Smith v. National Fire Insurance Co. of Hartford

AlleN, J. The lumber of the plaintiffs was insured by the defendant upon condition that a space of 200 feet should be kept clear between the lumber and any wood-working establishment or drykiln, with provision that this stipulation should not be construed to prohibit loading •or unloading within such space. The lumber destroyed was within 200 feet of a sawmill, which had been used to manufacture lumber but was not in operation at the time of the fire and had not been for several days, being stopped in contemplation of a removal of the mill to another location. The lumber of the plaintiffs was being loaded as rapidly as possible at the time of the fire, which did not originate in or about the sawmill but at a distant point, nor was its origin due to the negligence of the plaintiffs or their agents. Does the fact that the lumber was within 200 feet of the sawmill, under these circumstances, relieve the defendant from liability? "We think not. “The rule of construction prevails almost universally that contracts of insurance are construed against the insurer and in favor of the insured, and this has not been changed by the adoption of standard form of insurance. Wood v. Insurance Co., 149 N. C., 385; Gazzam v. Insurance Co., 155 N. C., 338; Cottingham v. Insurance Co., 168 N. C., 265.” Johnson v. Insurance Co., 172 N. C., 146. Doubts as to the meaning of ambiguous terms and phrases are resolved against the insurer, and Mr. Yance says in his work on Insur- *318 anee, quoted in Jones v. Casualty Co., 140 N. C., 264: “Probably tbe most important general rule guiding tbe courts in tbe construction of insurance policies is tbat all doubt or uncertainty, as to tlie meaning- of tbe contract shall be resolved in favor of tbe insured.” Again,-tbe Court says in R. R. v. Casualty Co., 145 N. C., 116: “When doubt arises by reason of tbe language employed to express tbe agreement, so tbat it admits of two interpretations, tbe courts, as a general rule, adopt tbat one which, without any violence to the words selected by the parties, will sanction tbe claim and cover the loss. Goodwin v. Assurance Society, 97 Iowa, 226; Kendrick v. Insurance Co., 124 N. C., 315,” and in Johnson v. Insurance Co., supra, “The courts look with disfavor upon forfeitures,” Skinner v. Thomas, 171 N. C., 98, and tbe trend of modern authority is that a stipulation in a policy which might avoid it does not have this effect if it in.no way contributes to the loss. Cottingham v. Insurance Co., 168 N. C., 264. Applying these principles, the defendant cannot be relieved from liability. The language used, “a wood-working establishment,” while perhaps comprehensive enough to include a sawmill, which merely cuts the logs into rough lumber, is not usually so applied, but to plants with more complicated machinery. “Woodwork” is defined in the Century Dictionary as “objects or parts of objects made of wood, tbat which is produced by tbe carpenter’s or joiner’s art,” and “woodworker” as “a worker in wood, as a carpenter; joiner, or cabinet maker,” and those employed to operate a sawmill are generally referred to as a sawyer and tbe bands, and are not carpenters, joiners, or cabinet makers. The term is at least ambiguous, and might be held not to include a sawmill, but conceding tbat it does so, when considered in connection with the nature of the contract and the danger sought to be provided against, it reasonably means an establishment working wood at the time of the injury complained of. The purpose of the condition, requiring a clear space of 200 feet, was to decrease tbe risk and tbe danger apprehended was tbe escape of fire from the wood-working establishment. The parties had in mind a live plant and not a dead mill, and the contract should be given a reasonable construction to conform to its spirit. Suppose the mill had been located and abandoned without being operated a day, would it not be “sticking in the bark” to say there could be no recovery because the lumber was within 200 feet of a min which had never had fire in it, and when there was no accumulation of sawdust or any other inflammable matter, and if so why should not the same rule prevail when the mill had not been operated for several days in contem *319 plation of a removal, and when there is no evidence of an accumulation of combustible matter about the mill or that the fire originated near the mill. The stipulation in regard to the drykiln also throws light upon the meaning of the contract because there is no accumulation of combustible matter of any kind about a drykiln, and the only danger of fire on account of nearness to one is while it is in operation. Again, the proximity of the mill did not in any degree contribute to the loss as the fire did not originate in or about the mill and reached the lumber of the plaintiffs from a point more than 200 feet from the mill. Again, this stipulation, on which the defendant relies, expressly provides that it shall not be construed to prohibit the loading and unloading of lumber within 200 feet of the wood-working establishment, and the parties have agreed that the plaintiffs had bought the lumber a few days before the fire, and at that time they were loading and hauling the lumber as rapidly as possible. In our opinion, the defendant is liable under the contract of insurance and judgment should be entered in favor of the plaintiffs upon the agreed statement of facts. Reversed.