The Indiana Insurance Company v. Hartwell

• Decision Date: 08 April 1890
• Docket Number: 14,141
• Citation: 24 N.E. 100,123 Ind. 177
• Parties: The Indiana Insurance Company v. Hartwell
• Court: Indiana Supreme Court

24 N.E. 100

123 Ind. 177

The Indiana Insurance Company v. Hartwell

No. 14,141

Supreme Court of Indiana

April 8, 1890

From the Marion Superior Court.

Judgment affirmed, with costs.

V Carter, for appellant.

A. W Hatch, for appellee.

OPINION

Berkshire, J.

The appellee sued the appellant on a fire insurance policy.

The appellant answered in three paragraphs, and the appellee replied in two paragraphs, the second paragraph being the general denial.

The third paragraph of answer cut no figure in the court below nor is it of any importance to the questions involved in this appeal.

The first paragraph of answer is, in substance, that, on the 5th day of February, 1881, the appellant issued the policy sued upon; that the property therein described was partially destroyed by fire on the 5th day of August, 1881; that, on the 16th day of August, 1881, the appellee made proof of loss, in which he claimed the sum of $ 469.09; but the appellant claims that the appellee ought not to maintain his said action, because by the terms of said policy the property insured and the building in which the same was situated was described in the written part of said policy in the words and figures following, to wit: "On stock manufactured and unmanufactured, and in process of manufacture, and on all materials and supplies for the same, all contained in the brick building situate Nos. 82, 84 and 86 Fulton street, Chicago, Illinois, and occupied as a sash, door and blind factory," and which description constituted a warranty that said building was occupied as a sash, door and blind factory, and for no other purpose; that there has been a breach of said warranty in this; that at the time said policy issued, and at the time of said fire, said building was not occupied as a sash, door and blind factory only, but was occupied in its several parts by other persons than the appellee, and for other purposes than a sash, door and blind factory.

The answer then stated in detail who else occupied the building, and the purposes for which occupied.

The second paragraph of answer may be abbreviated as follows: That the appellee ought not to recover in this action because by the terms of the policy it is covenanted and agreed that any application, survey or description referred to in said policy is true; that no fact material to the risk or relating to its condition, situation or occupancy has been concealed, and that said policy should become void and of no effect on failure or neglect of the assured to comply with its terms, conditions or covenants; that said policy contained the further condition that "Any such persons as shall hold the commission of this company shall be considered as its agents in any transaction relating to this insurance, or any removal thereof, or the payment of the premium to the company;" that the said policy was issued under the circumstances and representations following, and not otherwise; that in the month of February, 1881, one S. S. Nutting, an entire stranger to the appellant or any of its officers, and who was an insurance broker, doing business in Chicago, Illinois, was authorized by the appellee to procure a line of insurance on the property covered by the said policy; that Nutting applied to the firm of Mickel & Gardner, insurance agents and brokers, also doing business in said city of Chicago, to place a portion of said insurance without designating any particular company in which such insurance should be written; that at the time of such application said Nutting furnished to Mickel & Gardner a written description of the said risk in the words following: "On stock manufactured and unmanufactured, and in process of manufacture, and on all materials and supplies for the same, all situated Nos. 82, 84 and 86 Fulton street, Chicago, Ills., and occupied as a sash, door and blind factory; other insurance permitted; permission to use kerosene oil;" that said Mickel & Gardner wrote a portion of said insurance in a company represented by them as agents, but not being able to place the full amount of such insurance in companies of which they were the commissioned agents, they copied the same description so furnished by Nutting, with a blank form of application for insurance, as follows: "No. 172 La Salle street, Chicago, Ill. Application for insurance against loss or damage by fire by E. A. Hartwell; term one year from February 5th, 1881. On stock manufactured and unmanufactured, and in process of manufacture, and on all materials and supplies for the same; all situated Nos. 82, 84 and 86 Fulton street, Chicago, Ills., and occupied as a sash, door and blind factory; other insurance permitted; permission to use kerosene for lights," and forwarded the said application by mail to Martin V. McGilliard, an insurance agent for numerous companies, an insurance broker, and secretary of the appellant company, and whose place of business, as well as the home office of the appellant, was Indianapolis, Indiana; that neither in nor accompanying said application was there any particular company designated in which said insurance was desired; that upon receipt of said application said McGilliard placed said insurance in the appellant company, and wrote the policy, incorporating in the written portion thereof the description as furnished by Nutting and forwarded by Mickel & Gardner, and then forwarded the policy to Mickel & Gardner at Chicago; that they delivered the said policy to said Nutting, who delivered the same to the appellee; that within thirty days thereafter the appellee paid the premium to Nutting, and he to Mickel & Gardner; that they retained 17 1/2 per cent. of the said premium, and remitted the residue to McGilliard; that prior to the transaction in question said Mickel & Gardner had on several occasions sent similar applications to said McGilliard to place for them, and had been placed by him in other companies, and in each case a broker's commission of 17 1/2 per cent. was retained by them without objection on the part of McGilliard. The appellant further states that Mickel & Gardner were not its commissioned agents, and had no authority to accept a risk or to write a policy for it, nor did they have any other connection with the appellant than as stated above; that by the said written description furnished as stated, and incorporated by McGilliard in the said policy, the appellee represented and agreed with the appellant that the said building Nos. 82, 84 and 86 Fulton street, Chicago, Ill., was occupied as a sash, door, and blind factory, and for no other purpose; that appellant relied on said representations, believed them to be true, and issued the policy; that said representations and warranty in said policy were false and untrue, as appellant then and there well knew, in this, that at the time said policy was issued, and at the time of said fire, said building Nos. 82, 84 and 86 Fulton street, Chicago, was not occupied only as a sash, door and blind factory.

