Hubbard v. North British & Mercantile Insurance

Biggs, J.

— On the fourth of May, 1891, the defendant agreed with the plaintiff, Mattie C. Hubbard, to insure her frame dwelling house against loss by fire. The policy was for one year. The house was totally burned on the seventeenth day of September, 1891. The defendant having failed and refused to pay, the present action was instituted to recover the amount of the insurance, to wit, $400.

The action was defended on the ground that the assured in her application represented that the house was of the value of $600, when in fact its value did not exceed $300; that she represented that she had a fee simple title to the property, whereas she only held a contract for its purchase, and a portion of the purchase money remained unpaid; and that the plaintiff, when requested by the defendant so to do, failed to furnish to defendant a certificate of the nearest magistrate or notary to the effect that he had examined into the facts, and that he honestly believed that the assured had sustained loss to the amount claimed.

*4 The replication pnt in issue the new matter. There was a verdict for the full amount of the insurance, which was followed by a judgment. The defendant has appealed.

The only errors complained of, and which are subject to review, are: First, the action of, the court in admitting and rejecting evidence; second, the refusal of the court to direct a nonsuit at the close of the plaintiff’s evidence; third, that the court of its own motion gave improper instructions.

The second assignment of error must be sustained. The policy contained the following clause: “This entire policy, unless otherwise provided by agreement indorsed hereon or added hereto, shall be void, if * * the interest of the insured be other than unconditional and sole ownership-, or-if the subject of insurance be a building on ground not owned by the insured in fee simple.” It is .conceded that, at the time the insurance was taken out, the plaintiff had no deed to the lots upon which the house was situated, and that her title consisted of a bond for a deed. The deed was made after the fire. The statements of the plaintiff as to the date of the last payment on the lots are somewhat unsatisfactory, but, when her testimony is read as a whole, the conclusion is unavoidable that, at the time the property was insured, she owed a small balance of the purchase money which she paid before the loss. She was asked the following questions on cross-examination: “Q. You told him you had a good title to it? A. If I did not have a title to it, whose was it? Q. Don’t ask me, I am not a witness; I am asking you. You told him you had a good title to the house and lot? A. It was so near paid for, it was the same thing. It was mine.” On her re-examination the following question was asked: “Q. State whether or not you had almost paid for the lot before it was *5 insured! A. Yes sir, it was almost paid off.”

The acceptance of the policy with the foregoing clause therein was equivalent to a warranty- by the plaintiff that she had a fee, simple title to the lots on which the house was built, and that she was the sole and unconditional owner. Mers v. Ins. Co., 68 Mo. 127 . A fee simple title is nothing more than the absolute ownership of property in perpetuity, and it may exist without a deed. The supreme court declared this in Gaylord v. Ins. Co., 40 Mo. 13 . The court had a similar clause in a policy under consideration, and, in discussing what was meant by “absolute owners in fee simple,” said: “As .to absolute or full ownership of the property, whether it were by virtue of a legal or equitable title, it would seem to have been left to the general law on the subject of the interest of the insured. If he were the owner at the time of the loss, that would be enough; if he were not the owner, there could be no recovery on the policy. Under a somewhat similar claim, it has been held that the ‘absolute interest’ referred rather to the actual ownership than to the nature of the title, and meant a vested interest of which the owner could not be deprived without his consent, * in contradistinction to a contingent or conditional interest.’ Haight v. Ins. Co., 29 Conn. 10 . An equitable title, that would be protected by a court of equity as such, may be an ownership as absolute as the legal title. The clause does not concern the particular character of the owner’s title.”

We will assume that the title bond under which the plaintiff held was in the usual form, and that it provided for an absolute and unconditional deed when the purchase money was paid. This constituted the plaintiff the owner in fee simple of the lots within the meaning of the policy. But the warranty was broader than this. It was to the effect that the plain *6 tiff was the sole and unconditional owner of the property. This implied that she had paid all of the purchase money for the lots, and that there was no other incumbrance on the property. The plaintiff’s own testimony as preserved in this record shows that this portion of the warranty was broken. That the amount remaining unpaid was small can make no difference. Warranties in a policy of insurance can not be deviated from, whether they are material or not. Halloway v. Ins. Co., 48 Mo. App. 1 ; Maddox v. Ins. Co., 56 Mo. App. 343 ; Brooks v. Ins. Co., 11 Mo. App. 349 ; Loehner v. Ins. Co., 17 Mo. 255 ; McCullough v. Ins. Co., 113 Mo. 606 ; Mers v. Ins. Co., supra. Misrepresentations will not avoid a policy, unless found to be material to the risk, but not so as to warranties. They must be literally true. Abbott v. Ins. Co., 3 Allen (Mass.), 213.

It appears from the plaintiff’s testimony that the defendant’s agent visited the house at the time the application for the insurance was made, and that he made a thorough examination of the building and its surroundings. But there is nothing in her testimony to show that she disclosed to him the nature and condition of her title. Combs v. Ins. Co., 43 Mo. 148 ; Breckinridge v. Ins. Co., 87 Mo. 62 ; Franklin v. Ins. Co., 42 Mo. 456 ; Roberts v. Ins. Co., 26 Mo. App. 92 . Therefore, under any possible theory of law applicable to the facts proven there could be no recovery, and the court committed error in refusing to direct a nonsuit.

As the case is to be remanded and may be retried, we will briefly indicate our views concerning other questions presented by the record. It is claimed that the plaintiff falsely represented the value of the property, and that this avoided the policy. Generally speaking, the value of any species of property is a matter of opinion, unless it be some commodity which has *7 a well established market value. Parties in making contracts must be held to have contracted with reference to this. Therefore, a slight overestimate by the assured of the value of a house, such as might be accounted for by a difference of opinion, ought not to vitiate a policy of insurance. Especially is this true, if the amount of the policy is within the actual value of the property insured, and the agent of the insurance company made a personal examination and survey of the premises. If a stricter rule were applied, insurance, contracts would afford but little, if any, security. Ins. Co. v. Hall, 15 B. Monroe, 411; Catron v. Ins. Co., 6 Hum. 176 ; Hersey v. Ins. Co., 27 N. H. 149; Rice v. Ins. Co., 7 U. C. C. P. 548; Bonham v. Ins. Co., 25 Iowa, 328 ; Ins. Co. v. McDowell, 50 Ill. 120 . The over valuation may be so slight as to warrant the court in refusing to submit the question to the jury, and in other cases the over valuation may be so excessive as to authorize the court to direct a nonsuit.

In addition to notice and proof of loss the policy contained a provision that the plaintiff, if required, should in case of loss furnish the certificate of the nearest magistrate or notary public, to the effect “that he had examined the circumstances, and believed that the insured had honestly sustained loss to the amount that 'said magistrate should certify.” The evidence tended to show without contradiction that the defendant made a written request of the plaintiff to furnish the required certificate, and that the plaintiff failed to do so. This would preclude a recovery, unless the defendant at the time denied all responsibility under the policy. Baile v. Ins. Co., 73 Mo. 371 ; Weber v. Ins. Co., 35 Mo. App. 521 ; Fireman's Ins. Co. v. Crandall, 33 Ala. 9 ; Underhill v. Ins. Co., 6 Cush. 440 .

Judgment reversed and cause remanded.

All the judges concur.