188 Wis. 140 | Wis. | 1925
This is an appeal from an order overruling demurrers to four separate causes of action set forth in respondent’s amended complaint. All four causes of action grew out of an automobile liability insurance policy issued
On the 8th day of February, 1924, the plaintiff, in connection with its business of newspaper publisher, and as part of the social, educational, and recreational activities supervised and conducted by it for the newsboys who buy its papers, supervised and conducted an educational and recreational gathering for some of the newsboys who purchase its papers, which gathering of newsboys was. held at the station of the plaintiff at the city of South Milwaukee. One of the automobiles owned and operated by the plaintiff and covered by the policy of insurance mentioned was used to transport one of the employees of the plaintiff, some of the newsboys,
The demurrer to the first cause of action raises the question whether the policy covered the accident. It will be noted that the provision of the policy already quoted indemnifies the assured against loss by reason of damages on account of bodily injuries, including death, accidentally suffered by any person or persons other than employees by reason of the use of said automobiles enumerated and described in statement 5 of said declaration. It is not contended that the newsboys killed or injured were employees of the plaintiff, neither is it contended that the automobile in which they were riding was not covered by the policy. The contention on the part of the defendant is that at the time of the accident it was not being used in the usüal course of trade, business, profession, or occupation of the assured,
The sum and substance of these various provisions when brought together is this: The Assurance Corporation agrees to indemnify the plaintiff against loss by reason of damages sustained by any person or persons other than employees on account of bodily injuries, including death, occasioned by the ownership or maintenance of said automobiles while said automobiles are being used for the transportation of materials and/ or merchandise in connection with the assured’s business, which is that of a newspaper publisher. The complaint alleges that this gathering of newsboys was held and supervised by the plaintiff in connection with its business as publisher of a newspaper to instruct them in salesmanship, and that this automobile had been used to transport’favors, prizes, and refreshments to said gathering,
The coverage provided by the policy requires that the automobiles be used for the transportation of materials and/ or merchandise in connection with the assured’s business. It appears from the complaint that the automobile had been used to convey favors, prizes, and refreshments to a gathering of newsboys.' Manifestly, on the way to the gathering the automobile was being used for the transportation of materials and/ or merchandise. It is manifest that, having made the trip to the gathering, it was necessary for it to return. Since it was engaged in the transportation of materials or merchandise on the trip to the gathering, it plausibly can be argued that its use for that purpose continued on its return trip, as, obviously, it was necessary for the truck or automobile to return from the gathering, whether empty or loaded. However, it is not necessary to pursue that thought, as there is an affirmative allegation in the complaint that even upon the return trip it carried an empty container as well as a package of newspapers. Both of these articles constituted materials or merchandise and their carriage was in connection with the assured’s business as newspaper publisher. Even though it be argued that the carriage of these articles was a mere incident, and that the dominant purpose of the use of the automobile at that time was the return of the newsboys to their homes, still the policy does not require that the carriage of merchandise or material
The complaint also alleges a cause of action for a reformation of the policy. In view of our construction of the policy reformation thereof becomes unnecessary if the plaintiff can prove its allegations concerning the purposes for which the automobile was used at tlie time of the acT cident. But if it should fail in such proof, then the question of whether the policy should be reformed would become material, and it seems advisable for us to determine whether the demurrer to that cause of action was also properly overruled. This question arises upon the allegations that the plaintiff made an application for a contract of insurance which should cover the use of said automobile trucks not only for the purpose of transporting material or merchandise but for the purpose of transporting newsboys who purchased its papers to and from social; educational, and recreational activities supervised and conducted by the plaintiff for said newsboys, and that when said policy was delivered to the plaintiff by said defendant said defendant informed and advised the plaintiff that it covered the use and operation of the automobile truck of the plaintiff not only for the purposes of transporting material and merchandise but for the purpose of transporting newsboys as well, and that it accepted said policy with the understanding and in reliance on the statements and representations of said defendant that said policy did cover such uses and operations, and that it did not know that the said pplic)? did not cover the transportation of newsboys until after the accident. Reformation
The defendant contends that the plaintiff is estopped to claim a mistake in the writing of the policy because it did not read the same or sooner discover its provisions, and relies upon Bostwick v. Mutual Life Ins. Co. 116 Wis. 392, 89 N. W. 538, 92 N. W. 246. That was an action for rescission of an insurance contract and the recovery of premiums paid. There had been much negotiation between the plaintiff and the insurance agent concerning the character of the policy to be written. The agent strenuously recommended a five per cent, debenture policy. The plaintiff insisted from first to last that he did not want a policy that could not be paid up in ten years; that he would take a ten-payment policy and no other. Although the agent persistently recommended a five per cent, debenture policy, he did not say that such policy would require annual payments for life. Finally, the agent said he would obtain for plaintiff what the latter wanted, made out an application which the plaintiff signed, and in due time the policy was delivered, accompanied by á letter of transmittal, the opening lines of which were to the effect that it was a five per cent, debenture annual premium policy such as the agent had urged plaintiff to take. The plaintiff threw the policy into his desk and did not look at it for three months. The court held that the laches of the plaintiff in not earlier discovering that the policy was not what he had ordered forfeited his right to rescind. The court emphasized the fact that a casual glance at the policy would have informed plaintiff that it was not the kind of policy he ordered. We cannot say that is true in the present case. The general coverage provision which occurs earlier in the policy is subsequently
