World Fire & Marine Ins. Co. v. King

• Decision Date: 30 October 1939
• Docket Number: 33850
• Parties: WORLD FIRE & MARINE INS. CO. et al. v. KING et al
• Court: Mississippi Supreme Court

191 So. 665

187 Miss. 699

WORLD FIRE & MARINE INS. CO. et al. v. KING et al

No. 33850

Supreme Court of Mississippi, Division B

October 30, 1939

Suggestion Of Error Overruled January 8, 1940.

APPEAL from the chancery court of Covington county HON. BEN STEVENS Chancellor.

Suit by the World Fire & Marine Insurance Company and the Camden Fire Insurance Association against J. J. King and others to cancel two policies of fire insurance. From a judgment for defendants, plaintiffs appeal. Reversed and rendered as to the World Fire & Marine Insurance Company and affirmed as to the Camden Fire Insurance Association.

Reversed and rendered as to World Fire & Marine Insurance Company, and affirmed as to Camden Fire Insurance Association.

Watkins & Eager, of Jackson, for appellants.

Both policies of insurance here involved are void and there can be no recovery thereon because of an admitted violation by the insured of his "Warranty to keep books and inventories and to produce them in case of loss." This warranty is in the alternative and there was only a waiver of one of the alternate conditions agreed to by insured.

Moore v. La. Fire Ins. Co. (La.), 148 So. 905; Big Creek Drug Co. v. Stuyvesant Ins. Co., 115 Miss. 333 and 561, 75 So. 768, 76 So. 548; Bias v. Globe & Rutgers Ins. Co. ( W.Va.), 101 S.E. 247; National Life & Acc. Ins. Co v. Davison (Ark.), 58 S.W.2d 691; Pierowicz v. Farmers' Mut. Fire Ins. Co. (Minn.), 222 N.W. 514.

The policy contracts here involved are void and there can be no recovery thereupon because insured was guilty of fraud and false swearing touching matters relating to the insurance and the subject-matter thereof after the loss.

Claxton v. Fidelity & Guaranty Fire Corp., 179 Miss. 556, 175 So. 210; Fink v. La Crosse Fire Ins. Co. (Wis.), 234 N.W. 339; Columbian Ins. Co. v. Modern Laundry, 277 F. 355; Cuetara v. Royal Exchange Assur. Co. (C. C. A. 1), 23 F.2d 270; Orenstein v. Star Ins. Co. (C. C. A. 4), 10 F.2d 754; Fire Assn. of Philadelphia v. Allesina (Ore.), 89 P. 960; Pottle v. Liverpool & London & Globe (Maine), 81 A. 481; Rovinsky v. Northern Assur. Corp. (Maine), 60 A. 1025.

There is insufficient evidence in the record to sustain a finding that as a matter of fact insurers' sub-agent did waive the warranty to keep books or that he had any knowledge of the chattel mortgages.

Conley v. Queen Ins. Co. (Ky.), 96 A.L.R. 1255; Thompson v. Scoch (Pa.), 99 A. 72; Penn Iron Co. v. Diller (Pa.), 1 A. 924; Bevens v. Brown (Ark.), 120 S.W.2d 574; Rogers v. Clayton, 149 Miss. 47, 115 So. 106; Northern Assur. Co., Ltd., v. Del Moral (C. C. A. 1), 300 F. 513; Miller v. Home Ins. Co. (Md.), 96 A. 467; McHenry v. State, 119 Miss. 289, 80 So. 763; Universal Truck Loading Co. v. Taylor, 173 Miss. 353, 164 So. 3; Kinchen v. Royal Exchange Assur. of London, Eng. (La.), 134 So. 340; Harding v. Hellman, 158 So. 595; Roberts v. Coffee, 6 La. App. 323; Pailet v. Young, 3 La. App. 265; Ross v. Director General of Railroads (N.J.), 110 A. 750; Aetna Ins. Co. v. Eastman (Tex.), 72 S.W. 431; Marinelli v. Ferrand, 40 N.Y.S. 151; Riley v. Interurban State Ry. Co., 87 N.Y.S. 423.

There is insufficient evidence in the record sustaining a finding of the value of the insured's stock of goods at the time of the fire, and the court below committed error in excluding the best evidence thereof.

Sec. 5183, Code of 1930; Hartford Fire Ins. Co. v. Schlenker, 80 Miss. 667, 32 So. 155; Darden v. L. & L. & G. Ins. Co., 109 Miss. 501, 68 So. 485; Gibson v. Glenn Falls Ins. Co. (Neb.), 197 N.W. 951; Orient Ins. Co. v. Parlin & Orendorff Co. (Tex.), 38 S.W. 60; Lewis v. National Fire Ins. Underwriters, 101 So. 296; Miller & Lux v. Pinelli, (Cal.), 257 P. 573; City of Hazard v. Eversole (Ky.), 35 S.W.2d 313; Glenn v. Hollums (Tex.), 73 S.W.2d 1069; McAnarney v. Newark Fire Ins. Co. (N.Y.), 159 N.E. 902; Polizzi v. Com. Fire Ins. Co. (Pa.), 99 A. 907; Conn. Fire Ins. Co. v. Union Mercantile Co. (Ky.), 171 S.W. 407; Conn. Fire Ins. Co. v. Boydstun (Ark.), 293 S.W. 730; Stone v. Safe Ins. Co. (W.Va.), 156 S.W. 106.

The court below committed error in excluding evidence in regard to, and in failing to take into consideration, a motive of the insured upon the question of arson.

