Continental Insurance v. Ward

Opinion by Green, C.: This was an action instituted by Dennis Ward in the district court of Franklin county, upon a policy of insurance against fire issued by the Continental Insurance Company, of New York, for $2,500, distributed as follows: $150 on barn No. 1; $200 on wagons, buggies, harness, robes, and saddles, while on premises of assured; $300 on stallion “Bashaw;” $300 on a jack, and $1,300 on horses, mules, and colts; $250 on cattle, while in barn and on the farm, and against lightning on or off the premises. The fire destroyed barn No. 1, the stallion, jack, and some other personal property, covered by the policy, in the barn. The plaintiff asked judgment for $850. A trial was had by the court and a jury, which resulted in a judgment in favor of the plaintiff for $518.70 for the personal property destroyed. The court instructed the jury that there could be no recovery for the loss of the barn, because foreclosure proceedings had been commenced and prosecuted until the plaintiff had been divested of all title to the same. Certain questions were asked and answered in the application for the insurance by the insured, as follows: “ Have you a warranty deed to the land herein described and referred to? Ans. Yes. “ Is the land incumbered? A. No. “If so, what amount? A. $800. “When due? A. 1887.” As to the incumbrance upon the personal property, there was no answer. It seems from the evidence that the land was incumbered for more than $800. The personal property was also incumbered. The agent taking the policy, however, had [349] knowledge of such incumbrance. After the policy of insurance had been issued, and before the fire, the holder of the chattel mortgage sold the property under the mortgage, and the property which was afterward destroyed by the fire was bid in by the plaintiff. The only question presented is the liability of the insurance company for the loss of the personal property. The trial court said, among other things, to the jury: “I hold further, gentlemen, that as the policy itself specifies certain separate amounts, upon different classes of property, it is divisible, and the fact that the policy was void as to the barn does not make it void as to the personal property.” This the plaintiff in error insists was erroneous; that the court should have told the jury that the policy was void ab initio. This court in a very recent case has held, that where separate valuations have been placed upon different subjects of insurance, the contract is severable. (Insurance Co. v. York, 48 Kas. 488.) Upon the authority of that case and the cases there cited, the instruction was proper. The contention of the plaintiff in error that the policy was annulled, if not by the false statements as to the incumbrance upon the land, at any rate by the giving of a mortgage upon the personal property, is not tenable, because the agent taking the application and consummating the contract of insurance must have known the real condition of the title or ownership of the chattel property. (Insurance Co. v. Barnes, 41 Kas. 161; Am. Cent. Ins. Co. v. McLanathan, 11 id. 533.) It is contended that the sale of the insured personal property under the chattel mortgage to the plaintiff avoided the policy. We fail to see wherein the risk was increased. Before the sale the plaintiff only had a contingent interest in the property; after the sale his title became absolute. A change of title which increases the interest of the insured, whether the same be by sale under judicial decree or by voluntary conveyance, will not defeat the insurance. (Bailey v. Am. Cent. Ins. Co., 13 Fed. Rep. 250; Esch Bros. v. Home Ins. Co., 78 Iowa, 334; Bell v. Insurance Co., 39 Am. Dec. 542.) [350] We recommend that the judgment of the district court be affirmed. By the Court: It is so ordered. All the Justices concurring.