Independent School District v. Fidelity Insurance

113 Iowa 65 | Iowa | 1901

Waterman J.

1 The board of directors of plaintiff district, desiring to effect insurance upon the school building, took steps as follows: “Regular Meeting. Doon, Iowa, Nov. 4, 1895. Board of directors met in regular session. Members present: James Peterson, F. L. Jenkens, J. L. Weatherly, John Bentley, J. II. Kahl. On motion, J. L. Weatherly was chosen secretary pro tern. On motion, bill of Donohue & Hennebery for school seats, amounting to $54.48, was allowed. Bill of Holmes Bentley Lumber Company for $136.16 was allowed. It was moved and carried that the school buildings be insured in the following companies for amounts stated: The Fidelity Ins. Company of Des Moines, $1,250.00; the Phoenix Company of Hartford, $1,250.00. The secretary was instructed to issue an order for premium to local agents. By motion, board adjourned sine die. J. L. Weatherly, Sec’y pro tern.” J. L. Weatherly was the agent for defendant company, and procured the issuance to plaintiff of the policy in question, which was for the sum of $1,250. He knew a policy was to be procured of the Phoenix Company for a like amount, as was done. The policy issued by defendant company contained this provision: “This contract shall be void if the assured shall now or hereafter procure any other insurance, whether valid or not, on property covered in whole or in part by this policy, or if the risk become more hazardous by any means whatever,' or if any warranty as to the condition of the property mentioned in this policy shall be violated, * * * unless the consent of the company be indorsed thereon.” The consent of the company was not given, save as we shall now state, to other insurance. Weatherly, as agent of defendant, knew that the Phoenix policy was to be obtained; that plaintiff was to effect a total insurance in the sum of $2,500. His knowledge of this fact must be held the knowledge of the company. By issuing its policy with that knowledge, defendant must be held to have consented to tho additional insurance with the Phoenix company. Erb v. Insurance Co., 99'Iowa, 728. There was such a mutual mistake in this matter as would justify a reformation of the contract in this respect. Fitchner v. Association, 103 Iowa, 276.

2 II. But there is another matter in this case. At the time of the action of the board of directors which we have set out there was an existing policy on the school house for $1,250 in the Insurance Company of North America. The secretary of plaintiff board testifies that he knew, and the other members of the board, including Weatherly, were aware, of the existence of this policy when the agreement was made to effec the insurance with defendant. The other directors, of whom there were several besides Weatherly, testify that they supposed the policy in the Insurance Company of North America had expired when they ordered the policies placed with defendant and the Phoenix Company. Some of them state that the board desired to carry only $2,500 of insurance on the building, and they are corroborated to this extent; that no more than $2,500 had ever before been carried.. On the whole, we are clearly of opinion that defendant did not know of or assent to tbe policy in the Insurance Company of North America. Neither did plaintiff intend to effect or carry insurance to the amount of $3,150. The existence of this prior policy, to which defendant had not assented, violated the condition of the policy in suit which we have set out, and defendant is, therefore, released from liability on its contract. Zimmerman v. Insurance Co., 77 Iowa, 685.

Our holding on the merits of the case renders unnecessary any specific ruling on the motion to strike appellee’s argument. Por the reasons given,, the judgment below is reversed.