First Nat. Bank of Portland v. Fire Ass'n. of Philadelphia (Ore.), 53 P. 8; Mott v. Supreme Guardian Ins. Co. (Tex.), 154 S.W. 658; Underwriter's Agency v. Brown, 151 S.W. 899; Picoraro v. Ins. Co. of Pa. (La.) 143 So. 360; Meily Co. v. L. F. Ins. Co. (C. C. A. Pa.), 875; Girard v. Vermont Mutual Fire Ins. Co. (Vt.), 154 A. 666; Rent-a-Car Co. v. Globe & R. Ins. Co. (Md.), 156 A. 847; Joy v. Ins. Co. (Tex.), 74 S.W. 823; Rickeman v. Williamsburg City (Wis.), 98 N.W. 960.

The chancellor's finding of fact was practically an exact duplicate of appellee's pleading, word for word. We need only briefly point out to Your Honors that the finding of fact of a chancellor at the most has only the weight of the verdict of a jury.

5 C. J. S. 692-694; Tarver v. Lindsey, 161 Miss. 379, 137 So. 93; Crighton v. Halliburton & Moore, 132 So. 200, 154 Miss. 265; Gillis v. Smith, 75 So. 451, 114 Miss. 665.

The position of appellants here is (1) that upon the undisputed facts or from insured's own testimony, insured should not have been permitted to recover; and (2) that there was insufficient evidence to support the finding of the chancellor of any waiver.

We respectfully submit that any statement made by the agent on the delivery of the policies, in general terms as to the fact that the policies were in the best possible companies, etc., would be at the most an expression of an opinion of the agent.

Mutual Life Ins. Co. v. Hebron, 166 Miss. 145, 146 So. 445; Levinton v. Ohio Farmers Ins. Co. (Pa.), 110 A. 295; Davis v. Home.Ins. Co. (Tenn.), 155 S.W. 131.

E. L. and W. W. Dent, of Collins, for appellee, J. J. King.

We could do no better than refer to the detailed and able opinion of the learned chancellor, given on request of appellants, but for the fact that counsel for appellants appears to have overlooked it in their splendid, long and exhaustive brief. We do, however, commend this opinion to this court as settling both the law and the facts in this case.

Section 5196, Mississippi Code 1930, makes Calhoun the agent of appellants, as he delivered the policies and collected the premiums, and for his acts, and his intention to write good and enforceable policies in the event of loss, appellants are liable, under the facts of this case, and this is true "whatever condition or stipulations may be contained in the policy or contract."

The agents made an effort and intended to write good and enforceable policies in the event of loss, and they accepted the trust with full knowledge of King's affairs to write such policies, and such was the intention of the insured, King, by informing them fully of his affairs and entrusting to them the writing of such policies. With that in mind, and attributing good faith to both the insurer and the insured, we think the maxim of equity applies, which is, "equity regards that as done which ought to be done."

21 C. J. 200; Rivara v. Queen's Ins. Co., 62 Miss. 720; Ga. Home Ins. Co. v. Holmes, 75 Miss. 390, 23 So. 183; Phoenix Ins. Co. v. Randle, 81 Miss. 720, 33 So. 500; Scottish Union & National Ins. Co. v. Wylie, 110 Miss. 681, 70 So. 835.

We have been unable to find where the rule or doctrine announced in the Wylie case requiring the agent to inform himself as to the true condition of the property insured has ever been criticized or overruled, and applying this rule to the case at bar, appellants are bound by the acts of Calhoun, what Calhoun knew, and what he should have inquired about, as the whole matter was intrusted to him to write good enforceable policies in event of loss.

Big Creek Drug Co. v. Stuyvesant Ins. Co., 115 Miss. 333, 561, 75 So. 768, 76 So. 548; Fidelity-Phenix Fire Ins. Co. v. Redmond, 144 Miss. 749, 111 So. 366; St. Paul Fire & Marine Ins. Co. v. Loving, 163 Miss. 114, 140 So. 727.

The case of Home Ins. Co. v. Thornhill, 165 Miss. 787, 144 So. 861, is where even in a written application for insurance the agent filled out the answers, the insurer was bound by the answers of applicant even though the answers were not correctly written down. The syllabus of the court being: "Insurance company was bound by applicant's answer in such case just as if it had been written down in the language used by the applicant and presented thus to the company for its action, in view of Code 1930, sec. 5196, making insurance solicitor taking an application for insurance the agent of the company whatever conditions may be contained in the policy or contract."

Wilkinson et al. v. Goza, 165 Miss. 38, 145 So. 91; Aetna Ins. Co. v. Lester et al., 170 Miss. 353, 154 So. 706; Cox v. Hartford Fire Ins. Co. et al., 172 Miss. 841, 160 So. 741.

It is undisputed as well as admitted by all parties that there was a mutual mistake in writing the policies in case at bar.

As equity regards as done that which ought to be done, from the above authorities and the facts as disclosed by this record it is undoubtedly true that the insurer and the insured intended, in good faith, that these should be good, valid and enforceable policies in event of loss. That being true, the loss payable clause attached to the Camden policy should have been what is called a "rider, " designated as the "mortgage clause with full contribution, " with the name of J. E. Campbell as mortgagee, Charles E. McRaney, Trustee, the Hobart Manufacturing Company and the McCray Refrigerator Corporation, lien holders, as their interest may appear, instead of the Smith County Bank, which was admittedly placed in the mortgage clause by mistake; and the World Fire & Marine...