Wilson v. Herkimer County Mutual Insurance Co.

Wilson v. Herkimer County Mutual Insurance Co. Policy of Fire-insurance. A misstatement of the relative situation of the neighboring buildings, avoids an insurance rpon personal property; there is no distinction, in this respect, between an insurance upon the building, and one upon the merchandise contained in it. Appeal from the general term of the Supreme Court, in the eighth district, where a judgment upon a verdict in favor of the plaintiff had been affirmed. This was an action of assumpsit, upon a policy of insurance, whereby the defendants insured one Charles L. Mann against loss or damage by fire, to the amount of $2000, upon a stock of goods, in a store in Lockport, for the term of one year from the 25th November 1839. Mann sold the goods insured, and assigned the policy, to the plaintiff, with the assent of the defendants, on the 7th September 1840. The goods were destroyed by fire on the 26th of the same month. The declaration was in the usual form; and the defendants pleaded the general issue. The policy described the subject of insurance in the *541 ^0^0W^n§ terms: “On his merchandise *in the store occupied by the assured, in the village of Lockport, such goods as are usually kept in a country store, $2000.” *•* * “Reference being had to the application of the said Charles L. Mann, for a more particular description, and as forming a part of this policy.” It also provided as follows: “It is also agreed, that this policy is made and accepted, subject to, and in reference to, the terms and conditions of the act of incorporation and bylaws of the said company, which are to be used and resorted to, to explain or ascertain the rights and obligations of the parties hereto, ip all cases not herein otherwise provided for.” The defendants’ charter is contained in the Laws of 1836, c. 197. The conditions of insurance, annexed to the policy, and made a part of it, provided as follows: “All applications for insurance must be made in writing, according to the printed forms prepared by the company. Such applications shall contain the place where the property is situated; of what materials it is composed; its dimensions, number of chimneys, fire-places and stoves; how constructed, and for what occupied; its relative situation as to other buildings; distance from each, if less than ten rods; for what purpose occupied, &c. If any person insuring any property in this company, shall make any misrepresentation or concealment in the application, * * * such assurance shall be void and of no effect.” It was provided by the by-laws of the company, which were given in evidence, that “every person wishing to become a member of this company, shall, previous to being insured, deposit his application and premium-note with the secretary or assistant secretary of said company, and if approved, the policy shall bear date on that day, unless directed by the applicant to be dated on a future day. Furniture, goods, produce and stock, will be insured at the same rates with the buildings in which they are contained.” Mann’s application for insurance, which was in the handwriting of the defendants’ agent, with the exception of the signature, contained the following statements, in reference to the building containing the goods insured : *“ Where situated? On the north side of Main r * gg street, Lockport. Of materials, and whether new or *- old? Of brick, three stories high; new; 2d class building. Size of building, number of chimneys, fire-places and stoves? Building about 45 feet by 22; four chimneys, no fire-places; four stoves and conveniences for more; pipes well secured, &c. Relative situation as to other buildings; distance from each, if less than ten rods; and for what purposes occupied and by whom? Building is on corner of Main and Pine streets; no exposure on the right and rear, and on left, building with battlements, and no door or window; so that, if the building of the applicant should be exposed, by the burning of the building on the left (which is three stories high, of wood, occupied by groceries and dry goods, &c.), said building of the applicant would not burn.” It was admitted, that when the application was made, and the policy issued, there were several buildings standing on Main and Pine streets, within ten rods of the store containing the merchandise insured, which were not mentioned in the application. At the close of the plaintiff’s testimony, the defendants moved for a nonsuit, “ on the ground, that the policy was void, for the reason that the application did not contain a statement of the buildings which were within ten rods of the store in which the goods were, when the application was made, and when the policy was issued.” This was denied, and an exception taken. At the close of the case, the defendants’ counsel requested the court (Sill, J.) to instruct the jury that the policy was void, for the reason before given. The