126 Iowa 547 | Iowa | 1905
The policy in suit was issued to the plaintiff on the 15th day of April, 1901, and the loss occurred on the 15th day of November of the same year. On the 3d day of October preceding the fire, the plaintiff, who was the owner of the insured property, and Elijah Hiatt,.who was, a prospective purchaser thereof, signed a written instrument, which, so far as it is material here, was as follows: “ This agreement made and entered into this 3rd day of October, 1901, by and between W. S. Swank, party of the first part, and Elijah Hiatt, party of the second part, witnesseth: The party of the first part has this day sold to the party of the second part, the following described real estate, to-wit: * * * Possession to be given March 1st, 1902. For the consideration of nine thousand dollars ($9,000) to be paid as follows: $7,000 in cash, to be paid on or before March 1st, 1902, and the party of the'first part agrees to take a second mortgage of two thousand ($2,000) dollars on the above described land, at six per cent, interest, due January 1st, 1905. Party of the second part agrees to make payments mentioned.” The policy was conditioned that it
The appellant contends that the written instrument executed by the parties was a valid contract “ of sale or to sell” the insured property; that it changed or diminished the plaintiff’s interest therein, and rendered the policy void. On the other hand, the appellee says that the writing in question was only a part of the negotiations for a sale of the property; that it was not delivered, acted upon, or effective until long after the fire; and that at the time of the loss the plaintiff retained and held the sole legal title to, and equitable interest in, the property.
If there was a valid and enforceable contractof sale or to sell ” the property, the policy became void by its express terms. It is therefore necessary to determine the exact agreement the parties entered into with reference to the land and the insured buildings situated thereon. Hiatt wanted to buy the plaintiff’s farm, and they agreed on the price, $9,000, and on the times and terms of payment and possession. But Hiatt only had $1,500 in money, and could not buy unless he could procure a loan of $5,500 on the farm. The plaintiff was advised of this, and it was agreed that Hiatt could have the farm if he could procure the loan, and that if he could not do • so the deal would be at an end. Neither of the parties knew whether a loan of that amount could be procured, and they went to loan agents, who were also uncertain about the matter, but agreed to’ procure it if possible, and suggested that a written memorandum of the agreement between Swank and Hiatt be executed and left with them, and that a deed for the property be also made and left with them, for the purpose of showing title in the abstract that was to be used' in procuring the loan. The writing was then executed, and a deed prepared, which'was executed by the plaintiff and his wife soon thereafter and
The foregoing facts were found by the trial co.urt, and its finding has the force and effect of a verdict. With these facts established, we think there can be no doubt as to the validity of the policy at the time of the plaintiff’s loss, and of the defendant’s liability in this case. Conditions which may render a policy void if violated are to be construed strictly, and, if there be doubt as to their meaning, the insured is to have the benefit of such doubt. The condition rendering the policy void in case of a contract “ of sale or to sell ” must be construed to mean that a valid and enforceable contract shall have the effect stipulated, and, unless there was such a contract, there was no breach of the condition. Hiatt agreed to take the farm on the terms named, provided he could procure the necessary money by mortgaging it; and, if he could not so raise the money, he was under no obligation to the plaintiff which could be enforced either in law or in equity. The plaintiff, in effect, did no more than to give Hiatt an option to buy, which he might or might not exercise, and it could not become an enforceable
The trial court’s finding of facts is fully sustained by fhe record, and the judgment is affirmed.