Cagle v. Chillicothe Town Mutual Fire Insurance

Insurance: incumbrances: waiver: agent’s authority. A policy of insurance stipulated “that any incumbrance shall avoid the policy unless written consent by the secretary is obtained.” The application which is a part of the contract failed to mention certain unsatisfied mortgages. Held, the policy was void even though the local agent knew of the existence of the mortgages, since the secretary alone could consent to the incumbrances.

Appeal from the Jasper Circuit Court. — TIon. J. D. Perkins, Judge. . (1) It being admitted by the evidence that the property at the time of the application and issuing of the policy was incumbered for $1,000, renders the policy void. AYolf, Adm’r, v. Ins. Co., 1 Mo. App. Bep. 310; Lama v. Ins. Co., 51 Mo. App. 447; Barnes v. Ins. Oo., 30 Mo. App. 539; Men-sing v. Ins. Oo., 36 Mo. App, 602. (2) The clause in tbe application (and by the terms of the policy made a part thereof), “that any incumbrance shall avoid the policy unless written consent of the secretary is obtained,” is a valid and reasonable condition that the courts will uphold. Authorities above cited. Burnham v. Ins. Oo., 63 Mo. App. 85; Shoup v. Ins. Co., 51 Mo. App. 286; Sprague v. Ins. Co., 49 Mo. App. 423. (3) If the clause read, “any incumbrance shall avoid the policy,7 then a waiver might be shown by proving that the local agent of the company knew of the incumbrance. But under the terms of this policy the agent has no authority to waive such a condition and it is left solely to the secretary of the defendant. This point is plainly stated in the opinion of the court on page 91, 63 Mo. App. in the case of Burnham v. Ins. Oo. (1) The plaintiff, at the time the application for insurance was made to the defendant’s agent, having fully disclosed to him the existence and the amount of the incumbrances on the property and of his attempts and failure to procure other insurance upon the same, and the said agent having told plaintiff that -he would make no answer in the application as to the incumbrances, but that he would fully explain the facts to the defendant by letter in regard thereto, and plaintiff having signed said application without reading the same, and relying on the said agent’s statements, the defendant was, by the acts of said agent, precluded and estopped from claiming a breach of warranty as to incumbrances. Thackery v. Ins. Co., 62 Mo. App. 293; 1 Wood on Eire Ins., sec. 91; Haight v. Ins. Co., 92 N. T. 51; Hamilton v. Ins. Co., 94 Mo. 368; Anthony v. Ins. Co., 48 Mo. App. 65, 73. And this was true even though the policy provided that no agent had power to waive or modify any of the printed conditions of the policy. Burdick v. Life Ass’n, 1 Mo. App. Eep. 529; Burnham v. Ins. Oo., 63 Mo. App. 91. Where the agent effecting the insurance is notified of the incumbrances, and writes and delivers the policy and accepts the premium, and the policy is accepted in good faith by the assured, the company is liable. Eranklin v. Ins. Co., 42 Mo. 457; Ear-sons v. Ins. Co., 132 Mo. 583. (2) The clause that any incumbrances shall avoid the policy, unless the consent of the secretary is indorsed on the policy, relates to future incumbrances. This provision should be construed most .unfavorably to the insurer, and so as not to defeat the assured’s claim of indemnity. 1 May on Ins., sec. 175; Hoffman v. Ins. Co., 56 Mo. App. 301; Hosse v. Ins. Co., 84 Mich. 309; Hall v. Ins. Co., 93 Mich. 184; Hayward v. Ins. Co., -52 Mo. 181; Belkington v. Ins. Co., 55 Mo. 172; Murphy v. Ins. Co., 62 Mo. App. 497.