General Rules. Bridgewater Iron Co. v. Enterprise Ins. gence in representations in the applicaCo., 12 Ins. L. J. 301; 134 Mass. 433. tion, before they will vitiate or avoid a policy of insurance, unless an express warranty is given. Id. -- 20. A misrepresentation as to existence of an encumbrance at time of issue of policy is cured by the company subsequently consenting to an encumbrance replacing it. Lebanon Mutual Ins. Co. v. Losch, 15 Ins. L. J. 104; 109 Pa. 100. 21. The fact that the owner of insured property does not know of the existence of other insurance thereon will not excuse him in making a statement in his application that there is no other insurance; nor will it prevent the company from setting up the false representations, in an action on the policy. Phoenix Ins. Co. v. Copeland, 86 Ala. 551; 6 So. Rep. 143. 28.- By an express warranty the insured stipulates for the absolute truth of his statements in the application. Good faith and honest purpose will not excuse error in such case. The statements must be entirely true, or the warranty is not fulfilled. Id. 29.- A plea of misrepresentation must also aver an increase of hazard, and that the fact would have enhanced the premium or prevented the insurance. Kentucky Ins. Co. v. Southard, 8 B. Monroe, 634 (Ky.) 22. Where the complaint averred that 30. The knowledge of an agent, bethe policy was issued on an application fore the issue of an insurance policy, of made and signed by the plaintiff, which the truth as to the ownership of the incontained certain material representations sured property and litigation concerning as to the manner in which the building it, will prevent a defense on the ground was occupied, held, error to allow of misrepresentations as to those matters plaintiff to testify that he did not know what representations the application contained. Menk v. Commercial Ins. Co., 70 Cal. 585. in the application. *Western Assur. Co. v. Stoddard, 88 Ala. 606; 7 So. Rep. 379; German Ins. Co. v. Churchill, 26 Ill. App. 206; American C. Ins. Co. v. Brown, 29 Ill. App. 602. 31. A breach of an immaterial provision does not avoid the policy. *Waterbury v. Dakota F. & M. Ins. Co., 43 N. W. Rep. 697; 6 Dak. 468. 23.- A company cannot defeat an action on the ground that the assured made a false statement as to other insurance, when the agent taking the risk was informed as to the other insurance, and the conditions and terms of the policy. Miller 32. A representation by an assured v. Hartford F. Ins. Co., 70 Iowa 704; Ben- precedes the contract, and, being only an nett v. Council Bluffs Ins. Co., Id. 600. inducement thereto, need only be true as 24. By issuing a policy upon property to matters material to, and that influence with knowledge of an incumbrance the insurer in taking or rejecting, the risk, thereon, the insurer waives a misrepre- or in fixing the rate of premium. Id. sentation that the property is free from 33.- A statement in an application for incumbrance. Wilson v. Minnesota Farm-insurance, that it is a full statement of all ers' Mut. F. Ins. Asso., 36 Minn. 112; 30 N. the facts known to the applicant and maW. Rep. 401. 25.- If the matter misrepresented in creases the risk, it still may defeat the policy, although not made with intent to deceive. Ring v. Phœnix Assur. Co., 5 N. Eng. Rep. 387; 145 Mass. 426; 14 N. East. Rep. 525. terial to the risk, so far qualifies and limits the effect of warranties as to render them representations merely. Id. 34. A misrepresentation of a material fact inserted by a soliciting agent, without the knowledge and contrary to the instructions of the applicant, in an applica26.- In the absence of negligence, a tion not read to or by him, although it bona fide statement by applicant, upon contained a printed clause of which he knowledge and belief, although untrue or did not know and to which his attention inaccurate, will not avoid the policy. was not called, limiting the agent's powers Fisher v. Crescent Ins. Co., 33 Fed. Rep.-does not invalidate the policy. *Tubbs 544. v. Dwelling House Ins. Co., 84 Mich. 27.- There must be some element of 646; 20 Ins. L. J. 463; 48 N. W. Rep. frand, willful falsehood, or gross negli-296. What is a Misrepresentation. 39.- If the property is represented as sold for taxes, it is a misrepresentation that will avoid the policy. Wilbur v. Bowditch Mut. Ins. Co., 10 Cush. 446 (Mass.) 35. What is a misrepresentation. Plaintiff applied for insurance on a factory, unencumbered, when in fact it has been representing that an insurance of $15,000 had already been taken on the property, which was valued at $19,000. The company declined on the ground that there was insurance enough on the property. The plaintiff then represented that additions had been made to the factory fully equal to $10,000, and upon the faith of this statement, a policy was issued. This last statement turning out wholly untrue, held, that the policy was void, and that it made no difference that the misrepresentation was made by an agent, and by mistake. Carpenter v. American Ins. Co., 1 Story, 57 (U. S. Cir.) 36.