167 Ind. 659 | Ind. | 1905
Lead Opinion
This action was brought by appellees upon a policy of insurance against loss by fire. The policy contained the following, among other provisions:
"This entire policy shall be void if the insured has concealed, or misrepresented in writing or otherwise, any material fact or circumstance concerning this insurance or the subject thereof; or if the interest of the insured in the property be not truly stated herein; or in case of any fraud or false swearing by the insured, touching any matter relating to this insurance, or the subject thereof, whether before or after the loss; this entire policy, unless otherwise provided by agreement, indorsed hereon and 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."
Appellant answered the complaint in six paragraphs, the first, second and sixth of which were afterwards, by agreement, withdrawn. The third paragraph of answer alleged that "at the time said policy under which plaintiffs' claim was issued, and at the time of said loss and damage by fire, the interest of the plaintiffs in the buildings, additions, and appurtenances mentioned in said policy of insurance, and for loss and damage of which, by fire, the plaintiffs have brought this action, was not that of sole and unconditional ownership, and said building and its additions and appurtenances were not, at the time of the issuance of said policy, and were not at the time of said loss and damage by fire, on ground owned by the plaintiffs or either of them in fee simple; and therefore said policy of *663 insurance, so issued to them, was and is, by the provisions of the contract in the complaint mentioned and set out, void." The fourth paragraph alleged, in substance, that although it was not so provided by agreement indorsed on or added to the policy, yet the subject of insurance was, at the time of issuing the policy and of the fire, a building on ground not owned by assured in fee simple, but that at said times the plaintiffs' interest in said' premises was that of life tenants only, and the fee was in other persons named. The fifth paragraph alleged that, although it was not so provided by agreement indorsed on or added to the policy, nevertheless, at the time of issuing said policy, and at the time of said fire, the interest of plaintiffs in the subject of insurance was not that of unconditional or sole ownership, but was that of life tenants only; the remainder in fee in and to the subject of insurance being at said times vested in other persons named.
Appellees replied to the third paragraph of answer herein set out, admitting that at the time of the issuance of the policy, and of the loss and damage by fire sued for, their interest in the buildings mentioned in the policy of insurance was not that of unconditional ownership, and that said buildings were not at the time on grounds owned by them or either of them in fee simple, but they averred "that no change had taken place in the condition of the title to said property, described in the policy sued on, since said policy was issued; that the plaintiffs were then and are now the owners of a life estate in said real estate, with the remainder in fee to Herbert S. Michael, George Michael, and Morris S. Michael, their children; that no written application was made by plaintiffs or either of them for the policy of insurance sued on, and no representations of any character as to the state of said title were made by these plaintiffs or either of them; that at no time before the issuing of said policy or since that time, up until the date of the loss, was anything concerning the state of said title *664 asked of said plaintiffs or either of them by the agent of the defendant who wrote said policy; that the attention of neither of the plaintiffs was called to the conditions in the policy sued on in reference to title, and plaintiffs had no knowledge of said condition in said policy, or that the defendant considered the state or condition of plaintiffs' title to the property insured material to the risk, or that anything in the condition of plaintiffs' title might or could work a forfeiture of said policy; that the defendant, without making any inquiry of plaintiffs concerning the condition of said title, issued said policy, and accepted and retained the premium therefor from the plaintiffs, and that said defendant never thereafter made any objection to the condition of said title until after the loss by fire had occurred; that the plaintiffs accepted said policy and paid the premium therefor in the full belief that the same was a valid and binding contract of insurance, covering the property described therein. Wherefore plaintiffs aver that the defendant has waived any defense to said policy by reason of the condition of said title, and they pray for judgment accordingly." Appellees' reply to the fourth paragraph and also to the fifth paragraph of answer was substantially the same as the reply to the third paragraph of answer, above set out.
Appellant demurred to each of the replies for want of sufficient facts.
