Tower v. Fidelity-Phenix Fire Ins. Co. of New York
| Decision Date | 07 June 1927 |
| Docket Number | No. 19769.,19769. |
| Citation | 296 S.W. 257 |
| Parties | TOWER v. FIDELITY-PHENIX FIRE INS. CO. OF NEW YORK. |
| Court | Missouri Court of Appeals |
Appeal from Circuit Court, Audrain County; N. M. Pettingill, Judge.
Action by F. E. Clower against the Fidelity-Phenix Fire Insurance Company of New York. Judgment for plaintiff, and defendant appeals. Reversed and remanded, with directions, if reinittitur is filed, to enter judgment for plaintiff; otherwise, reversed and remanded for new trial.
Leahy, Saunders & Walther, of St. Louis, A. C. Whitson, of Mexico, Mo., and Lyon Anderson, of St. Louis, for appellant.
Clarence A. Barnes, of Mexico, Mo., for respondent.
This is an action on a policy of fire insurance, issued by defendant, insuring plaintiff's automobile against loss by fire and theft. The verdict of the jury was in favor of plaintiff, and assessed the amount of his recovery on the policy at the sum of $500, together with the sum of $50 as a penalty for vexatious delay and the sum of $100 for attorney's fees. From the judgment rendered on such verdict, defendant, after an unavailing motion for a new trial, has duly perfected this appeal.
The petition was in conventional form, alleging that the policy was issued on August 1, 1924, whereby plaintiff's automobile was insured against loss by fire and theft to the amount of $500, for a term of one year; that on December 21st following, the said car was totally destroyed by fire; and that the car at the time was of the value of $500, or more.
Defendant's answer, in addition to a general denial, pleaded that, by the terms of the policy, plaintiff warranted that there was no other insurance covering the insured property, and that it was provided therein that no recovery could be had, if, at the time of the loss, there was any other insurance covering such loss that would attach if such prior insurance had not been effected. It was then alleged that, at the date of the issuance of the policy in suit, and at the time of the fire, there was a policy covering the said automobile, issued by the Export Insurance Company, and that by reason thereof the policy in suit had become void. It was further averred that the policy had been avoided by reason of the concealment by plaintiff of the fact of this other insurance.
Although no reply was filed, it appears that the case was tried as though the new matter in the answer was at issue.
The evidence disclosed that on June 20, 1924, plaintiff purchased from the J. E. Lyon Motorcar Company, of Mexico, Mo., a Star coupe, the list price of which was $735, which sum included certain extra equipment, consisting of bumpers and an extra tire. It developed, however, that the total purchase price of the car was $781, the sum of $46 in excess of the list price representing a service charge covering the interest on the unpaid balance, and the premium on insurance to be taken out in conformity to certain provisions in the chattel mortgage. Plaintiff paid part cash, and gave his note to the J. E. Lyon Motorcar Company for $390.50, for the balance due with interest, and at the same time executed to such company a chattel mortgage on the car to secure payment of the note. By the terms of such chattel mortgage it was provided that the mortgagor should keep the automobile insured against loss or damage by fire and theft, the loss to be payable to said mortgagee, as the mortgagee's interest might appear, and that, in case the mortgagor should neglect or refuse to obtain such insurance, the mortgagee might, at its option, obtain the same, all sums of money thus expended to be repayable upon demand from said mortgagor to said mortgagee.
On the same day, the J. E. Lyon Motorcar Company sold the note to the Commercial Credit Trust, a finance company with its principal offices in Chicago, Ill., and also assigned to the latter all its right, title, and interest in and to said chattel mortgage and the property covered thereby. Thereafter, and as of June 26, 1924, the Commercial Credit Trust secured a contract of insurance from the Export Insurance Company, issued under a master policy, which covered the risk against damage or loss by fire and theft upon any and all ears on which the finance company held mortgages. Such contract purported to cover the risk on plaintiff's car to the extent of $580, and provided that the loss should be payable to the Commercial Credit Trust and others, although not enough of the policy was read into the record to disclose what parties the term "others" would include. It was the usual custom upon the issuance of a master policy for the finance company to send what was termed a certificate of insurance to each mortgagor, although in this case plaintiff did not receive such certificate, nor did he have any recollection of having been informed at the time he purchased the car that it would be covered by insurance.
On July 29, 1924, plaintiff paid the amount of the note in full to the J. E. Lyon Motorcar Company, by whom the proceeds were immediately transmitted to the Commercial Credit Trust, and thereupon plaintiff drove the car to Palmer, Ill., where he took up with one of defendant's agents the question of securing insurance on his car from defendant company. On August 1, 1924, he obtained the policy upon which this action was brought. At the time of procuring same, plaintiff was unaware that there was other insurance upon his car, and in his testimony he did not, recall that defendant's agent, in taking his application, had asked him about other insurance. Subsequently, plaintiff returned to Missouri, and on December 21, 1924, his car was destroyed by fire in the city of Auxvasse, having a salvage value thereafter of $10.
Shortly after the loss had occurred, plaintiff for the first time learned of the outstanding insurance with the Export Insurance Company and informed such company of his loss on or shortly before January 19, 1925. However, the certificate of insurance from such company was not obtained by plaintiff until in the following May. The defendant company was also informed of the loss, and on January 21, 1925, one of its adjusters interviewed plaintiff relative to the matter. It was in this interview that defendant first became advised of the prior insurance in the Export Insurance Company. The adjuster testified that during this discussion he informed plaintiff that he was entitled to the return of his premium, but it appears that the premium was retained by defendant until September 14, 1925, when the same was deposited in court after this action had been brought.
In the policy in suit there was the following condition and stipulation:
"No recovery shall be had under this policy if at the time a loss occurs there be any other insurance covering such loss which would attach if this insurance had not been effected."
The first point made and most earnestly urged by defendant is that the court erred in refusing to give the peremptory instruction in the nature of a demurrer to the evidence requested by it at the close of the whole case. With commendable frankness learned counsel state in their brief the essence of their contention; namely, that the evidence showed conclusively that plaintiff had violated the clause of the policy forbidding double insurance, and that there was no attempt on his part to establish a waiver of such breach by defendant. If such contention is well taken, plaintiff clearly may not recover, because the law is well settled that additional insurance in violation of the terms of the contract will avoid the policy, since overinsurance by concurrent policies on the same property tends to cause carelessness on the part of the insured and opens the door to fraud.
In determining the correctness of the court's ruling on the demurrer at the close of all the evidence, the rule to be applied...
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