98 Pa. 41 | Pa. | 1881
delivered the opinion gí the court,
The application and policy evidence the contract between these parties, and it is stipulated that “ this application shall form a part of this policy of insurance, and all the statements herein shall constitute warranties on the part of the insured.” One of the statements is, that the amount insured on the property is $1,500 in Pennsylvania Mutual, of Columbia. In fact, the amount of insurance was $2,000. To avoid the consequences of a breach of his warranty, Huntzinger called James W. Ziebach, who testified that he was agent for the company defendant, and also for the Pennsylvania Mutual, of Columbia ; that the defendant did not furnish him blank policies to write and issue; that he received the application, sent it to the company, and if it accepted the risk, the policy was forwarded .to him and he delivered it to the insured. When he took this application he read the question, “ What amount is there insured on the property, in what company, and in whose name ?” Huntzinger “Said he had $1,500 or $2,000insurance in the Pennsylvania Mutual, he didn’t know wliich. He thought it was $1,500. I said, ‘ We ought to know for sure.’ He said, ‘ My policy is at the house.’ He didn’t have it in the store, and he was not sure about it. He was under the impression it was $1,500, and put it down $1,500. I said, we would put it down $1,500 because I thought it was that. And he signed the application.”
It is clear beyond question that the plaintiff intended to make the statement as written when he signed the paper, and knew just what he was doing. There was no mistake or fraud
The distinction between a representation and a warranty is too broad and well-defined to require remark. For an injury arising from a false representation, the remedy is in case for tlie deceit, bad faitli lying at its foundation; for an injury by a breach of ivarranty the action is upon the contract, and it is immaterial whether the defendant did or did not believe the fact be warranted. Precisely the same principles apply in making a defense on the ground of the plaintiff’s false representation, or breach of warranty, as would in sustaining an action on such ground. Hero, no question was raised as to false representations by Huntzinger which involved fraud or bad faith on his part. The testimony adduced by himself plainly revealed his broken warranty, and the chief question was as to the effect of that upon his claim under the policy. It is not material whether the agent knew of the breach. “ Mere mutual knowledge by the assured and the agent of tlie insured of the falsity of a fact warranted, is entirely inadequate to induce a reformation of • the policy so as to make it conform with the truth. It is rather evidence of guilty collusion between tlie agent and the assured, from which the latter can derive no advantage.” Knowledge by the underwriter, or by him and the assured, of the breach of
In Cooper v. Farmers’ Mutual Ins. Co., 14 Wright 299, it was held'that that which is a warranty in a policy of insurance by its terms, cannot be shown by parol evidence to have been inserted by mistake. ' This certainly is sound, if understood with reference to such mistakes of the assured as when he makes a false statement, believing it to be true, without having been deceived and misled by the other party. No principle of law will enable a party who guarantees a fact upon which a contract for insurance is based, which fact is afterwards found not to exist, to enforce the contract. He agrees to answer for the truth of the fact, and cannot escape on the ground of his mistake as to its existence. But if by a fraud or mistake 'of the other party, or of the agent of the other party while acting within his authority, he be induced to sign a statement which he did not make and did not intend to make, such statement is not only void as to himself, but he shall not lose the benefit of a contract for which he paid the stipulated consideration, and held without knowledge of the mistake or fraud. If an agent for an insurance company, intending to write an answer to his question as made, by the applicant, write something else, and the paper is signed, both believing the answer correctly written, there is a mutual mistake, and the policy may be reformed. Where the answer is written as made, there is no mutual mistake, and no relief for him who warranted it, unless the agent deceived him into the making of it.
The cases of Smith v. Farmers and Mechanics’ Mutual Fire Ins. Co., 8 Nor. 287, and Eilenberger v. Protective Mutual Fire Ins. Co., Id. 434, are not at all in conflict with prior decisions as to the effect of a warranty actually made; they relate to the admissibility of evidence to show fraud or mistake by an agent of the company, of which the assured had no knowledge till after his
We are of opinion that plaintiffs fifth point should have been refused, and the defendant’s point affirmed. If the jury believed the evidence of Ziebach, the plaintiff was not entitled to recover. The facts assumed in the defendant’s point were shown by written evidence, and were not disputed.
The conditions of insurance provide that notice of additional insurance, or of any change in existing insurance, shall be given to the company by the insured in writing, and shall be acknowledged in writing by the secretary; and no other notice shall be binding or have any force against the company. In absence of evidence of waiver of the notice required in this stipulation, we do not think “ the jury would be justified in inferring that the knowledge of the agent will bind the principal of notice of subsequent insurance or surrender of previous insurance.” The parties agreed that written notice should be given, and in like manner acknowledged by the secretary; mere knowledge of an agent is not the equivalent of that.
Judgment reversed.