62 So. 182 | Ala. | 1913
A. H. Laird insured his household goods against loss by fire, in the Security Insurance Company. The policy was for a term of three years, commencing on August 13, 1910, at noon, and ending on the 13th day of August, 1913, at noon. The policy was to cover all loss by fire not exceeding $600. The policy, among other provisions, contains a clause declaring that the policy, unless otherwise provided by agreement indorsed thereon or added thereto, shall be void, “if the subject of insurance be personal property and be or become incumbered by a óhattel mortgage.”
The mortgage of insured personalty to secure a debt is an increase of the risk, and the quoted clause was, of course, valid. — Lee v. Agricultural Insurance Co., 79 Iowa, 379, 44 N. W. 683.
If, subsequent to the issuance of the policy, Laird executed and delivered to a creditor a valid chattel mortgage on the property insured without the consent of the insurance company, then he was not entitled to recover in this suit unless, after the execution and delivery of the chattel mortgage, the insurance company, with knowledge of the existence of the mortgage, in some way, waived the forfeiture.
Tbe fire occurred on or about May 19, 1911, and on tbe 6th day of July, 1911 — long after tbe adjuster bad left Bessemer — we find that Laird, in a second proof of loss made by him to tbe company, which was sworn to by Laird, stated that no incumbrance at all existed on tbe insured property. Laird, it appears, on June 12, 1911, procured from tbe Citizens’ Bank a statement that tbe bank, at that time, held no claim against tbe insured property or upon tbe insurance money; but tbe president of tbe bank, who signed this statement, testified in effect, when this case was tried, that when tbe fire occurred tbe bank held a valid chattel mortgage on the insured property and that tbe statement was given to Laird to aid him in collecting tbe money from tbe insurance company. Tbe second proof of loss, however, referred to the status of tbe property at tbe time of tbe fire, as is plainly and unequivocally shown by tbe instrument, and when, in that second proof of loss, Laird stated that no incumbrance “at all existed” on tbe insured property, be was referring to tbe status of tbe
This case, as tried, presented two issues to the jury, viz.: First, did Laird, after the policy was delivered, execute and deliver to the Citizens’ Bank a mortgage on the insured property, to secure an indebtedness? Second, if such a mortgage was in fact executed and delivered by Laird, then did the insurance company waive the forfeiture created by the execution and delivery of the mortgage? The first issue grew out of the fact that Laird has always denied that he executed and delivered the mortgage on the insured property. The second issue Laird was not, as we shall show, in a position to mahe.
When Laird told the insurance company or its adjuster that he had not made a mortgage on the chattels, the company had a right to rely on his statement, and, whether the company did so or not, his statement and conduct through this entire matter estops him from claiming such waiver. Whether the agents of the insurance company believed Laird or not, Laird is not in a
We think that, in the above opinion, we have indicated that, on the trial in the court below, in several material ways, the trial court committed reversible error. The judgment of the court below is therefore reversed, and the cause is remanded for further proceeding in the court below in accordance with this opinion.
Reversed and remanded.