— Assured applied to the agent of the defendant company for an insurance of two thousand dollars, stating in reply to inquiry of the agent, that he had no other insurance on the property. In fact, he had already insured two thousand dollars in another company, and, with consent of that company, assigned the policy to a creditor from whom he had purchased the goods, and to whom he was yet indebted for the balance of the purchase money. The policy in suit provided, **that it should be void if prior insurance were not expressed in the policy." Held, that the policy, by its terms, was void, it having been obtained by fraud and misrepresentation. Neve v. Columbia Ins. Co., 2 McMullin, 220 (S. C.) 40.- Where applicant stated that the premises to be insured were incumbered for "about $3,000," when in fact there was a mortgage on them for $4,000; held, that the representation as to encumbrance was a material one, which assured was bound to make substantially true; and that having failed to do so, he could not recover. Hayward v. New England Mut. Ins. Co., 10 Cush. 444 (Mass.) 41.- Where policy provided for "a true statement of the interest of the assured, if less than fee simple," and also for “a lien on all buildings insured;" and the assured represented the property as "his building," when in fact it had been erected on land of another, under an agreement to purchase (assured to pay rent in the meantime); and the conditions of such purchase had not been fulfilled at the time of the insurance; held, that in the absence of knowledge on the part of the underwriters of the true state of the title, the policy was void for misrepresentation. Marshall v. Columbian Mut. Ins. Co., 7 Fost. 157 (N. H.) 42.- Policy stipulated "that the assured should make a true representation as to title and interest, and also as to encumbrances, or policy should be void." To questions: "Who owns the buildings?" and "whether incumbered ?" he answered, "owned by insured; "" no encumbrance;" when in fact he was but the mortgagee, and had no other title. Held, to be such a misrepresentation of "title and interest" as to avoid the policy. Jenkins v. Quincy Mut. Fire Ins. Co., 7 Gray, 370 37.- The assured represented that there were no lamps in the picking room. The proof was that lamps were used in the picking room, which materially increased the risk and from which the fire arose. Held, that the policy was void. Clark v. Manufacturers' Ins. Co., 2 Woodb. & Min. 472 (U. S. Cir.); aff'd, 8 How. 235 (U. S.) 38. The application represented the premises to be mortgaged for $2,000, and|(Mass.) the applicant took a policy payable, in case of loss, to the mortgagee. The encumbrance, in fact, amounted to $3,800. Held, that this was a material misrepresentation, and avoided the policy; and that the misrepresentation was not relieved or excused by the fact that an agent and director of the company assisted the assured in drawing it up. Lowell v. Middlesex Mut. Fire Ins. Co., 8 Cush. 127 (Mass.) 43.-It appearing that policy had been made payable to mortgagees with consent of company, and that there had been a failure to disclose an $800 mortgage; held, a material misrepresentation that avoided the policy in the hands of the assignee. Bowditch Fire Ins. Co. v. Winslow, 8 Gray, 38 (Mass.); 3 Id. 415. 44. The plaintiff represented his title as unincumbered. There was a mortgage on it; but certain services which he was What is Not a Misrepresentation. at time of insurance as well as at time of loss, the debtor's equity of redemption to perform for the mortgagee were to be credited on the mortgage. Before application for insurance, these services had not expired. Held, that the omission amounted to the face of the mortgage which the mortgagee was ready to cancel; but it was still outstanding. Held, no reply to the defense of misrepresentation. Muma v. Niagara District Mut. Ins. Co., 22 Up. Can. Q. B. 214. 45.-A representation that assured held building in fee is rendered false by the fact that he had a leasehold interest only and his right to remove the building cannot help the assured. Stickney v. Niagara District Mut. Ins. Co., 23 Up. Can. C. P. 372. 46.- When goods are represented and described in policy as being in a "store," the fact that they are contained in a lodg-| ing and boarding house or tavern is a misrepresentation avoiding the insurance. In such a case the distinction between a tavern and a hotel is without any difference. Prudhomme v. Salamander Fire Ins. Co., 27 La. Ann. 695. 47.- Encumbrances were represented as amounting to about $3,000, when in fact they amounted to $4,425. Held, such a misrepresentation as to avoid the insurance without reference to the good faith of the assured. Glade v. Germania Fire Ins. Co., 12 Rep. 238; 56 Iowa, 400. to make known the debtor's equity of redemption was not such a misrepresentation, within the meaning of the condition, as would avoid the policy. Clapp v. Union Mut. Fire Ins. Co., 7 Fost. 143 (N. H.) 51. If a representation as to encumbrances upon the property is untrue, but not fraudulently made, and the agent of the company knows the true state of the facts and writes the statement from his own knowledge, and fails to state it truly, such misrepresentation will not avoid the policy, although the statement is adopted and signed by the agent of the insured. Protection Ins. Co. v. Harmer, 2 Ohio St. 452. 