Cobb, Stribling & Co. v. Insurance Co. of North America

The opinion of the court was delivered by Valentine, J.: This action was brought by Cobb, Stribling & Co., as assignees of G. F. Bernstein, against the In — 497 — surance Company of North America, for the loss of a certain stock of goods insured by said company, and destroyed by fire. We have once before had this case under consideration, and we then decided such questions as were then presented to us. (Cobb v. Ins. Co. of N. A., 11 Kas. 93.) A new question is now presented, and that question is, whether Bernstein had a right under his insurance policy, and without any further or other permission from the insurance company, to keep gunpowder for sale in his store, along with his other goods, in such quantities and in such shape as it is usually kept for sale in country stores. The insurance policy, so far as it has any application to this question, provides for insuring Bernstein’s “stock of boots and shoes, dry goods, drugs, liquors, and such other goods as are usually kept for sale in a country store; and that “ gunpowder, saltpetre, phosphorus, petroleum, naptha, benzine, benzole or benzine varnish, are positively prohibited from being deposited, stored, or kept in any building insured, or containing any property insured by this policy, unless by special consent in writing indorsed on this policy, naming each article specially, otherwise the insurance shall be void.” Accompanying the policy, and a part of it, is the application of the assured, in the body of which he obtains, in writing, special permission to keep one of the prohibited articles, in words following: “Permission given to keep coal oil, not to exceed three barrels at 'any one time.” The first paragraph or clause above quoted from the policy is in writing, and the second is printed. Therefore, if there were any real and irreconcilable conflict between the two paragraphs, the first would, according to well-known rules of construction, be of controlling force in determining what the real intentions of the parties were. But we should not construe said paragraphs or clauses so as to make them conflict with each other, if such a construction can be avoided. On the contrary, we should construe them so as to make them harmonize, if such a construction is possible; and should construe them so as to give to each and, all their terms full force and operation. And in construing them we — 498 — should also take into consideration the rest of the instrument, the acts of the parties, and all the surrounding circumstances. By this means we can probably arrive at the real intention of the parties; and the real intention of the parties is the great end and object in the construction of all instruments. The two most natural constructions that can be given to said paragraphs, (provided it be attempted to make them harmonize,) would seem to be about as follows: First — The insurance company insures Bernstein’s “stock of boots and shoes, dry goods, drugs, liquors, and such other goods, [including “gunpowder, saltpetre, phosphorus, petroleum, naptha, benzine, benzole or benzine varnish,”] as [ the same] are usually kept for sale in a country store,” provided, that “gunpowder, saltpetre, phosphorus, petroleum, naptha, benzine, benzole or benzine varnish [except “as” they “are usually kept for sale in a country store”] are positively prohibited from being deposited, stored, or kept in any building insured or containing any property insured by this policy unless by special consent [of the company] in writing indorsed on this policy, naming each article specially.” Second — The insurance company insures Bernstein’s “stock of boots and shoes, dry goods, drugs, liquors, and such other goods [including “gunpowder, saltpetre, phosphorus, petroleum, naptha, benzine, benzole or benzine varnish] as [the same] are usually kept for sale in a country store,” provided however, that as to “gunpowder, saltpetre, phosphorus, petroleum, naptha, benzine, benzole or benzine varnish [said insurance does not extend except by the “special consent” of the company “in writing indorsed on this policy, naming each article specially,” and said articles] are positively prohibited from being deposited, stored or kept in any building insured or' containing any property insured by this policy, unless by special consent [of the company] in writing indorsed on this policy, naming each article specially.” Other constructions might also be given to said paragraphs; but we think the second one which we have given is the most natural, and it undoubtedly has this great advantage over all — 499 — others — it is the one which the assured himself gave to said paragraphs when he made his application for the insurance policy in which they are contained. If he had supposed that he could keep “coal oil” for sale without special permission from the insurance company, he would not have taken any trouble to obtain such permission. The reason for using the words or terms that the parties did use in said policy, instead of using some other words or terms, we think is obvious. It was evidently the intention of the parties, as we think, that every article of goods such as are usually kept for sale in country stores should be insured, either conditionally, or absolutely. But these articles are so various in kinds, and so unlimited in numbers, as to be practically infinite; and to name each article separately would be practically impossible. Then how are they to be named .or designated ? Some of them, as we have before stated, are insured absolutely, while others are insured only conditionally or contingently. Then how are these two classes to be designated ? Probably the only easy way of doing it would be to do it in the very manner that it was done in this particular case. First, use general language embracing all articles in both classes, and then by way of exception, limitation,- or modification use special terms, naming each particular article belonging to the smaller class. This can easily be done in this particular case, for in this case only a few articles, to-wit, “gunpowder, saltpetre, phosphorus, petroleum, naptha, benzine, benzole or benzine varnish,” belong to the smaller class. This use of language is common both in contracts, and in statutes. General language is first used embracing a large class of things, and is used with reference to such things absolutely and unconditionally. And then special words or terms, embodying an exception, a modification, a limitation, a proviso, or some condition,' is used with the intention of qualifying or explaining the previous general language. Bonds and mortgages in contracts, and provisos and saving-clauses in statutes, are good illustrations of this use of language. It is also, easy to be understood why the first paragraph above quoted from — 500 — the policy of insurance is in writing, and why the second is •printed. Insurance companies always use printed policies, with certain blank spaces left in them to be filled up when issued according to the circumstances of each particular case. And insurance companies, like the defendant in