Insurance policies like other written instruments have been the frequent subjects of reformation by the courts. While, as a general proposition, reasonable diligence is exacted of the suitor seeking reformation in acquiring a knowledge and understanding of the provisions of an ordinary contract, it is obvious that a complete knowledge and understanding thereof is not an inexorable requirement, else few contracts would be reformed.. While it is a general rule that the ordinary contract should at least be read by the person seeking reformation, the weight of authority does not seem to require this with reference to insurance contracts. The reason is quite obvious. The assured has little or nothing to say concerning the form of the contract. In many instances this is prescribed by law. In common practice the assured informs the agent of his coverage necessities and leaves it entirely to the agent to provide therefor. The average individual accepts the policy tendered relying upon the assurance on the part of the insurer, express or implied, that the policy affords him the coverage desired. In many instances a reading of the policy would not be enlightening to the assured. It is couched in technical terms and often complicated and involved. This is especially true of the ordinary accident or liability policy, where a provision ap
“The fact that insured accepted a policy of fire insurance without noticing a mistake is generally held not to preclude him from having the mistake corrected, even though he failed to read the policy over or carelessly read it. Policies of fire insurance are rarely examined by the insured. The same degree of vigilance and critical examination would not be expected or demanded as in the case of some other instruments. But there is authority to the effect that it is the duty of the insured to read and know the contents of his policy before accepting it; and that if one can read his policy, his failure to do so is such gross negligence as conclusively estops him from denying knowledge of its contents, unless he was dissuaded from reading it by some trick, artifice, or fraud of the other party to the agreement.” See, also, 14 Ruling Case Law, 902.
In 32 Corp. Jur. 1142, it is said:
“Whether the failure of the insured to read and examine the policy is such negligence on his part as defeats his right to a reformation depends on the facts and circumstances, it being sometimes held that there is negligence, but more often that there is not.”
Though not read by the assured, this court reformed an insurance policy in Komula v. General Acc., F. & L. Assur. Corp. 165 Wis. 520, 523, 162 N. W. 919, to express the real agreement between the parties. In that case the reason for exonerating the assured from negligence in not having read the policy was probably greater than here. But in a very recent and well-considered case the supreme court of Nebraska granted reformation under circumstances very similar if not identical with those here presented. Robinson v. Union Automobile Ins. Co. 112 Neb. 32, 198 N. W. 166. Our conclusion is that the second cause of action set forth in
A contention is made by the appellants that the mistake pleaded is one of law and not of fact, but there is no substance in this contention. The mistake was a misapprehension concerning the terms of the policy — not the legal effect of terms used. This is a mistake of fact.
It is further contended that the plaintiff cannot sue on the contract as it exists and at the same time demand relief in the way of specific performance. “It may be generally stated that an action at law upon a policy of insurance as written and its prosecution to final judgment bar the insured from bringing a new suit in a court of equity for the purpose of reforming such policy.” 12 L. R. A. n. s. 907, note. It is the judgment, however, rendered in the cause of action at law which operates as a bar to an action thereafter brought to reform. A perusal of the authorities reviewed in the note mentioned indicates that the mere pend-ency of an action at law to recover on the contract as written concurrently with an action to reform the contract is not a bar to the reformation of the contract. This latter principle should be peculiarly true in this state where all distinctions between actions at law and suits in equity have been abolished (sec. 2600, Stats.) ; where the plaintiff may unite in the same complaint several causes of action, whether they be such as were formerly denominated legal or equitable, or both (sec. 2647) ; and where, even after trial, it shall appear to the court that any party claiming affirmative relief or damages has mistaken his .remedy, his action shall not be finally dismissed and he shall be allowed a reasonable time within which to amend, and the amended action shall continue. Sec. 2836b. In fact, it has been held by this court that an insurance policy may be reformed in an action brought to recover upon the policy as issued. Coats v. Camden Fire Insurance Asso. 149 Wis. 129, 135 N. W.
The third cause of action was one for specific performance compelling the insurance company to defend the actions brought against the plaintiff, but as those actions have all been settled, that cause of action drops out of the case, and we are not asked to consider it.
The fourth cause of action is alleged against the defendant Roberts Company for damages because of its failure to deliver the form of policy which it agreed with the Journal Company to deliver. If it agreed with the Journal Company to deliver a policy which should indemnify the plaintiff against damage while the automobile was used in transporting its newsboys and it failed so to do, and the Journal Company sustained damages by reason of such failure, the Roberts Company is liable for such damages. Rainer v. Schulte, 133 Wis. 130, 113 N. W. 396; Milwaukee B. Co. v. Graebner, 182 Wis. 171, 196 N. W. 533. The demurrer to this cause of action was also properly overruled.
By the Court. — Order affirmed.