insurer shall not be liable if the building is vacant or unoccupied for a definite number of days is waived by the insurer.

3. Restrictions in a policy of insurance upon the power of the agent to waive any condition except in a particular manner, as by indorsing a waiver on the policy, do not apply to those conditions which relate to the inception of the contract.

4. 'A general objection to evidence admissible in part and inadmissible in part is properly overruled.' Point 6, syllabus, State v. Taylor, 130 W.Va. 74 .

5. Parol evidence of prior or contemporaneous oral agreements is inadmissible to contradict, add to, detract from, vary or explain the unambiguous terms of a policy of insurance in the absence of a showing of illegality, fraud, duress, mistake or insufficiency of consideration.

6. Under Section 29, Article 6, Chapter 56, Code, 1931, a judgment for the payment of money on a policy of insurance, entered upon a conditional verdict for the plaintiff upon a demurrer to the evidence, shall bear interest from the date of the verdict.

Bailey, Worrell & Bailey, C. S. Worrell, Pineville, for plaintiff in error.

D. Grove Moler, Mullens, for defendant in error.

HAYMOND, Judge.

This is a proceeding by notice of motion for judgment instituted in the Circuit Court of Wyoming County in January 1957, in which the plaintiff, Kermit McKinney, seeks a recovery from the defendant, Providence Washington Insurance Company, a corporation, upon a fire insurance policy issued by it to the plaintiff on October 10, 1953, for a period of three years, on a frame one family dwelling situated on a thirty five acre tract of land in Wyoming County.

The defendant filed a statement of defense in which it alleged that certain specified conditions suspending or restricting the insurance were not complied with by the plaintiff and that by reason of his violation of such conditions the defendant was not liable under the policy for the loss which occurred. The conditions set forth and relied upon in the statement of defense are: 'Conditions Suspending or Restricting Insurance--Unless otherwise provided in writing added hereto this Company shall not be liable for loss occurring (a) while the hazard is increased by any means within the control or knowledge of the insured; or (b) while a described building, whether intended for occupancy by owner or tenant, is vacant or unoccupied beyond a period of sixty consecutive days; * * *.'

The plaintiff filed his special reply to the statement of defense and alleged that when he applied through the duly authorized agent of the defendant for the policy of insurance he informed the defendant that the building to be insured was vacant; and that although the loss occurred during a period of vacancy of more than sixty consecutive days, the defendant by issuing the policy with knowledge that the building was vacant at the time and would likely remain vacant was estopped to deny liability for the amount of the policy.

The case was tried on March 18, 1957. The defendant offered no evidence but at the conclusion of the evidence introduced in behalf of the plaintiff entered its written demurrer to the evidence. The jury returned a conditional verdict for the plaintiff for $2,000.00 if the court should be of the opinion that the law arising upon the demurrer should be for the plaintiff, but for the defendant, if the court should be of the opinion that the law arising upon the demurrer should be for the defendant. By final order entered June 9, 1958, the court overruled the demurrer to the evidence and entered judgment on the verdict for the plaintiff for $2,000.00 with interest from the date of the judgment and costs.

To the final judgment of the circuit court this Court granted this writ of error and supersedeas on December 8, 1958, upon the application of the defendant.

The only evidence consisted of the testimony of the plaintiff, his wife and his father-in-law and the exhibits introduced with their testimony; and there is title, if any, dispute with respect to the material facts.

The plaintiff, an uneducated farmer and the owner of a one family frame dwelling situated in a sparsely settled section of Wyoming County, went to the office of a duly authorized agent of the defendant in Mullens on October 10, 1953, to obtain a policy of insurance upon his dwelling. He was accompanied by his father-in-law. The dwelling was vacant at the time and had been for several days. The plaintiff described the building, mentioned its location in an outlying area which was without protection against fire, and requested an insurance policy in the amount of $2,000.00. The agent issued the policy in the amount of $2,000.00 for a period of three years from October 10, 1953, and the plaintiff paid the required premium of approximately forty dollars. Before the policy was issued the plaintiff and his father-in-law informed the agent that the building was vacant at that time. The plaintiff testified that he told the agent that 'the building was vacant and probably would be vacant during the duration of the policy, might be someone in it the next two weeks or months, or possibly during the duration of the three eyars;' and that the agent said 'that didn't make any difference.' The plaintiff did not know that the policy contained any provision with regard to the dwelling being vacant or that there was any difference in the premium if the dwelling was or became vacant; and that agent did not inform the plaintiff that the policy contained any provision with respect to the dwelling being vacant or of any requirement with respect to a different premium. The plaintiff did not know that the policy contained a provision of the character indicated until after the building was destroyed by fire and he had reported the loss to a representative of the company who then told him about the provision. After the policy was written by the agent on October 10, 1953, it was sent by him by mail to the plaintiff and though the plaintiff had the policy in his possession until after the fire occurred he did not read it at any time. Within eight or ten days after the policy was written a tenant occupied the dwelling and continued to do so until sometime during the month of July, 1955, when it became vacant and continued to be vacant until it was totally destroyed by fire on the morning of November 2, 1955.

The defendant assigns as error the action of the court in overruling the demurrer to the evidence; and the plaintiff cross-assigns as error the action of the court in refusing to allow interest on the amount of the verdict from the date of the verdict and in allowing interest only from the date of the judgment.

The controlling question is whether a clause in a fire insurance policy that, unless otherwise provided in writing added to the policy, the insurer shall not be liable for loss occurring while a described building, whether intended for occupancy by owner or tenant, is vacant or unoccupied beyond a period of sixty consecutive days, is waived when a duly authorized agent of the insurer with knowledge that the building was vacant and probably would be vacant during the term of the policy but might be occupied in two weeks or months or during the period of three years, issues a policy to the insured who paid the required premium for a three year period and was unaware of the vacancy clause of the policy but within a period of eight or ten days obtained a tenant who occupied the building until approximately four months before it was destroyed by fire after it had been vacant for a period of more than sixty consecutive days.

It is well established that a condition in a policy of insurance respecting the vacancy of property for a definite number of days is a valid provision of a policy. Bias v. Globe and Rutgers Fire Insurance Company, 85 W.Va. 134, 101 S.E. 247, 8 A.L.R. 373; Conley v. Queen Insurance Company of America, 256 Ky. 602, 76 S.W.2d 906, 96 A.L.R. 1255; 4 Couch Cyclopedia of Insurance Law, Section 970. A condition of that character in the policy is for the benefit of the insurer and may be waived by it or its authorized agent or the insurer may be estopped to rely upon the condition as a defense to an action upon the policy. Georgia Home Insurance Company v. Kinnier's Adm'x, 28 Grat. 88; Hamlet v. American Fire Insurance Company, 107 W.Va. 687, 150 S.E. 7; Kimball Ice Company v. Springfield Fire and Marine Insurance Company, 100 W.Va. 728, 132 S.E. 714; Medley v. German Alliance Insurance Company, 55 W.Va. 342, 47 S.E. 101, 2 Ann.Cas. 99; Iverson v. Metropolitan Life Insurance Company, 151 Cal. 746, 91 P. 609, 13 L.R.A., N.S., 866. Rochester Loan and Banking Company v. Liberty Insurance Company, 44 Neb. 537, 62 N.W. 877, 48 Am.St.Rep. 745; 4 Couch Cyclopedia of Insurance Law, Section 970o.

A condition respecting the vacancy of property for a definite number of days in a fire insurance policy has given rise to variant results and conflicting decisions in different jurisdictions. The weight of authority, however, supports the view that if an insurance company has knowledge, through its agent, when a contract of insurance is effected, that the premises...