52.-The representation that there is a force pump in starch manufactory does not, by implication, include hose. Peoria Marine & Fire Ins. Co. v. Lewis, 18 Ill. 553. 53. In this case the policy was on "starch manufactory, including fixtures and machinery," and assured represented that he had $2,000 insurance on the property in Stevenson County Mutual Insurance Company, when in fact the insurance in the latter company was upon "starch 48.- Materiality of a misrepresentation manufactory" alone. Held, that the repis essential to sustain such a defense.resentation of other insurance on the same Mosley v. Vermont Mut. Fire Ins. Co., property was not untrue, as “starch man13 Ins. L. J. 97; 55 Vt. 142. ufactory" included fixtures and machinery. Id. 49. Where an applicant for insurance on being asked if there is $1,000 encumbrance on the property, answers, "Over $2,000," whereas there is $5,000, there is a material misrepresentation. *Smith v. Agricultural Ins. Co., 118 N. Y. 518; 29 N. Y. S. Rep. 810; 19 Ins. L. J. 374; 23 N. East. Rep. 883. 54. In the application and policy the property insured was described as "a brick dwelling house and wood house," situate, &c., and "occupied for the usual purposes, by a tenant." It appeared that the "wood house was built at one time, had but one frame, was all under one 50. What is not a misrepresentation. roof, and was designed for one building, The policy required the applicant for in- a wood house and carriage house; the wood surance to make a true representation as room constituted two-thirds or more of to his title and interest in the property to the entire building, and was separated be insured. In the application which was from the carriage room by a loose partimade a part of the contract, was this tion about seven feet high, which extended question: "Whose is the property in- to the eaves on one side, and not so high sured?" To which answer was made: on the other side, leaving a distance of "L. Miller's." In fact L. Miller was a about seven feet between the top of the judgment creditor, to whom this property partition and the ridge pole. The comhad been set off on execution, subject to pany set up in defense a false representatwo small mortgages to other parties, and|tion on the part of the assured, in stating What is Not a Misrepresentation. 57.- A void tax sale does not affect an insurable interest nor a representation as to ownership. Cheek v. Columbia Fire Ins. Co., 4 Ins. L. J. 99 (Tenn.) there was no other building within four | Hough v. City Fire Ins. Co., 29 Conn. rods of the premises insured, claiming 10. that the carriage house, part of the wood house, was a separate building which should have been mentioned; held, that the "wood house" covered and included the carriage house, and evidence that the whole structure was called by the tenants and neighbors the "wood house" was admissible. White v. Mutual Fire Ins. Co., 8 Gray, 566 (Mass.) 58. When there is no condition in policy which relates to matters of title in such case the silence of the insured as to the precise condition of title is not a ground of defense although interest in 55. The facts in this case were, that ownership may not be absolute in law, the agent of the assured, before the appli- there is no false representation in assured cation for insurance, had made an arrange- representing the building insured as "my ment with the attorney of the mortgagee, residence." The nature of his title and who was foreclosing a mortgage then ex-interest may be fully explained in such isting on the property, by which he paid case upon trial by parol testimony. Liv., him $130, and attorney loaned him the Lond. & Globe Ins. Co. v. McGuire, 52 balance necessary to pay off the mortgage Miss. 227. by accepting his personal responsibility for such balance, and considered the mortgage as paid, and discontinued the suit for foreclosure. The agent of assured then told plaintiff that the mortgage was paid, and she made the application for insurance, representing that the property was not encumbered. Held, that this mortgage, though not discharged of record, was no longer an existing encumbrance on the land, and that assured had not therefore made any misrepresentation as to encumbrance. Hawkes v. Dodge County Mut. Ins. Co., 11 Wis. 188. 59.- A representation of ownership is not rendered false by the existence of an equitable title. Farmers' Mutual Fire Ins. Co. v. Fogelman, 35 Mich. 481. 60. A representation that other companies upon the same risk, had reduced the rate of premium, is no ground for evading the policy if company has already accepted the risk upon its own judgment, such misrepresentation having the effect only of inducing them to take a lower rate of premium. Canada Fire Ins. Co. v. Northern Ins. Co., 2 Tupper, 373 (Can.) 61.- Application contained following: 56.