It was thereupon agreed by the parties to this action, and the agreement made a matter of record, that all questions not presented by these pleadings should be waived, and the cause submitted to the court upon the issue of law presented by appellant's demurrer to each of the replies, and that, in case the court should hold the replies sufficient to avoid the several paragraphs of answer to which they were addressed, judgment was to be rendered in favor of appellees for $917.86, together with interest after March 1, 1903, and, in case the court should hold the replies insufficient, *665 judgment should be rendered in favor of appellant for costs. But nothing in the agreement was intended to preclude either party from appealing or otherwise obtaining a review of the decision of the circuit court in like manner as they might do without having entered into such stipulation. The court subsequently overruled appellant's demurrer to each of said paragraphs of reply, to which rulings the appellant duly excepted, and thereupon judgment was rendered in accordance with said agreement in favor of appellees for $932.40, together with costs. The assignment of errors calls in question the decision of the court on appellant's demurrer to each of said paragraphs of reply.
The contention of appellant is that appellees are bound by the strict terms of the policy with regard to title, and that it was their duty to make known, voluntarily, the exact state of the title to the grounds upon which the insured building stood, and to see that the same was correctly described, and that a failure to do so rendered the policy absolutely void. This contention is primarily founded upon a principle which prevails in marine insurance. The subject of marine insurance is often in distant ports or upon the high seas, and generally not open to the examination of the underwriter. The perils to which such property may be exposed are peculiarly numerous, hazardous, and difficult to anticipate by any reasonable inquiry, but are always known to the owner of the property. The underwriter is compelled, from necessity, to rely upon the assured, for a full disclosure of all facts known to him which may in any way affect the risk to be assumed. It is both reasonable and just, under such circumstances, that the assured should not only act with unquestioned good faith, but also make known every fact and circumstance within his knowledge which might increase the hazard of insurance, and, in case of failure so to do, liability upon the policy should be avoided. *666
It is apparent that there is a marked difference in this respect between the subjects of marine and fire insurance.
The subjects of fire insurance may almost always be seen and inspected, and, if the underwriter assumes the risk without taking the trouble either to examine or inquire about facts which may affect the hazard of insurance, he ought not to complain, in the absence of fraud, if the risk proves to be greater than he anticipated.
A pertinent general rule of law applicable to the construction of these contracts is, "that if policies of insurance contain inconsistent provisions, or are so framed as to be fairly open to construction, that view should be adopted, if possible, which will sustain rather than forfeit the contract." McMaster v.New York Life Ins. Co. (1901),
The courts of many states have construed policies having provisions identical with or similar to those of the policy in suit. The importance of the principle involved, and a desire that the reasoning and authority upon which our conclusion rests may more fully appear, have prompted us to quote extensively from these cases. In the case of Morotock Ins. Co. v. RodeferBros. (1896),
From the case of Western, etc., Pipe-Lines v. Home Ins.Co. (1891),
In Miotke v. Milwaukee, etc., Ins. Co. (1897),
In the case of German Ins., etc., Inst. v.Kline (1895),
The supreme court of Montana, in the case of Wright v.Fire Ins. Co. (1892),
These quotations express the doctrine which meets our approval, and indicate the correct construction of the policy *677 in suit. We cannot with any regard for justice, strictly apply to this class of written instruments the rule for the interpretation of written contracts generally. The making of contracts is generally preceded by some negotiations, culminating in a meeting of the minds upon terms, mutually agreeable and understood, which are then reduced to writing, and the agreement formally executed. Insurance policies are prepared in advance by insurance and legal experts, having in view primarily the safeguarding of the interests of the insurer against every possible contingency. The insurer not only fully knows the contents of the writing, but also adequately comprehends its legal effect. The insured has no voice in fixing or framing the terms of his policy, but must accept it as prepared and tendered, usually without any knowledge of its contents, and often without ability to comprehend the legal significance of its provisions. The meeting of the minds ordinarily deemed essential to a valid contract, as to many of its terms and conditions, is wanting in fact, and a mere fiction of law.
