Case Title: Cooperative Fire Insurance Association of Vermont v. Domina

Citation: 399 A.2d 502

Docket Number: 165-77

State: vermont

Court: Vermont Supreme Court

Date: 1979-01-29T00:00:00Z

Document:
399 A.2d 502 (1979) COOPERATIVE FIRE INSURANCE ASSOCIATION OF VERMONT v. Gary DOMINA and Pauline Domina. No. 165-77. Supreme Court of Vermont. January 29, 1979. Charity A. Downs of Conley & Foote, Middlebury, for plaintiff. Richard A. Gadbois, Enosburg Falls, for defendants. Before BARNEY, C. J., and DALEY, LARROW, BILLINGS and HILL, JJ. HILL, Justice. This action was brought to foreclose a mortgage, and the litigation has not gone beyond the pleadings. The mortgaged property is insured against loss by fire with the plaintiff-appellant, Cooperative Fire Insurance Association of Vermont (Cooperative). When the property was destroyed by fire, Cooperative denied a claim by the named insureds, Gary and Pauline Domina, appellees herein, purchased the mortgage from the Enosburg Falls National Bank, and foreclosed on the property. The Dominas have denied default and have counterclaimed for recovery of the fire insurance proceeds. Prior to this suit, Gary Domina was convicted of second degree arson in connection with the fire. His spouse was not charged and has not been implicated in the crime. It is her right to recover on the policy that forms the basis of this appeal. The trial court has entered an order under V.R.A.P. 5(a) certifying to this Court the following question: The general rule is that an innocent co-insured, whether partner, see Bellman v. Home Insurance Co., 178 Wis. 349, 189 N.W. 1028 (1922), or spouse, see Kosior v. Continental Insurance Co., 299 Mass. 601, 13 N.E.2d 423 (1938), cannot recover on a fire insurance policy where the property wilfully was destroyed by the other co-insured. The appellees, however, urge us to adopt the opposite view and direct our attention to Howell v. Ohio Casualty Insurance Co., 130 N.J.Super. 350, 327 A.2d 240 (1974). In Howell the plaintiff and her husband owned a home as tenants by the entirety. *503 Her husband intentionally set fire to the house. The court held that the fraud by the husband could not be imputed to the wife and therefore the responsibility for the fire was several. They then determined that the fraud of the husband the arson did not void the policy as to the innocent wife. The court observed that 130 N.J.Super. at 355-56, 327 A.2d at 243 (emphasis added). But assuming that the misconduct of Gary Domina would not bar recovery by Pauline, the innocent spouse, nevertheless her interest in the property as tenants by the entirety is such that the extent thereof cannot be determined. The characteristics of a tenancy by the entirety are set forth in Town of Corinth v. Emery, 63 Vt. 505, 506-07, 22 A. 618 (1891). We hold that Mrs. Domina cannot be permitted to make a burning, fraudulently done by her co-insured husband, the basis of recovery in this action of the total proceeds of the policy. Further, permitting a recovery by the wife of one-half the proceeds of the policy, as suggested by the appellees, would be to substitute another contract in place of the one made to protect the indivisible ownership by the entireties. Matyuf v. Phoenix Insurance Co., 27 Pa. D. & C.2d 351, 359 (1933). The certified question must be answered in the negative.