Rochester Loan & Banking Company v. Liberty Insurance Company

• Decision Date: 04 April 1895
• Docket Number: 6214
• Citation: 62 N.W. 877,44 Neb. 537
• Parties: ROCHESTER LOAN & BANKING COMPANY ET AL. v. LIBERTY INSURANCE COMPANY
• Court: Nebraska Supreme Court

62 N.W. 877

44 Neb. 537

ROCHESTER LOAN & BANKING COMPANY ET AL. v. LIBERTY INSURANCE COMPANY

No. 6214

Supreme Court of Nebraska

April 4, 1895

ERROR from the district court of Douglas county. Tried below before KEYSOR, J.

REVERSED AND REMANDED.

James H. Macomber, for plaintiffs in error:

The company made defense upon the merits of the case, contending and answering that the policy was void, whereby it cannot now be heard to allege and rely upon a want of proof of loss. (Phenix Ins. Co. v. Bachelder, 32 Neb. 490.)

Oral testimony is not admissible to show that the title was held in trust. (Bicknell v. Lancaster City & County Fire Ins Co., 58 N.Y. 677; Ayers v. Hartford Fire Ins Co., 17 Iowa 188; German Ins. Co. v. Hyman, 34 Neb 704.)

The insurer had an insurable interest in the property. (Phenix Ins. Co. v. Bawdre, 67 Miss. 620; May, Insurance, sec. 81; Bicknell v. Lancaster City & County Fire Ins. Co., 58 N.Y. 677; Phoenix Ins. Co. v. Mitchell, 67 Ill. 43; German Ins. Co. v. Hyman, 34 Neb. 704; Warren v. Davenport Fire Ins. Co., 31 Iowa 464; McDonald v. Black, 20 O., 185; Hancox v. Fishing Ins. Co., 3 Sumner [U. S.], 132; Western Horse & Cattle Ins. Co. v. Sheidle, 18 Neb. 495; Hoose v. Prescott Ins. Co., 84 Mich. 309; Hall v. Niagara Fire Ins. Co. 53 N.W. [Mich.], 728.)

The vacancy of the building for ten days just prior to the fire does not work a forfeiture of the policy. (Springfield Ins. Co. v. McLimans, 28 Neb. 850; Billings v. German Ins. Co., 34 Neb. 502; Menk v. Home Ins Co., 76 Cal. 51; Home Ins Co. v. Gilman, 112 Ind. 7; Bonnert v. Pennsylvania Ins. Co., 129 Pa. 558; Newman v. Covenant Mutual Ins. Association, 76 Iowa 56; Aurora Fire & Marine Ins. Co. v. Kranich, 36 Mich. 289; Bennett v. Agricultural Ins. Co., 106 N.Y. 243; German Ins. Co. v. Rounds, 35 Neb. 752; England v. Westchester Fire Ins. Co., 51 N.W. [Wis.], 954; Devine v. Home Ins. Co., 32 Wis. 471; Dickinson v. State, 20 Neb. 81; Helme v. Philadelphia Life Ins. Co., 100 Am. Dec. [Pa.], 621; Hoffman v. AEtna Fire Ins. Co., 32 N.Y. 405.)

Jacob Fawcett, contra:

The policy was void because the insured was not the owner of the property. (Henning v. Western Assurance Co., 42 N.W. [Ia.], 308; Grigsby v. German Ins. Co., 40 Mo. App., 276; Trott v. Woolwich Mutual Fire Ins. Co., 83 Me. 362; Clark v. Dwelling House Ins. Co., 81 Me. 373; Pelican Ins. Co. of New Orleans v. Smith, 9 So. Rep. [Ala.], 327; Barnard v. National Fire Ins. Co., 27 Mo. App., 26; De Armand v. Home Ins. Co., 28 F. 603; Crescent Ins. Co. v. Camp, 64 Tex. 521; Lasher v. St. Joseph Fire & Marine Ins. Co., 86 N.Y. 423; Mers v. Franklin Ins. Co., 68 Mo. 127; Hinman v. Hartford Fire Ins. Co., 36 Wis. 159; Columbian Ins. Co. v. Lawrence, 2 Pet. [U. S.], 25; Day v. Charter Oak Fire & Marine Ins. Co., 51 Me. 99; Denison v. Phoenix Ins. Co., 52 Iowa 457.)

Vacancy without the consent of the company indorsed upon the policy renders the same void. (Royal Ins. Co. v. Lubelsky, 86 Ala. 530; Hotchkiss v. Home Ins. Co., 58 Wis. 297; Ins. Co. of North America v. Garland, 108 Ill. 220; Newmarket Savings Bank v. Royal Ins. Co., 150 Mass. 374; Evans v. Queen Ins. Co., 31 N.E. [Ind.], 843; England v. Westchester Fire Ins. Co., 51 N.W. [Wis.], 954; Boyd v. Vanderbilt Ins. Co., 16 S.W. [Tenn.], 470; Herrman v. Adriatic Fire Ins. Co., 85 N.Y. 162; Barry v. Prescott Ins. Co., 35 Hun [N. Y.], 601; Hartshorne v. Agricultural Ins. Co., 50 N.J.L. 427; Bennett v. Agricultural Ins. Co., 50 Conn. 420; Moore v. Phoenix Fire Ins. Co., 64 N. H., 140; American Ins. Co. v. Padfield, 78 Ill. 167; Sexton v. Hawkeye Ins. Co., 69 Iowa 99; Fishe v. Council Bluffs Ins. Co., 74 Iowa 676; Cook v. Continental Ins. Co., 70 Mo. 610; Farmers Ins. Co. v. Wells, 42 Ohio St. 519; Dewees v. Manhattan Ins. Co., 35 N.J.L. 366.)

