Tesson v. Atlantic Mut. Ins. Co.

• Decision Date: 31 March 1867
• Citation: 40 Mo. 33
• Parties: EDWARD P. TESSON, Respondent, v. THE ATLANTIC MUTUAL INSURANCE COMPANY, Appellant.
• Court: Missouri Supreme Court

40 Mo. 33

EDWARD P. TESSON, Respondent,

v.THE ATLANTIC MUTUAL INSURANCE COMPANY, Appellant.

Supreme Court of Missouri.

March Term, 1867.

Appeal from St. Louis Court of Common Pleas.

Hill & Jewett, for appellant.

I. The evidence is conclusive and overwhelming that the defendant never did agree to insure any other building than the one described in the written application and policy; and there is no testimony in this cause showing any other agreement than the one evidenced by the writings.

II. To sustain a petition in equity for the reformation of a written instrument on the ground of accident or mistake, it is essential that the error or mistake be on both sides, and that it be so must be distinctly proved-- Adams' Eq. 411, s. p. 171; 1 Story's Eq. §§ 155, 157; Joynes v. Statham, 3 Atk. 388; Pitcairne v. Osbourne, 2 Ves. 377; Gillespie v. Moon, 2 John Ch. 595-7. That the mistake must be on both sides is clear; for if there be a mistake by one party only, the altered instrument is not the agreement of both parties-- Adams' Eq. 411, s. p. 171; 1 Story's Eq. §§ 155-7, 160.

III. A mistake on one side may be a ground for rescinding a contract, or for refusing to enforce its specific performance; but it cannot be a ground for altering the terms of a contract, and creating a new contract not agreed to by both parties--Townshend v. Strangroom, 6 Ves. 328; Beaumont v. Bramley, T. & R. 41; Alexander v. Crosby, L. & G. 145; Mortimer v. Shortall, 1 Conn. & L. 417.

Glover & Shepley, and Bakewell & Farish, for respondent.

On the pleadings and evidence in the cause, the plaintiff was entitled to the relief sought--Phœnix Ins. Co. v. Gurnee, 1 Paige, 278; Franklin Fire Ins. Co. v. Hewitt et al., 3 B. Mon. 231; Roth v. City Ins. Co., 6 McLane, 324; Harris v. Columbiana Ins. Co., 18 Ohio, 116; N. Y. Ice Co. v. Northwestern Ins. Co., 23 N. Y. 357; Columbia Ins. Co. v. Lawrence, 2 Pet. 55; Malleable Iron Works v. Phœnix Ins. Co., 25 Conn. 465; Fowler v. N. York Indem. Ins. Co., 23 Barb. 43.

HOLMES, Judge, delivered the opinion of the court.

This is a petition in the nature of a bill in equity to reform a policy by correcting a mistake, alleged to have been made in the framing of the instrument, in order to make it conform to the real contract of the parties, and for relief upon the policy so reformed. The court below granted the relief prayed, and the case came up by appeal.

It appears that the agent of the insured made a written application to the company in these words: “$5,000 fire insurance wanted for six months on a 3 or 4 story brick distillery and machinery, not running, no fire about it, situated entirely detached (nearest building being an office, say 100 yards) on the bank of the Mackinaw river, in the town of Forneyville, Woodford county, Illinois, valued at $32,000. Privilege of $5,000 other insurance. Gable end is frame. December 16, 1858. Ed. P. Tesson, per L. E. Suber, attorney in fact. Brought a letter from Tesson--no plat.”

The policy contained this description: “On his three or four story brick distillery building and machinery in the same, not running, no fire in or about it, situated entirely detached on the banks of the Mackinaw river, in the town of Forneyville, Woodford county, Illinois; valued at $32,000; other insurance on same $5,000.”

The evidence shows that the agent had, at the time of the application, no more exact information concerning the true situation and description of the buildings to be insured than that which he communicated to the company; that the company had no other knowledge of the premises than that which was communicated by the agent; that certain plats were handed to a person (by the witness stated to be the secretary) at the insurance office, soon after the application was made and before the policy was delivered, which (as stated by the secretary) never came to his knowledge, nor to that of the directors, until after the loss, and formed no part of the written application as made; and that the policy came into the hands of the assured soon after it was issued, but that no mistake had been discovered or notified to the company until after the loss.

It does not appear that these plats furnished any evidence that any contract or agreement for a policy had been made and agreed on between the parties, different in its terms from that which the policy contained. So far as appears from any explicit testimony, the policy conformed in all essential particulars with the written application, except in the omission of the words “ gable end is frame.” No stress is laid upon this difference.

The evidence further shows that the distillery, as a whole, stood detached from any other buildings of adjoining proprietors; that the main part of the building was three stories high, two stories of brick and the third story of wood; that there were boilers set in brick work outside of the building, and covered with a shed roof on posts and supported against the wall, with an engine in the cellar; and that there was a wooden addition to the main building one story (eight or nine feet) high, and some sixty feet long and thirty wide, used in connection with the distillery and as a part of it.

The plaintiff proceeds here upon the supposition that he would not be entitled to recover on the policy at law. He assumes that it is necessary to have the policy reformed, on the ground of a mistake made in not framing the instrument according to the agreement that was entered into between the parties, and that the contract as understood by both parties was not correctly embodied in the policy.

A court of equity has jurisdiction to reform a policy of insurance, or other written contract, upon parol evidence, when the agreement really made by both parties has not been correctly incorporated into the instrument, through accident or mistake, in the framing of it; but both the agreement and the mistake must be made out by the clearest evidence, according to the understanding of both parties, as to what the contract was intended to be, and upon testimony entirely exact and satisfactory; and it must appear that the mistake consisted in not drawing up the instrument according to the agreement that was made--Andrews v. Essex Fire & Marine Ins. Co., 2 Mason, 6; 1 Sto. Eq. Jur. §§ 157-61; Adams' Eq. 171; 1 Phil. Ins. 42; 1 Arnold Ins. 51; Delaware Ins. Co. v. Hogan, 2 Wash. C. C. 4; Lyman v. U. S. Ins. Co., 2 J. Ch. 630; Keisselbrack v. Livingston, 4 J. Ch. 144; 1 Duer on Ins. 71. The court cannot supply an agreement that was never made--Graves v. Boston Ins. Co., 2 Cran. 419.

The record here does not...