error, generally insure all kinds of personal property which they may be asked to insure, whether the same is kept in stores or somewhere else, whether the same is kept for sale or for use, or for some other purpose, and whether the same belong to a merchant, a mechanic, a professional man, a farmer, or to some other person. Hence a blank space is always left in the printed policy for the description of the property insured, which blank space must be necessarily filled up in writing when the policy is issued. But this is not so with reference to “gunpowder, saltpetre,” etc. They are always dangerous articles, and are therefore, and should always be sufficiently provided for in the printed policies. Or at least, they should be and are always sufficiently provided for so far as the insurance company is concerned. Such an insurance policy as we are now considering has never before received judicial construction. What force and effect should be given to the words, “ naming each article specially ” contained in this policy, have never before been judicially determined. Hence we are left to grope our way in- the dark so far as any exact judicial precedents are concerned. In certain cases, where the said words, “naming each article specially,” have been omitted from the policy, courts have said that the insurance by the company by a clause in writing of “all such goods as are usually kept for sale in a country store,” is a “ consent by the company in writing indorsed on the policy” to keep the prohibited articles in quantities and in the shape in which they are usually kept for sale in country stores. But no court has ever decided that such an insurance was a consent to keep such prohibited articles “naming each article specially.” In some of - said cases it has also been said by the court, in delivering the opinion, that there was a repugnancy between the written and the printed — 501 — clauses; but such of course has never been said in a case like the one at bar. In said cases the consent to keep the prohibited articles could be given and was given in general language; but in this case the consent must be given by “naming each article specially.” If the written clause in this case had so read as to insure Bernstein’s “stock of boots and shoes, dry goods, drugs, liquors,” “gunpowder, saltpetre, phosphorus, petroleum, naptha, benzine, benzole or benzine varnish,” “ and such other goods as are usually kept for sale in a country store,” then this case would be analogous to those cases, for the written clause in this case would then mention -the prohibited articles in the very language required by the printed clause, just as the written clause did in the cases to which we have referred. We do not think that there is any repugnancy in this case which the law will recognize between the written and printed clauses. Many analogous illustrations might be given, and we shall give two or three. Suppose that the granting part of a mortgage were written, and conveyed (as that part of the mortgage usually does) an absolute title, and that the defeasance clause were printed: then, if the mortgagee should bring an action on the mortgage, would it be held that there was a conflict between the written and the printed parts of the mortgage, and that the printed part was void? Would it be held that as the written part of the instrument was an absolute grant of the premises, and the printed part empowered the mortgagor, on the payment of a sum fixed, to have the instrument canceled, there was a conflict, and therefore the printed part should be disregarded, and the written treated as an absolute conveyance? And take the ease of an ordinary penal"bond, or a recognizance; and suppose that the obligation is written, and the conditions printed: the obligor, by his bond, admits that he owes, and binds himself in writing to pay the obligee a sum certain. By the condition, which is printed, he seeks to explain that he does not owe any money, and will not owe any, unless he fails to do a particular thing at some future time. Now there is as much conflict between the written and the printed — 502 — parts of this bond, as there is in the contract at bar; but would any court if called on to pass upon this bond, say that the printed part, being inconsistent with the written, must be ignored, and the obligor held to the payment of the money as upon an absolute promise to pay? And again: Suppose that a farmer should make an agreement to sell “all the corn then on his farm, being about five thousand bushels,” “provided, however, that he might if he chose retain two hundred bushels thereof for his own use.” Would any person suppose that there was an irreconcileable conflict between the two clauses, and that if the' first were in writing, and the second printed, that the second must be held to be void? After a careful consideration of the case, we have come to the conclusion that the printed clause in the policy in this case is not in conflict with any written clause therein. Or at most, there is no such conflict between any of the clauses of said policy as will render said printed clause void. The conflict, if any, is only to the extent that one clause modifies the other. Therefore, as gunpowder was not insured, except upon a condition precedent, which has never been fulfilled, and as it was absolutely prohibited from being kept upon the premises except upon a condition subsequent which has never been fulfilled, and as the assured did keep gunpowder on the premises in -violation of the express terms of his insurance policy, we think the policy was rendered void in accordance with its own express terms. ■ We have examined many authorities supposed to apply more or less nearly or remotely to this case, among which are the following, cited by the plaintiffs in error: Phœnix Ins. Co. v. Taylor, 5 Minn. 493; Whitmark v. Conway Fire Ins. Co., 16 Gray, 359; Niagara Fire Ins. Co. v. DeGraff, 12 Mich. 124; Harper v. Albany Mut. Ins. Co., 17 N. Y. 194; Bryant v. Poughkeepsie Mut. Ins. Co., 17 N. Y. 200; Harper v. N. Y. City Ins. Co. 23 N. Y. 441; Pindar v. Kings Co. Ins. Co., 36 N. Y. 648; Steinbach v. Lafayette Fire Ins. Co., 54 N. Y. 90; Hall v. Ins. Co. of N. A., 58 N. Y. 292; Archer v. Ins. Co., 43 Mo. 434; Wash. Ins. Co. v. Mer. & Man. Ins. Co., 5 Ohio St. 450; Franklin — 503 — Fire Ins. Co. v. Updegraff, 43 Penn. St. 350; Citizens Fire Ins. Co. v. McLaughlin, 53 Penn. St. 485. And the following cited by defendant in error: Steinbach v. Ins. Co., 13 Wallace, 183; Peoples Ins. Co. v. Kuhn, 1 Cent. Law. Jour. 214; [This case will probably also be reported in 9 Heiskell’s Tennessee Reports]; McComber v. Howard Fire Ins. Co., 7 Gray, 257; Whitmarsh v. Charter Oak Ins. Co., 2 Allen, 581; Commonwealth v. Hide & Leather Ins. Co., 112 Mass. 136. Now we think that the printed clause in the present insurance policy may be held to be valid without conflicting with any of the foregoing decisions; but it could not be held to be invalid without conflicting with the last five of said decisions. The judgment of the court below will be affirmed. Brewer, J., concurring. Horton, C. J., not sitting in this case.