The answer then goes on to state by whom and for what purposes the building was occupied, and that if the facts stated had been known to the appellant it would not have issued the policy.

It is then averred that at the time Nutting delivered said written description of said risk to Mickel & Gardner, he had full knowledge of all the facts, but did not communicate the same to them; that prior thereto, Mickel & Gardner had inspected said building as the agent of other companies than the appellant, and at the time they received and forwarded said application to said McGilliard, they had full knowledge of the occupancy of said building as aforesaid, but had never at any time inspected the same for the appellant; nor did they at any time inform the appellant of said occupancy other than as a sash, door and blind factory; that at the time said policy was issued neither the appellant nor any of its officers had any actual knowledge of such other occupancy, but the same was concealed from it as already stated.

The first paragraph of reply stated, in substance, the following facts: It is true there were other kinds of business carried on in the same premises, 82, 84 and 86 Fulton street, Chicago, but the appellant had full knowledge thereof when it issued the said policy; that the appellant had many times inspected said building, and was acquainted with the existence, situation and location of the dry kilns, etc., referred to in the answer, and with such knowledge accepted said premium, as set out in the complaint, and issued the policy.

The cause being at issue, was submitted to the court at special term for trial, and by request properly made, the court returned a special finding of facts, together with its conclusions of law thereon.

The appellant excepted to the conclusions of law, and then filed a motion for a new trial, which the court overruled, and it reserved an exception. Judgment was then rendered for the appellee, and from the said judgment the appellant appealed to the general term.

In general term the judgment at special term was affirmed, and therefore this appeal.

We are of the opinion that the evidence fully supports the facts as found by the court at special term, and do not feel called upon to consider the action of the court in overruling the motion for a new trial.

The judgment must stand or fall upon the conclusions of law to be drawn from the facts found by the court.

The following is the special finding of the court, including its conclusions of law:

"Finding of Facts.

"The court having been requested by both plaintiff and defendant to make a special finding of the facts and its conclusions of law herein, finds the following to be the material facts:

"Prior to February 5th, 1881, the said defendant was, and ever...