Pelican Ins. Co. v. Smith
| Decision Date | 20 May 1891 |
| Citation | 92 Ala. 428,9 So. 327 |
| Parties | PELICAN INS. CO. OF NEW ORLEANS v. SMITH. |
| Court | Alabama Supreme Court |
Appeal from circuit court, Dale county; J. M. CARMICHAEL, Judge.
This action was brought by the appellee, Mrs. Mary W. Smith, was based on a fire insurance policy, and sought to recover the amount of insurance therein specified.
J W. Foster and John D. Gardner, for appellant.
H L. Martin, for appellee.
The action was upon a fire insurance policy to recover the value of a store-house and goods destroyed by fire. The policy was taken out in the name of Smith & Co., by M. A. Smith, the husband of plaintiff. The defense relied on was misrepresentation and breach of warranty as to the ownership of the property insured. There is no material conflict in the evidence of the husband, M. A. Smith, who was examined by plaintiff, and J. A. Speller, the defendant's agent through whom the policy was issued, examined by the defense. M. A. Smith testified that defendant's agent did not inquire of him who composed the firm of Smith & Co., and he did not make any statement to defendant's agent as to who composed the firm. The evidence showed that M. A. Smith, the husband, who at one time owned and conducted the business of Smith & Co., had sold the store-house and goods to his wife the plaintiff, in payment of his indebtedness to her. There was no evidence to show that the defendant's agent had any notice of the transaction between the husband and wife by which she became the owner of the store-house and goods. Defendant's agent testified that he did not inquire of M. A. Smith, when the application was made, who composed the firm of Smith & Co.; that when M. A. Smith applied for the policy he said, "I want to take out a policy on my store-house and goods," and the application was then filled out, and the applicant, M. A. Smith, signed it "Smith & Co." That M. A. Smith made the foregoing statement to the defendant's agent is not controverted.
An insurance company has the right to know the real owner of the property insured, and the extent of his insurable interest, and a contract of insurance is one in which the utmost good faith is required of the insured. A representation has been defined to be a statement incidental to the contract relative to some fact having reference thereto, and upon the faith of which the contract is entered into. 4 Wait, Act. § Def. p. 39; May, Ins. § 181. Where the policy, by express stipulation, requires a full statement as to the ownership of the property, it becomes material, and one who accepts such a policy, issued upon such statements, becomes bound thereby. Brown v. Insurance Co., 86 Ala. 192, 5 South. Rep. 500; Assurance Co. v. Stoddard, 88 Ala. 606, 7 South. Rep. 379.
The effect of the negligence of the defendant's agent in failing to inquire of plaintiff's agent who composed the firm of Smith & Co., is not the only question for consideration. If M. A. Smith was plaintiff in this action and the defense set up was that defendant issued the policy upon the belief that some other person associated with M. A. Smith constituted the firm of Smith & Co., the failure to make the necessary inquiry might be fatal to a successful defense; but a material inquiry now is whether M. A. Smith, by act or statement, represented to the company that he was the owner of the property, or had an interest therein, or whether he suppressed the fact that his wife was the sole member of the firm of Smith & Co., and sole owner of the property insured, under circumstances that made it his legal duty to disclose the real owner to the agent of the defendant. It is not pretended that the agent of the defendant had any notice or knowledge that Mary Walker Smith, the wife, was "Smith & Co.," or had any interest in the property insured. The policy declares the insurance to be upon "their stock of general merchandise." The policy is to become void "if the interest of the assured be not truly stated in this policy," and it requires that the interest of the assured must be...
To continue reading
Request your trial
-
Co. Lane v. Parsons, Rich & Co. (In re Millers)
...Insurance Co. (Wis.) 54 N. W. 326;Henning v. Assurance Co. (Iowa) 42 N. W. 308;Insurance Co. v. Boulden (Ala.) 11 South. 771;Insurance Co. v. Smith, 92 Ala. 428,9 South. 327.’ In Orient Ins. Co. v. Williamson, supra, Chief Justice Simmons said: ‘The acceptance by the insured of a policy con......
-
Parsons, Rich & Co. v. Lane
...54 N. W. 326; Henning v. Assurance Co., 77 Iowa, 319, 42 N. W. 308; Insurance Co. v. Boulden, 96 Ala. 508, 11 South. 771; Insurance Co. v. Smith, 92 Ala. 428, 9 South. In Orient v. Williamson, supra, Chief Justice Simmons said: "The acceptance by the insured of a policy containing the stipu......
-
Parsons, Rich & Co. v. Lane
...... notice of its contents, and is bound by its conditions. McFarland v. St. Paul F. & M. Ins. Co., 46 Minn. 519, 49 N.W. 253. . . 4. The. company, by issuing the ...308; Insurance Co. v. Boulden, 96 Ala. 508, 11 So. 771; Insurance Co. v. Smith, 92 Ala. 428, 9 So. 327.". . . In. Orient v. Williamson, supra, Chief ......
-
Phoenix Insurance Co. v. Public Parks Amusement Co.
...121. An insurable interest is not sufficient; there must be ownership. 86 Ala. 189; 27 A. 1077; 22 N.E. 229; 96 Pa.St. 37; 36 La. An. 600; 9 So. 327; 17 326; 68 Mo. 127; 2 Pet. 25; 87 N.Y. 69; 41 Am. Rep. 359; 32 F. 640. The contract was entire, and, if void as to any portion of the propert......