OPINION

See opinion for statement of the case.

RAGAN, C.

This action was brought in the district court of Douglas county by L. G. Bangs against the Liberty Insurance Company of the city of New York (hereinafter called the "Insurance Company"). The action was based on an ordinary fire insurance policy issued by the Insurance Company to Bangs on certain real estate situate in the city of Omaha. The Rochester Loan & Banking Company (hereinafter called the "Loan Company") was joined as a party plaintiff because the policy provided that the loss, if any, should be payable to it as mortgagee. At the close of the evidence the jury, in obedience to a peremptory instruction of the district court, returned a verdict in favor of the Insurance Company, and to reverse the judgment of dismissal pronounced on such verdict Bangs and the Loan Company have prosecuted to this court a petition in error.

1. The policy in suit contained among other things the following provisions: That the policy should be void if the interest of the insured in the insured premises be other than unconditional and sole ownership; if the insured premises be or become vacant or unoccupied and so remain for ten days; that if a fire occurred the insured, within sixty days, should render a statement to the company, signed and sworn to by the insured, stating the knowledge and belief of the assured as to the time and origin of the fire, etc. One of the defenses interposed by the Insurance Company to the action was that the insured did not furnish it, the company, "proofs of loss as required by the terms and conditions of said policy of insurance." The fire occurred on the 7th day of November, 1891, and on the 1st day of December, 1891, Bangs made and furnished the Insurance Company an affidavit in words and figures as follows:

"STATE OF IOWA, CARROLL COUNTY. SS.

"I, L. G. Bangs, being duly sworn, depose and say: That my house on lot 3 of Allen's subdivision of lot 5, Ragan's Addition to Omaha, Nebraska, was destroyed by fire on the night of November 7, 1891; that the causes of the fire are unknown to me; that the damage done to my buildings was about $ 1,000, and that said building was insured in the Liberty Insurance Company for $ 900 by policy dated April 28, 1891; that I have made inquiry and am unable to find anything about the origin of the fire. The policy on said buildings was for $ 800 on the house and $ 100 on the barn. L. G. BANGS.

"Subscribed and sworn to," etc.

We remark: (1.) This was a substantial compliance with the terms of the policy requiring Bangs to furnish the Insurance Company proofs of loss. (Hanover Fire Ins. Co. v. Gustin, 40 Neb. 828, 59 N.W. 375.) (2.) That if Bangs had wholly failed to furnish the Insurance Company any proofs of loss whatever, such failure under the circumstances of this case would afford the Insurance Company no defense whatever to this action. Here, as we shall presently see, the Insurance Company refuses to pay the loss, and defends against this action on the ground that the policy in suit was, at the date of the loss of the insured property, not in force. In Phenix Ins. Co. v. Bachelder, 32 Neb. 490, 49 N.W. 217, this court, speaking through its present chief justice, NORVAL, said: "The absolute denial by the insurer of all liability, on the ground that the policy was not in force at the time of the loss, is a waiver of the preliminary proofs of loss required by the policy." (See, also, Western Home Ins. Co. v. Richardson, 40 Neb. 1, 58 N.W. 597.) In Omaha Fire Ins. Co. v. Dierks, 43 Neb. 473, 61 N.W. 740, it was held: "The right of an insurance company to notice of loss is a right which the company may waive; and when the insurer denies all liability for the loss, and refuses to pay the same, and places such denial and refusal upon grounds other than the failure of the insured to give notice of the loss, such denial and refusal avoid the necessity of such notice." (See, also, Omaha Fire Ins. Co. v. Dierks, 43 Neb. 473, 61 N.W. 740.) The precise question was squarely presented and decided in Dwelling House Ins. Co. v. Brewster, 43 Neb. 528, 61 N.W. 746, where HARRISON, J., speaking for this court to the point, said: "Proofs of loss required by a condition of an insurance policy are waived when the insurance company denies any liability for the loss on the ground that the policy was not in force at the date of the loss." We conclude, therefore, that the Insurance Company waived the defense under consideration, in view of the fact that it defended the action on the ground that the policy was not in force at the date of the loss; and if the Insurance Company had not waived such defense, that the evidence establishes that the insured sufficiently complied with the provisions of the policy in reference to furnishing the Insurance Company proofs of loss.

2. The second defense of the Insurance Company was that Bangs, at the time of the issuance of the policy in suit, was not the unconditional and sole owner of the real estate insured; that such real estate was in fact the property of the Loan Company, the title to which property was held in trust for it by Bangs. The policy in suit was issued on the 28th of April 1891. It is undisputed that prior to the 21st of April, 1891, the Loan Company was the owner and held the legal title to the insured real estate. On the 21st day of April, 1891, the Loan Company, at its home office in the state of New Hampshire, executed to Bangs an absolute warranty deed for this property, which was recorded in the office of the register of deeds some time in the following May. On the trial of this action Bangs swore that he was the owner of this real estate and had been since the date of his deed, and that he purchased it of the Loan Company at private sale. The president of the Loan Company testified on the trial that Bangs was the owner of the property. We are unable to understand upon what theory the learned district judge reached the conclusion, if he did reach such...