Parsons v. The Knoxville Fire Insurance Company

• Decision Date: 03 March 1896
• Citation: 31 S.W. 117,132 Mo. 583
• Parties: Parsons et al. v. The Knoxville Fire Insurance Company, Appellant
• Court: Missouri Supreme Court

31 S.W. 117

132 Mo. 583

Parsons et al. v. The Knoxville Fire Insurance Company, Appellant

Supreme Court of Missouri, First Division

March 3, 1896

Appeal from Mercer Circuit Court. -- Hon. Paris C. Stepp, Judge.

Affirmed.

Ira B Hyde, Hugh C. Ward, and O. H. Dean for appellant.

(1) The court erroneously held that defendant's agent could waive, and in fact did waive, the condition in the policy of insurance in suit as to keeping books, etc. Fire Ins. Co v. Small, 66 F. 490; Sprague v. Ins. Co., 49 Mo.App. 423, and cases cited; Fletcher v. Ins. Co., 117 U.S. 531; Mensing v. Ins. Co., 36 Mo.App. 602; Shoup v. Ins. Co., 51 Mo.App. 287; Greenwood v Ins. Co., 27 Mo.App. 412. (2) The court erroneously held that a substantial compliance with the condition in defendant's policy of insurance as to the keeping of books, etc., was sufficient. 1 May on Insurance, sec. 156; Hollaway v. Ins. Co., 48 Mo.App. 6; Ins. Co. v. Altheimer, 25 S.W. 1067; Ins. Co. v. Wilkinson, 53 Ark. 353; Ins. Co. v. Morgan, 18 S.E. 191. (3) The court erroneously held that Griffith had authority to waive the forfeiture of defendant's policy of insurance, and in fact did waive such forfeiture. May on Insurance [3 Ed.], sec. 138a; Waverley, etc., Co. v. Cooperage Co., 112 Mo. 383; Mitchum v. Dunlap, 98 Mo. 418; James v. Stookey, 1 Wash. 330; Barre v. Ins. Co., 76 Iowa 611; Hollis v. Ins. Co., 65 Iowa 454; Ins. Co. v. Lawrence, 4 Metc. (Ky.) 9; Weed v. Ins. Co., 116 N.Y. 106.

H. J. Alley and H. G. Orton for respondents.

(1) The agent of defendant was advised of the condition of the title, and the policy having been issued with such knowledge, the company can not, after loss, claim a forfeiture by reason of the want of title. The knowledge of the agent, Roberts, was the knowledge of the company. Combs v. Ins. Co., 43 Mo. 151; Haywood v. Ins. Co., 52 Mo. 181; Plankington v. Ins. Co., 55 Mo. 172; Frank v. Ins. Co., 42 Mo. 457; Breckenridge v. Ins. Co., 87 Mo. 71; Thomas v. Ins. Co., 20 Mo.App. 151; Robert v. Ins. Co., 26 Mo.App. 92; Spratt v. Ins. Co., 13 S.W. 799; Shafer v. Ins. Co., 10 N.W. 381; Ins. Co. v. Williams, 48 Am. Rep. 474; 1 Wood on Ins., sec. 90; Manhattan Co. v. Weill, 26 Am. Rep. 364; Van Schaick v. Ins. Co., 64 N.Y. 434; Wilson v. Ins. Co., 30 N.W. 401; Dwelling House Co. v. Brodie, 11 S.W. 1016; Bidwell v. Ins. Co., 24 N.Y. 302. (2) The defendant having issued this policy with knowledge of facts that would render it void, is estopped from setting up such facts as a defense. This doctrine is well discussed in Ins. Co. v. Weill, 26 Am. Rep. (Va.) 365. (3) Parol evidence is admissible to show what transpired between the agent and the assured. In most of the cases cited above the proof was by parol, but this question has been especially discussed in the following cases: Ins. Co. v. Sorrel, 25 Am. Rep. (Tenn.) 780; Co. v. Throop, 7 Am. Rep. (Mich.) 638; Ins. Co. v. Wilkerson, 13 Wall. 222; 2 Wood on Ins., 829, sec. 408. (4) The instructions asked by defendant and refused by the court did not properly declare the law. (5) The sixth instruction for plaintiffs was correct. The adjuster of defendant waived the alleged forfeiture on account of the failure to keep the books. He was shown the books, and afterward required of the plaintiffs the further presentation of their claim under the terms of the policy. These were facts which authorized the submission of this question of waiver to the jury. Brown v. Ins. Co., 38 N.W. 135; Oshkosh Gaslight Co. v. Ins. Co., 37 N.W. 820; Marthinson v. Ins. Co., 31 N.W. 291; Holly v. Ins. Co., 21 N.W. 774. (6) The agent had a right to change the policy. 1 May on Insurance, 129. Ins. Co. v. Kelly, 15 Am. Rep. 612. The company was informed at the time of the manner of keeping their books, and notice to the agent of a condition which renders a policy void, waives such condition. 1 May on Ins. [3 Ed.], sec. 130; Ins. Co. v. Brown, 15 N.E. 167.

