Louck v. Orient Insurance

Opinion by Mr. Justice Dean, On February 1, 1894, defendant issued to plaintiff a policy of insurance against fire in the sum of $1,150, for the term of one year. The risk covered four buildings, described thus in the policy: “$750 on his two and a half story frame shingle roof building, 28 X 34 feet, occupied by the assured as a distillery, situated in Monaghan township, York county, Pa., near Bowmansdale. $250 on his iron clad building, 36 X 50 feet, and frame addition 18x20 feet, occupied as a bonded warehouse, situated about seventy-five feet east of distillery. $75.00 on his frame shingle roof hogpen, situated between distillery and warehouse, being about ten feet from the former and eleven feet from the latter. $75.00 on frame shingle roof building occupied as an icehouse, situate about thirty feet north of distillery.” Total, $1,150. On the 6th day of June, 1894, the property was wholly destroyed by fire. There was no question raised as to the fact of loss, or that preliminary proof of it, as required by the policy, had been made. But the policy contained this condition: “ This entire policy shall be void if the insured has concealed or misrepresented in writing or otherwise any material fact or circumstance concerning this insurance or the subject thereof. . . . Or if the subject of the insurance be a manufacturing establishment, and it be operated in whole or in part at night later than ten o’clock, or if it cease to be operated for more than ten consecutive days.” The undisputed testimony was, that the distillery was not in operation at the date of the policy or of the fire, and had been standing idle for about two and a half years; nor was it the intention of the owner to presently put it in operation. The policy in suit was a renewal of a previous one for one year in the same company, which was about expiring. Both the original and the renewal policy were delivered to plaintiff by L. T. Deininger; through him the business was transacted, and he received the premium from defendant; White & Jessop were the regularly authorized agents of defendant, and through them Deininger obtained the policies, and by them they were oounter [643] signed before delivery. As a fact found by tbe jury, Louck informed Deininger, both at the date the policy was issued and afterwards, that the distillery was not in operation, and he did not know when it would be; to which Deininger replied, it made no difference. The court submitted the evidence to the jury as to the value of the property destroyed, and also as to whether the insured informed Deininger that it was not in operation as a distillery at the date of insurance and afterwards. But the court, on an interpretation of the policy, assumed, and so instructed the jury, that the description of the property imported a distillery in operation at the date of insurance; if, however, the company had notice, by virtue of the notice to Deininger, that then and afterwards it was not in operation, that would be a waiver of the right to forfeit for a violation of the ten day clause. And further, whether the testimony as to notice to and knowledge on part of Deininger was notice to the company, was a question of law, which question the court reserved. The jury having found for plaintiff on the evidence as submitted, the learned judge of the court below, afterwards, in opinion filed, entered judgment for defendant, notwithstanding the verdict, on the question reserved. From that judgment plaintiff appeals, assigning five errors to the rulings of the court on the point reserved. They are all practically disposed of by a determination of the fifth. Assume, with the learned judge of the court below, Deininger occupied no such position towards the company as authorized him to waive written conditions of forfeiture, and that notice to him was not notice to the company; put completely aside the testimony which the jury believed, that Louck notified him expressly that the distillery was not in operation at the date of the policy, and had not been for more than two years, and that he had no intention of presently operating it, then, how stands the case ? The learned judge says: “ This policy is not binding upon the company, either because the risk was not truly represented, so that the company was deceived into issuing a policy upon a subject of insurance materially different from the true subject; or, if the insured is to be taken as bound by the description in the policy and if therefore he is estopped to deny that the distillery was in operation [644] when the policy was issued, then the contract is not binding, because the manufactory ‘ ceased to be operated for more than ten consecutive days.’ ” And this constitutes appellant’s fifth assignment of error. But putting aside Louck’s testimony, as we have already suggested, we cannot see any evidence tending in the least to show the risk was not truly represented, and that the company was not fully aware of the condition of the property when it issued its policy. The description in the policy is, that the property is “ occupied by the assured as a distillery; ” that is, the building containing the stills, the bonded warehouse seventy-five feet distant, of which the government had the keys; the hogpen eleven feet off, and the icehouse thirty feet. The insured had an office on the premises, which he occupied and in which he slept. There is not one word in the description suggesting the stills were then in operation; the purpose of the buildings is plainly indicated by the word “ distillery,” but nothing further. It must be borne ■ in mind, these are the written words of the company inserted in the contract framed by it, and are therefore to be taken as fully describing what they supposed they were insuring. It is not intimated that Louck represented the distillery was in operation, or that he concealed from the company the fact that it was not then and had not been in operation for years. But the company, instead of saying, if they so believed, “A distillery now being operated by the assured,” or “now being run by the assured,” or using language of like significance, adopts the very words which describe the exact condition of the property, a distillery, merely occupied by the assured. It was a distillery and intended by the owner as such, but not operated, and he did not know when it would be started; he occupied it then as he had for years before, and as he did for months afterwards, although in the whole time, he did not distil a quart of whisky. And without misrepresentation or concealment, this is just what the company, by its policy, insured, an occupied idle distillery, no matter what the scope of the authority of their agent. The agent did not frame the policy and insert the description; that is the company’s instrument. Every contract must be interpreted in view of the subject of it, and the surroundings of the parties at the date of it. A company receiving a property [645] owner’s money, and undertaking to idemnify him against fire by a written contract descriptive of the subject, cannot plead ignorance of the palpable condition of that subject, where there is no pretense of fraud, misrepresentation or concealment. We might as well assume that one who, by written contract, buys a farm could defend against payment of the purchase money, because it was upland instead of meadow, as he thought; for misrepresentation or concealment wliich misleads, equity will relieve, but not for ignorance of that which is before his eyes, and which he must see. Parties to such a contract as this are conclusively presumed to have seen that which was obvious. If at the date of the contract, the distillery had been running, and had afterwards stopped for more than ten days, the forfeiture clause might have been invoked; this, not because the word “ occupied ” implied it was in operation, but because, in view of the situation of the subject of the contract at the date of it, such would have been the reasonable interpretation. But how can this language defeat the contract, when the manufactory was not in operation at the date • of insurance ? It could not cease, when it had not commenced. Therefore, the forfeiture clause has no application to the facts of this case, and we will not wrest language from its ordinary meaning to enforce forfeitures which are odious. The judgment is reversed, and it is directed that judgment be entered on the verdict for plaintiff.