North River Ins. Co v. Atkinson

• Decision Date: 20 September 1923
• Citation: 119 S.E. 46
• Court: Virginia Supreme Court
• Parties: NORTH RIVER INS. CO v. ATKINSON.

119 S.E. 46

NORTH RIVER INS. CO

v.ATKINSON.

Supreme Court of Appeals of Virginia.

Sept. 20, 1923.

Error to Law and Chancery Court of City of Norfolk.

Action by W. E. Atkinson against the North River Insurance Company. Judgment for plaintiff, and defendant brings error. Reversed and rendered.

R. H. Mann, of Petersburg, for plaintiff in error.

Page, Page & Page, of Norfolk, for defendant in error.

WEST, J. On the 21st day of September, 1920, the plaintiff, W. E. Atkinson, of Norfolk, Va., purchased in Philadelphia, Pa., a Hudson automobile, known as stock model four-passenger phaeton. The bill of sale was signed by "R. L. Allen, Salesman, " and described the motor number to be 87382, and stated that the purchase price was $2,850 in cash. Allen was a dealer in "used" and new cars, and "buys on the road" between Philadelphia and New York. If he cannot sell at his price, he sells at auction. The speedometer on the car at the time of the purchase showed that it had been run 600 miles. Without registering his title in Pennsylvania, Atkinson drove the car to Baltimore and shipped it to Norfolk.

After arriving in Norfolk, the plaintiff registered the car with the secretary of the commonwealth. On January 15, 1921, he insured it for one year against loss by fire and theft in the sum of $2,000 in the Northwestern National Insurance Company, which was succeeded by the defendant, the North River Insurance Company, and in his policy warranted the factory number of the car to be 87382, and that the car was new. On May 11, 1921, the automobile was stolen from in front of the Strand Hotel in Newport News, Va., and has not been heard from since.

On July 21, 1921, the plaintiff filed proof of loss under oath, in which he described the car as bearing factory number 87382. The defendant declined to pay the loss, and theplaintiff instituted this suit for $2,000. There was a verdict and judgment in favor of the plaintiff for $2,000, and this writ of error is to that judgment.

The defendant relies on six assignments of error, involving the action of the court in admitting certain evidence, in refusing to strike out certain evidence, in giving and refusing instructions, in misdirecting the jury, in refusing to set aside the verdict of the jury on the ground that it is contrary to the law and evidence and grant a new trial, and in refusing to set aside the verdict of the jury and enter judgment for the defendant.

In our view, all the assignments can be disposed of by a discussion of the warranties in the policy contract.

The clause in the policy with reference to warranties reads as follows:

"The following are statements of facts known to and warranted by the assured to be true, and this policy is issued by the company relying upon the truth thereof."

The warranties in the instant case were that the factory number of the automobile insured was 87382, and that it was new when purchased.

The plaintiff contends that section 4220 of the Code has destroyed the effect of all such warranties. This section applies only to the application for the policy. The section reads as follows:

"When Answers or Statements of Applicant Not to Bar Recovery on Policy.—All statements, declarations and descriptions in any application for a policy of insurance shall be deemed representations and not warranties, and no statement in such application or in any affidavit made before or after loss under the policy, shall bar a recovery upon a policy of insurance, or be construed as a warranty, anything in the policy to the contrary notwithstanding, unless it be clearly proved that such answer or statement was material to the risk when assumed and was untrue."

It will be observed from the language used in this section that it has no application to the instant case, as it is clearly proven that such answer or statement was material to the risk when assumed and was untrue.

In this case there was no written application in which the insured answered interrogatories. He approached the agent of the company and asked for the insurance, and in answer to questions asked him gave the agent a card from the office of the secretary of the commonwealth from which to obtain the description of the automobile, necessary to make out the policy. The agent had seen the insured driving a car along the streets of Norfolk, but relied on the truth of the facts furnished him by the assured, and, deeming it unnecessary, did not inspect the car.

The uncontradicted evidence at the trial was that there is no duplication of numbers, either factory or motor numbers, of Hudson automobiles, that factory number and serial number are one and the same, and that no automobile with factory number 87382 had ever been manufactured by the Hudson Motor Company; that motor number 87382 was installed in a four-passenger coupe, with factory number 10-0-50454, the ownership of which was traced from the Hudson Motor Company to the Lu Will Printing Company, the present owner, and that the motor number 87382 thereon showed no sign of being tampered with. The evidence further shows, without contradiction, that in tracing stolen cars it is very material to have the right number, whether factory or motor number, and that without it the car cannot be identified, and that to give the factory number for the motor number is not sufficient for purposes of identification.

Insurance Co. v. Walker, 127 Va. 140, 102 S. E. 585, relied on by the plaintiff, is not in point. While Judge Prentis mentions section 4220 of the Code in his opinion, that case was tried before the Code of 1919 became effective, and the court was construing section 3344a of Pollard's Code.

The effect of a warranty in an insurance contract is stated in 2 Cooley's Briefs on Insurance, at page 1127, thus:

"A warranty in the law of insurance may be defined as a statement or stipulation in the policy as to the existence of a fact or a condition of the subject of the insurance which, if untrue, will prevent the policy from attaching as the...