# FILED Dec. 1, 1995 Cecil Crowson, Jr . Appellate Court Clerk TENNESSEE FARM ERS MUTUAL ) INSURANCE COMPANY, ) ) Plaintiff/Appellee, ) ) Appeal No. ) 01-A-01-9505- CV-00190 VS. ) ) Lawrence Circuit ) No. C 13595 BILLY WAGNER, and wife, ) MONA G. W AGNER, ) ) Defendant/Appellant. )

COURT OF APPE ALS OF TENNESSEE MIDDLE SEC TION AT NASHVILLE APPEALE D FRO M THE C IRCU IT COU RT OF L AWRENCE CO UNTY AT LAWRENCEBURG, TENNESSEE THE HONORABLE WILLIAM B. CAIN, JUDGE

PAUL B. PLANT HARWELL, PLANT & CHEATWOOD 225 MAHR AVENUE P. O. Box 399 Lawrenceburg, Tennessee 38464 Attorney for Plaintiff/Appellee CHARLES W . HOLT, JR. BOSTON, BATES & HOL T 235 Waterloo Street P. O. Box 357 Lawrenceburg, Tennessee 38464 Attorney for Defendant/Appellant

AFFIRMED AND REMAN DED

BEN H. CAN TRELL, JUDGE CONCUR: TODD, P.J. LEW IS, J.- 2 - 

## O P I N I O N
The issues in t his appeal are (1) whet her the misrepr esentations in an application for insurance madethe policy void as t o the applicant and (2) whe ther the insurance was void as

to the appellant' s wife, w ho did not sig n the applicati on. The Circuit Court of Law rence County granted summar

y judgment to the insurance company . We affirm.
I.

In December of 1988 Bil ly Wagner applied for ins urance in his and his wife's joint names to cover a dwelling the yowned in Lawrence County. Although Mrs. Wagner was pres ent, she did not a nswer any of the questions

on the applicat ion and did not sign i t. In responseto a question on t he form asking i f the applicant had ever had any fire, th eft, or liabil ity loss , Mr. Wagner answered "no" . In fact, Mr. Wagner had had several fire and theft losse s, so me a s recent as 198 5. Most of the l osses were covered by ins urance.

After the dwell ing was

damaged by

fire in June of

1992, the insurance company

refused to pay the claim and br ought this ac

tion for a declar

atory judg ment. The trial cour

t held that there were no g enuine issues of fact and thatthe insurance company had no liability to Mr. and Mrs. W agner. II.
It is well established in this state that materi al misrepres entations in an application for insurance w ill voi d the policy . Loyd v. Farm ers Mutual , 838 S.W.2d 542 (Tenn. A pp . 1992); Milligan v. MFA Mut ual Insurance Co. , 497 S.W.2d 736 (Tenn.- 3 -

App. 1973). The leg islature, however, hasprovided that insurance companies may void a policy

only if the mi srepr esenta tion is made w ith the actual intent to deceiv e, or if it incr

eases the ris k of loss. Tenn. C ode Ann. § 56-7-103 . Whether a misreprese ntation increases t he risk of loss is a quest ion of law, Billington v

. Crowder

, 553 S.W.2d 590 (Tenn. App. 197 7), and we have held that a misrepresent ation that influences the judgment of the insurer in making t he contract i n creases the risk of l oss with in the meaning of the statute. Seaton v. Natio nal Grange Mutual Insurance Co. , 732 S.W.2d 288 (Tenn. App. 198 7); Sloop v. Mutu al of Omaha Ins. Co. , 55 Tenn. App. 656, 404 S .W.2d 265 (1966). The uncontradict ed proof file d in su ppo rt of the m otio n fo r sum mary j udgment in this case supports a conclusion that the i nsurer rel ied on the informati on in the application, and that the inf orma tion infl uen ced t he in sure r's ju dgme nt in deci ding t o issu e the polic y.

III. a. Mr. Wagner
There can be no doubt that the trial judge properly granted summary judgm ent to t he ins urancecompany on Mr . Wagner'sclai m. b. Mrs. Wagn er Since Mrs. Wagner did not answer the questi ons on the application (she was not even asked) and did not s ign it, she ar gues that the mi srepresentati ons do not bar her rig ht to recover under the policy. In her affidavit she says that she and Mr. Wagner married in 1986 and that she was not aware of Mr . W agner's prior loss hist ory.- 4 - We think, how ever, that the misrepres entations in theapplication d efeat Mrs. W agner's rights under the policy as well. In 43 Am. Jur. 2 d Insurance § 1038 the text writer

states a gene ral proposi tion that "In the absence of a contr act or statutory provisi on to the contrar y, an insur

ed is bound by

rep resen tations contai ned in an application signed by

his own d uly authori zed agent." W hile this rule of law is most often applied to si tuations w here the agent misrepr esents facts in r

eference to the principal, we think it also applies to the agent's

statements about hi mself where th e pr incipal and agent jointly own the insured property and the agent si gns th e application s ecuring coverage for both.
There can be no doubt that Mr. Wagner was acti ng as the agent for Mrs. W agner. The application was in their joint names, bu t Mr . Wagner al one signed i t. The policy

issued in the ir joint na mes was, ther efore, obtained th rough the a gency of the husband. Either Mr. W agner was acting as Mrs. Wagner's agent or the policy should have be en issued to M r. Wagner alone.

If Mr. Wagner was not acting asMrs. Wagner's agent , there is a r elated doctrine that would effectively defeat her rig ht to recover. In Woodmen of the W orld Life Insurance v. Kinnaird , 874 S.W.2d 47 (Tenn. App. 1993), thi s court held that the fraud of a bene fi ciary to a life insurance policy would allow the insurer to avoid paymentunder the pol icy (and d efeat theclai ms of the insu red's he irs) even th ough th e insured hers elf had no part in the fraud. This cour t quoted at le ngth fro m Columbi an Mutual Life InsuranceCompany v. Martin , 175 Tenn. 517, 136 S.W.2d 52 (1940), which es tablished that i nnocent persons cou ld not a vail themse lves of an advanta ge gained by

the fraud of another

unless the innocent perso n had given value or had materiallychanged his or her posit ion in reli ance on the trans action. (Fo r the rule applied to contracts generally

see Restatement

of the Law of Contr

acts § 477). In this case the re is noevidence th at Mrs. Wagner gave any

considerati on separate- 5 -

and apart from that

given jointly with Mr . W agner. Therefore, she co uld not cl aim a status superior to his.

The judgment of the t rial cou rt is affirmed and t he cause is remanded to the Circuit Court of Lawrence C ounty for any further proceedi ngs necessar y. Tax the costs on appeal to the appellants.

_________________________________ BEN H. CAN TRELL, JUDGE CONCUR:

_______________________________ HENRY F . TODD, PRESID ING JUDGE MIDDLE SEC TION

_______________________________ SAMUEL L. LEWIS, JUDGE