Vozne v. Springfield Fire & Marine Ins. Co. of Springfield, Mass.

• Decision Date: 09 October 1935
• Docket Number: No. 53.,53.
• Citation: 180 A. 852
• Court: New Jersey Supreme Court
• Parties: VOZNE v. SPRINGFIELD FIRE & MARINE INS. CO. OF SPRINGFIELD, MASS.

180 A. 852

VOZNE

v. SPRINGFIELD FIRE & MARINE INS. CO. OF SPRINGFIELD, MASS.

No. 53.

Court of Errors and Appeals of New Jersey.

Oct. 9, 1935.

Syllabus by the Court.

1. An insurance contract, like any other contract, should be enforced in accordance with its plain provisions.

2. A policy provision that the conditions of insurance shall not be waived except in writing is valid and effective when applied to such conditions and provisions as relate to the formation of the contract of insurance and are essential to its binding force.

3. The admission of parol evidence to vary such a policy provision is error.

4. A standard form lire insurance policy which provides that the policy shall be void if the subject of insurance be encumbered by a chattel mortgage is voided by a chattel mortgage existing at the time the policy was issued and is not revived by the later payment, before fire loss, of the mortgage indebtedness.

5. A remark by defendant's attorney during the early course of the trial that he is willing to leave the case to the jury is not a waiver of exceptions taken to subsequent court rulings made over defendant's objection.

Appeal from Supreme Court.

Action by Louis Vozne against the Springfield Fire & Marine Insurance Company of Springfield, Massachusetts. Judgment for plaintiff, and defendant appeals.

Reversed, and venire de novo issued.

Arthur T. Vanderbilt and G. Dixon Speakman, both of Newark, for appellant.

William Simon, of Newark, for respondent.

CASE, Justice.

The appeal is from a judgment in the Supreme Court entered on a jury verdict in the Somerset Circuit in favor of the plaintiff and against the defendant.

Defendant issued an insurance policy which by its terms insured plaintiff against loss by fire on his household furniture. The policy contained this provision: "This entire policy, unless otherwise provided by agreement endorsed hereon or added hereto, shall be void * * * if the subject of insurance be personal property and be or become encumbered by a chattel mortgage." There was no saving indorsement. At the time the policy was issued the insured's property was encumbered by an unpaid chattel mortgage open of record. Later there was a fire loss. After the making of the contract of insurance and before the fire, the amount due on the chattel mortgage was paid. Plaintiff sued upon the policy and defendant answered, inter alia, that the policy, by reason of the quoted clause, was void in that the subject of the insurance was, at the issuance of the policy, encumbered by a chattel mortgage.

At the trial the plaintiff was permitted, over the objection of the defendant, to prove that the mortgage had been, as above stated, paid at a time between the issuing of the policy and the occurrence of the fire loss. Plaintiff was further permitted, over objection, to testify that he had, when ordering the policy, informed plaintiff's local agent of the existence of the chattel mortgage. The points argued by the defendant are that the trial court erred in denying defendant's motion for a directed verdict and in making the disputed rulings on evidence.

The policy provision is clear and unmistakable. Quite as clear and unmistakable is the existence, at the inception of the contract, of the factual contingency upon which the entire policy was, according to its terms, to be void. An insurance contract, like any other contract, should be enforced in accordance with its plain provisions. Precipio v. Insurance Co. of Pennsylvania, 103 N. J. Law, 589, 137 A. 549. So, unless reason be found for holding that the language does not mean what it says, or that the insurer has in some way undone the effect of the explicit words of the contract, the policy was, from the beginning, not voidable but void —null and of no effect.

Plaintiff submits that he ordered the policy from one of defendant's agents who had in his possession blank policies of insurance and who had the authority to issue the same, accept and retain premiums, and bind the company; that at the time of placing the order for the policy plaintiff informed the agent of the existence of the chattel mortgage and the agent gave assurance that he would take care of the matter; that the company, through its agent, failed, on issuing the policy, to make the appropriate indorsement and thereby waived the policy requirement.

That plaintiff had given the information to the agent and that the agent had assumed responsibility came solely from plaintiff's lips in response to questions allowed over defendant's objections. We first consider the admissibility of that testimony.

The effect of the testimony was to alter or vary the terms of the written instrument. The policy was in the standard form required by legislative enactment. Section 77 of the 1902 Insurance Act, 2 Comp. St. 1910, p. 2862, as amended by P. L. 1932, c. 35, p. 53 (N. J. St. Annual 1932, § 99—77). It contained, also, the following standard provision: "* * * No officer, agent or other representative of this Company shall have power to waive any provision or condition of this Policy except such as by the terms of this Policy may be the subject of agreement endorsed hereon or added hereto; and as to such provisions and conditions no officer, agent or representative shall have such power or be deemed or held to have waived such provisions or conditions unless such waiver, if any, shall be written upon or attached hereto, nor shall any privilege or condition affecting the insurance under this Policy exist or be claimed by the insured unless so written or attached."

The leading cases in this state on the application of the parol testimony rule to insurance contracts are Dewees v. Manhattan Insurance Co., 35 N. J. Law, 366; Franklin Fire Insurance Co. v. Martin, 40 N. J. Law, 568, 29 Am. Rep. 271; Carson v. Jersey City Insurance Co., 43 N. J. Law, 300, 39 Am. Rep. 584; and Snyder v. Dwelling House Insurance Co., 59 N. J. Law, 544, 37 A. 1022, 59 Am. St. Rep. 625. The opinion in the first of these cases was written for the Supreme Court by Chief Justice Beasley, and the opinions in the last three were written by Mr. Justice Depue for the Court of Errors and Appeals. In Dewees v. Manhattan Ins. Co. Chief Justice Beasley had himself conducted the trial at the circuit and there, impressed by the factual merits of the plaintiff's claim, had allowed the case to go to the jury, reserving questions of law for the Supreme Court in the hope that a legal ground might be found to support the action. With that predilection for the plaintiff's case he nevertheless, in expressing the court's decision against admitting parol evidence upon the theory that the company was estopped because of the acts and representations of its agent, wrote in the opinion (page 374 of 35 N. J. Law): "In the long line of innumerable cases which have proceeded and been decided on the ground that parol evidence is not admissible as against a written instrument, no judge or counsel has ever intimated, as it is believed, that the same result could be substantially...