Case Name: THE SPRING GARDEN INSURANCE CO. vs. SCOTT
Court: Supreme Court of Pennsylvania
Jurisdiction: Pennsylvania
Decision Date: 1870-02-07
Citations: 1 Walk. 181
Docket Number: No. 448
Parties: THE SPRING GARDEN INSURANCE CO. vs. SCOTT.
Judges: 
Reporter: Reports of cases decided by the supreme court of pennsylvania which have been omitted from the regular reports
Volume: 1
Pages: 181–188

Head Matter:
THE SPRING GARDEN INSURANCE CO. vs. SCOTT.
When an assignee of a polioy of insurance brings suit in his own name, the name of the assignor may be added by an amendment.
A policy of insurance may be reformed by parol evidence of the representations that were made when the policy was delivered.
Certificate from Nisi Prius. No. 448 January Term, 1868.
This was an action of covenant brought by Jacob Scott in his own ñame against the Spring Garden Insurance Company, on a sealed policy of insurance dated April 20, 1867, by which that company, in consideration of a premium of $9.10, paid by Theodore Hawk, insured a “stock of wooden and willow ware” in the sum of $1,200, and “fixtures” in the sum of $200 against loss by fire, in favor of Hawk, “his heirs, executors, administrators, or assigns, according to the conditions hereunto (to the said policy) annexed. It was provided in the policy that it should have no force or effect if assigned, unless the assignment were made within thirty days after the transfer of the property, and were allowed by the company. It was also provided that all insurance, original or renewed, should be considered as made under the original representations so far as they had not been varied by new representations.
By an endorsement on the policy on the 26th of June, 1867, the insured, in consideration of an additional premium of $4, was allowed the privilege of keeping fireworks.
On the 4th of September, 1867, Hawk assigned the policy to the plaintiff by an endorsement thereon duly approved by the Secretary of the company.
A fire occurred on the 17th of December, 1868, by which the plaintiff claimed to have sustained a loss of $1,175 on his stock of merchandise, as follows: Six hundred dollars on “toys and fancy articles,” totally destroyed; three hundred and seventy-five dollars on “toys, dolls; and fancy articles,” damaged; and two hundred dollars on “baskets and wooden ware,” damaged, according to his affidavit presented to the company. The company denied their liability for any ] art of this loss, except that sustained on the vpooden and willow ware. And this suit having been brought, paid into Court the sum of $200, and took defense as to the rest of the claim.
On. the trial, which took place on the 8d of February, 1869, the plaintiff, notwithstanding the objections of the defendants, was permitted to introduce the testimony of Hawk and another witness named Knight, to show that when Hawk applied for the insurance he stated that he wished it to cover fancy toys as well as wooden and willow ware. That alter the policy had been filled up, the attention of the Secretary of the company was called to the omission of the Iomur articles, and that he (the Secretary) said that the words “wooden and willow ware” included fancy toys.
The defendants then produced the written application of Hawk, dated the some day as the policy, for insurance of $1,200 on stock of wooden and willow ware,” and of $200 on “fixtures,” and called their Secretary, who testified that no other application had been made, and that no such conversation as that detailed by the plaintiff occurred. They also relied upon certain .expressions made use of by Scott and Hawk, in a conversation with the insurance agent, by whom the statement of the loss was prepared. The Secretary of the company proved that the rate of insurance on toys and fancy articles was 75 cents, while that on wooden and willow ware was but 65 cents on the $100.00.
It is proper to add that Hawk, when shown the application for insurance, testified that he thought he signed his name to a loose piece of paper, and that he did not think that anything was writen on it, although he was not positive. The Secretary of the company, on the other hand, testified that the application was filled up by him, that the book containing it was handed to Hawk, and that the application was then signed by the latter.
The judge who presided at the trial submitted the case to the jury as one depending on the credibility of the plaintiff’s witnesses, and the verdict was for the plaintiff.
The plaintiff submitted no points in writing. Those of the defendant’s are as follows:
1. That the plaintiff cannot maintain this action in his own name.
2. That under the pleadings and evidence in this case, the defendants cannot be held liable for loss of or damage to any other goods than those included in the terms used in the policy, “Stock of wooden and willow ware.”
3. That evidence that Hawk told the Secretary of the defendants that he wanted insurance on fancy toys as well as on wooden and willow ware, cannot enlarge the terms of the policy so as to make it include the stock of toys.
