Charles I. Eddy, Respondent, v. Farmers' Mutual Insurance Company of Orleans and Niagara Counties, Appellant

Charles I. Eddy, Respondent, v. Farmers’ Mutual Insurance Company of Orleans and Niagara Counties, Appellant. Co-operative town insurance company — the property insurea by, may be used anywhere where the use is customary — a trottinghorse, insured in one county, destroyed by fire in another where he was being trained. ' T.n the absence of special restriction, clothed in clear and unequivocal language, as to the territory within which property is to continue to he insured, the parties' will be deemed to have contemplated that .the property may he used in the ordinary way, and that, while thus used, the insurance shall attach to it wherever the property may he while the owner is using it in a customary way. A policy of insurance, covering a trotting stallion, issued in the county of Niagara . by a co-operative town insurance company authorized to do business only in the counties of Orleans and Niagara, in the application for which insurance the stallion is not stated to he in any building or any particular place, nor restricted by the policy from temporary or permanent removal by its owner from the county of Niagara, and to the knowledge of the company’s agent, when the policy was issued, was expected to he trained subsequently in.the city of Buffalo for racing, and which was destroyed by Are in said city of Buffalo, does not in terms'constitute a violation by the company of the provisions of section 13of chapter-573 of the Laws of 1886, forbidding the issue of a policy on “ property out of the limits of the territory nor is it an infraction of section 378 of chapter 38 . of the Laws of 1893, as amended by chapter 907 of the Laws of 1896, forbidding such a company to “transact business ” beyond the territorial limits mentioned in its certificate of incorporation. Appeal by the defendant, Farmers’ Mutual Insurance Company of Orleans and Niagara Counties, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk oí the county of Niagara on the 11th day of November, 1896, upon the decision of the court rendered after a trial at the Niagara Trial Term before the court without a jury. On the 17th of' December, 1892, the defendant issued a policy of insurance to Charles F. Williams, of the town of Royalton, Niagara county, by the terms of which it insured his buildings and other property upon said farm, “ including a trotting stallion four years old, named Red Gothard, then owned by him on said farm, against loss or damage by fire or lightning, the insurance upon said stallion being a separate item of insurance of $500, and it was provided that such insurance should continue for the period of five years; and in and by said policy, the defendant agreed to pay such insurance to said Williams or his assignee in case of loss.” When the insurance was effected the agent of the defendant, was informed that the stallion was a race horse, and “ that he had been away from the farm in training, and that the owner expected to take him to the city' of Buffalo for training the following year.” It is found as a fact that, in the latter part of March, 1896, the owner sent the said- stallion to the driving park at Buffalo, to be trained “ for a period of four weeks, after which time 'the horse waa to be returned to said farm.” On the - 4th of April, 1896, while the horse was in care of one McDonald, in one of the barns on the said Buffalo Driving Bark, the buildings upon the park and their contents were destroyed.- It was found that the fire was' not caused by the negligence of Williams, nor caused by anything in the policy of insurance prohibited ; and that Williams had conformed to the policy, “and immediately after said fire caused notice to be given to the secretary of the defendant of said loss.” That the defendant refused to pay, “ upon the ground that it occurred without the counties of Orleans and Niagara.” ' . . Williams assigned his cause of action to the plaintiff and this, action was commenced. Judgment was entered upon the decision made by the court, and an appeal is taken therefrom, exceptions having been filed to the decision. David Millevr, for the appellant. L. E. Filkins, for the respondent. [MAJORITY — Hardin, P. J.:] Hardin, P. J.: Defendant’s answer alleges that it is a co-operative town insurance company, “ and that in and' by the certificate of incorporation it is limited to the territory embraced in the counties of Orleans and Niagara.” It also alleges that Williams was a resident of the town of Royalton “ and was the owner of a farm situated in said town, and was the owner of the stallion ” in and upon said farm when the policy was issued. It is further alleged in the answer that “ it is prohibited from ■ insuring or issuing any policy of insurance upon or in respect of any property out of the limits of the territory embraced within the limits of its certificate of incorporation.” It then alleges that in the month of March, 1896, “ Williams, in violation of the terms and provisions of said policy, and of the laws of this State, removed the said stallion from the limits of the territory embraced in the certificate of incorporation of this defendant, to Wit, from the county of Niagara, and took the same to the county of Erie and to the city of Buffalo, at which place the loss and injury to said stallion referred to in said complaint occurred.” It is further alleged in the answer “ that such removal was made without the consent or permission of this defendant.” Before the policy was issued an application in writing was made by Williams for insurance upon his dwelling house, household furniture, and on “ wagons, carriages,- sleighs, harnesses, robes, blankets and farming utensils on said premises, $500. On live stock in and near said barns against fire, and anywhere in Orleans and Niagara counties against lightnings $400.” Then the application, after the use of the words which we have already given, contained the following: “ Registered stock. On horse colt,. 