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

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

36 S.E. 63

110 Ga. 618

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

Supreme Court of Georgia

April 11, 1900

Casemaker Note: Portions of this opinion were specifically rejected by a later court in 141 S.E.2d 206

Casemaker Note: Portions of this opinion were specifically rejected by a later court in 172 S.E.2d 629

Syllabus by the Court.

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.

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.

Fouché & Fouché, 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 ginhouse 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:

Sum

insured.Valulation.

One steam power 1 & 2 story gin house, built of

France and covered with shingles .............................. $ 150 $ 500

One one gin stands of saws, $___ each .............................. 75 150

On one condensers " " .............................................. 35 60

On beaters and cleaners " "B 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 Bleting ........................................................ ___ ___

On runing gear and appurtenances .................................. ___ ___

On assured's cotton, ginned and unginned, packed

and unpacked, in said gin house ................................. 250 400

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 $2,00 and that the amount paid was much less than the amount for which the property was insured, and it was accepted because the plaintiff would not pay the full loss, or what was justly due on the policy, without suit, and defendant took this sum to avoid a suit at law. The answer further denied the allegation that the title to the property insured, as well as the land upon which the same was located, was not absolutely in it, and averred that the charge contained in the petition with reference to this title was not the truth.

It appeared from the evidence that the deed under which the Rome Grocery Company claimed title to the property in question conveys lot 135, and 60 acres off the south side of lot 154 in the Twenty-Second district and Third section of Floyd county. It also conveys the crops and personal property on said land; also, one 8 horse power engine, one 60-saw gin, feeder, and condenser attached; also, one cotton press,--all in the gin house on said place, and the crop, lands, etc., described in the deed, warranted free from incumbrance. It further appears that plaintiff procured a surveyor to survey the land in question, and under his testimony, who identified the plat he had made to the land, it appeared that in the lot 135, and in the 60 acres cut off of the south side of lot 154, the gin house was not included; that a part of the line, which included the line described in the deed, did take in a portion of the personality,-for instance, the engine, or a portion thereof, which was off a few yards from the house. The house, however, was in a few feet outside of the lines run by the surveyor. The evidence seems undisputed that all this property, which had been insured, had been fully paid for by the defendant, and that the personality, which embraced by far the largest amount of insurance, was entirely unincumbered. After a discovery of this condition in the title, correspondence ensued between Livingston Mims, of Atlanta, Ga., the general manager for plaintiff in this state, and the Rome Grocery Company, in which Mims gave in formation about discovering that the title to the property was not in the defendant, and made demand upon the Rome Grocery Company to repay the money that had been paid. To these letters the latter responded, among other things, that it did own the property in question. Mims admitted, in a communication to the defendant, that the representation it made about the property was unintentional on its part, and clearly indicated in his...