German Insurance & Savings Institution v. Kline

Irvine, C. This was an action by Kline against the insurance company to recover, upon a policy of insurance written on a frame building in the city of Omaha, the building having been destroyed by fire. The insurance company answered, admitting the payment of-the premium and the issuance of the policy, but denying that plaintiff was the owner of the building. Further answering, the defendant alleged that the policy provided that “if the interest of the assured in the property be any other than the entire, unconditional,- and sole ownership of the property for the use and benefit of the assured, or if the building insured stands on leased ground, it must be so represented to the company and so expressed in the written part of this policy, otherwise this policy shall be void;” that the building did stand upon leased ground, and that this fact was not communicated to the'defendant. Two other defenses were pleaded of an affirmative character, in support of which it was not sought to introduce any evidence. They will not, therefore, be noticed. The defense was actually made on two grounds: First, that notice and proofs of loss were not furnished ; and second, that the building stood on leased ground, contrary to. the terms of the policy. At the close of the [399] evidence the court instructed the jury that the only question for their consideration was the amount of damage, and that they should return a verdict for the plaintiff for such amount. After the loss the company wrote to plaintiff’s attorney a letter stating that the company denied all liability because the policy was void according to its conditions at the time of the fire. In its answer it pleaded that for three' different reasons the policy was so void. Notice" and proofs of loss are waived when an insurance company denies liability on the ground that the policy was not in force' when the loss occurred. (Phenix Ins. Co. v. Bachelder, 32 Neb., 490; Omaha Fire Ins. Co. v. Dierks, 43 Neb., 475; Dwelling House Ins. Co. v. Brewster, 43 Neb., 528.) As to the defense based upon the title to the land, the evidence showed that the policy contained the provision set out in the answer; that the building' belonged to the plaintiff, and that it stood on leased land. It appears that the Omaha, agents of the company were Kneutsen, Smith & Co., and that they had in their employ one Miller, who solicited insurance for them and received a commission on policies written. Miller approached the plaintiff, requesting insurance, and was told to return some days later and it would be given him.. Plaintiff told Miller that the building stood on leased ground. Miller filled: out a printed blank stating certain' facts in connection with the risk, but containing no reference to title. This he delivered to Kneutsen, Smith & Co., who issued the policy. - The insurance company claims that Miller was not the agent of the company and that plaintiff’s statement to him in regard to the title did not charge the company with notice, and that therefore the provision of the policy avoiding it because of the building’s being on leased ground was enforceable. It is not necessary to decide what the- nature of Miller’s agency was. If of such a'character as-to charge the company with notice, [400] then the facts in regard to the title were truly disclosed and the company issued the policy and received and retained the premium with such notice. This fact would estop the company from now insisting that the policy was void because of the lease-hold clause. (Phenix Ins. Co. v. Covey, 41 Neb., 724; German-American Ins. Co. v. Hart, 43 Neb., 441.) On the other hand, if Miller was not the agent of the company, then the policy was issued without any inquiry in regard to title. In any event it was issued without requiring any formal application, and there was certainly no concealment or misrepresentation by plaintiff. When an insurance company issues its policy and accepts and retains the premium without requiring an application by the insured, and without making any inquiry as to the condition of the property or the state of the title, and the insured has in fact an insurable interest, the company will be conclusively presumed to have insured such interest and to have waived all provisions in the policy providing for its forfeiture by reason of any facts or circumstances affecting the condition or title of the property in regard to which no such statement was required or inquiry made. The real contract of insurance is made before the policy is written, and the insured, by accepting the policy with such a condition as the one relied upon, cannot be deemed to have represented his title to be in fee-simple, or not by lease-hold. How can it be said that under such circumstances there has been either fraud, misrepresentation, or concealment on the part of the insured? He has represented nothing. He has not been asked to represent anything. To give such a condition the force contended for would, instead of protecting the insurance companyfrom fraud, be to permit it to work a fraud upon a policy holder, and permit insurance companies to avoid their policies all the more readily because of neglecting inquiry and investigation before writing them. On this point, as on most points of insurance law, the authorities are not alto [401] gether harmonious, but we think their great weight is in •accordance with the views we have expressed. (Philadelphia Tool Co. v. British-American Assurance Co., 132 Pa. St., 236; Commonwealth v. Hide & Leather Ins. Co., 112 Mass., 136; Castner v. Farmers Mutual Fire Ins. Co., 46 Mich., 15; O’Brien v. Ohio Ins. Co., 52 Mich., 131; Western Assurance Co. v. Mason, 5 Brad. [Ill.], 141; Dunbar v. Phenix Ins. Co., 72 Wis., 492; Cross v. National Fire Ins. Co., 132 N. Y., 133.) It is in accordance with the same principle that the courts have held with practical uniformity that where a formal application is required and some questions are left unanswered or not fully answered, and the company accepts the application in that form and issues its policy, the company'thereby waives the information required by such questions. (Phœnix Life Ins. Co. v. Raddin, 120 U. S., 183; Carson v. Jersey City Ins. Co., 43 N. J. Law, 300; Lorillard Fire Ins. Co. v. McCulloch, 21 O. St., 176.) There was no contradiction and no conflict in the evidence on any of these points, and it follows that in any view of the case the plaintiff was entitled to judgment. Therefore, the instruction given by the court was correct. Error is assigned on the refusal of certain instructions asked by the company. None of these related to the measure of damages, and as the peremptory instruction to find for the plaintiff was correct, it was not error to refuse any instruction asked by the defendant in regard to the right to recover. Numerous assignments of error relate to the rulings upon the evidence. But one of these is referred to in the briefs and the others are deemed waived. The plaintiff, on direct examination, was asked, “Who was the agent with whom you made the transaction when you got this policy ? ” This was objected to as calling for a conclusion. The objection was overruled and the witness answered, “ Mr. Miller.” It is claimed that this ruling was particularly prejudicial because a similar question was excluded when asked a wit [402] ness for the defendant. The latter witness was asked whether he knew Miller and then this question was put, “Was he an agent of the German Insurance & Savings-Institution at that time?” An objection to this question was sustained. Both rulings were free from error. In the question first quoted, put to the plaintiff, he was not asked for whom Miller was agent. There was no dispute as to-Miller’s agency either for the company or for the plaintiff in procuring the policy, and the question put to the plaintiff' merely asked as to the identity of the person. It involved no question as to his authority or the identity of the principal. The second question put to defendant’s witness called for a legal conclusion as to what constituted agency. The record discloses no error and the judgment is Affirmed.