In this case appellees were not the owners of a feesimple title to the real estate on which the insured buildings stood, but owned only a life estate therein. They had an insurable interest in the property at the time the policy was issued and at the time of the loss by fire. They desired, in good faith, to obtain insurance upon their interest in the property, and were guilty of no misrepresentation, concealment, or fraud. They were ignorant of the invalidating provisions of the policy, and of the materiality of their exact title to the risk assumed. No change was subsequently made in the title held, nor was any act done increasing the risk of insurance. It is not suggested that the value of their title was not equal to the amount of insurance carried, nor that the fire would not have occurred just as it did, had their title been an unconditional fee simple. They *678 paid the premium charges, which appellant accepted and retains, and honestly rested in the belief that they had valid insurance. We must assume that both parties in good faith intended to effect a valid contract, and, if reasonably possible, so construe the policy as to make it effective. The appellant did not require of appel. lees a written application for insurance, or ask of them any questions concerning the property to be insured, or concerning their title to the same. We must therefore presume that appellant or its agent had satisfactory knowledge of the condition and surroundings of the property, and of the title to the same as then existing.
Knowledge of the true state of the title on the part of the insurer being, under the circumstances shown, presumed by law, the provisions of the policy with respect to title pleaded in the answers were waived. It follows that the policy was valid, at least to the extent of the interest of the insured, and that the facts set out in each paragraph of reply were sufficient to avoid the paragraph of answer to which the same was addressed.
The same result is obtained, and the replies upheld by another course of reasoning. In our opinion the word "void" is used in the policy in the sense of voidable. Hunt v. State Ins.Co. (1902),
If a title to the property insured, other than a sole and unconditional fee simple in the insured, ipso facto, rendered the policy void, then it was void as to both parties. It will scarcely be insisted by any one that the insured, at their option, might have treated the policy as void, and recovered the premium paid, prior to the fire; but the evident meaning of the policy was that, for a breach of its terms, the insurer, acting with reasonable diligence, at its option might avoid the contract. If appellant could elect to avoid the policy for any reason, it is equally clear that in a case like *679 this, where the insured had an insurable interest, it could elect not to do so, and treat the policy as valid. If the stipulations with regard to title made the contract voidable only, then, upon discovery of the true condition of the title, whether before or after the loss, the insurer was required to make its election either to regard the contract as valid or void. A court cannot by its fiat alone render a voidable contract void, but it can only adjudge that the party entitled to avoid it has done so, and that it thereby and for that reason became invalid. If appellant desired to avoid this policy for the reasons pleaded, it was required to act with reasonable promptness after acquiring knowledge of the facts, and thereupon it was its duty to notify appellee of its decision to avoid the policy and of the reasons therefor, and to return, or tender, or in some appropriate way manifest its willingness and readiness to restore, the unearned premium received. The answers filed do not disclose the time when appellant learned the true state of appellees' title, nor deny knowledge of the same at the time of issuing the policy, but proceed upon the theory that the policy was void ab initio, and without any action on the part of the insurer. This theory was wrong, and the averment of facts insufficient. The answers should have pleaded the covenants or conditions relied upon, a breach, and the acts done by appellant in pursuance of its election to avoid the contract.
Appellant's contention is that, under the terms of the policy, no risk attached and no liability was assumed by it at any time. It must therefore follow that there was no consideration for the premium received, and good faith and common fairness required its prompt return; and the insurer, by retaining such premium with full knowledge of the facts, elected not to insist upon a forfeiture of the policy. Hanover Fire Ins. Co. v. Bohn (1896),
We are of the opinion, for the reasons indicated, that the answers were insufficient, and that appellant's demurrers to the several paragraphs of reply should have been carried back and sustained to the answers.
No reversible error being shown, the judgment is affirmed.
Gillett, J., dissents.
Dissenting Opinion
The condition referred to is in the following language:
*681"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."