1 year, Kite Gothard, $-:. On mare colt, 1 year, Golden Chimes, $300. On stallion, 4 years, Red Gothard, $500.” The total insurance applied for was $4,800. The last three items mentioned evidently fell within the classification found in section 9,- article 5 of the constitution. That section contains the following words: “ Fancy stock shall be especially designated, and a valuation placed upon each when insured.” It is to be observed that the last three items mentioned in the application are not specified therein to be in any building, nor stated to be in any particular place. The evidence,-however, indicates that the last two items were upon the farm of Williams, in Royalton,. in the county of Niagara. When the policy was issued of $4,800 it contained the following language: “ On the following property as described in Application and Survey No. 6091, to wit: $1*200 on Dwelling House. $600 on Household Furniture, Beds and Bedding, Carpets, Sewing Machine, Wearing Apparel and Provisions therein. * * * $500 on Wagons, Carriages, Sleighs, Harness, Robes, Blankets, Farming .Dtensils, including Reaper and Mowers, in and near said barns and outbuildings. $400 on Live Stock" in and near .said barns against fire, and elsewhere in Orleans and Niagara counties, against lightning.” " Then came the following words in the policy: “$300 on mare colt, 1 year old, Golden Chimes. $500 on stallion, 4 years old, Red Gothard.” It is thus seen that there are no restrictive words in relation to-the stallion’s location or building in which he was at the time the policy was issued. Nor does the policy contain any words of restriction against temporary or permanent removal of the stallion from the farm or from the county of Niagara. Therefore, the policy was an absolute policy of insurance, in terms, as to the stallion. Inasmuch as there is no specification in the application or in the policy of any building in which the stallion was at the time of issuing the policy, we see no occasion to apply to it the provisions of section 12 of the constitution. Indeed, there is no defense alleged in the answer, in terms, under any of the conditions mentioned in section 12 of the constitution. Nor does the policy contain any words restrictive of the place where a loss shall transpire. It may be that there was an .oversight in the application, and a failure to express definitely where the property was in.the policy, so far as it relates to the stallion, or to prescribe a limit as' to where the loss" should transpire which the company should be held liable for. Such/omissipn, however, cannot, be made the foundation- for defeating the positive and' unrestricted language of. the policy. , The stallion came under the designation of “ registered stock,” and under the classification of “ fancy stock.” We are of the opinion that the defense sought to be made is ' unavailing. Somewhat similar questions have been discussed in two reported cases which are adverse to the contention of the defendant. (Coventry Mutual Live Stock Ins. Assn. v. Evans, 102 Penn. St. 281; Reck v. Ins. Co., 163 id. 443.) By the issuance of the policy in question the defendant was not engaged in transacting business outside of the territory prescribed in its articles of incorporation. By issuing the policy the company did not “ transact business ” beyond the territorial limits mentioned in its certificate of incorporation, and, therefore, did not commit an infraction of section 278 of chapter 690 of the Laws of 1892, as amended by chapter 907 of the Laws of 1896. Nor did it issue a policy on “ property out of the limits of the territory ” where it was authorized to do business by its articles of incorporation, and, therefore, did not, in terms, violate section 12 of chapter 573 of the Laws of 1886, which latter statute related to the formation of town and county co-operative insurance companies. In the opinion delivered by the learned trial judge many pertinent suggestions are made in respect to the construction of the policy in question. We quote with approbation from that opinion the following : “ In the absence of special restriction, clothed in clear and. unequivocal language, as to the territory within which the property was to be insured, it will be deemed to have been within the contemplation of the parties that the property might, be used in the-ordinary way, and, considering the nature of the property, that the insurance would continue to attach wherever the same may be while-the owner is using his property in the ordinary manner, and for the-purposes for which such property is ordinarily held and used.. (Wood on Fire Ins. [2d ed.] § 47; Noyes v. The Northwestern National Ins. Co., 64 Wis. 415 ; Longueville v. The Western Assurance Co., 51 Iowa, 553; Mills v. The Farmers' Ins. Co., 37 id. 400 ; Peterson v. Mississippi, etc., Ins. Co., 24 Iowa, 494.) ” - If the defendant desires to avoid its obligation of insurance of property as soon as the property is removed beyond the territorial limits in which it is authorized to transact business, it should insert a clause to.that effect in its policy, to the end that the party receiving the policy may have a clear understanding of the restrictions' and limitations sought to be imposed upon the owners of property. The foregoing views lead. to the conclusion that the defense attempted was properly overruled at the Trial Term.' Judgment affirmed, with costs. All concurred, except Follett, J., not sitting. Judgment affirmed, with costs.