The Michigan State Ins. Co. v. Lewis

• Decision Date: 21 July 1874
• Citation: 30 Mich. 41
• Court: Michigan Supreme Court
• Parties: The Michigan State Insurance Company v. William W. Lewis

30 Mich. 41

The Michigan State Insurance Company v. William W. Lewis

Supreme Court of Michigan

July 21, 1874

Heard May 13, 1874

Error to Lenawee Circuit.

Judgment affirmed, with costs.

Walker & Weaver and Ashley Pond, for plaintiff in error.

C. A & S. C. Stacy and A. C. Baldwin, for defendant in error.

OPINION

Cooley J.:

On the 22d day of April, 1871, Lewis made application to the plaintiff in error for insurance to the amount of two thousand three hundred dollars, on his dwelling house and other buildings and the contents thereof, situate in the township of Oakland. The application was prepared by one Buzzell, an agent of the insurance company, and contained a covenant of the correctness of its recitals. Among other things it stated the premises to be incumbered by a mortgage of "near five thousand three hundred dollars." In fact, the mortgage was given three years before, for five thousand three hundred and twenty-five dollars, with interest at seven per centum, and only one hundred dollars had been paid upon it, though Lewis claimed an offset or deduction of five hundred dollars more. There was conflicting evidence in the case, whether Lewis fully explained to the agent the situation of the mortgage, so as to enable the latter to get at the exact amount; Lewis claiming that he did, and that he urged the agent to call upon the owner of the mortgage, who lived not far off, and ascertain the amount from him; and that the agent replied that it was not necessary, as the sum stated in the application was near enough. The application was sent by the agent to the office of the company, where it was approved, and a policy of insurance was made out and forwarded to Lewis, who received it some weeks after the date of the application. By one of the conditions of the policy, it was stated that in all cases of application for insurance the applicant shall state the whole amount of incumbrance on the property, or the policy should be void and of no effect. Another was, that "there shall be no waiver or evasion of any of the terms or conditions of this policy, and no agent or servant of this company has any right or power to waive or dispense with any of the terms or conditions of insurance, as printed or contained in the application or in this policy, excepting that the same is done by the concurrence of the secretary of the company, endorsed hereon or otherwise specifically acknowledged in writing by him." And in the body of the policy it was stated that "in case of any transfer or termination of the interest of the insured, or any part of his interest, in the property hereby insured, either by sale, contract or otherwise, or in case any mortgage, lien or incumbrance shall be executed thereon, or shall attach thereto, or if the title thereto shall be in any way changed or affected after the date of this policy, or if any proceedings for sale thereof shall be had, commenced or taken, or if the title thereto shall be or become less than an absolute and perfect one, without such consent, this policy shall from thenceforth be void and of none effect."

The evidence which is set forth in the record shows that the house insured was burned July 6, 1871. On the first of the preceding month the holder of the mortgage mentioned in the application commenced proceedings to foreclose it by advertisement, and those proceedings were brought to the knowledge of Lewis about two weeks before the fire, but no notice thereof was given to the insurance company. After the fire Lewis made his claim for indemnity, but the company refused payment upon the grounds, first, that the policy was made void by the misrepresentation regarding the incumbrance; or, if not by that, then, second, by the proceeding taken for a foreclosure and the neglect to notify the company thereof and obtain its assent.

The legal questions in the case arise upon the instructions given and refused. Without giving them in detail, it may be sufficient to say that in substance the judge instructed the jury that if Lewis correctly informed the agent of the date and amount of the mortgage, and the latter by neglect or ignorance failed to state the true amount in the application, the policy would not be avoided by the omission; and he refused to instruct them that the institution of the foreclosure proceedings without the company's consent avoided the policy; or that the failure of Lewis to notify the company of such proceedings--they being ignorant thereof--would have that effect.

It is insisted on behalf of the plaintiff in error that, by the express terms of the contract between the parties, the policy is void for the under-statement of the amount due on the mortgage, and that the only question on this branch of the case is, whether the agent was authorized on behalf of the company to waive an exact compliance with the condition in this regard. But by the policy all power which the agent might otherwise have had to make such waiver is expressly taken away; and this being the contract of the parties, Lewis is bound by it, and is precluded from asserting such a waiver. On the other hand, it is claimed on the part of Lewis, that such a provision in the policy, which is not shown to have been expressly agreed upon, except as the policy proves it, and which cannot be supposed to have come to his knowledge until the policy was actually received by him, some weeks after the application was made and signed cannot in reason reach back to and make...