The Kings County Fire Ins. Co. v. Swigert

• Decision Date: 31 October 1882
• Parties: THE KINGS COUNTY FIRE INSURANCE COMPANYv.CHARLES F. SWIGERT.
• Court: United States Appellate Court of Illinois

11 Ill.App. 590

11 Bradw. 590

THE KINGS COUNTY FIRE INSURANCE COMPANY

v.CHARLES F. SWIGERT.

Appellate Court of Illinois, First District.

October Term, 1882.

OPINION TEXT STARTS HERE

APPEAL from the Circuit Court of Cook county; the Hon. KIRK HAWES, Judge, presiding. Opinion filed November 29, 1882.

This was an action of assumpsit, brought by Charles F. Swigert against the Kings County Fire Insurance Company, to recover for a loss under a policy of insurance against fire. By said policy the defendant insured the plaintiff, for a certain term, against loss or damage by fire, to the amount of $750, to wit: $200 on his one story and basement brick and frame building, situate, etc., in the city of Chicago; $375 on his saloon and restaurant, furniture and fixtures, show cases, gas fixtures, furnace and connections, and bar glassware; and $175 on his stock of wines, liquors, tobacco and restaurant supplies, all contained in said building. Among the provisions and conditions contained in, or attached to and forming a part of said policy, were the following:

“If the above mentioned premises at any time during the period for which this policy would otherwise continue in force, shall be used for the purpose of carrying on therein any trade or occupation, or for storing or keeping therein any articles, goods or merchandise, denominated hazardous, or extra hazardous, or specially hazardous, in the second class of the classes of hazards annexed to this policy, from thenceforth, so long as the same shall be so used, this policy shall be of no further force or effect.

Whenever gunpowder, or any other article subject to legal restriction, shall be kept on said premises in quantities greater than the law allows, or in a manner different from that prescribed by law, unless said use or keeping is specially provided for herein, this policy shall be null and void.

If any person effecting insurance in this company, shall make any misrepresentation or concealment touching the risk to be assumed, or during the existence of this policy or any renewal thereof, the risk shall be increased by any means within the control of the assured, or by the occupation of the premises for more hazardous purposes than are permitted by this policy, * * * * this policy shall be void.

It is agreed that the person or persons, if any, other than the assured, who have procured this insurance to be taken by this company, shall be deemed to be the agent or agents of the assured and not of this company, in any transaction relating to this insurance.”

In the classification of hazards annexed to the policy, the first and second classes were as follows:

“Petroleum, benzine, benzole and naphtha, are classed specially hazardous, and if kept on the premises described in this policy, will vitiate this insurance, unless privilege to keep such articles shall be indorsed in writing thereon.

Kerosene and other refined coal or earth oils are classed extra hazardous, when kept in quantities not exceeding five barrels; but when kept in quantities exceeding five barrels, are classed specially hazardous.”

The premises insured were occupied and used by the plaintiff as a saloon and restaurant, and the evidence shows that at the date of the policy and from thence up to and at the time of the loss, the plaintiff kept gasoline on said premises, and used it for cooking oysters, and also in a carburetter or apparatus for manufacturing illuminating gas, attached to his gas meter. It appears that he usually kept a barrel of gasoline on the premises in the area under the sidewalk, and also a can containing from five to ten gallons in the restaurant under the lunch counter. On the day of the fire, three men in the plaintiff's employ, undertook, by his direction, to lower a barrel of gasoline into the basement, and while they were doing so, the barrel fell and burst, and the gasoline, running over the floor, took fire and destroyed the building and contents.

The policy was obtained for the plaintiff by one Kennedy, a member of the firm of E. E. Ryan & Co., insurance agents. The property insured, had been previously owned by Gewee & Davis, and while they were owning it, the plaintiff, acting as their agent, applied to Kennedy for $1,500 insurance thereon, and he thereupon drew up a paper, stating, in substance, that insurance was wanted by Gewee & Davis in the sum of $750 on said property for the term of one year, signing to said statement the name of his firm as applicants. With this paper he went to one Waller, the defendant's general agent at Chicago, procured from him a policy for that amount, and delivered it to the plaintiff, receiving from him the premium and paying it to Waller, after deducting his commissions. A similar policy for the same amount was also at the same time obtained by Kennedy in another company.

