Greenwich Insurance v. State , 74 Ark. 72 ( 1905 )

PIiEL, C. J.

This is a suit against a fire insurance company and the sureties on its bond to the State of Arkansas. Two policies, covering the same property, are sued upon. They were issued April 20, 1900, and October 8, 1900, respectively, and are each for the sum of $1,000, and are for loss against fire, for the period of one year, of the property described, which is á stock of lumber in the shed and on the open yards of the appellant’s lumber plant in the city of Pine Bluff. During the life of the policies, on December 25, 1900, the lumber in the shed and a large quantity on the yards were totally destroyed by fire.

' The Repoiter will set forth in the statement of facts the substance of the pleadings and evidence, and the instructions which are drawn in question.

The trial resulted in a verdict and judgment in favor of appellee, Murray, for the face of the policies, and the insurance company has appealed.

1. The appellant claims that the verdict is excessive, to the amount of $866.28, in this :

Attached to and a part of the policy is a clause described as the “85 per cent, co-insurance clause,” the object of which, appellant asserts, is to compel the insured to carry insurance to the amount of 85 per cent, of the value of the property insured, and in the case of partial loss the amount is paid by contribution from the various insuring companies, and, had this clause been complied with under -the facts, the extent of the appellant’s liability would have been $866.28 less than the face of the policies. The answer of the insurance company denied liability, and pleaded various alleged violations of other clauses of the policies, and did not put this in issue. No instructions were asked on this clause, and no point made involving it until after verdict, when, in motion for a new trial, it was assigned as error that the' verdict was excessive in this amount, and here it is contended that it is excessive because of a violation of this clause. If the appellant is right in its-contention, then it had a defense, pro tanto, to the suit, and a failure to plead it waived it. This court has frequently decided that when a battery is masked in the trial court, it cannot be opened in this court.

2. The policy contained the standard clause requiring the insured to keep a set of books, which shall clearly and plainly present a complete record of the business transacted. It is asserted that this clause was violated, and that was put in issue on the trial. This court held in Western Assurance Company v. Altheimer, 58 Ark. 573, that it was proper to leave to the jury, under instructions, explaining the terms the contract imposed, the question- whether the books kept, from an inspection of them and other evidence on the subject, were such a “set of books” as the contract contemplated. The books in this case were brought into court for inspection, if desired, and evidence sustaining and impeaching their sufficiency was adduced. The appellant asked, and the court gave, an instruction on this subject telling the jury that a failure to comply with this clause of the contract avoided the policy. Therefore appellant cannot question the propriety of sending that issue to the jury, nor the adverse finding by it, which was, however, supported by the evidence.

3. It is admitted that the clause in the policy requiring the insured to make, within 60 days after the fire, a complete inventory, etc., commonly called the “proof of loss,” was not complied with. The insured claimed that its performance was waived, and the insurance company took issue upon this question. It is thoroughly established that denial of all liability and refusal to pay is a waiver of this requirement of the policy. Such conduct is a declaration that the payment will not be made, even if the proof of loss is furnished; and the law does not require the insured to perform a vain act. Knickerbocker Life Ins. Co. v. Pendleton, 122 U. S. 696; German Ins. Co. v. Gibson, 53 Ark. 494; Phoenix Ins. Co. v. Minner, 64 Ark. 590; Planters, etc., Ins. Co. v. Loyd, 67 Ark. 584. It is insisted, however, that the facts do not bring this case within the rule; that the adjuster merely refused to furnish the blanks for the proofs to be made upon, and denied liability as to part of the loss, not all, and that the insurance company could insist upon all its defenses without waiving this. Such is the conclusion to be drawn from the appellant’s witnesses. On the other hand, Murray testified positively that all liability was denied by the adjuster representing appellant; and the adjuster wrote a letter to the effect that, if Murray would accept $71.11, which he claimed was all that was due him, he would send proof of loss for signature, and that he proposed “to stand pat on these figures.” Murray had already refused this sum, and, if the company was liable for any more, it was a vain act for him to send the statement, and an unnecessary one if he would accept this offer, as the company would furnish the proof in that event ready for his signature. The court submitted this issue to the jury, under proper instructions, and their verdict that the proof of loss was waived is fully sustained by the evidence.

4. It is contended that improper evidence was admitted in form of inventories prepared by the foreman of the lumber yard, showing the lumber destroyed. They were introduced, not, as appellant contends, in lieu of the requirement of the policy to keep and produce inventories, but merely to refresh the memory of the witness as to the amount and value of the lumber destroyed. They were made by him the day following the fire, and were merely memoranda strengthening his recollection. The evidence was within the rule declared by this court on a similar question in Phoenix Insurance Company v. Public Parks Amusement Company, 63 Ark. 187.

5. The policies covered lumber in a frame shingle-roof shed and on the open yards. The first was written in April, and in October the insured telephoned the insurance agent to write another $1,000 policy on his lumber, and the agent wrote it with the same description of the property insured which was in the first one. The shingle-roof shed was floored, partially inclosed, and contained racks for storing lumber. After April, and before October, the insured erected on his open yards, close to his mill, and over the most valuable part of his lumber, an asbestos roof. This was not constructed as the shed was. It was not floored nor inclosed, nor did it contain racks for lumber. The lumber piles were merely reduced from 20 to 12 feet in height, and uprights erected, upon which the asbestos roof was placed. There was a conflict in the evidence as to whether the insurance agent, whose duty it was to inspect property insured,, had knowledge of this change in the manner of storing the lumber and the erection of this roof; and also a conflict as to whether this roof increased the hazard of the risk contracted against by the insurance company. The question of increased risk only arises as to the first policy, as there was no change after the second was written. In the fourth instruction the court properly sent this issue to the jury, and it has, on legally sufficient evidence, decided that the risk was not increased. As to the second policy, the question is whether it included the lumber under the asbestos roof. As stated, there was a conflict in the evidence as to whether the agent knew this roof was over the valuable lumber piles. In reporting on issuing the second policy, the agent said he had that day inspected the risk, and that the total value of the property insured was $13,000. The evidence shows that the total value of all the lumber was $12,000, of which $6,000 was under the asbestos roof. The court sent this question to the jury under an instruction telling them that if the agent inserted the description in the policy from his own knowledge of the property while inspecting it for insuring it, the insurance company can not take any advantage of an inaccuracy in the description, unless the insured misled him by his conduct into making such inaccuracy. And any inaccuracy known to the agent at the time of affecting the insurance as to the description of the lumber insured would estop the company from assert- ' ing it after the loss. This was-as favorable a statement as the insurance company was entitled to, and the finding against it on this issue can not be disturbed. Questions are raised as to some parts of other instructions; but, on the whole case,' the court is of opinion that the jury was properly instructed and had legally sufficient evidence before it upon each issue to justify its verdict.

The judgment is affirmed.