Court Opinion

ID: 6410581
Source: CourtListenerOpinion
Date Created: 2022-06-25 11:52:23.366732+00
Date Added: 2024-06-11T15:51:21.605925
License: Public Domain

Bigelow, J.
The effect of the evidence admitted and of the instructions founded upon it was to authorize the jury to return a verdict for the plaintiff for the amount insured by the policy, although it was proved that a grist mill was carried on in the premises at the time of the loss. This was clearly contrary to the express stipulation in the policy, and permitted the jury to substitute, in the place of the written agreement of the parties, their acts and statements prior to the execution of the policy. Upon the most familiar principle of the law of evidence, all previous verbal agreements must be taken to be merged in the written contract of the parties, made for the very purpose of embodying the terms of their contract, and designed to be the repository and proof of their final intentions. It must be presumed conclusively that the whole engagement of the parties, and the extent and mode of their undertaking, was reduced to writing, and all evidence of a previous colloquium is incompetent. This wise and salutary rule cannot operate harshly upon parties who read and understand their written agreements before executing them. The agreement in the policy was that the carrying on of a trade included in the class of special risks should render the policy void. This was a clear and explicit stipulation, the manifest purpose of which was to exclude paroi evidence as to the danger of such occupations, and th ;ir materiality to the risk, and substitute in place thereof the agreement of the parties, about which there could not be any cavil or dispute. The evidence offered by the plaintiff, and submitted to the jury under the foregoing instructions, was in direct contravention of the written contract. It not only tended to vary it by paroi evidence, but directly to contradict it. It was the assured who were estopped by their own deliberate and solemn agreement in writing, and not the defendants, who relied solely *590on the terms of the contract which the plaintiff sought to enforce against them. The recent case of Barrett v. Union Mutual Fire Ins. Co. 7 Cush. 175, well illustrates and enforces the rule of evidence excluding paroi testimony, as applicable to policies of insurance, and is decisive of this case, as the facts are now presented.
We have not deemed it necessary to decide whether the policy in question would be rendered invalid by the use of the premises insured for purposes or occupations enumerated in the conditions annexed to the policy as belonging to the same class with those specified in the policy, but not stated or set out as being purposes or occupations to which the insured intended to appropriate the buildings insured; that is, whether, in a policy upon a building, stated in the policy as one used for a particular hazardous or extrahazardous risk, the insured might use the premises for any other occupation, not stated in the policy, but coming within the same class of hazards. But we confine our decision to the precise case of buildings enumerated in the policy, and specified therein as being used only for particular designated occupations, and which, subsequently to the making of the policy, were actually appropriated to the carrying on of a business coming within the class of special hazards, for which special rates of premium are charged, and which was not named or designated in the policy. It is clear that the latter class of hazards stand on their own peculiar ground, and that the premiums thereon do not come within any rate or tariff common to risks of a particular kind, but are intended in all cases to be the subject of a special agreement and distinct rate of insurance, to be determined on by the parties, according to the circumstances of each particular case.

Exceptions sustained ; new trial in this court.

