131 Iowa 180 | Iowa | 1906
The policy of insurance sued on was' issued to the plaintiff upon an application in which he was asked: “ What is your title to the land on which the above-described property to be insured is situated % ” and answered: “ Sheriff’s certificate. I will get a sheriff’s deed on June 5, 1904.” Notwithstanding a condition declaring the contract void if the assured had less than a title in fee simple, no question is raised as to its validity on that ground. The reason for not doing so will appear later. One Baker was owner of the premises which had-been sold on execution to plaintiff, and a sheriff’s certificate of sale issued accordingly. The house burned down April 26, 1904, and plaintiff .acquired a sheriff’s deed June 13th following. Evidence was offered tend
The doctrine is peculiar to the law of insurance and is founded on the laudable design of preventing the perpetration of a fraud through obtaining a premium by the insurance of a policy known to be void ab initio. As an original proposition it would be difficult to defend this exception to the general rule that he who becomes a party to a contract is presumed to have knowledge of its contents and is bound thereby, unless prevented from ascertaining them by some artifice or deception. But such contracts are so common and of such universal use in the business world that they are ordinarily spoken of as commodities rather than individual agreements. Insurance is bought and sold, according to the speech of the people. To omit reading the application before signing it or the policy upon its receipt is not deemed negligence as a matter of law, as would be the ease with other instruments. Fitchner v. Insurance Co., supra. To obtain money as a premium for a policy of insurance known to be void is like procuring it for any other worthless article known to be such on the pretense that it has value. If the scheme were to prevail, it would be more reprehensible even, for thereby the assured would not only lose the money paid as a premium, but be deprived of the opportunity of insuring with others in order to guard against great loss. Notwithstanding the condemnation of- the doctrine by the majority of the court in Northern Assurance Co. v. Grand View B. Ass’n, 183 U. S. 308 (22 Sup. Ct. 133, 46 L. Ed. 213), it has the approval of the overwhelming weight of authority.
But the facts of this case do not permit of its application, At the time the policy was issued to plaintiff the premises were occupied by the owner. The house was not
That the insured’s interest conferred on him neither the right of possession nor control can make no difference. He could contract for the insurance of the house while occupied by another and stipulate that upon its becoming vacant the policy should stand suspended until occupied again, precisely as though he had been owner, and this even though without authority to place any one in possession. The parties to the contract might well have proceeded on the theory that the possessory use of the property was of such value that it would be likely to continjie, as it then was in the occupancy of either the owner of the fee or some one under him. The term of the policy extended nearly two years from the date the assured might obtain a sheriff’s deed.
The agreement that the house should be insured when occupied and the policy suspended when vacant was not limited to property of which the assured might be in possession