Nat'l Mut. Ins. Co. of Celina v. Bales

• Decision Date: 05 June 1923
• Docket Number: No. 11615.,11615.
• Citation: 81 Ind.App. 302,139 N.E. 703
• Parties: NATIONAL MUT. INS. CO. OF CELINA, OHIO. v. BALES et al.
• Court: Indiana Appellate Court

81 Ind.App. 302

139 N.E. 703

NATIONAL MUT. INS. CO. OF CELINA, OHIO.

v.BALES et al.

No. 11615.^*

Appellate Court of Indiana, Division No. 1.

June 5, 1923.

Appeal from Superior Court, Vigo County; John E. Cox, Judge.

Action by John Bales and others against the National Mutual Insurance Company of Celina, Ohio. Judgment for plaintiffs, and defendant appeals. Affirmed.

James D. Johnson, of Celina, Ohio, and Amis & Amis, for appellant.

Frank R. Miller, of Terre Haute, Chas. B. Swayne, of Clinton, and Wm. H. Beeler and Ernest M. Causey, both of Terre Haute, for appellees.

BATMAN, J.

Appellees, Bales, Nichols, and Wright, instituted this action against appellant on a policy of insurance, covering an automobile, issued by the latter to appellee Bales, which contained the following provisions, among others:

“Loss if any under this policy shall be payable to Nichols & Wright, Clinton, Indiana, as their interest may appear. *** This entire policy, unless otherwise provided by agreement indorsed hereon or added hereto, shall be void *** if the interest of the assured be other than unconditional or sole ownership. *** This company shall not be liable for loss caused *** by the neglect of the insured to use all possible means to save and preserve the property at and after the fire.”

Appellant filed the following motions, each of which was overruled, and the actions of the court in so doing are assigned as error: (1) To strike from the complaint certain portions thereof; (2) to grant a new trial of the cause; and (3) for an arrest of judgment. These rulings were followed by a judgment in favor of appellees, on the verdict returned by the jury, from which this appeal is prosecuted.

[1][2] Appellant recognizes that it is not reversible error to overrule a motion to strike out a part of a pleading, and therefore does not urge a consideration of the ruling on said first motion. As appellant has failed to direct any proposition or point to the action of the court in overruling said third motion, any error in that regard has been waived. Therefore we will limit our consideration to the action of the court in overruling said second motion. Appellant contends that the verdict is not sustained by the evidence. It bases this contention mainly on the undisputed fact that appellee Bales was not the unconditional owner of the automobile at the time of the issuance of the policy. The provision thereof, upon which appellant relies in making this contention, appears in the above quotation, and states a condition under which it shall be void. It is well settled, however, that-

“A provision in a policy rendering it void upon certain conditions means voidable at the option of the insurer, and that to render it void, upon discovery of the facts, by which liability may be avoided, it must act with reasonable promptness, must notify the insured of its election to avoid the policy, tender back, or in some appropriate way restore, or offer to restore, the unearned premium received, and upon failure so to do will be deemed to have waived the right to so declare the policy void, and to have elected to treat it as a valid contract of insurance.” Western Ins. Co. v. Ashby (1913) 53 Ind. App. 518, 102 N. E. 45;Commercial Union, etc., Co. v. Schumacher (1919) 71 Ind. App. 526, 119 N. E. 532;Vulcan Ins. Co. v. Johnson (Ind. App. 1920) 128 N. E. 664.

In the instant case there is no evidence of any effort on the part of appellant to restore the premium, which the undisputed evidence shows was paid therefor, and hence it will be deemed to have waived any defense it might otherwise have had, because of the undisputed fact, as to the ownership of the automobile in question, at the time the policy was issued.

[3] There is evidence of another fact, which prevents us from sustaining appellant's contention, as to the effect of an absence of evidence that appellee Bales was the unconditional owner of the automobile in suit. We refer to that which tends to show that appellant's agent, Call, knew the truth with reference to such ownership, at the time he wrote the policy in suit. If the jury believed that appellant's said agent had such knowledge, it was warranted in attributing such knowledge to appellant itself, under the general rule that the knowledge of material facts, acquired by an agent in the course of his employment, and within the scope of his authority, is the knowledge of the principal. The Pittsburgh, etc., R. Co. v. Ruby (1871) 38 Ind. 294, 10 Am. Rep. 111;Blair v. Whittaker (1903) 31 Ind. App. 664, 69 N. E. 182;Farmers', etc., Co. v. Jackman (1904) 35 Ind. App. 1, 73 N. E. 730;West v. National, etc., Co. (1915) 61 Ind. App. 479, 112 N. E. 115;Modern Woodmen, etc., v. Ball (Ind. App. 1921) 131 N. E. 539.

Where no actual knowledge is shown, the rule will be given effect on the theory of constructive knowledge, resting on the principle, as stated in a recognized legal treatise-

“that it is the duty of the agent to disclose to his principal all material facts coming to his knowledge, and upon the presumption that he has discharged that duty, and also upon the fiction of the legal identity of principal and agent.” 2 C. J. 859, 862; West v. National, etc., Co. supra; Modern Woodmen v. Ball, supra; Field v. Campbell (1904) 164 Ind. 389, 72 N. E. 260, 108 Am. St. Rep. 301.

We find the following...