Wich v. Equitable Fire & Marine Ins. Co.

• Decision Date: 24 October 1892
• Parties: WICH v. EQUITABLE FIRE & MARINE INS. CO.
• Court: Colorado Court of Appeals

31 P. 389

2 Colo.App. 484

WICH v. EQUITABLE FIRE & MARINE INS. CO.

Court of Appeals of Colorado

October 24, 1892

Error to district court, Arapahoe county; GEORGE W. ALLEN, Judge.

Action by John Wich against the Equitable Fire & Marine Insurance Company to recover on a policy for loss by fire. Defendant's motion for nonsuit was granted. Plaintiff brings error. Reversed.

In an action on a fire insurance policy, whether plaintiff explained the nature of his title to the agent was a question of fact for the jury.

The other facts fully appear in the following statement by RICHMOND, P.J.:

February 4, 1889, the Equitable Fire & Marine Insurance Company, defendant in error, made and delivered to John Wich, plaintiff in error, in the business name of the Arkansas Valley Brewing Company, its policy of insurance for the sum of $1,530 upon certain buildings and personal property, to run for the period of one year. September 5 1889, the buildings and their contents were destroyed by fire. Proof of loss was made, and the company denied any liability under the policy. This action was brought to recover the sum mentioned. The answer is general and specific. It denies that the business name of the plaintiff was the Arkansas Valley Brewing Company; that the property insured was the property of plaintiff at the time of the issuance of the policy or at the time of the loss. It admits that the policy was issued to the Arkansas Valley Brewing Company, but alleges it was procured by false and fraudulent representations, in this: that Wich represented he was the sole owner of the premises, when in fact neither he nor the Arkansas Valley Brewing Company were sole owners. It is further claimed that the value of the property was not as represented. From the record we learn that at the time of the issuance of the policy the property stood in the names of Gottlieb Hess, Paul Voght, Harmon Ell, and the plaintiff Wich. Wich testified that at the time of the issuance of the policy he explained the nature of his title to the agent asserting that Hess, Voght, and Ell had only a conditional interest in the property; that they had agreed to put in as their part of the purchase price the sum of $3,000 each within a certain time, and, in case of default, they would transfer their interests to him; that in the month of May, 1889, Hess, Voght, and Ell executed a quitclaim deed to him of their entire interests, thus making him, as he represented himself to be, the sole owner of the property, in fee, subject to a certain incumbrance. It is in testimony, also, that Wich was doing business in the name of the Arkansas Valley Brewing Company, although it does appear from the record that, in response to a direct question as to whether he was doing business in such name, he answered, "No, sir." Yet he qualifies this answer immediately afterwards. It further appears that the policy of insurance was issued prior to the signing of the application. The cause was tried to a jury, and, at the close of the plaintiff's testimony, motion for a nonsuit was made and granted. To reverse this judgment this writ of error is prosecuted.

S.D. Walling and Chas. M. Bice, for plaintiff in error.

Chas. J. Hughes, Jr., for defendant in error.

RICHMOND, P.J., (after stating the facts.)

The main contention of the defendant company is that the title of the property at the time of the issuance of the policy was not in the plaintiff, and that by the terms of the policy it is provided that, if the interest of the insured be other than unconditional and sole ownership, or it is not owned by the insured in fee simple, or if any change takes place in the interest, title, or possession of the property, (except change of occupants without increase of hazard,) whether by legal process, judgment, or voluntary act of the insured, or if the building remains vacant for 10 days, then the policy shall be void. The policy may have been issued by the company upon the representations of the plaintiff that he was the owner in fee of the premises, although he claims that at the time he notified the solicitor of the condition of the title. Admitting that the title did not stand in the name of the plaintiff at that time, it certainly did long prior to the destruction of the property by fire, and in keeping with the understanding of the company at the time of issuing the policy. The object of providing against a transfer or change of title is to guard against a diminution in the strength of the motive which the insured may have to be vigilant in the care of his property. The substantial diminution of interest in the property insured has been suggested as a test of the kind of transfer or change of title which will avoid the policy. In Ayres v. Insurance Co. 17 Iowa 176, the court, in discussing what transfer or change of title would avoid the policy, used the following language: "The object of the insurance company by this clause is that the interest shall not change so that the assured shall have a greater temptation or motive to burn the property, or less interest or watchfulness in guarding and preserving it from destruction by fire. Any change in or transfer of the interest of the insured in the property, of a nature calculated to have this effect, is in violation of the policy. But if the real ownership remains the same, if there is no change in the fact of title, but only in the evidence of it; and if this latter change is merely nominal, and not of a nature calculated to increase the motive to burn, or diminish the motive to guard the property from loss by fire,--the policy is not violated. ***" May, Ins. § 273. The evidence, as disclosed by the record, so far as it relates to the title, clearly brings the parties to this action within the above rule. We are unable to see how it can be claimed by the company that the change in the title...