While these policies were in force, the property insured was purchased by the plaintiff, and for the purpose of getting the insurance transferred to himself, he delivered said policies to Kennedy and requested him to get the transfer made. Kennedy thereupon drew up another application, stating, in substance, that $750 insurance on said property was wanted by the plaintiff for the unexpired portion of the term covered by the former policy, and delivered it together with the former policy to Waller, whereupon Waller issued and delivered to Kennedy for the plaintiff the policy in suit, the consideration therein expressed being the cancellation of the former policy.

E. E. Ryan & Co. appear to have been the agents of one or more insurance companies doing business in Chicago, but there was no evidence tending to show that they were authorized to act for the defendant, but the evidence on the contrary was express, that they were not and never had been in fact employed as its agents. It appears, however, that they, as well as other insurance agents in Chicago, made a practice of obtaining insurance upon risks which for any reason they did not wish to insure in their own companies, from the agents of other companies, keeping, as between themselves and such agents, a mutual account of premiums, upon which monthly settlements were made; and that by such course of dealing with Waller, E. E. Ryan & Co. had frequently obtained policies in the defendant company prior to the transactions in question in this suit.

There was evidence tending to show that gasoline is an oil obtained from petroleum, and that it is one of the most volatile and inflammable of the products derived from that substance; and also that keeping it on the plaintiff's premises greatly increased the risk. There was also evidence tending to show that Kennedy, at the time he obtained the policy in suit, had notice that the plaintiff was keeping and using it on said premises in the manner shown by the evidence.

The defendant also read in evidence an ordinance of the city of Chicago, declaring it to be unlawful to keep for sale or on storage, any refined carbon oil, kerosene, or other products for illuminating purposes, of coal, rock or earth oils, excepting such as would stand a certain fire test; and also declaring it unlawful for any person, firm or corporation to manufacture any gas for illuminating purposes, from any substance whatever, within the limits of said city, without the permission of the common council of the city.

The evidence shows that gasoline will not stand the fire test prescribed by the ordinance; and there was no evidence tending to show any permission by the common council of the city of Chicago to the plaintiff, to manufacture gas for illuminating purposes.

The court, at the instance of the plaintiff, gave to the jury the following instructions:

“If the jury believe from the evidence in this case, that the witness, Kennedy, of the firm of E. E. Ryan & Co., examined the premises in question, with a view of placing insurance thereon, representing himself to be an insurance agent, and afterward returned with a policy of insurance properly executed, ready for delivery, either personally or through some member of the firm of E. E. Ryan & Co. to the assured, who accepted the policy and paid the premium in good faith, under the belief that such person was an agent clothed with full power of defendant company who issued the policy, which premium was afterward received, paid to, and accepted by the defendant company, the company will be bound by the payment to such person, and estopped by its own act in giving such person the policy, to dispute the right of such person to act as its agent in that behalf, and it makes no difference whether the premium was paid in money or by the surrender and cancellation of a former existing policy made by defendant company.

2. The court instructs the jury that where it is known to the insurance agent at the time the policy is issued that the assured kept an article prohibited by the terms of the policy, and intends to keep it in the building assured, the keeping it will not render the policy void, whether permission to keep it was indorsed, or intended or neglected to be indorsed; and if the jury believe from the evidence in this case that the agent of the defendant, at the time the policy introduced in the evidence was made, dated February 13, 1879, knew that gasoline was kept on the premises in question, and that the assured intended to keep such article for the purpose of lighting and cooking only, and not in store or for sale, then such keeping or use would not render the policy sued upon void, even although the jury may believe that said policy prohibited the keeping or use of said article on the premises,...