Peoria Marine & Fire Ins. Co. v. Hall

• Decision Date: 08 January 1864
• Citation: 12 Mich. 202
• Court: Michigan Supreme Court
• Parties: The Peoria Marine and Fire Insurance Co. v. Reuben S. Hall

12 Mich. 202

The Peoria Marine and Fire Insurance Co. v. Reuben S. Hall

Supreme Court of Michigan

January 8, 1864

Heard November 5, 1863 [Syllabus Material] [Syllabus Material] [Syllabus Material]

Error to Washtenaw Circuit, to which the case had been transferred from Jackson. All the material facts appear in the opinion.

Judgment reversed, with costs, and a new trial granted.

Livermore & Wood, and Johnson & Higby, for plaintiffs in error:

1. This suit was commenced by the last writ. There is nothing showing it to have any connection with the former writ, except the words "Alias Summons," indorsed on the seal of the writ; but we submit that does not make it a continuous writ.

As to the validity of the limitation of right of action by the insured, see 2 Phil. on Ins., § 2171; 1 Blatch. 280; 25 Ill. 446; 3 Hill 161; 9 Ind. 448; 20 Vt. 230; 27 Vt. 101; 31 Penn. 449; 24 Geo. 101; 6 Ohio 602; 6 Gray 606, 180; Broom's Legal Maxims, 539.

2. The second question to be submitted in this case, is whether, if the agent, King, knew at the time of effecting the policy, that the property insured belonged to the plaintiff and Bennett, the policy would be valid for the whole stock insured.

The third question is, whether the court erred in charging that if the plaintiff informed the agent that he kept gunpowder in his store for sale, and the agent intended to insure against keeping it, but neglected to indorse the permission on the back of the policy, such neglect would not make the policy invalid.

We propose to discuss these questions under one head, as they involve substantially the same principle in law, viz: whether the written terms of the policies, and consequently the liabilities and obligations of the parties, can be changed by any parol agreement or understanding between the agent and insured.

The phraseology of this last charge is peculiar, and is really inapplicable to the evidence in the case; for the evidence is that the plaintiff informed the agent that he kept gunpowder for sale, and the agent denies it. Yet the court charged the jury, that if the plaintiff informed the agent that he kept gunpowder, etc., and the agent intended to insure against it, the policy is not invalid. There is no evidence the parties intended to make any other or different agreement than the one reduced to writing; but the jury have found that the parties did intend to make a different agreement, and the question is, which is to prevail, the written agreement or the agreement which the jury say the parties intended to make, founded upon the evidence of the conversation of the parties at the time this written agreement was executed and delivered?

We need not cite authorities to show that parol evidence is not admissible to vary, explain or contradict an agreement in writing; as, in the language of the books, "It is not admissible to give evidence of a parol agreement prior to, or contemporary with a written instrument, and which varies its terms:" 23 N. Y., 516.

So that if we have properly stated this question, the charge was certainly erroneous. For the express provision of the policies is, that the keeping of gunpowder for sale, or on storage, without the authority in writing, shall render them void.

But we think this charge is erroneous for another reason, viz: we think the conditions annexed to policies are limitations on the power of agents; and these limitations were known to the assured, and therefore he has no cause of complaint. He knew from both of these contracts in his possession, that they were forfeited by keeping gunpowder.

And he knew, or was bound to know, any parol agreement contrary to the terms of his policies was of no account.

There is this difference in the last two questions: In reference to the ownership of the property, it was represented in the application of the plaintiff as his property. It was insured as his property, and the facts contained in the applications are declared to be warranties by the express terms of the policy; and such is the law, without these express stipulations, if referred to in the policy: Ang. on Ins., § 141, and note 2. And unless these facts are literally true, the policy is void.

O. Hawkins, for defendant in error, argued that the second summons was to be regarded as an alias. Also, that the stipulation contained in the policy limiting the time to one year after the loss, in which suits may be brought for losses sustained, is against public policy and void: 5 Ind. 23; 2 Ind. 102; 9 Ind. 448; 4 Ind. 239; 5 McLean 461.

