Mount Leonard Milling Co. v. Liverpool & London & Globe Insurance

Philips, P. J. -There is no ground for controversy but that, under the application for, and. the provisions of, the policy of insurance, the statement by 'plaintiff respecting the quality of his title to the sacks was made express warranty. Loehner et al. v. Home Mutual Ins. Co., 17 Mo. 247 ; American Ins. Co. v. Barnett, 73 Mo. 364 ; Wood on Insurance, sect. 137. It is equally undeniable that if the interest of the assured in the sacks was any other “than the entire, unconditional and sole ownership,” his cause must fail. Authorities, supra; Mers v. Franklin Ins. Co., 68 Mo. 131; Reithmueller v. Insurance Co., 20 Mo. App. 250 ; Ins. Co. v. Montague, 38 Mich. 548; Southwick v. Atlantic Ins. Co., 133 Mass. 457; McCormick v. Mutual Ins. Co., 66 Cal. 361. This is to be distinguished from that class of cases where the question is, had the plaintiff an insurable interest in the property % There is no doubt in my mind but that, by the terms of the contract under which the plaintiff held the sacks, he had an insurable interest in them; and that the measure of his recovery would have been the market value of the property at the time of the loss ; for that was the measure of his liability over to the Cole Bros. Shaw v. Ætna Ins. Co., 49 Mo. 578. But the question here is one of contract — an express warranty — that the interest of the assured in the property was the absolute ownership, with the stipulation that if his interest was otherwise the policy was not binding. The single question, therefore, is, was the plaintiff the entire, unconditional, and sole owner of the sacks ? It must be admitted that his relation to the sacks was somewhat peculiar. There was no limitation placed [265] by the contract between him and Cole Bros, as to the time when the letting should cease. The plaintiff was to pay a sum certain as rental during the time he kept them. From which it would seem that the lease or bailment would continue at the pleasure of the plaintiff, so long as he chose to pay the rental. It was, however, still a lease, for the agreed statement of the facts is, the Cole Bros, “leased them to plaintiff.” This, without more, would defeat the plaintiff’s claim, that he was the absolute owner. The interest and estate of a lessee is less than the absolute, unqualified ownership. But plaintiff contends that this admitted quality of his estate is énlarged into an absolute one by the subsequent provision of the contract, “ that plaintiff should pay Cole Brothers Commission Company for all such sacks which should not be returned to it, by plaintiff, at the market value.” Did this amount to a sale of the sacks, or even a contract of sale? A sale of personal property is a transfer of the absolute, or general, property in a thing for a price in money. There must be a transfer of the absolute or general property in the thing sold; “for, in law, a thing may, in some cases, be said to have, in a certain sense, two owners, one of whom has the general, and the other a special, property in it; and a transfer of the special property is not a sale of the thing.” Benj. on Sales, sect. 1. There was certainly no intent on the part of the parties to the contract, to pass a present title, absolute, in the sacks from Cole Brothers to plaintiff. As lessee, the plaintiff was only a special owner. The general ownership remained in the lessor, for the plaintiff was to pay the company for the use of the property, and did so pay for the same up to the very instant of the fire. It certainly is incompatible with the idea of general, absolute ownership in the thing, that plaintiff should pay, under contract, for the use of what he himself owned absolutely. It occurs to me that the facts of this case bring it [266] within that line of cases which regard the contract a bailment, as distinguished from a sale. Where one receives goods upon a contract to keep them, a certain period, and, if he pays for them in that time, to become the owner, but, otherwise, is to pay for the use of them, it is a bailment, and the property in the goods is not changed until paid for. Rose v. Story, 1 Barr. 195 ; Sargent v. Giles, 8 N. H. 325. In Enlow v. Klein (79 Pa. St. 488), Enlow furnished Klein’s vendor with a team of horses and wagon to use in peddling. He was to pay Enlow at the rate of five dollars per week until the sum reached two hundred dollars, the value of the property, when he was to become the owner. The court say, that the intent of this contract was for the owner to place the property in the possession of another, for the use of which he was to be paid, in the aggregate, two hundred dollars, and the ownership was to vest in that other party only on payment of that sum ; that, until that was done, it was a mere bailment — the ownership of the property remaining in Enlow. “No present interest was created in the bailee by this agreement, so as to make the property subject, in his hands, to the claims of execution creditors.” So, in Crist v. Kleber, a piano was rented for a rent payable quarterly, the rent to determine at the election of the lessor, if the rent were not paid; with privilege to the lessee to buy, and, if purchased, all sums paid as rent to be deducted from the purchase price. The court held it to be a continuing lease, determinable at the option of the plaintiff, if the rent was not paid. “The property remained in bailment, and, consequently, was not liable to a sale for payment of his (the lessee’s) debts, or for taxes.” Had the plaintiff, in this case, become insolvent, without having paid to Cole Brothers the market value of the sacks, they could not, according to the authorities supra, have been taken in execution for plaintiff’s debts. The underlying difficulty in [267] the plaintiff’s way is the fact that there was no bargain and sale. The plaintiff took as lessee, or bailee, to pay a stipulated sum per month for the use of the sacks. He -was to so pay as long as he kept them. He had the option, it may be conceded, to end, at any time, the relation of bailor and bailee, by paying to the bailor the market value of the sacks, and thereby relieve himself of the obligation to pay the rental, and become the absolute owner. But, until he made the election, by making, or tendering, payment of the value, the relation of bailor and bailee continued. If it can be regarded as an election at all, the plaintiff did not make it until after the destruction of the property by fire. The doctrine of title by operation of the fiction of relation, as applied in the case of Gaylor v. Lamar Insurance Company (40 Mo. 18), has no application to the facts of this case. Had the plaintiff made his election by paying for the sacks prior to the loss by fire, there might be some color for the application of that doctrine. But when the contract of insurance was consummated, and when the loss occurred, the plaintiff was paying Cole Brothers for the use of their property. He was then a lessee, or bailee. The stipulation to pay for all such sacks as should not be returned was little more than what the law would have implied in the absence of such express agreement. Regarding it, however, as an option accorded to plaintiff to pay the value of the sacks, he could only become the owner by exercising that election. This election he could not defer until after the loss by fire. The legal status of the title must be determined, at the latest admissible time, by the facts as they existed when the fire occurred. No subsequent act of the plaintiff, by paying his bailor for property which he had not returned, could affect the special contract of insurance. It must follow that the judgment of the circuit court should be affirmed, The other judges concurring, it is accordingly so ordered.