223 Wis. 105 | Wis. | 1936
The first defense is based on a claim of concealment and misrepresentation of material facts. Appellant contends that at the time of the application for insurance, which was purely oral, insured’s agent made a false statement with reference to the cancellation of policies previously in force and secured through the North Wisconsin Insurance Agency. A review of the testimony shows that insured had for some years prior to the issuing of the policies by appellants been insured by companies dealing through the North Wisconsin Insurance Agency; that a claim for loss caused by hail had been disputed; that some controversy had developed over the collection of premiums; that the North Wisconsin Insurance Agency notified respondent Young of their intention to reduce the amount of the insurance; that respondent Young wrote to the agency directing it to cancel all the insurance. The letter is as follows:
“According to Mr. J. H. O’Melia’s letter of February Sth after you were over to see him in regard to' the insurance that you told him that even though the arrears is paid up his company would not care to carry more than about $3,500 on the Main Lodge and furniture.
“Since that is the case Mr. Estabrook I wish you would cancel all the policies as I don’t expect you to tell me how much I should carry on these buildings as nobody but Mr. Young and myself knows how much money we have invested in this place. I am; also writing to Mr. O. H. Koch regarding the insurance.”
It was after this that negotiations were begun by insured with the appellants to secure the insurance which is the basis of the claim on the part of insured. The agent of appellants was informed of the previous insurance and of its cancellation. Insured’s, agent did say that the cause of breaking off relations with the North Wisconsin Insurance Agency was the controversy over the hailstorm loss, and did not mention
Appellant claims concealment on the part of insured of the fact that judgment of foreclosure and sale had been entered against the property. Thq fact, however, was not known to her. The insured knew the action had been commenced, had talked with a lawyer, and had been assured that the extended redemption would give her an opportunity to- adjust her obligation to the mortgagee. The existence of the mortgage was disclosed. The fact that a foreclosure was pending when the present policies were issued gives no advantage to appellants under the circumstances made to appear by the evidence here. Appellants had knowledge of the mortgage. By the terms of the policy, the loss, if any, was payable to the mortgagee as
Appellants make a further claim of concealment in that insured’s husband, in making the application, did not disclose the fact that insured’s title was incumbered by a second mortgage and a judgment lien. Apparently no- questions were asked leading to the disclosure of these incumbrances, and there was accordingly no misrepresentation and no active concealment. It is to be remembered that there was no written application for this insurance, and that the policies here involved were issued with knowledge on the part of appellants’ agent of the general condition of the property, its location, and its worth. The agent knew that the new insurance would take the place of that recently carried by other companies. .Questions asked were truthfully answered.
Appellants’ second ground of defense is based upon a provision of the policy that:
“This entire policy shall be void, unless otherwise provided by agreement in writing added hereto, (a) if the interest of the insured be other than unconditional and sole ownership.”
Appellants contend that since suit to foreclose the mortgage to which the property was subject had been begun and judgment entered June 27, 1934, insured was not the unconditional and sole owner when the policies were issued in February, March, and April, 1935.
The question accordingly arises: Is the title of a mortgagor after foreclosure and during the period of redemption unconditional and sole ownership within the meaning of this provision of the insurance contract? It has been held in Wisconsin that the equitable ownership of a vendee under a land contract is such unconditional and sole ownership., Mat
In the case of Steinmeyer v. Steinmeyer, 64 S. C. 413, 42 S. E. 184, an insolvent debtor had conveyed to defendant without consideration. Creditors obtained a decree subjecting the property to sale, so* far as necessary for the payment of the judgment claims. The defendant subsequently insured the property against loss by fire by'a policy void by its terms if the ownership' of the insured were other than unconditional and sole. In this situation the South Carolina court held that defendant’s interest was unconditional because she had a fee simple. The defendant’s status at the time of the insurance was that—
“of one holding the fee subject to an incumbrance, the equity of the grantor’s creditors. The existence of a lien or in-cumbrance on the insured’s property is not a breach of the condition which requires sole and unconditional ownership.”
It would seem that the situation of the land conveyed in fraud of creditors and made subject to sale by a decree would
In Phenix Ins. Co. v. Hilliard, 59 Fla. 590, 52 So. 799, the following test is laid down:
“The just and reasonable purpose of insurance policies in requiring the insured to have the ‘unconditional and sole ownership’ of the property insured, is to give protection to only .those upon whom the loss insured against would inevitably fall but for the insurance, and to avoid talcing risks for those whose lack of interest or whose contingent interest in the property insured might tend to encourage carelessness or wrong doing in the use or preservation oí the property. . . .
“By fair construction and intendment the ‘unconditional and sole ownership’ of property for the purposes of insurance is in those upon whom the loss insured against would certainly fall, not as a matter of mere contract obligation, but as the result of real bona fide rights in the property insured.”
In that view of the purpose of the provision of the contract requiring unconditional and sole ownership, such ownership would seem in the case at bar to have been in insured. The risk of loss was upon respondent Young. If the building burned, she would be the ultimate loser. If she redeemed the property from the foreclosure, she would have to pay the mortgagee’s full claim, yet the property would be worth less by the amount of the loss. If she did not redeem, the proportion of the proceeds of sale coming to her would be reduced by the amount of the loss; or if the proceeds were in
The first two grounds of defense would, if valid, result in the conclusion that the policies were void ah initio. But appellants’ view cannot prevail.
Appellants further contend that the policies were later voided by the false swearing of the insured on the trial. Each policy provides:
“This entire policy shall be void ... 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 a loss.”
Appellants’ claim that .there was false swearing on the part of insured is based on testimony given March 16, 1936, to the effect that the earlier policies of insurance were canceled because of a dispute over a hail loss. They seek to1 support that claim by showing that on February 14, 1935, she had written the letter quoted above, directing the policies to be canceled because of the fact that the “company would not care to carry more than about $3,500 on the Main Lodge and furniture.” In the light of the circumstances discussed with reference to1 the defense that insured was guilty of concealment when her husband told appellants’ agent that the previous policies had been canceled because of a dispute over a hail loss, there exists no such contradiction by the letter referred to or other evidence to' substantiate a charge of false swearing.
Evidence of the familiarity of appellants’ agent with the whole situation, the lack of any effort to mislead or to secure
By the Coitrt. — Judgment affirmed.