4. That even if the jury should believe that the Secretary of the defendants said, after delivering the policy, that it would cover the stock of toys, the liability of the defendants under the the policy cannot be enlarged by such a declaration.
5. That the written order for insurance signed by Hawk, is as a mere matter of evidence, entitled to much greater weight in determining what his application was, than the unaided recollection of witnesses on the subject.
The charge of the Court was as follows :
The only question in this case is whether toys are included in the policy issued by the defendants. There is no dispute about anything else. [The policy is first to be regarded. The words are “Stock of wooden and willow ware.” I take it for granted that there is an ambiguity or that they do not cover fancy toys and the other articles in dispute. Parol evidence is therefore to be admitted, to prove that it was intended that toys should be covered.] It is objected that parol testimony should not be admitted to vary or contradict and instrument under seal. The rule in Pennsylvania is more liberal than in England or any other of the Hnited States. [In case of fraud, accident or mistake, a Court of Equity will “reform” an instrument, and in this state, where there was originally no Court of equity, the common law Courts will enforce equitable principles, and do the same thing.] Chalfant vs. Williams, 11 Casey, 212. Was there any mistake in this case ? Are you convinced by the parol testimony that .there was? If you are, perhaps the plaintiff has made out his case. ' [If the the Secretary said that the words, “stock of wooden and willow ware” covered all, it is the same as it the words were in the policy.]
One witness (Knight) has no interest. You are the judges of his credibility. Knight and Hawk went to the Insurance Co. It is clear that they went only twice, between the 10th and 20th of April, 1867. Knight testified to what the Secretary said. Hawk is a competent witness.
If you believe these two witnesses, the Secretary, who had a ‘ right to bind the company, there can be no doubt that he told them the words would cover everything. Mr. Reger said that he could not remember having said so. If you believe the conver sation took place, as told by Knight and Hawk, it is as if the instrument had the words inserted in it.
The preliminary proof establishes nothing but the fire.
I negative the first, second and fourth points presented to me by defendant’s counsel. In reply to the third, I say this would enlarge it if agreed to by the Secretary.
To the fifth I answer that this will depend on the weight to be given by the jury to the real evidence. It is a question for the jury and not for the Court.
There is no dispute as to the amount claimed, which is $1,175 with interest. If the jury find for the plaintiff they will find only for $975 with interest, the sum of $200 with costs (being the amonnt admitted by the defendants to be due under the policy) having been paid into Court.
February 4, 1869, verdict for plaintiff for $1,054.52.
The Insurance Company then took a writ of error and assigned nine errors ; the first of which was to the action of the judge in admitting parol evidence to prove that the Secretary of the Insurance Company said the words ‘‘stock of wooden and willow ware” would include toys and everything else. The second error was in allowing Hawk to testify. Errors three to seven were to the answers to the points. Errors eight to ten were to the portions of the charge which are printed in brackets.
James E. Gowen and A. D. Campbell, Esqrs., for plaintiff in error,
argued that this case was tried before the passage of the act of April 15th, 1869, P. Laws 30, and Hawk, the assignor, was incompetent; Foreman vs. Ahl, 5 P. F. S., 325; Post vs. Avery, 5 W. & S., 509; McClelland vs. Mahon, 1 Barr, 364; Patterson vs. Reed, 7 W. & S., 144; Wilson vs. Bank, 9 Wright, 488.
The plaintiff could not sue in his own name; 1 Chitty on Pleading, *15. The only act bearing upon the subject is act of May 28, 1715, 1 Smith Laws, 90, but the assignment must be before two credible witnesses, which was not the case here; Gourdon vs. Ins. Co., 1 Binney, 430, note; Steiner vs. Fell, 1 Dall, 22; Bury vs. Hartman, 4 S. & R., 175; Faull vs. Tinsman, 12 Casey, 108; Aldricks vs. Higgins, 16 S. & R., 212. The assignee cannot sue in his own name; DeBolle vs. Insurance Co., 4 Wharton, 68; Insurance Co vs. Insley, 7 Barr, 223; Insurance Co. vs. Schreffler, 8 Wright, 272; Insurance Co. vs. Roberts, 7 Casey, 438; Insurance Co. vs. Mitchell, 12 Wright, 374, Insurance Co. vs. Boyle, 12 Wright, 368; Landis vs. Urie, 10 S. & R., 321; 1 Chitty on Pleading, *104.
