McIntosh v. North State Fire Insurance

PROWN, J. This action appears from the complaint to be brought by A. TL McIntosh, Sadie and Pearlie Price, infants, by their next friend, A. H. McIntosh, and Sallie McIntosh, wife of A. H. McIntosh, to recover for a loss by fire upon a standard policy of insurance in which A. H. McIntosh is the sole beneficiary. Prom the complaint it appears that- the property belonged to C. R. Price, and at his death descended to his two daughters, the infants herein named, and that his widow has a dower interest in a portion of it. Plaintiff A. H. McIntosh married the widow, and afterwards at his own expense “repaired, enlarged and constructed a house, on his wife’s part of the land,” which is the house destroyed-by fire and covered by the policy of insurance. The policy is referred to and made a part of the complaint. It is standard in form and contains the following clause: “This entire policy shall be void if the insured has concealed or misrepresented, in writing or otherwise, any material facts or circumstance covering this insurance, or the'subject .thereof; or if the interest of the insured in the property be not truly stated herein; * * * or if the interest of the insured be other than unconditional and sole' ownershipor if the subject of insurance be a building on ground not owned by the insured in fee simple.” 1. It is patent that upon the allegations of this complaint A. H. McIntosh cannot recover. He is not an unconditional or sole owner. In fact, he has no legal or equitable estate in the land. Jordan v. Insurance Co., 151 N. C., 340; Weddington v. Insurance Co., 141 N. C., 234, 239; Hayes v. Insurance Co., 132 N. C., 702; Coggins v. Insurance Co., 144 N. C., 7; Cuthbertson v. Insurance Co., 96 N. C., 480. 2. But it may be that as to the other plaintiffs the complaint is a defective statement of a good cause of action, and that it may be made plain by amendment. A bill in equity may be entertained to reform a written policy of insurance after the loss has occurred, upon the ground that it does not express the true contract entered into because of mutual mistake or a mistake of the draftsman. Snell v. Insurance Co., 98 U. S., 25. *54 There is nothing sacred about an insurance policy which exempts it from reformation under the same equitable doctrine applied to all other written contracts. In Henkle v. Insurance Co., 1 Ves., case 156, p. 318, the bill sought to reform a written policy after loss had actually happened, upon the ground that it did not express the intent of the contracting parties. Lord Hardwicke said: “No doubt but this Court has jurisdiction to relieve in respect of a plain mistake in contracts in writing as well as against frauds in contracts, so that if reduced to writing contrary to the intent of the parties, on proper proof, it would be rectified.” If the plaintiffs can establish by the proper degree of proof that this contract of insurance was made for the benefit of the wife and the two infants, who are the owners of the property, and that by mutual mistake, or the error of the draftsman, A. H. McIntosh was erroneously made the beneficiary therein, instead of the other plaintiffs, they will have made out a cause of action which will entitle them to a reformation of the written policy. The cause is remanded, to the end that the plaintiffs be allowed to file another complaint. The plaintiffs will be taxed with costs of this Court. The judgment of the Superior Court is modified and Affirmed.