Court Opinion

ID: 6411996
Source: CourtListenerOpinion
Date Created: 2022-06-25 11:53:23.15486+00
Date Added: 2024-06-11T15:51:24.263953
License: Public Domain

Bigelow, J.
The instructions to the jury were carefully guarded and sufficiently favorable to the defendants, with the exception of that which relates to the subject of damages. This was founded on what seems to us to be a misinterpretation of the by-laws. The defendants did not assume a liability in case of the existence of other insurance on the property to be ascertained solely by calculating the proportion what the sum insured by them bore to the whole amount insured on the property. The basis of calculation was in all cases to be the value of the property insured after deducting one fourth of such value. Of this sum the defendants were to pay such proportion as the sum insured by the policy issued by them should bear to the whole sum insured by all the policies existing on the property at the time of the loss. In other words, the defendants were to be liable only for their proportion of three fourths of the value ul *552the property insured; and this proportion was to be ascertained by calculating the ratio which the sum insured in the policy declared on bore to the whole sum insured by all the policies existing on the. property. Thus, if the whole property at the time of the loss amounted to ten thousand dollars, the sum on which the liability of the defendants must be reckoned would be three fourths of ten thousand, or seven thousand five hundred dollars; and of this last sum the defendants could be held to pay only the proportion which the amount insured by them, viz: two thousand dollars, bore to the whole sum insured, viz: five thousand dollars; or two fifths of seven thousand five hundred dollars, which would be three thousand dollars. But as this last sum exceeds the whole amount insured by the defendants, it would be cut down to that amount, and the plaintiff could recover only two thousand dollars. This is the clear result of an analysis of the provisions of the by-laws. The second bylaw is limited to cases where the defendants are sole insurers on the property. It limits, their liability in the first place to three fourths of the value of the property, as stated in the policy ; and in the next place it provides for a further limitation by cutting down the amount to which the plaintiff would' be entitled to three fourths of the value of the property at the time of the loss, if that happens to be less than the amount stated in the policy. Then comes the eighth by-law, which provides for the case of double insurance. By this it is stipulated that the defendants shall be liable to pay only such proportion of the loss “ as the sum insured by this company bears to the whole amount insured thereon, such amount not to exceed three fourths of thé actual value of the property at the time of loss; ” that is, the amount insured by the defendants and all other insurers, for the purpose of ascertaining the extent of the defendants’ liability, is not to be allowed to exceed three fourths of the value of the property at the time the loss occurs. The purpose of this provision is obvious. It is to carry into effect the provisions of Rev. Sts. c. 37, § 28, which enacts that mutual fire insurance companies sbail not insure property for. a sum exceeding three fourths of its value. The effect of the eighth by-law is, that in ascertaining *553the liability of the defendants on a policy issued by them, in cases where there is other insurance, the property is to be taken at three fourths of its value, and the proportion which the defendants are to pay is to be reckoned on that basis.
It is suggested by the counsel for the plaintiff, that the effect of this interpretation of the by-laws is to restrict the plaintiff from obtaining insurance on his property by other insurances for a sum greater than three fourths of its value. But this is an error. The purpose and effect of the by-laws are only to require that, in calculating the liability of the defendants according to the agreed proportion, it is to be assumed that the property was insured only for three fourths of its value.
Inasmuch as the instructions on the subject of damages did not conform to this view of the liability of the defendants, there must be a new trial on the question of damages; and for this purpose only the order is to be Exceptions sustained.
Upon a new trial, it appearing" that part of the property insured by the defendants was not covered by the other insurance, it was held that the plaintiff might recover three fourths of the value of that part of the property, and three fourths of the value of so much as was covered by the other insurance, not exceeding $2000 in all. 1 Allen, 536.