Prudential Ins. Co. of Am. v. Paris Mut. Fire Ins. Co.

• Decision Date: 07 November 1933
• Parties: PRUDENTIAL INS. CO. OF AMERICA v. PARIS MUT. FIRE INS. CO.
• Court: Wisconsin Supreme Court

213 Wis. 63

250 N.W. 851

PRUDENTIAL INS. CO. OF AMERICA

v.PARIS MUT. FIRE INS. CO.

Supreme Court of Wisconsin.

Nov. 7, 1933.

Appeal from a judgment of the Circuit Court for Kenosha County; E. B. Belden, Circuit Judge.

Action by the Prudential Insurance Company of America against the Paris Mutual Fire Insurance Company. From a judgment for plaintiff, defendant appeals.--[By Editorial Staff.]

Affirmed.

Action on a fire insurance policy, commenced September 3, 1931. From a judgment entered February 11, 1933, the defendant appeals.

The plaintiff is a mortgagee of premises upon which a dwelling house insured by the defendant, a town mutual fire insurance company, was destroyed by fire and sues to recover the loss as payable to it under a clause of a rider attached to the policy issued to the owner. The mortgage was executed subsequent to the issuance of the policy of insurance. The plaintiff company thereupon procured and had attached to the owner's policy a rider which provided that loss under the policy should be payable to the plaintiff as its interest might appear, and that the insurance should not be voided by any act of the mortgagor or owner of the property insured, or by occupation of the premises for more hazardous purposes than permitted by the policy. It further provided that in case the mortgagor or owner should neglect to pay any premiums the mortgagee would pay them on demand; that if the premises should be occupied for a more hazardous purpose known to the mortgagee than permitted by the policy, the mortgagee would inform the insurer and would on demand pay the increased premium required by the increased hazard; and that whenever the insurer should pay the mortgagee for any loss or damage under the policy and claim that the insurer was not liable to the owner therefor, the insurer should be subrogated to the rights of the mortgagee under the mortgage as to such payment; and that if the insurer should pay the mortgagee the amount of the mortgage debt, the mortgagee would assign its mortgage to the insurer. The by-laws of the insurer provide that policies shall be signed by the president and secretary and the policy in suit was so signed. The rider under which the plaintiff claims was signed by the secretary only, but the form of policy used by the insurer contains no mortgage clause provision, and it was the custom of the secretary, known and acquiesced in by the insurer, whenever mortgagees were insured by a policy to attach to the policy a rider signed by him only covering such insurance. The policy recited that it was issued in consideration of the payment of $1 paid by the insured to the insurer, the receipt whereof was acknowledged and the execution by the insured of a bond in the penal sum of the total amount of the insurance covered by the policy conditioned for the payment of all assessments made against the insured by the insurer. The premises were owned by M. Minikel, wife of Erdman Minikel. The application for insurance and the bond for assessments purported to be signed by M. Minikel. This signature was attached by Erdman Minikel, in the presence of his wife, with her knowledge and consent, and with intent by her to procure insurance on her property. Assessments on the policy were made against M. Minikel. Notices thereof were mailed to her, and she sent the amount to the company. The defendant claimed it supposed the husband was M. Minikel, the owner of the property, and that he affixed his own signature to the application and bond, but there was no false statement relating to ownership and the company insured property owned by married women as readily as property otherwise owned. Previous to the fire which destroyed the dwelling house, the premises were rented and the tenant went into possession and installed an alcohol still in a barn also covered by the policy which was located 400 feet from the house, and the still was in operation at the time of the fire. The mortgagee had no knowledge of this fact. The case was tried to the court without a jury. The plaintiff's mortgage being unpaid and for an amount in excess of the insurance on the dwelling house, the learned trial judge found for the plaintiff and entered judgment for the amount of such insurance.

Robert V. Baker, Jr., of Kenosha (Chris A. Juliani and M. E. Baker, both of Kenosha, of counsel), for appellant.

Schubring, Ryan & Petersen and Ralph E. Axley, all of Madison, for respondent.

FOWLER, Justice.

The appellant claims that (1) the policy was void for want of consideration and (2) because of the operation of the still; the rider was void because (3) without consideration and (4) because not signed by the president and secretary of the company; (5) the secretary of the insurer had no authority to waive the defense resulting from installation of the...