The parol testimonj^ made an entirely different contract out of the policy; Weisenberger vs. Insurance Co., 6 P. F. S., 442. As to the eighth error, the judge assumed there was an latent ambiguity when that was a question of fact for the jury; Best vs. Hammond, 5 P. F. S., 409; Beaty vs. Insurance Co. 2 P. F. S., 456; Mitchell vs. Insurance Co. 1 P. F. S., 402; Miller vs. Fichthorn, 7 Casey, 252; Gould vs. Lee, 5 P. F. S., 99; Curtis vs. Howell, 39 N. Y., 211; Thorp vs. Ross, 4 Keyes, 546; Cram vs. Bank, 4 Keyes, 558. The Court gave no instruction as to the kind of evidence which should be required to reform the written instrument; Rearich vs. Swinehart, 1 Jones, 233. Altering a written instrument by parol should only be allowed in a clear case; 1 Phillips on Insurance, Sect. 117; Parsons Marine Ins. page 150, Sect. 14; Cumberland Valley Ins. Co. vs. Edmunds, Pittsburg Legal Journal June 28, 1869, page 69. Lamot vs. Ins. Co., 3 E. D. Smith, 199; Insurance Co. vs. Updegraff, 9 Harris, 513.
E. H. Weil and J. Goforth, Esqrs., contra.

Opinion:
The Supreme Court reversed the decision of the judge at nisi prius on February 7, 1870, in the following opinion by
Thompson, C. J.:
The complaint of error in sustaining the action on the policy in this case in the name of the assignee, is not worth discussing as it was amendable by adding the name of the assignor as plaintiff,. for the use of the assignee; Lycoming Mut. Ins. Co. vs. Schreffler, 8 Wr., 269. If there were nothing else in the case we would treat it as amended, but as it must go back on other grounds, the amendment had better be made before trial.
We agree with our learned brother who tried the case at nisi prius, that parol evidence was admissible to show what the company by its agent undertook and agreed to was covered by the terms used in the policy, viz : "Stock of wooden and willow ware." If the testimony be true, the attention of the Secretary was called to the fact at the time the insurance was being consummated by by the execution of the policy, "that the application was for insurance on wooden and willow ware and fancy toys," and be dedared that the words used, viz., wooden and willow ware, in-eluded "everything," and upon this' understanding the policy was accepted and the premium paid. The company therefore is as much bound by this as if it had been inserted. The reformation of the agreement by supplying the omission, is justified, either on the ground offered, or of mistake, and the omission, if the testimony be believed, is attributable to or the consequence of, one or the other of these grounds. Reformation ot instruments is an equitable result, although performed in a common law action, the maxim being "that what ought to be done shall be condered as done." This is undoubtedly a highly moral and honest principle, and whenever the proof offered tends to show that it ought to be applied, it will be. The cases cited by the counsel for the defendant in error, are abundant proof that the testimony on the question of the correction or explanation of the terms of the policy was well received, and to them we refer without troubling ourselves to report them. We have looked into Weisenberger vs. The Insurance Co., 6 P. F. Smith, 442, cited by the counsel for the plaintiff' in error, and we regard it as an authority against, rather than in his favor.
There is a difficulty, however, in the case, which is not easily to be gotten over as the the law stood when the case was tried below. Hawk, the assignor of the policy, was called as a witness by the assignee, and was examined against objections by the other side. This, we think, was in contravention of the rule in Post vs. Avery, 5 W. & S., 509, and the long list of cases since, which stand on the grounds of disallowing an assignor in a chose in action to be a witness for his assignee. Hawk was incompetent, under this rule, at the time he testified, although he may be a witness on another trial, owing to the change in the rule by the act of 1869. This assignment of error is therefore sustained.
If the answer of the learned judge to the defendants fourth point was as is complained of, it would be error. The declarations of the Secretary made at an after period to the delivery of the policy, might be given in evidence, perhaps as corroborative of those made at the time, but of themselves, would not bind the company. It was of the former that the answer to the point was doubtless predicated. This is immaterial, however, for as the case goes back for re-trial, all doubt on this head will be avoided. For the reasons mentioned the case must be reversed.
Judgment reversed and venire facias de novo is awarded.