Court Opinion

ID: 7935463
Source: CourtListenerOpinion
Date Created: 2022-09-08 23:09:02.821166+00
Date Added: 2024-06-11T16:33:31.433021
License: Public Domain

Long, J.
The plaintiffs were partners, camying on a grocery business in the city of Detroit.
On the 1st day of May, 1890, they procured a policy of insurance of $400 in the defendant company, — $250 on a stock of flour, feed, and other goods, and $150 on hay, etc. The policy was for one year. After the insurance was procured, it appears one of the plaintiffs gave a chattel mortgage upon the property described to secure an individual debt of his. On July 12, 1890, the goods caught fire, and were destroyed and injured to the extent of $319.87. The defendant company had no knowledge of the chattel mortgage until after the fire. It refused to pay the loss, and on the trial in the cii’cuit court the jury was instructed to find a verdict for the defendant-Plaintiffs bring error.
*98The policy sued upon is what is known as a “Miomgan Standard Policy,” and contains this clause:
“ This entire policy, unless otherwise provided by agreement indorsed hereon or added hereto, shall be void * * * if the subject of insurance be personal property, and be or become' incumbered by a chattel mortgage; or if any change other than by the death of the insured takes place in the interest, title, or possession of the subject of insurance, whether by legal process or judgment, or by voluntary act of the insured, or otherwise.”
The defense to the action is based upon the proposition that the placing of the chattel mortgage by one partner upon the partnership property for his individual benefit works a change in the interest of the insured, so that the policy becomes void under the stipulations above quoted, contained in the policy.
This stipulation in the policy in regard to giving chattel mortgages is valid and reasonable, and we think the court below not in error in directing verdict for defendant. The placing of the chattel mortgage by one partner for his individual benefit upon the partnership chattels works a change of interest therein. In Hicks v. Insurance Co., 71 Iowa, 119 (32 N. W. Rep. 201), it was held that:
•CA condition in a fire insurance policy issued to a firm, that the property should not afterwards be in any manner incumbered, was violated by the execution of a mortgage by one of the partners on his undivided one-third interest in the property, and by a judgment against him, which became a lien on his said interest.”
We think the company discharged from liability on the policy by such an incumbrance without its knowledge, or any notice to it, and its assent thereto. The placing of the chattel mortgage thereon by one partner may not have changed the title or possession, but there was a *99■change of interest, which was provided against by the policy.
The court was not in error in directing verdict and judgment for defendant.
The judgment of the court below will bo affirmed, with costs.
The other Justices concurred.