And this is not all. Immediately preceding the attesting clause of the policy is the following:
"This policy is made and accepted subject to the foregoing stipulations and conditions, together with such other provisions, agreements, or conditions as may be indorsed hereon or added hereto."
No preliminary application is required under the terms of the policy.
It is to be observed that the clause first quoted is so plain as not to admit of construction. The policy is void, it asserts, if certain conditions as to ownership and title do not exist, unless by agreement indorsed on or added to the policy it is provided otherwise.
The majority opinion, while it speaks in a prefatory way of the rule that insurance policies are construed most strongly against the company, does not pretend to construe said words. On the contrary, the whole effort is to escape their force. While I should be prepared to sanction the proposition that any fair doubt as to the construction of the contract should be solved against the insurer, yet it is plain that where room to doubt concerning the meaning of the condition does not exist, and where there is no element of illegality or fraud present, the court should not undertake to strip the company's undertaking of a vital condition, and then enforce the promise, on the poor excuse that the property owner failed to read the contract. If there was no meeting of the minds, the court ought not to undertake to supply so vital an element. It is true that the forms of insurance policies are prepared by experts, and that it is the habit of the careless not to read the conditions which are made to underlie the undertakings of such companies, but if a reason for the breaking down of the limitation in question can be extracted from these circumstances, I do not know what limitation of liability exists in life or fire insurance contracts, or in the contracts of the great corporations generally which issue limited liability undertakings *682 in serving the public, that could not be brushed aside by the courts, where the failure to read the writing resulted in a hardship which might otherwise have been avoided.
It was said by one of the great writers of legal literature: "It is likewise a general and most inflexible rule, that wherever written instruments are appointed, either by the requirement of law or by the compact of the parties, to be the repositories and memorials of truth, any other evidence is excluded from being used, either as a substitute for such instruments or to contradict or alter them. This is a matter both of principle and policy: of principle, because such instruments are in their nature and origin entitled to a much higher degree of credit than parol evidence; of policy, because it would be attended with great mischief if those instruments upon which men's rights depended were liable to be impeached by loose collateral evidence." Starkie, Evidence (10th Am. ed.), *648.
While the rule of contra proferentem ordinarily seems to be applied in all of its vigor in construing insurance contracts, yet I am not aware of any well-considered case which countenances the idea that a party may be relieved upon so unwarranted an excuse as the one which the appellees in this case asserted. In Wierengo v.American Fire Ins. Co. (1894),
It ought not to be necessary, however, to seek to justify the existence of a condition precedent. It ought to be enough that it is a component part of the contract, and has not been waived, and that the contract must be made the basis of recovery. In the vigorous language of Woodward, *685
C. J., in Pennsylvania Ins. Co. v. Gottsman (1864),
In the absence of misleading conduct, waiver can only be predicated upon the relinquishment of a right which is known (Bishop, Contracts [2d ed.], § 792; 29 Am. and Eng. Ency. Law [2d ed.], 1091, 1093), and the knowledge upon which a claim of waiver is based must be actual, and not merely constructive.Aetna Ins. Co. v. Holcomb (1896),
The weight of authority, where a matter of principle is involved, is a minor consideration; but since I am not only so unfortunate as to differ with my brethren, but also to be confronted with a formidable amount of apparent authority for the conclusion reached, it becomes necessary to review their authorities. Morotock Ins.Co. v. Rodefer Bros. (1896),
I turn now to the authorities which uphold my view. The following cases evince the peremptory character of the condition here involved, or of a like condition: Geiss v. Franklin Ins.Co. (1890),
In Dumas v. Northwestern Nat. Ins. Co., supra, the precise question which is here involved was before the court. In the course of a careful opinion the court, after referring to such condition, said: "But it is said that all this is of no consequence, inasmuch as the defendant company made no inquiry as to the true condition of things, and there was no fraudulent concealment on the part of *693