The stipulation is a mere attempt to bar a right of action before the right accrues. It is a release to operate upon the happening of an event yet to occur, and which may or may not take place; and to make a release good it must operate on an existing claim, a present right.

The time specified in the statute of limitations is as much a part of the policy of the law as the act itself, and it is a matter of law and can not be changed by the contract of the parties: 5 McLean 465.

Another error alleged, is, that the Circuit Judge charged the jury, that if the agent, King, at the time of making the policy on the goods, knew the interest of the parties, that they were jointly owned by Hall & Bennett, and insured the whole stock, the policy would be valid for the whole stock insured. The court was clearly right.

It was in proof that Hall stated to King he did not think he had the right to insure Bennett's share. King replied it would make no difference, that Hall had the right to insure for the whole amount.

It would be a fraud to permit them to take advantage of their own acts to defeat the plaintiff's recovery, and the law will not permit it. The insurance company having received the premium, and adopted the acts of their agent, they must abide by them.

It makes no difference whether Hall's interest was much or little, only to show that Hall practised no fraud by representing he was the owner of the goods when he was not. That his interest was sufficient to entitle him to recover will appear from the following cases: Ang. on Ins., §§ 55, 79; 1 Hall 84; 6 Cush. 7.

It was left to the jury to determine, from the evidence, whether the agent, King, intended to insure the whole stock against fire, and including gunpowder; and the jury found he did, though he omitted to make the indorsement on the policy.

The failure to indorse it on the policy was not the fault of the plaintiff, and the company can not take advantage of it: 1 Bosw. 522.

OPINION

Christiancy J.:

This was a suit brought by Hall against the company, upon two policies of insurance against loss by fire; one upon a stock of goods in plaintiff's store in the village of Hamburg, Livingston county, Michigan, to the amount of two thousand dollars, dated January 13th, 1860; and the other for a like amount in the aggregate, upon plaintiff's dwelling-house, furniture, clothing, barn and shed, hay and grain, and on his store (building) there situate, the amount insured upon each item being specified; that upon the store building being one hundred and fifty dollars. This policy is dated August 9th, 1859.

The policies on their face are declared to be "made and accepted in reference to the conditions thereto annexed, which are to be used and resorted to in order to explain the rights and obligations of the parties in all cases not therein otherwise specially provided for." By the eighth condition annexed, it is declared (among other things) that "the keeping of gunpowder or fireworks, for sale or on storage, upon or in the premises hereby insured, or in any building containing property insured by or under this policy, without written permission in the policy, shall render it void and of no force or effect."

The 17th condition is in the following words: "It is further hereby expressly provided, that no suit or action against said company, for the recovery of any claim under or by virtue of this policy, shall be sustainable in any court of law or chancery, unless such suit or action shall be commenced within the term of twelve months next after any loss or damage shall occur; and in case any suit or action shall be commenced against said company after the expiration of twelve months next after such loss or damage shall have occurred, the lapse of time shall be taken and deemed as conclusive evidence against the validity of the claim so attempted to be enforced."

It was proved on the trial by the plaintiff below, who was sworn as a witness in his own behalf, and the fact was undisputed, that at the time of the application for insurance of the goods, and at the date of the policy (January 13th, 1860), one Helam Bennett was partner of the plaintiff in business, and, as such, was the owner of the undivided half of the goods insured, and continued to be such partner and owner until the 14th day of March, 1860, when the plaintiff bought out his interest.

There was evidence tending to show (as to the policy on the goods) that King, the agent of the company, came to the store and wanted to insure the goods; that plaintiff signed the application for the policy, which was mostly blank when signed; that some one came in, and King turned around and said plaintiff could sign it, and he (King) could fill it out; that plaintiff told King he usually sold gunpowder and everything usually sold in a country store, and that he intended to do so. And (in reference to the policy on the store) there was evidence that, at the time the insurance was taken, the keeping of gunpowder was talked over with King, the agent, and he was told they had gunpowder in the store, and was asked if it would make any difference if powder was kept for sale; to which King replied "No."

There was also evidence that plaintiff,...