The Overland-Reno Company v. The International Indemnity Company

• Decision Date: 12 January 1924
• Docket Number: 24,897
• Citation: 115 Kan. 137,222 P. 122
• Parties: THE OVERLAND-RENO COMPANY, Appellee, v. THE INTERNATIONAL INDEMNITY COMPANY, Appellant
• Court: Kansas Supreme Court

222 P. 122

115 Kan. 137

THE OVERLAND-RENO COMPANY, Appellee, v. THE INTERNATIONAL INDEMNITY COMPANY, Appellant

No. 24,897

Supreme Court of Kansas

January 12, 1924

Decided January, 1924.

Appeal from Reno district court; WILLIAM G. FAIRCHILD, judge.

Judgment affirmed.

SYLLABUS

SYLLABUS BY THE COURT.

INSURANCE--Against "Theft, Robbery and Pilferage"--Property Obtained by a Preconceived Plan Involving False Representation and Fraud Within Provisions of Policy. Under a contract of insurance issued to protect a dealer in automobiles against "theft, robbery or pilferage," the act of a swindler who deprived the insured of an automobile by means of a preconceived plan which involved misrepresentation and fraud was a species of theft for which the insurance company was liable--following Motor Co. v. Insurance Co., 111 Kan 225, 207 P. 205, and Overland-Reno Co. v. Indemnity Co., 111 Kan. 668, 208 P. 548.

A. C. Malloy, R. C. Davis, and Warren H. White, all of Hutchinson, for the appellant.

J. R. Beeching, J. F. Rhodes, and William H. Burnett, all of Hutchinson, for the appellee.

OPINION

HOPKINS, J.:

This action was to recover on an automobile insurance policy where the owner was deprived of his car by a preconceived fraudulent trick or scheme. This is the second appeal. On the previous appeal, reported in 111 Kan. 668, 208 P. 548, this court reversed an order of the trial court sustaining a demurrer to plaintiff's petition. After the case was sent back to the district court it was tried on an agreed statement of facts. Plaintiff prevailed and defendant appeals.

A close examination of the petition and the agreed statement of facts shows that no new facts are presented for consideration. All the material facts in the agreed statement are substantially as alleged in the petition on which this court passed on the previous submission.

The facts are that one Dolson, representing himself to be a farmer, gave his check for and procured from O. B. Mayfield a Little-Overland 4 Roadster, Mayfield, in good faith believing the representations of Dolson, which proved to be false. The policy insured against "theft, robbery or pilferage."

The defendant contends that the act of Dolson did not constitute a larceny but that the car was procured by false pretense.

We adhere to the doctrine in Motor Co. v. Insurance Co., 111 Kan. 225, 207 P. 205, and Overland-Reno Co. v. Indemnity Co., 111 Kan. 668, 208 P. 548. In the former it was said:

"The prevailing rule is that any scheme whether involving false pretenses or other fraudulent trick or device whereby an owner of property is swindled out of it with the preconceived intent of the swindler not to pay for it, is classed as larceny." (p. 226.)

Reference is made in the briefs to the case of Cedar Rapids Nat. Bank v. American Surety Co., recently decided by the supreme court of Iowa (195 N.W. 253). It was there held by a divided court that "where one deposited money with a bank and presented checks at the windows of two paying tellers, both being honored by reason of the diversion of the attention of one teller, each check equaling the amount of the deposit, the money was obtained by the cashing of the second check by 'false pretenses' and not by 'theft,' within the meaning of a policy of insurance." A dissenting opinion by Chief Justice Preston upholds the doctrine heretofore announced by this court. It may be that the statute of Iowa is not as broad as the Kansas larceny statute, and that there was, therefore, reason for a restricted construction by that court. It may also be observed that the policy or bond considered by the Iowa court contained a provision reading: "This bond does not cover any loss covered by an overpayment by a teller to a customer."

It is the contention of the defendant that the plaintiff was negligent in not taking proper precautions or making proper investigations to circumvent the action of Dolson in perpetrating the fraudulent trick by means of which he procured the car.

After any theft such as this was, some means always appears whereby it might have been avoided had the parties been warned or sufficiently advised. In this case, when Mayfield delivered the car to Dolson he took Dolson's check believing it was genuine and worth its face value, and believing the representations and statements made to him by Dolson to be true. From such statements he assumed that what Dolson told him was...