Brace, P. J. Gantt and Sherwood, JJ., concurring with Brace, C.

J., in the opinion; Barclay, J., in the result; Macfarlane, Burgess, and Robinson, JJ., dissenting.

OPINION

In Banc.

DIVISION ONE

Brace P. J.

This is an action on a fire insurance policy, dated October 12, 1891, for $ 2,500, for the term of one year from date; $ 400 on storehouse, $ 2,000 on stock of merchandise, and $ 100 on store furniture and fixtures. The property was destroyed by fire on the eighth of March, 1892. The plaintiffs obtained judgment below for the sum of $ 2,677.50, the full amount of the policy and interest, and the defendant appealed.

The policy consisted of two papers, a policy in the usual form, and a paper attached, headed "Country Store Form," called a "sticker." To defeat a recovery the defendant relied upon the following condition, contained, among others, in the policy proper: "If the assured is not the sole, absolute, and unconditional owner of the property insured, or if the property be a building, and the assured be not the owner of the land on which said building stands, by title in fee simple, and this fact is not expressed in the written portion of the policy * * * this policy shall be void." And upon the following covenants and conditions contained in the "sticker:"

"The assured under this policy hereby covenants and agrees to keep a set of books, showing a complete record of business transacted, including all purchases [O>and sales, both for cash and on credit, together with the last inventory of said business; and further covenants and agrees to keep such books and inventory securely [O>locked in a fire proof safe at night, and at all times when the store mentioned in the within policy is not actually opened for business, or in some secure place, not exposed to a fire which would destroy the house where such business is carried on; and in case of loss the assured agrees and covenants to produce such books and inventory, and in the event of a failure to produce the same, this policy shall be deemed null and void, and no suit or action at law shall be maintained thereon for any such loss."

The only errors assigned are upon the action of the court in giving certain instructions for the plaintiffs, and in refusing others asked for by the defendant. These instructions are long and numerous, and need not be set out in detail, in order to manifest the rulings of the court of which the defendant complains.

I. The court by its refusal to give instructions 2 and 3 for the defendant, and in giving plaintiffs' instruction numbered 8, in effect held, that although the plaintiffs were not the owners of the land on which their building was situate, yet if they were the owners of the building, and had the right to remove the same, and at the time of making the application for insurance informed defendant's agent that they did not own said land, and if the defendant, notwithstanding such knowledge, issued said policy, and plaintiffs in good faith accepted such policy "not knowing of said condition therein, and did not know (or by the exercise of ordinary care might not have known) of such condition until after said loss, then the defendant is estopped from claiming said policy void by reason of their nonownership of said land." And in so holding the defendant contends the court committed error, "because plaintiffs agreed that statements made in their written application for insurance should be incorporated into and form a part of the policy of insurance, as the basis upon which insurance was to be effected, thereby giving the defendant the right to rely upon such written statement; and, second, because the written statement made by plaintiffs could not be contradicted or overcome by parol evidence."

The application for insurance was made out by the agent of the insurance company, upon personal inspection of the risk, and signed by the plaintiffs, in which the name of the owner of the building is given as W. E. Parsons & Son, and in the long list of questions and answers that follow, occur the following: "What did the building and land cost the present owner? $ 600 -- * * * How long has building been owned by present owner? Since it was built. -- Is there any incumbrance on building and land? No." These are the only answers in the statement that can be said to touch the question of the ownership of the land. The defendant's agent, who made the survey and prepared the application, and the plaintiff who signed it, both testified as witnesses in the case (and no exceptions were taken to their evidence) showing that the agent was informed, and knew at the time the application was made, and the policy issued, that the plaintiffs were not the owners of the land on which the building was situate, but that the same belonged to one Neal. The policy proper contained no description of the property insured, nor any statement in respect thereof, the written portion being simply: "Sum insured $ 2,500. Time, one year. Rate, 1 3-4. Premium, $ 43.75," -- the number of the policy, and the dates fixing the term. The written portion of the "sticker" under the heading "Country Store Form" was as follows:

"$ 400.00. On their one story frame building, with shingle roof, occupied by assured as a country and general merchandise store, situated sec. 35, tp. [O>65, R. 25, lot 4, block 1, town of Goshen, country of Mercer, state of Mo.

"$ 2,000.00. On their stock of merchandise, consisting of dry goods, groceries, boots, shoes, hats, caps, hardware, cutlery, notions, and such goods not more hazardous as are usually kept for sale in country stores, while contained therein.

"$ 100.00. On their store furniture and fixtures, including iron safe, while contained therein."

From all which it appears that the plaintiffs did not in fact in their application represent themselves to be the owners of the land and...