Reiter v. Michigan Commercial Insurance ( 1915 )

Opinion by

Kephart, J.,

This is an appeal from the refusal of the court below to enter judgment for want of a sufficient affidavit of defense. The policy of insurance covered a stock of general merchandise, consisting of flour, feed, dry goods, groceries, furniture, hardware, etc. The particular paragraph of the policy upon which the defense is founded is as follows: “This entire policy shall be void if the insured has concealed or misrepresented, in writing or otherwise, any material facts or circumstance concerning this insurance or the subject thereof; ......or 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.”

The last clause of this paragraph sets up two distinct grounds, which, if in existence, would avoid the policy. “Fraud” and “false swearing” are essential features which will avoid a policy of insurance where found to exist with a dishonest motive. As was said in Ellis v. Agricultural Insurance Co., 7 Pa. Superior Ct. 264: “Under these provisions, and in view of the facts above stated, the court. beloAV submitted the case to the jury. We cannot see how this can be sustained. Insurance companies are entitled to the enforcement of the provisions of their policies. If thesé provisions are violated, especially in respect to matters referred to the conscience of the insured, it is the duty of the court to see that the violations are followed by the proper forfeiture of right.”

The first and second paragraphs of the affidavit of de-. fense charge fraud, false swearing and misrepresentation ; that the defendant “is informed and believes and expects to be able to prove” that plaintiff’s averment that the goods destroyed by fire were worth $2,745, and the actual loss sustained was $2,645, was false and untrue and a misrepresentation; and that the value was not in excess of the sum of $700, and by reason thereof the plaintiff Avas not entitled to recover in any sum whatever. The defense is planted squarely on the ground of false swearing and fraud, if the facts on which they rely are sufficiently averred. It is not a contest to reduce the value of the goods lost to their true value but is a denial of all liability. The affidavit specifically charges that the plaintiff, on the date the proofs of loss were executed, falsely swore that the value was a sum of money grossly in excess of the real value. The disproportionate amount between the value claimed and the real value was sufficient evidence, if believed by the jury, to charge the plaintiff with swearing falsely Avith a fraudulent motive. It is a positive averment of an act done which indicates fraud but it is not conclusive. The difference in value being so great we cannot say that this is one of those clear cases in which the court below erred in refusing judgment for want of sufficient affidavit of defense: Beck v. Schekter, 235 Pa. 253.

The assignments of error are overruled and the appeal is dismissed at the cost of appellant without prejudice, etc.