At September term 1854, the parties submitted the case to the decision of the court upon a statement of facts, embodying substantially the facts proved and found by the jury at the former trial, and also the following facts, which were agreed to be true, provided paroi evidence would be admissible to prove *591them : The risk was a special risk; the rate of premium paid was that usually charged for special risks, (though there was no uniform rate for such risks,) and higher than the agent had ever before charged on extrahazardous risks. The rate would be higher on two or more extrahazardous risks than on one; but two rooms occupied for a pail factory and one for a grist mill would not be so great a risk as if all three were occupied for a pail factory. When two or three kinds of business, all special risks, are carried on in the same building, the rate usually charged would be that chargeable for the greatest risk. The premium in this case was determined by the hazard of making tubs and pails, which was the greatest of the several special risks in the building insured. The use of the building for a grist mill was not material to the risk. The fire, by which the buildings were consumed, originated in the tub and pail factory, which was a separate building from the blacksmith’s shop.
Huntington Sf Wells, for the plaintiff, in addition to the points taken by them at the former argument, argued that the opinion already given did not settle this case, because it was founded on the assumption that the property insured was only extrahazardous, whereas it was now agreed to have been a special risk, and taken at the highest rate known to the office ; and that as, by the terms of the policy, the conditions of insurance were to be referred to in order to explain it, and one of those conditions, by stipulating that the policy should be avoided by any use which increased the hazard, implied that any use which did not increase the hazard would not avoid the policy, paroi evidence was admissible to show that the risk was not rendered more hazardous, but that the special hazard, taken by the company, was in fact diminished by the substitution of a grist mill in one of the rooms.
They also contended that if the policy was avoided as to the larger building insured, it was still (especially as it was not issued by a mutual insurance company) good as to the blacksmith’s shop, which was a separate subject of insurance, and not applied to any other use than the one described. Clark v. New England Mutual Fire Ins. Co. 6 Cush. 346. Trench v. Chenango County Mutual Ins. Co. 7 Hill, 122.
Davis Sf Allen, for the defendants.
Bigelow, J.
Upon a careful consideration of this case, in the aspect in which it is now presented by the agreed statement of facts, we are satisfied that the plaintiff is not entitled to recover. It is conceded that the premises insured, in addition to the purposes specified in the policy, were, at the time of the fire, appropriated to carrying on a grist mill. This was a distinct use of one of the buildings insured, not assented to by the defendants, for an occupation included in the classes of hazards, annexed to che policy, as a “ special hazard.” It was therefore a violation of the express stipulation in the policy, and by its terms avoids the contract. Nor does it at all affect the result, that this additional unauthorized use of the premises was for a purpose comprehended within the same class of hazards as that which was specified in the policy, and originally covered by the .nsurance. The manifest purpose of this stipulation was to prevent any use of the premises for an occupation or business ncluded in any of the classes of risks denominated “ hazardous, extrahazardous or special,” without the express sanction of the. company in writing. It was not intended to limit the assured, in the use of his property, to the same class of risks as those specified in the policy, and to allow him to change the mode of its occupation, or appropriate the premises to additional uses of the same grade of hazards, at his pleasure. Such is not the import of the language used in the policy, nor would such a construction of it be just or reasonable. To prevent the accumulation of hazardous occupations in the same premises, without their assent, was the object which the defendants sought to accomplish by this agreement. Each distinct use of a building insured, for a purpose or business of a hazardous nature might, in the opinion of the insurers, increase the risk by fire; and this might be so, whether the additional use came within the same kind of hazards as that specified in the policy, or belonged to a higher or lower class. It was not, therefore, a compliance with this stipulation to use general terms of description, in the application and policy, comprehending various kinds of risks, even of the same class. The insurance of a building described *593only as a mill, a factory, a store, or workshop, without any words designating or limiting the particular uses to which it was to be appropriated, would include a wide range of risks, some of which, if known, the defendants might not be willing to assume. It was necessary to state specifically the business or occupation to be carried on in the premises, and to confine then-use to the purposes specified in the policy. By this means the defendants were enabled to ascertain the precise nature of the risks they assumed. But this was not the only object effected by this agreement. It also enumerated the various trades and occupations which should be deemed, under the policy, “ hazardous, extrahazardous, and special,” and which, if carried on in the premises without the consent in writing of the defendants, should avoid the policy. It thereby put at rest all questions between the parties, as to the different nature of the uses to which buildings might be appropriated, and their materiality to the risk actually assumed by the defendants.
It results from this view of the agreement of the parties, that the objection to the right of the plaintiff to recover does not rest on the ground of misrepresentation or concealment by the assured in the description of the property contained in his application for insurance. But it proceeds solely on the ground that the assured has violated an express stipulation in the policy, by the very terms of which the contract between the parties is at an end. Nor can this stipulation be in any way controlled or modified by reference to the “ conditions of insurance ” annexed to the policy, so as to open the question whether the use of a grist mill on the premises was material to the risk. These conditions are, by the terms of the policy, to be resorted to, in order to explain the rights and obligations of the parties, only in cases not otherwise specially provided for in the policy itself. The use of the premises insured, for purposes not specified, is a matter expressly provided for in the policy, by a distinct agreement of the parties. It is not, therefore, in any way affected by the provisions embraced in the conditions of insurance.
We can see no reason for applying the doctrine of estoppel to the- defendants, on the ground that the assured was misled by *594the acts of the agent of the company. In making the application for insurance, he did not act for the defendants, but for the assured. In delivering the policy, although acting as agent for the defendants, he did nothing which can be construed into a waiver of any of the provisions in the policy. It was the written contract, which 'fixed and determined the rights of the parties, and these could not be varied or changed, in the absence of fraud, by the verbal acts or conduct of the parties or their agents, previously to its execution and delivery. Barrett v. Union Mutual Fire Ins. Co. 7 Cush. 175. Lowell v. Middlesex Mutual Fire Ins. Co. 8 Cush. 133.
The policy cannot be held valid for a portion of the risk and invalid for the residue. It was an entire contract, entered into for an entire consideration. The property was insured as one risk, and was in fact closely connected together. It is impossible to say that either portion of the risk would have been taken without the other. Besides, it is expressly agreed that, in case of a breach of the stipulation as to the use of the premises for purposes not specified in the policy, “these presents shall cease and be of no force or effect.” The contract was therefore, by its terms, at an end. Judgment for the defendants.