the plaintiff. And there is excellent authority for the doctrine, that `as to the ordinary risks connected with the property insured, if no representations whatever are asked or given, the insurer must be supposed to assume them; and if he acts without inquiry anywhere concerning them, he seems quite as negligent as the insured, who is silent when not requested to speak.' Clark v. ManufacturersIns. Co. [1850], 8 How. *235,
The text-writers may ordinarily be relied on to make an unbiased statement of the adjudications as they are, and therefore I quote briefly from some of the writers on the law of insurance. A late writer, after referring to the condition as to ownership and title which is found in the standard policy, makes this comment: "Without this requirement there would be no duty incumbent on the insured to state the character of his interest, provided he had an interest that was insurable. The condition above quoted, however, requires a description of that interest, and it seems that the condition applies even to those policies that are issued without a previous application; for, if the policy does not elsewhere contain a statement of the character of the interest, it will be implied, by reference to the latter condition, that the interest is represented as being sole and unconditional." Vance, Insurance, p. 443. Another writer says: "There is some conflict of authority on the question of the binding effect of provisions of this *696
character in a policy issued without a written application. The weight of authority doubtless supports the view that the insured, by accepting the policy, is charged with knowledge of its contents." Elliott, Insurance, § 257. Still a third text-writer states the doctrine thus: "A condition that if the insured is not the sole, entire, and unconditional owner the policy shall be void is reasonable and valid, and violation of it will prevent recovery. And failure to disclose the real state of the title if not sole, etc., will be fatal although the insured was not questioned as to that fact." 1 May, Insurance, § 287a. In 13 Am. and Eng. Ency. Law (2d ed.), 228, it is said: "Explicit questions are largely or wholly replaced by conditions that the interest of the insured must be truly stated, and that if the title or interest is other than one specified, it must be specifically described, or the insurance will be avoided; and the statements of title in the policy, where there are such conditions, are construed in the same manner as answers to express interrogatories. The conditions have the effect of questions as to the nature of the title or interest, and in case a statement thereof would be false or insufficient if made in answer to a question, or if the facts are not disclosed which would be required in such answers, there is a breach of the contract. Where such conditions are contained in the policy, and there is no statement of the title or specific interest, an acceptance of the policy amounts to a representation by the insured that his title or interest is that stated in the condition, and if his title or interest is substantially different, the insurance is avoided." The case ofGeiss v. Franklin Ins. Co. (1890),
The conclusion of the majority is opposed to principle; it is out of accord with the weight of authority, and it involves a disregard of the doctrine of stare decisis. As I have attempted to point out, this holding cannot be maintained if the court looks to the solemn dispositive agreement of the parties in determining their rights. I cannot give my sanction to a decision that nullifies the most important element in the contract, from the standpoint of the company. *698
It is to be remembered that fire losses are in almost every instance paid out of the premiums received, and not out of the capital of the company. Careful people, who read their policies, are entitled to some consideration, and ought not to have their premiums enhanced by the fact that essential limitations of liability put into insurance policies are disregarded by the courts. I cannot better conclude this portion of my opinion than by calling attention to the following language of Story, J., in Carpenter v.Providence Washington Ins. Co. (1842), 16 Pet. 495,
As to the question of pleading, I am of opinion that the answer of appellant was good without an averment that it had tendered a return of the premium. The holding of it after knowledge of the fact that the risk had never attached would at most operate as a waiver, and matter of that character ought, in the order of things, to come from the plaintiff. It appears to me that if there is nothing further in the case than a failure of the minds of the parties to meet, the case is one for a return of the premium. New York LifeIns. Co. v. Fletcher (1886),
ON PETITION FOR REHEARING.
