Cagle v. Chillicothe Town Mutual Fire Insurance

On the twelfth day of April, 1897, defendant issued its policy insuring plaintiff’s frame building in Carthage for the sum of $1,000. In less than a month thereafter the building was destroyed by fire. Defendant refusing to pay the loss, this suit was brought, resulting in a verdict and judgment for $681.74 in plaintiff’s favor and defendant appealed.

The defenses relied on were: that at the time the policy was applied for and issued there were two mortgages aggregating $1,000 on the property, and which were not mentioned in plaintiff’s application; that in said application plaintiff stated that no other insurance company had ever declined the risk, whereas every agency in Jasper county had so declined; and further it was claimed that plaintiff in his application had fraudulently overvalued the building which was -warranted to be of the value of $1,500 whereas it was worth very much less.

*218Of these defenses the first only need be considered, since that is sufficient to deny plaintiff’s right of recovery. In plaintiff’s application — and which by its terms it was agreed should be treated and become a part of the contract of insurance — it was stipulated, “that any incumbrance shall avoid the policy, unless written consent of the secretary is obtained.” It is conceded that when the application was made, before and since, there were two unsatisfied mortgages on the property, one for $600 and one for $400; that notice thereof was not given to defendant’s secretary, and hence he never gave any written consent thereto. It must follow then, according to the terms of contract above quoted, that the policy is void. There was however evidence tending to prove 'that at the time the application was signed, and the policy issued, the local agent at Carthage was informed as to the existence of these incumbrances; it is contended then that such knowledge on the part of the agent and failure to object, constituted a waiver of the stipulation as to incumbrances. But this can not be; the local agent had no authority to waive this provision against incumbrances; by an express provision of the contract between the assured and the company this could only be consented to by the secretary thereof. The power and authority thus given to the company’s secretary involved a denial thereof to the local agent. Such limitation on the authority of the local agent was, too, brought home to the assured; it is therefore binding on him. Wolf v. Ins. Co., 75 Mo. App. 337, and cases cited; Lama v. Ins. Co., 51 Mo. App. 447.

The judgment of the circuit court must be reversed.