Case ID: nys_4/html/0925-01.html
Source: Caselaw Access Project
Author: {"author": "Dwight, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Carpenter et al. v. German Amer. Ins. Co.
    
      (Supreme Court, General Term, Fifth Department.
    
    March, 1889.)
    1. Insurance—Proofs of Loss—Delay in Serving.
    A policy provided that “in case of loss the assured shall give immediate notice thereof, and shall render to the company a particular account of said loss, under oath, stating, ” etc. Immediate notice was given, but proofs were not given until six months after loss. The policy was “in consideratibn of the receipt of S50, ” and contained conditions relating to matters before and after loss, non-compliance with which should work a forfeiture, and provided that the policy was “made and accepted on the above expressed conditions, ” but nothing was stated as to the effect of non-performance of the stipulation in relation to proofs of loss. Meld, that while the proofs were required to be served within a reasonable time, and while they were not served within a reasonable time, such failure did not, of itself, necessarily work a forfeiture.
    3. Same—Conditions—Ownership of Property—Estoppel.
    It was declared that the policy should be void if the assured was not the sole, absolute, and unconditional owner of the property. The assured held the property under a contract of sale executed by a bank, but informed the company’s agent, when the policy was issued, that they held by contract for purchase and not by deed. Meld,, that there was no estoppel to insist on the condition where the title was in an individual and not in the bank.
    Appeal from circuit court.
    Action by George G. Carpenter and another against the German American Insurance Company of Hew York. Defendant appeals from a judgment on a verdict, and from an order denying a motion for new trial on the minutes.
    
      M, W. Cooke, tor appellant. ■ George Wadsworth, for respondents.
   Dwight, J.

The action was on a fire policy for the loss of a steam sawmill, in McKean county, Pa. Several defenses were set up by the answer, only two of which are insisted upon on this appeal, viz.: (1) That the plaintiffs have violated the condition of the policy in respect to rendering proofs of loss; (2) that the plaintiffs had no insurable interest in the property at the time of effecting the insurance. The omission to render proofs of loss until about six months after the loss was incurred is admitted. The language of the policy in that respect is as follows: “In case of loss the assured shall give immediate notice thereof, and shall render to the company a particular account of said loss, under oath, stating, ” etc. Here follows specification of the facts required to be stated in what are commonly called the prelim inary proofs of loss, and the requirement of a certificate of a magistrate or other specified official in support of such statement. The immediate notice of the loss was given and acknowledged. Ho time being fixed within which the preliminary proofs should be rendered, the contract will be construed to intend a reasonable time; and there was nothing in the case which would have justified the court in holding that the delay of six months was reasonable. But what was the effect of failure on the part of the plaintiffs to perform this stipulation of the contract? Hone is specified in the policy. Performance of the stipulation is not in terms made a condition of liability on the part of the defendant, nor is a forfeiture of the policy attached to that stipulation as a penalty for its non-performance. The undertaking of the defendant is expressed to be “in consideration of the receipt of $50.” But there are in the contract a score of express conditions upon the existence or non-existence of which the validity of the policy or the liability of the defendant are made to depend. Thus: if the assured make an erroneous representation in an application; if he omit to make known any fact pertaining to the risk; if there be any other insurance; if the risk be increased; if the assured be adjudged a bankrupt; if any change take place in the title, whether voluntary or’otherwise; if the policy be assigned; if the assured is not the sole, absolute, and unconditional owner of the property insured; if gunpowder, or any one of many other things, be kept or used on the premises; if the mill be run over hours, or lie still for more than lOdaj'S,—and upon many other expressed conditions existing previous to loss the policy shall be void. So, too, after loss no recovery shall be had on this policy beyond the actual damage to the property, or its cash value if totally destroyed, to be determined by appraisal if not agreed upon. A refusal to answer questions on an examination under oath to which the assured may be required to submit, or to subscribe his evidence taken on such examination, or any fraud or attempt at fraud or false swearing on the part of the assured, shall cause á forfeiture of all claim under this policy. Finally, at the close of the contract, occurs the provision: “This policy is made and accepted on the above expressed conditions.” This language may, we think, with propriety be held to refer to those provisions of the policy, of which illustrations have been given, which are expressly made conditions of its validity, or of liability on the part of the insurer, or of the limitation of such liability. The stipulation in respect to rendering proofs of loss is not made one of those eondition§, and we think the delay in rendering those proofs did not of itself necessarily work a forfeiture of the policy or preclude a recovery by the plaintiffs.

Tlie other question is possibly one of more difficulty. It is made by the contract one of the conditions of the validity of the policy that the assured were, at the date of the insurance, the sole, absolute, and unconditional owners of the property insured. If not so the policy is declared to be void. The proofs and admission of the plaintiffs show that, at the date when the insurance was effected, the plaintiffs had no legal title to the property insured, but held it under a contract of sale. The contract was executed by the national State Bank of Elizabeth, H. J., as party of the first part, dated September 10,1881, and thereby the bank agreed to sell and convey the premises to the plaintiff George C. Carpenter on or before the 6th day of December, 1882. On the contract was indorsed an assignment by George G. Carpenter to the plaintiff Henry M. Carpenter of “an undivided one-half part of the premises.” There was also evidence tending to show, and the jury, by a special verdict, found the fact to be, that the plaintiffs, at or before the time of the issuance of the policy, to them, informed the agent of the defendant, who countersigned and issued the policy, “that they held the mill and premises on which it was situated by contract for purchase and not by deed.”

We do not understand the defendant to question here the proposition maintained by counsel for the plaintiffs, and upon which the court directed a general verdict for the plaintiffs, that the notice found by the jury to have been given to the agent at the time of issuing the policy was notice to the defendant, and that the defendant is chargeable with knowledge of the facts thus communicated to the agent, so far as they were facts, to the same effect as if those facts had been stated in the contract itself. But there is the further question here whether that statement represented the actual facts of the case. If not, it had no effect to relieve the plaintiffs from the express condition of the contract to the effect that they were the sole, absolute, and unconditional owners of the property insured, and upon that question the burden of proof was clearly on the plaintiffs. By their contract with the defendant the plaintiffs have expressly consented to the condition that if they were not at the date of the contract the sole, absolute, and unconditional owners of the property the policy should be void.. It is conceded that this condition was not fulfilled. The plaintiffs seek to avoid the condition by proof that the insurer was informed at the time of making the contract that they were not the sole, absolute, and unconditional owners of the property, but held an equitable title thereto by virtue of a contract of purchase and sale. The theory of the plaintiffs’ case in this respect is that the defendant was estopped from insisting upon the violated condition because it contracted in view of the actual facts of the case, which were communicated to its agent at the time of the contract. Clearly, in .order to avail themselves of the estoppel, it was necessary for the plaintiffs to prove both the fact of the communication to the defendant’s agent, and the truth of the fact communicated. This they have failed to do. The evidence is that the plaintiffs had a contract from the Bank of Elizabeth, but that the title of the property was in one John ICean. There is a suggestion that Kean was the president of the bank, and that he held the title in trust for the latter; but there is no evidence to that effect, and, so far as the evidence goes, it negatives the proposition that the vendor in the plaintiff’s contract of purchase had any title to convey. The plaintiffs have therefore failed to show that at the time of the issuance of the policy they held an equitable title by virtue of a contract of sale from the owner of the property, as, in substance, they allege that the jury have found they informed the defendant’s agent. We must consider the plaintiffs as having failed to make a case in the respect last considered, and that the defendant was entitled to a direction of a verdict in its favor on the first and second grounds stated in its motion to that effect. The judgment and order appealed from should be reversed, and a new trial granted. All concur. So ordered.