JORDAN, J. — Appellant has petitioned for a rehearing and supported the same by an able argument on the part of its counsel. We have examined the authorities cited by counsel and have again given the case careful and patient consideration. Upon the question here involved the authorities may be said to "fight on both sides." Nevertheless, they are not so overwhelmingly on either side that they should be held, as seemingly insisted, to preclude us from adopting and following what we believe to be the better rule and the one which, because of its fairness and reasonableness, commends itself to our approval. It is admitted that our holding at the former hearing upon the point in issue is sustained by the supreme courts of Nebraska, Montana, Washington, California, and "possibly Kentucky," and by the decision of the court in the case ofManchester Fire Assur. Co. v. Abrams (1898), 89 Fed. 932, 32 Cow. C. A. 426, but *700
this concession is certainly too narrow, for, with the courts hereinbefore mentioned must be classed or included the supreme courts of Michigan, Oregon, Virginia, Mississippi, Pennsylvania, Missouri, Alabama, Wisconsin, West Virginia, and probably New York. The decisions of some of the latter courts directly sustain the doctrine in question, while others may at least be said indirectly to support the principle. To the cases or authorities cited and relied on by this court in its original opinion herein, we may add the following: Allesina v. London Ins. Co. (1904),
In the appeal of Allesina v. London Ins. Co., supra, the policy there involved, when issued, contained a printed provision that it should be void "if the subject of the insurance be personal property, and be or become encumbered by a chattel mortgage." This policy was issued upon an oral application, the agent of the company making no inquiry of the insured concerning liens or encumbrances upon the property, nor were there any statements or representations made in reference thereto by the insured, and he had no knowledge that such information was material, or that the policy to be delivered would contain any provision in reference thereto, or that if the company knew of the mortgage upon the property it would decline to assume the risk. The insured paid and the company received and accepted the premiums, and the property was destroyed by fire during the life of the policy. The court, in that case, said: "The only question on this appeal is whether, under these circumstances, the defendant can defeat a recovery on the ground that the policy issued by it and delivered to the plaintiff and for which he paid and it accepted and retained *701 his money was invalid from the beginning because of the mortgage clause." This case, under the facts, may be said to be on principle on "all fours" with the case at bar. The policy involved in that appeal was sustained. In deciding the case the court, in the course of its opinion, said: "A contract of insurance, like any other contract, must, of course, be given force and effect according to its terms as agreed upon by the parties, but provisions in the printed forms, inserted for the benefit of the insurer, may be waived by it in special instances. In determining whether there has been such a waiver, a court should not overlook the fact that insurance policies are prepared by the company for general use, without reference to particular cases, and contain divers and sundry provisions and stipulations concerning different subjects. The contract is not like ordinary contracts between individuals, wherein every clause and stipulation is considered and agreed upon by the parties before the agreement is executed. A policy of insurance is prepared in the office of the company and becomes binding on the assured because it is delivered to and accepted by him. In accepting it he has a right to assume that the company does not intend to insist upon the printed clause therein relating to encumbrances on the property if it makes no inquiry of him concerning the matter, and he has made no statements in reference thereto, and has not been advised that the question was at all material. The preparation and issuance of the policy is the act of the company, and if, in pursuance of a previous agreement to insure, it issues and delivers a policy purporting to cover loss or damage by fire, and accepts and receives the money of the insured, without making any inquiry of him as to encumbrances, or without advising him of the effect on his contract of an encumbrance, it is receiving and accepting his money under circumstances but little short of false pretenses, if the contract is void from the beginning, and never in fact had any force *702 or validity, because of a provision inserted therein by it without the knowledge of the assured, rendering it void if the property is encumbered. In such a case the company would not only wrongfully receive and accept the money of the insured, but would mislead him into the belief that his property was insured, when in fact it was not, thus deceiving a party honestly seeking and paying for insurance." In 1 Wood, Insurance (2d ed.), § 176, the rule is stated as follows: "When a policy is issued upon a verbal application, without any representations in reference thereto, all information relative to the risk, except such as is unusual and extraordinary, is waived, and the policy is valid, even though it contain a clause or stipulation that `the insured covenants that the representations given in the application for this insurance contain a just, full and true exposition of all facts and circumstances in respect to the condition, situation, value and risk of the property insured,' and, although the policy professes to be made upon the faith or representations made by the insured, yet, it is valid, even though no representations whatever were made in reference to the risk, and the lack thereof is not a matter of defense. The insurer cannot charge the assured with laches, induced by its own conduct." In 3 Cooley, Briefs on Insurance, pp. 2630, 2631, the author says: "If an insurance company issues a policy of insurance without any application, or without representations in regard to certain facts, the company will be presumed to have written the policy on its own knowledge, and cannot complain, after loss, that such facts were not correctly stated in the policy or disclosed by the insured. * * * Analogous to the rule stated is another one to the effect that though the policy by its terms requires the disclosure of all material facts, yet if the insurer issues it on an oral request or application, and makes no inquiry in regard to matters covered by certain conditions in the policy — as, for instance, encumbrances — it will be assumed that the insurer waives knowledge as to such *703 facts." The author says, however, that the rule stated is not supported by all the authorities, but, on the contrary, it is a mooted question whether an insurer waives the condition in a policy by issuing it without inquiry.