learned judge refused such instruction, and the defendants excepted to his decision. There was a verdict in favor of the plaintiff, for the amount insured; and the judgment entered thereon having been affirmed at general term, and a motion for a new trial, made upon a bill of exceptions, denied, the defendants took this appeal. Hill, for the appellants. Taber, for the respondent. [MAJORITY — *Foot, J.] *Foot, J. — In this case, the terms of the inquiry respecting buildings within ten rods, are identical with those in the cases of Burritt v. Saratoga County Mutual Fire Insurance Co. (5 Hill 188) and Jennings v. Chenango County Mutual Insurance Co. (2 Denio 75), and the answer is deficient in the same particulars. The decisions in those cases are, consequently, direct authorities for this. They were reviewed at length by Jones, J., in delivering the opinion of this court, in the case of Gates v. Madison County Mutual Insurance Co. (2 N. Y. 48, 51), approved of, and the distinction clearly pointed out between them and the case then under consideration. The subject is exhausted in the opinion of that learned judge, and I need only say, that my opinion on this branch of the case is placed on the ground, that the respondent, in his application, concealed a fact which the appellants had a right to know, viz., the number and situation of other buildings, within ten rods of the building containing the goods insured; and for that reason, the policy was invalid, it being a part of the contract between the parties, that any “ concealment in the application ” should render the insurance void. There is another and important branch of this case on which a serious question arises, and that is, whether there is any difference between real and personal property in applying the principle above stated. This question acquires seriousness from the decision of the supreme court in the case of Trench v. Chenango County Mutual Insurance Co. (7 Hill 122), where the supreme court have recognised and adopted such distinction. The contract between the insurer and assured is not set forth fully in that case; parts of it, however, are presented, and, probably, it was substantially like the contract in the present case. But whether so or not, the agreement between the parties now before the court is fully set forth, and *the sole inquiry is, did they ^ ^ intend that the provisions of the policy, relative ^ to other buildings within ten rods, should not apply to their contract. I say, provisions of the policy, for by its terms, the act of incorporation and the by-laws of the appellants are a part of it; and by the 12th section of the by-laws, and one of the conditions, the application is an essential part, indeed, the very basis, of the agreement. By the 11th section of the by-laws, the appellants engage to insure goods, at the same rates with the buildings in which they are contained; hence, the character and situation of the building is the prominent consideration in every contract of insurance, and is just as important, when the policy covers personal property in a building, as when it covers the building itself. The building, consequently, is the main object presented in all the preliminary propositions, but no distinction is anywhere indicated in respect to the character and situation of the building, between insurance on personal and real property. From an examination of the contract, in general, I am satisfied, that the parties have made no such distinction. But when the application itself is examined, and it is there found, that the respondent, having in contemplation an insurance on his personal property, recognised the materiality of the inquiry concerning the situation of the building in reference to others within ten rods, undertook to answer, and did answer it, in part, and the appellants received the application, with this answer, referred to and adopted it in their policy, every doubt is removed, in respect to the true construction of this contract; and if the contract in the case of Trench v. Chenango County Mutual Insurance Co. was like this, I am constrained to say, that, in my opinion, the supreme court erred in their construction of it. Judgment reversed. In Smith v. Empire Insurance Co., 25 Barb. 497, Balcom, J., said, that Trench v. Chenango County Mutual Insurance Co. had been shaken too much by the court of appeals, in Wilson v. Herkimer County Mutual Insurance Co., to be followed, as an authority. Nevertheless, the supreme court, in the case of Merrill v. Agricultural Insurance Co., 10 Hun 428, followed that case, and held, that it was by no means clear, that the court of appeals intended to overrule it; referring to the unreported case of Heacock v. Saratoga County Mutual Insurance Co., decided by the court of appeals, in March term 1856. The question is, therefore, as yet, an unsettled one, in this state. See also, Burrill v. Chenango County Mutual Insurance Co., Edm. S. C. 233.