Court Opinion

ID: 6528275
Source: CourtListenerOpinion
Date Created: 2022-07-19 19:26:48.635792+00
Date Added: 2024-06-11T15:55:16.488132
License: Public Domain

Appellant has applied for rehearing in this case charging that we erred in holding that appellee had an insurable interest in the property insured. The issue of insurable interest is the crux of the case.
It has been held that one who has either a legal or equitable interest in property has an insurable interest therein. It was stated in American Equitable Assur. Co. v. Powderly Coal 
Lumber Co., 225 Ala. 208, 142 So. 37 as follows:
 "In the early history of insurance, there was a tendency to require title and ownership as a basis of insurable interest, but later decisions have adopted a more liberal doctrine, and it is not now essential to an insurable interest that one should have a property in the thing insured, or an estate, legal or equitable; the term 'insurable interest' being more extensive than property or estate. Any qualified or limited interest in the subject of insurance is sufficient and an equitable interest is sufficient to support an insurable interest."
We do not see it necessary to proof of an equitable interest in a suit on the policy, that such interest has first been established in a court of equity. Such proof is available in opposition to the plea *Page 581 
of lack of insurable interest. We have held that there was evidence to support the decision of the trial court that appellee had an equitable interest sufficient to amount to an insurable interest.
In the first appeal of this case the question of insurable interest was based upon the theory of the relationship of a gratuitous agent. We held such relationship gave rise to neither legal nor equitable interest in the property. Such was not the question in the case as it came on this appeal.
Appellant contends that even if appellee had an insurable equitable interest, the nature of such interest was not disclosed to its agent.
There is no warranty of ownership in the policy issued to appellee. The evidence is in conflict as to what the agent was told as to ownership at the time of taking the application. The agent stated he was informed that appellee was the owner. It is stipulated that appellee told the agent he was not the owner. There is no testimony as to whether further information was requested by the agent as to appellee's interest.
In such a case, if no questions were asked as to the precise nature of his interest and the conditions of the policy did not require such disclosure, failure to do so must be shown to be fraudulent and material to the risk of loss in order to avoid the policy. 45 C.J.S. Insurance Sections 515 and 473(3).
Forfeiture of insurance policies are not favored by the law. Employers Insurance Co. of Alabama v. Crook, 276 Ala. 177,160 So.2d 463. The evidence in this case, except for the testimony of appellant's agent, is that since the death of his sister in 1935, appellee's relationship to the insured property was in a representative capacity. There was no evidence that he claimed ownership in himself but to the contrary. It was a matter of record on the tax assessment sheets of the county and with the improvement assessment records of the City of Florence that the property belonged to the estate of appellee's deceased sister. Her only child was Lonnie Groves. The general agent of appellant had insured the property since 1962, though with another company prior to changing coverage to appellant in 1966. In no other instance did appellee claim ownership except as stated by appellant's agent. There was evidence that Lonnie Groves was present when the agent was allegedly told by appellee, that he appellee, was the owner of the property. There was a deed of record from appellee to Lonnie Groves to the insured property executed prior to the issuance of the policy. With this evidence before it, it was within the province of the court to disbelieve the testimony of appellant's agent as to appellee's averment of ownership.
The issue of standing or the legal right to bring an action on the policy in a representative capacity by one claiming to be a guardian in invitum was not an issue on this appeal. The sole question has been whether there was evidence to support an insurable interest in the property insured by David Brannon.
It is passingly strange that appellant, though seeking to void the policy, was at the time of the initial trial continuing to collect premiums thereon.
We adhere to our view that the evidence and its reasonable inference is sufficient to support the claim of an equitable interest sufficient to give rise to an insurable interest in David Brannon, and that failure, if there was such failure, to disclose the precise nature of such interest was insufficient to void the policy.
Rehearing denied, opinion extended.
BRADLEY and HOLMES, JJ., concur. *Page 582