Rome Grocery Co v. Greenwich Ins. Co. Of N.Y.

• Court: Supreme Court of Georgia
• Writing for the Court: LEWIS
• Citation: 110 Ga. 618,36 S.E. 63
• Parties: ROME GROCERY CO. v. GREENWICH INS. CO. OF NEW YORK.
• Decision Date: 11 April 1900

110 Ga. 618
36 S.E. 63

ROME GROCERY CO.
v.
GREENWICH INS. CO. OF NEW YORK.

Supreme Court of Georgia.

April 11, 1900.

INSURANCE—RECOVERY OF MONEY PAID ON POLICY—EVIDENCE.

1. In order to entitle an insurance company to recover back money paid upon a policy of insurance, it is, under section 2113 of the Civil Code, incumbent upon the company to show affirmatively that after making payment it discovered evidence showing itself not liable on the policy.

2. Such evidence must consist of proof showing that, because of the fraud of the insured, the policy was, ab initio, void, or that after it issued he was guilty of conduct either vitiating the policy, or rendering it unconscionable for him to receive money thereon, and fraudulently concealed from the company, at the time of receiving payment, the fact that he had been guilty of such conduct.

(Syllabus by the Court.)

Error from superior court, Floyd county; W. M. Henry, Judge.

Action by the Greenwich Insurance Company of New York against the Rome Grocery Company. Judgment for plaintiff, and defendant brings error. Reversed.

Fouche & Fouche, for plaintiff in error.

Reece & Denny and W. S. McHenry, for defendant in error.

LEWIS, J. The Greenwich Insurance Company of New York brought suit in Floyd superior court for the purpose of recovering back money paid on an insurance policy issued by the plaintiff to the defendant in consequence of the destruction by fire of the property insured. The ground for the action was that the insured, in its application for a policy, had warranted that the entire title (not only to the property insured, but also to the land upon which the same was located) was absolute and in fee simple in the applicant, and that the applicant was the sole and undisputed owner of the whole of said property proposed for Insurance, including the land on which it stood. Proof of loss was made out by the applicant, in which it was reaffirmed that the representations made in its application were true. Upon the faith of these representations, the company sent an adjuster to Rome, Ga., where the property was located, and they finally settled the loss, by the company paying the insured the sum of $534.50. Since said payment, the petition alleges, plaintiff ascertained that the representations of the insured as to the ownership of the land and buildings were false, and that the title thereto was not in defendant, but that it claimed title under a certain deed from Simpson to said defendant, and petitioner had an accurate survey of the property made in accordance with the description in said deed. This survey discloses the fact that the gin-house property that was insured was not embraced within the same. Plaintiff thereupon made demand upon defendant for the refunding and repayment to it of said sum, which defendant refused to entertain, and declined to refund the money to petitioner. Petitioner further avers, in effect, that it was entirely ignorant of any defect in the title to the property until after the settlement was made, and, if it had had knowledge of the condition of the title, it would not have paid any loss, and would not have insured the property at the beginning. It appears from the record that there was introduced on the trial the policy of insurance, and the application therefor, and that the insurance extended from September 22, 1894, to March 22, 1895, to the amount of $1,000, upon the following property, set forth and itemized in the policy as follows:

[36 S.E. 64]

-------------------------------------------------------------------------------
                | |Sum |Valuation.|
                | |insured.| |
                |---------------------------------------------------------|--------|----------|
                |one steam power 1 & 2 story gin house, built of frame and|$ 150 |$ 500 |
                |covered with shingles | | |
                |---------------------------------------------------------|--------|----------|
                |On one gin stands of saws, $—— each |75 |150 |
                |---------------------------------------------------------|--------|----------|
                |On one condensers" " " " |35 |60 |
                |---------------------------------------------------------|--------|----------|
                |On heaters and cleaners " " | | |
                |---------------------------------------------------------|--------|----------|
                |On one feeders and breakers " " |35 |60 |
                |---------------------------------------------------------|--------|----------|
                |On engine and boilers |250 |600 |
                |---------------------------------------------------------|--------|----------|
                |On press & fixtures belonging thereto |55 |— |
                |---------------------------------------------------------|--------|----------|
                |On fan, elevator, and appurtenances |55 |100 |
                |---------------------------------------------------------|--------|----------|
                |On flues, leveler, and distributer |— |— |
                |---------------------------------------------------------|--------|----------|
                |On belting |— |— |
                |---------------------------------------------------------|--------|----------|
                |On running gear and appurtenances |— |— |
                |---------------------------------------------------------|--------|----------|
                |On assured's cotton, ginned and unginned, packed and |250 |400 |
                |unpacked, in said gin house | | |
                |---------------------------------------------------------|--------|----------|
                |On cotton held in trust or on commission, for which |— |— |
                |assured may be liable, therein | | |
                |---------------------------------------------------------|--------|----------|
                |On cotton seed therein |150 |250 |
                |---------------------------------------------------------|--------|----------|
                |On cotton grist mill |— |— |
                |---------------------------------------------------------|--------|----------|
                |Total |$1.000 |$2,120 |
                -------------------------------------------------------------------------------
                

It also appeared that the insured, in its application, guarantied absolute title to this property, and to the land on which it was located.

To this petition the defendant answered, denying it had made any specific warranty; admitting the amount paid, but denying that it was the agreed amount of damages to the insured property. Defendant averred that the insured property was totally destroyed, and defendant's loss by the fire was $2,000 and that the amount paid was much less than the amount for which the property was insured, and it was accepted...