Roloff v. Farmers' Home Mutual Insurance

Dodge, J. Tbe reckless interposition of defenses involving charges of crime and fraud is not creditable to a corporation organized to supply indemnity to those unfortunate enough to lose their property by fire, where, as seems to be tbe case here, such charges have no foundation even, apparently, in tbe imagination of tbe defendant. Tbe charges of arson in destruction of tbe property and of perjury in tbe proofs of loss have not been supported, nor sought to be, by tbe offer of a word of evidence of any sort. Tbe remaining allegation of intentional and fraudulent withholding of knowledge in relation to tbe title of tbe property bad apparently slightly more of good faith to excuse it. Plaintiff bad stated in bis application to tbe defendant’s agent tbat the property [404] to be insured was not incumbered; that it stood on leased ground; that it was occupied by the owner; and that the same was a full exposition of all facts in regard to the condition,, value, and risk of the property to be insured so far as known to the applicant and material to the risk. This statement was-made to an agent who, as plaintiff was perfectly aware, had full knowledge that the ground belonged to one Conrad, that the building had been erected thereon by one Armstrong, under lease from Conrad, and that the same company had carried insurance thereon for Armstrong, and had twice insured the building for plaintiff after its transfer to- him from Armstrong. The utmost diligence of counsel has been unable to suggest any untruth in the letter of these affirmative statements. Of course, both parties to the conversation understood that the property referred to was the building, and that was wholly unincumbered, except as any building erected by a lessee may be said to be incumbered by tire rights of the landlord. The building was occupied by the owner, namely, the plaintiff, and the defendant’s agent well knew that he, and not the owner of the ground, occupied it. It was on leased ground, as the agent had known, for many years, and as he communicated somewhat industriously by letter to the president of the company before the insurance was written. But was there any fraudulent concealment of other facts which the plaintiff knew, and knew to be material to the risk ? Here it is urged that, since the lease to Armstrong contained a prohibition against underleasing the premises without the consent of the owner and a provision that the latter might expel the lessee in such an event, plaintiff’s occupancy was momentarily terminable by the landlord, and that this fact was one enhancing the risk. The evidence is well-nigh conclusive that plaintiff had no knowledge of any such situation. When Armstrong sold him the building he had also manually transferred to him the lease, and plaintiff, according to his own testimony, had notified the owner of the land [405] and obtained bis consent to sucb assignment of right of possession. In this he is in some measure contradicted by Conrad, who, however, upon cross-examination, admitted a part of the conversation which he had first denied in toio, and admitted further and subsequent dealings with the plaintiff serving strongly to confirm the probability of latter’s statement, so that we do not hesitate to hold that the evidence preponderates in its favor, although the trial court has not found specifically on that question. Obviously the transaction between Armstrong and Roloff evinced a purpose in both to transfer from one to the other the full term for which the land was occupied, for the sale of the building was absolute and complete. Whether such assignment could be effective at law without writing under the statute of frauds, a most persuasive case was presented for equity to declare and enforce it,' for plaintiff had at once gone into possession on the faith of whatever oral agreement was made between him and Armstrong, had paid over $700 for the building, and had expended large sums in the improvement, enlargement, and equipment thereof. Certainly a claim by Armstrong to possession of the land would have been deemed fraudulent as against plaintiff. We cannot escape the conclusion that plaintiff had, by virtue of such conduct of Armstrong and the consent by Conrad, become assignee of said lease, and tenant according to- its terms, so that his statement was strictly true, even construed as declaring that the ground -was leased to him. The evidence wholly fails to show that any facts were known to the plaintiff in any wise limiting his absolute title to this building or affecting the insurance risk thereon, except the one fact that he did not own the ground on which it stood, and that he communicated industriously in his application. If defendant was interested to know the terms of the lease 'or tenancy as affecting the value of plaintiff’s interest in the building, the duty was upon it to inquire. When an applicant for insurance has answered truthfully all the questions [406] submitted to Him and bas not suppressed any fact witbin bis-knowledge tending to enhance tbe risk, be bas performed all tbat is required of bim. If more information is necessary to a full understanding of tbat risk, it is tbe duty of tbe insurer to seek it, or at least ask for it. Alkan v. N. H. Ins. Co. 53 Wis. 136, 141, 10 N. W. 91; Dunbar v. Phenix Ins. Co. 72 Wis. 492, 501, 40 N. W. 386. By the Court. — Judgment affirmed.