Mrs Annie Penman v. St Paul Fire Marine Insurance Company

• Decision Date: 21 February 1910
• Docket Number: No. 67,67
• Citation: 30 S.Ct. 312,54 L.Ed. 493,216 U.S. 311
• Parties: MRS. ANNIE E. PENMAN, Petitioner, v. ST. PAUL FIRE & MARINE INSURANCE COMPANY
• Court: U.S. Supreme Court

216 U.S. 311

30 S.Ct. 312

54 L.Ed. 493

MRS. ANNIE E. PENMAN, Petitioner,

v ST. PAUL FIRE & MARINE INSURANCE COMPANY.

No. 67.

Argued January 7 and 10, 1910.

Decided February 21, 1910.

Messrs. A. J. Truitt, Frederick D. McKenney, and B. M. Clark for petitioner.

[Argument of Counsel from Pages 312-314 intentionally omitted] Messrs. William D. Mitchell, W. K. Jennings, Jared How, Pierce Butler, and George Hoke for respondent.

Mr. Justice McKenna delivered the opinion of the court:

This is an action to recover the sum of $2,600, with interest, upon a fire insurance policy for the value of a building de- stroyed by fire. The action was brought in the court of common pleas of Jefferson county, Pennsylvania, and by the insurance company, the respondent herein, removed to the United States court for the western district of Pennsylvania.

Plaintiff's statement, to use the local name for her pleading, alleged a contract of insurance whereby the insurance company insured, for the term of three years, against direct loss by fire, 'a two-story shingleroofed building, 28 x 96, and additions,' etc., to be occupied by tenants as dwellings, and situated in Punxsutawney, Jefferson county, Pennsylvania. Payment of the premium and charges was alleged, also the total loss of the building by fire. A copy of the policy was attached to the statement and made a part of it. The policy contained the following covenant:

'This entire policy, unless otherwise provided by agreement indorsed thereon or added hereto, shall be void . . . if (any usage or custom of trade or manufacture to the contrary notwithstanding) there be kept, used, or allowed on the above-described premises, benzin, benzole, dynamite, ether, fireworks, gasolene, Greek fire, gunpowder, exceeding 25 lbs. in quantity, naphtha, nitroglycerin, or other explosives.'

The policy also contained the full covenant:

'This policy is made and accepted subject to the foregoing stipulations and conditions, together with such other provisions, agreements, or conditions as may be indorsed hereon or added hereto, and no officer, agent, or other representative of this company shall have power to waive any provision or condition of this policy except such as, by the terms of this policy, may be the subject of agreement, indorsed hereon or added hereto, and as to such provisions and conditions no officer, agent, or representative shall have such power, or be deemed or held to have waived such provisions or conditions unless such waiver, if any, shall be written upon or attached hereto; nor shall any privilege or permission affecting the insurance under this policy exist or be claimed by the insured unless so written or attached.'

The case was tried to a jury and resulted in the verdict for the plaintiff, upon which judgment was duly entered. A motion for a new trial was denied. The judgment was reversed by the circuit court of appeals. 81 C. C. A. 151, 151 Fed. 961. This writ of certiorari was then allowed.

The question in the case is the effect of the covenants which we have quoted. It was raised in the circuit court by objection to certain testimony, which was admitted, and the denial of certain instructions which were requested.

The property is situated in the coal mining regions of Pennsylvania, and the testimony shows that an explosion preceded or was coincident with the fire as its cause or effect. Indeed, it seems to be clear that the explosion was caused by one of the tenants throwing lighted 'squibs' in the air 'for fun.' And there was testimony that it was the custom of miners to keep more or less blasting powder in their dwellings. The custom seems to have arisen on account of a law of Pennsylvania which provides that 'no powder or high explosive shall be stored in any mine, and no more of either article shall be taken into the mine at any one time than is required in any one shift unless the quantity be less than 5 pounds.' [3 Purdon's Dig. 13th ed. p. 2592.]

In supplement to this testimony the circuit court admitted, over the objection of the company, the testimony of the agent who placed the insurance upon the property, to the effect that he had taken considerable risks as agent for defendant company on miners' dwellings; that he knew of the custom of miners to keep blasting powder in their dwellings; that he knew that the building insured was in seven compartments, 'seven miners' dwellings,' to be occupied by seven different families, and that he 'increased the rate by reason of the fact that this building was to be occupied by miners, and having knowledge that they kept more or less blasting powder about their dwellings.' And he also testified that, after he had placed the risk, the special agent of the company went with him, looked at the risk, and said it was satisfactory, after having made inquiry as to the rate. He expressed the increase in percentage as 'one and a quarter for one year, or two and a half for two years.' He also charged an extra premium for finishing.

He increased the premium, he further testified, because he 'thought it was going to be occupied by coal miners,' and 'because there was seven of them.' The increase was from 1 1/4 per cent to 2 1/2 per cent, but he did not know what he would have charged if the building had not been for coal miners. And further, that he was not told that the building was to be occupied by coal miners, he knew that from his experience in the business. Mrs. Penman did not tell him, nor did he tell her that he had increased the rate, because she might possibly have it occupied by miners, but he told the special agent of the company 'that that entered into the calculations.' He did not report it on the form, because it was not his custom to do so. To the question whether it was special business he was 'performing, rather than acting for the company,' he answered, 'Yes.'

The policy recited that the building insured was 'in process of erection, with privilege to finish and to be occupied by tenants as dwellings,' and that 'in consideration of the extra premium of three and 90-100 dollars ($3.90) thirty days' permission is hereby granted to finish the building.' There was evidence showing that blasting powder is a lower degree of explosive than gunpowder or dynamite, and that the latter is a higher degree than gunpowder.

In view of this testimony, the circuit court decided, as it said, that though ordinarily it was 'the duty of a court to construe a written instrument, and instruct the jury what its terms meant,' he would leave to the jury 'as a question of fact' for it 'to determine, whether, under the evidence and the facts proven here, blasting powder' was 'included in the term 'other explosives." Entertaining that view, the court refused to instruct the jury, as requested by the company, 'that, under the evidence, the verdict should be for the defendant.' The court refused other requests which were based on the controlling effect of the policy.

In passing upon the motion for a new trial, the circuit court reasserted the view that it was for the jury to 'determine whether blasting powder was one of the prohibited articles which were to invalidate the policy.' The court observed: 'It was contended by one side that it was embraced under the term 'other explosives;' by the other, that it was not.' The court further said: 'While, of course, blasting powder is an explosive, and is therefore covered by the generic term 'other explosives,' yet the fact that other explosives of the...