Watson v. Firemen's Ins. Co.

• Decision Date: 03 January 1928
• Citation: 140 A. 169
• Parties: WATSON v. FIREMEN'S INS. CO.
• Court: New Hampshire Supreme Court

140 A. 169

WATSON

v. FIREMEN'S INS. CO.

Supreme Court of New Hampshire. Belknap.

Jan. 3, 1928.

Assumpsit by Charles H. Watson against the Firemen's Insurance Company to recover on two policies of fire insurance. Defendant's motion for a directed verdict was granted at the close of plaintiff's evidence, and plaintiff brings exception under an agreement entitling him to judgment if the exception to the order is sustained. Judgment for plaintiff.

Wayne M. Plummer, Owen & Veasey, and S. Owen, all of Laconia, for plaintiff.

Jewett & Jewett and Theo. S. Jewett, all of Laconia, for defendant.

PEASLEE, C. J. In this action to recover upon policies of fire insurance the question presented by the case as transferred is whether there was any evidence from which it could be found that the origin of the fire was a risk insured against. The cause of the fire was an explosion, resultant from pouring gasoline into an automobile tank, by the light of an ordinary kerosene lantern. In the original policies all use of gasoline within the buildings was prohibited. This, under our decisions, would put the risk outside the policies, whether the insured knew of the use or not. Badger v. Platts, 68 N. H. 222, 44 A. 296, 73 Am. St. Rep. 572. The reason for this conclusion is that the risk incident to such use is one that "the defendants expressly refused to assume. * * *" Wheeler v. Traders' Ins. Co., 62 N. H. 326, 329.

By a subsequent contract, attached to one of the policies, certain uses of gasoline were permitted. The right was given to keep two automobiles in the barn, and stipulations as to such use (called warranties) were a part of the agreement. That involved here reads:

"2. That the opening, filling, or emptying of any gasoline reservoir of any automobile while the same is contained in the within described buildings shall be done by daylight or by incandescent electric light only, and that there shall he no other artificial light and no fire or blaze in the room when such reservoir is open. * * *"

Following these provisions is a statement that:

"This policy shall not be affected by failure of the insured to comply with any of the warranties of this permit in any portion of the premises over which the insured has no control."

It is evident that the contract made differed vitally from those considered in the cases upon which the defendant relies. The dangers incident to certain uses of gasoline were insured against generally; and as to the excluded uses, the defendant undertook the risk if the use was in any portion of the premises over which the plaintiff had no control. The rule that there is no liability when forbidden acts are done by one "in whose possession and control" the premises "have been placed by the insured" (Liverpool & London & Globe Ins. Co. v. Gunther, 116 U. S. 113, 6 S. Ct. 306, 29 L. Ed. 575) is not applicable here.

The act with which the defendant seeks to charge the plaintiff was done by the plaintiff's son, in the plaintiff's absence. But because the plaintiff had the right to determine what should or should not be done upon the premises, it is claimed that he had such control thereof that the act could not be found to be within the terms of the contract of indemnity.

The meaning of the word "control," as here used, is a new question in this jurisdiction, and one upon which little authority is to be found elsewhere. The term was evidently chosen deliberately and with an appreciation on the part of the defendant that it has its limitations. Had right of possession or right to control been intended, it is a fair inference that it would have been so stated. Instead thereof the insurer used the term of more limited application, and its rights are to be determined accordingly.

The phrase under consideration is not one having an exact and technical definition, which necessarily excludes any other interpretation; and much depends upon the point of view from which the problem is approached. Looking at the question solely from the insurer's standpoint, and giving to each word used the significance most favorable to that party, there would be ground for the contention that the exception applied only when the insured had formally surrendered possession and authority over the premises for a definite period; that is, when they were held under a lease.

It is hardly necessary to cite authority for the refusal to adopt such a method of interpretation. This was language used by the insurer to the insured. The test is not what the insurer intended its words to mean, but what a reasonable person in the position of the insured would have understood them to mean. Fitch Co. v. Phoenix Ins. Co., 82 N. H. 318, 133 A. 340, and cases cited. "Men have a right to be dealt with with some regard for the state of mind and body, of knowledge and business, in which they are known actually to exist." Delancey v. Rockingham, etc., Ins. Co., 52 N. H. 581, 590.

The evident purpose of the exception from the terms of the warranties was to relieve the insured, to some extent, from the application of the rule that his nonparticipation in the forbidden use was immaterial. Such being the object in view, there is fair reason to conclude that the plaintiff would understand that he was insured if the forbidden use should be made "without his fault," as he would express it. This might well be thought to be "the meaning which [the words] convey to the common mind." Stone v. Granite State Fire Ins. Co., 69 N. H. 438, 441, 45 A 235, 237. Upon such an interpretation of the contract, he was insured against this risk if the act was done without his authority, consent, knowledge, or culpable ignorance. Insurance Company of North America v. McDowell, 50 Ill. 120, 99 Am. Dec. 497.

If this should be thought to be too broad an application of the proviso, there is, upon the particular facts of this case, other similar ground upon which the defendant's claim of nonliability as matter of law should have been denied. Even taking a schoolman's view of the language, rather than that of the farmer and portable mill operator to whom it was addressed, it does not conclusively appear that the defendant is not liable.

In its ordinary acceptance, "control" means regulating or directing power. In the sense that, as owner, the plaintiff could have determined in advance what uses the premises should be put to, he had control. Of course, this is not what the term means here, for such a construction would make the stipulation in question wholly nugatory. It plainly contemplates a situation where, for a greater or less period, the plaintiff had given over to another the power to decide what should be done. It applies to parts of the premises as well as to the place taken as a whole. The language is, "Any portion of the premises." The premises concerning which this additional contract was made consisted of one barn only, and therefore the above phrase...