Merchants & Manufacturers Insurance v. Washington Mutual Insurance

The plea, which both replications purport to answer, is founded on the clause of the policy which has been quoted, prohibiting, in connection with the condition to which it refers, the use of the building for any mechanical operation requiring fire-heat. The plea avers, that “ kiln drying corn meal,” is such an operation, and the building being used for that business at the time of the loss by fire, there can be no recovery for such a loss under the policy. The 2d replication seeks to avoid this conclusion, by showing, that, as the building described in the policy, was a K steam flouring mill,” its use as such must have been intended, though all mills are prohibited as hazardous by the clause in and condition annexed to the policy, *184on which the plea is founded, and that “ kiln drying corn meal” is incident to the use of “steam flouring mills.” If I properly understand the replication, it claims that the apparatus for kiln drying corn meal was a part of the machinery of the mill, and appertained to, or was a proper appliance or means in the carrying on of the business of steam flouring mills. If this replication be so understood, and that it may be so understood is sufficient, I think it is a good answer to the plea, and that a general demurrer to it must be overruled.

To the 3d replication there is a general demurrer; and this replication, though setting out the same general facts which are stated in the 2d replication, is essentially different. In the one, “ kiln drying corn meal ” is defended, on the ground that it is an incident to the business of “ steam flouring mills; ” in the other, on the ground, that it is a part of the regular business of the establishment, described in the policy as the “ City Mills.”

If the carrying on the business of “ kiln drying corn meal” is protected, from its usual and proper connection with the business of a steam flouring mill, that defence is fully made in the second replication. The 3d replication can only be maintained on the hypothesis, that any independent business, in point of fact, carried on in the building, at the time of the insurance, might still be carried on, nothwithstanding the clause in the policy and the conditions annexed; or, on the ground, that as the business of a steam flouring mill is authorized, any appliance in aid of that business, or which may, in any manner, facilitate the carrying it on, though it may be only used in the particular mill, and before such use have been unknown, and although it requires fire-heat, is also authorized.

*185The first proposition certainly cannot be sustained. If a powder mill or steam cotton manufactory had been in operation in some part of the building described as the City Mills, unless the use of such a mill or manufactory had been discontinued, there could be no recovery under the policy. If, then, the business of “kiln drying corn meal” can be protected, it must be from a connection with the steam flouring mill in respect of the nature of the operation, and not from the point or place of its.location. If it be an independent business requiring fire heat, it is prohibited by the policy. The warranty contained in the policy upon this point is prospective; it provides for what may exist, and the existence of the thing prohibited at the date of the policy, is no excuse for its subsequent' continuance.

The second proposition involves more difficulty. It must be considered that the business of a steam flouring mill is authorized, and as I have already decided that business may be conducted in the manner and with the appliances usual and proper to “steam flouring mills.” That “kiln drying corn meal” is one of those appliances, is the question raised by the second replication. But suppose that “kiln drying corn meal” as an aid, appliance, or means in the business of a steam flouring mill had never been tested, but should be considered a new and valuable improvement in the mode or manner of carrying on that business, would the clause in the policy prohibit its introduction ? The list of hazardous trades mentioned in the second of the conditions annexed to the policy, embraces nearly every description of manufactories; and probabfy all in which steam power is used. I am not prepared to say, that it was the meaning of that condition to prevent *186the introduction and trial of the various improvements which ingenuity is constantly devising, though their operation might require the use of fire heat. I rather think, that the framers of the policy supposed that any material change or modification of a steam manufactory in respect of the use of fire, would necessarily involve such an alteration of the structure or premises insured, as to be embraced by the clause in the policy prohibiting such alteration, that when one of the hazardons risks is assumed, e. g-a “ steam flouring mill,” every thing fairly and properly connected with such a business, as part of it and appertaining to it, whether newly introduced or before used, must be considered as authorized; that the “other mechanical operations requiring fire heat,” are those having-no proper connection with the operation of a “steam flouring mill.”

In this view, if the averments of the replication are to be understood, as stating, that the building with its machinery, including that for kiln drying corn meal, constitutes a “steam flouring mill,” and that the “kiln drying corn meal” is a part of the operation or business of a “steam flouring mill,” I should be prepared to sustain it as a sufficient answer to the plea. The point to which I shall require the replication to come up, is, that the business of “kiln drying corn meal” being connected with that of a “steam flouring mill,” the authority to carry on the one embraces the other. Such a ground may probably be taken under the first replication or the general denial of the plea: but I see no objection to its being taken specially. The third replication does not, however, in my opinion, though it may have been so intended, stand with sufficient clearness on that ground. If it was so intended, *187by one or two slight verbal alterations it may be made to conform to what is required. If it was not so intended, then the replication is, what may be fairly inferred from the language, a statement, that the business of kiln drying corn meal, though not properly connected with the business of a “steam flouring mill,'5’ was a part of the regular business of the establishment known as the “City Mills,” the connection with a steam flouring mill being in respect of location and not in the nature of the operation. Thus understood, the replication cannot, in my opinion, be deemed sufficient, and the demurrer to it must be sustained.

In the briefs which have been submitted to me by the counsel, I find some elaborate and able arguments on the question of representation, but I do not see that any question on that point now arises. I may, however, very properly make one remark, having a connection with a question of concealment, which has influenced my mind in allowing the 3rd replication to stand, if amended as I have required. I suppose that the introduction of any new mode of carrying on or of aiding in the carrying on the manufactory, which would materially increase the risk by use of fire heat, would generally involve such an alteration of the premises as to be precluded by the clause in the policy on that subject; and I have assigned this as a reason, why the prospective warranty against other mechanical operations extends only to those of an independent character’.' It may be said that in such a case as the present — the novel and extraordinary apparatus — if it be such — being in use and attached when the policy was made, would not be embraced in the clause providing against a material alteration of the premises insured. This may be true — but still the insurer would probably be protected *188against any extraordinary or unusual mode of carrying on the business — one which he would have no just reason to expect, and which materially increased the risk, by the obligation resting in such a case on the insured to make a communication on the subject. Such I believe is the rule on the subject laid down in the recent case of Clark v. Manufacturer’s Insurance Co. 8 Howard, 285-249.