While it is true that the quantum of appellees' interest or title in the property insured was not a fee simple, still they had an insurable interest as tenants for life, and that is the only interest which appellant can be said to have insured, and the value of the property destroyed by fire, when tested by such interest, would be the measure of the company's liability. We cannot discover wherein appellant has been actually prejudiced by reason of the fact that the interest of appellees in the property insured was not that of a fee simple. Possibly it might be said that the fact that appellees were not the owners in fee might afford a temptation or inducement for them to set the property on fire, on the supposition that they would receive the full amount for which it was insured, regardless of the value of their interest. As appellant company did not in any manner inquire of appellees in respect to their interest in or title to the property, they certainly had no reasons for presuming when they paid the price of the insurance and received the policy issued to them that the company would not have insured the property had it known that their interest in the building insured and in the premises upon which it was located was that of a life estate instead of a fee simple. Generally speaking, it may be asserted that it is not the custom of the insurance company to place the policy to be issued by it before `the person to be insured prior to its delivery to him, but the first opportunity afforded him for an examination of the many printed conditions and stipulations therein contained is after he has paid the premium for the insurance and the policy has been delivered. It ought not to be considered or regarded that he agreed to all of the conditions and *704 stipulations in the policy before he was aware or had knowledge thereof, especially in respect to such stipulation or condition declaring that the policy shall be void if his interest in or title to the property insured is other than that therein stipulated by the company without its having made any inquiry of him relative to his interest or title in or to the property which he desired insured, or in the absence of any representations or statements made by him in respect to his interest or title.
Appellant's learned counsel contend that it cannot be asserted that it waived its right to repudiate the liability upon the policy unless it is shown it had knowledge of all of the facts constituting the waiver. But it certainly had knowledge of its own conduct in the matter, and a waiver may be manifest by conduct as well as by words.Phenix Ins. Co. v. Tomlinson (1890),
Possibly, with equal force, it might be said that appellees ought not to be considered as having consented or agreed, without knowledge thereof, to the condition or stipulation in the policy which avoided the insurance, if their interest or title to the property was otherwise than that of a fee simple. It is true that it can with plausibility be asserted that it was their duty to read the policy issued to them, but suppose they did read it after its delivery and the payment by them of the premium and then discovered the provision in respect to a forfeiture, they were not then in a position, and had not the right, to cancel or surrender the policy and recover back the premium which they had paid; for the very moment the risk actually attached they could not thereafter have recovered back the premium. Standley v. Northwestern, etc.,Ins. Co. (1884),
Suppose they had made a demand thereafter of appellant company for a return of the premium paid, the latter *705
would possibly have parried the demand by asserting that its right under the circumstances was one which it could at. its option waive, therefore it would retain the premium paid by appellees and await results. The case of German Mut. Ins. Co. v.Niewedde (1895),
In Continental Ins. Co. v. Munns (1889),
We are satisfied with the conclusion which we have reached in this case, and the petition for rehearing is therefore overruled. All concur except Gillett, J.
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