- In the application and policy, "Incumbrances. Is the property mortassured described the property as "his," gaged? If so, state the amount. Is there when, in fact, by virtue of a parol agree-any insurance by the mortgagee? Ans. ment, he was but the equitable owner in Yes, $500 mortgage. Loss payable to Mr. possession, the legal title being in another, G. as interest may appear." But there and part of the purchase money remain- was no mention of another mortgage for ing unpaid. The defendants claimed $1,000. This application was one of three that the assured's denomination of the made at same time, and although for inproperty as "his," was a misrepresenta-surance on different buildings they were tion which rendered the insurance void, and to meet that claim, assured offered evidence to show, that he made known to the agent taking the application, the true state of the title, and that agent then filled up the application in his own language and he (the assured) signed it; held, that the evidence was admissible, under the circumstances, to estop the insurers from taking advantage of their own wrong, and was also proper, as conducing to prove an understanding and agreement between the parties to consider and treat the property as belonging to assured. all on same piece of land of about 4 acres. In one of the other applications assured in answer to similar question stated the correct amount of the mortgage incumbrance to be $1,500. Held, no misrepresentation as to incumbrances, and that company had notice of the facts by the other application. McGugan v. Manufacturers' & Merchants' Ins. Co., 29 Up. Can. C. P. 494. 62. A representation that assured “owns land in fee simple," is not rendered untrue by the fact that price has not been paid, he holding a deed. O'Neill v. Ottawa As to Value. Agricultural Ins. Co.,30 Up. Can. C. P.151. a misrepresentation, although he knew 62a. A condition as to misrepresenta- that at that time the title had not been tion and concealment, held to be unjust transferred to him from the government. and unreasonable and therefore inopera- *St. Paul F. & M. Ins. Co. v. Neidecken, tive under the Ontario Act. Reddick v. 19 Ins. L. J. 369; 43 N. W. Rep. 696; 16 Saugeen Mut. F. Ins. Co., 15 Ont. App. Dak. 494. 363 (Can.); below 14 Ont. 506; and see Butler v. Standard Fire Ins. Co., 4 Tupper, 391 (Can.) 63. If applicant is not guilty of any misleading conduct, his silence on the subject of an encumbrance cannot be deemed a misrepresentation; the company assumes the risk incident to an undisclosed encumbrance. So held under special wording of the policy and construction of the court. O'Brien v. Ohio Ins. Co., 13 Ins. L. J. 825; 52 Mich. 131. 69. As to value. An over-estimate of $4,000 in the value of the property is a gross over-valuation, that avoids the policy, though a slight over-estimate, such as might reasonably be accounted for from difference of opinion, would not have done so. Catron v. Tennessee Ins. Co., 6 Humph. 176 (Tenn.) 70.- The valuation is material to the risk; and misrepresentation as to value avoids the policy. Wilbur v. Bowditch Mut. Ins. Co., 10 Cush. 446 (Mass.) 71.— A condition in a policy of insur sured of a building insured, or of its contents, or in a valued policy, an overvaluation shall render void a policy issuing upon such description or valuation,” does not apply to an over-valuation of goods insured under an open policy. Lee v. Howard Fire Ins. Co., 11 Cush. 324 (Mass.) 64.- A mortgagee may insure as general owner without disclosing his particu-ance "that a false description by the aslar interest unless it is inquired about; and speaking of the building insured as "his" in the absence of such inquiry, is not a misrepresentation of his title. Buck v. Phonix Ins. Co., 14 Ins. L. J. 412; 76 Me. 586. But note that case does not decide upon the application of the language of a policy requiring interest of assured to be stated if not sole and unconditional ownership. See Section five. -- 72. A serious over-valuation, knowingly made, upon work not done or a sub65. Failure to mention a mortgage isject not in existence, and that fact not not a misrepresentation concerning the disclosed, is a sufficient cause for avoidtitle. Guest v. New Hampshire Fire Ins.ing the policy; but a small over-valuation, Co., 16 Ins. L. J. 790; 66 Mich. 98. 66.- A representation that stovepipes enter a brick chimney, when they pass through the roof, will not avoid the policy if plaintiff can show that they are just as safe as though they entered the chimney. Bankhead v. Des Moines Ins. Co., 70 Iowa, 387. 67.— Where one tenant in common, after entering upon a part of land set off to him under an agreement between all the tenants, in procuring an insurance payable to mortgagees of the entire tract, represents his estate as only subject to that portion of the debt which, under the agreement, he has assumed, he is not guilty of misrepresentation that will avoid the policy. Mutual Mill Ins. Co. v. Gordon, 10 West. Rep. 613; 121 Ill. 366; 12 N. East. Rep. 747. 68.- A statement by an applicant for insurance that he had a homestead, in answer to a question as to his title, is not such as might reasonably be accounted for in difference of opinion, is not. Protection Ins. Co. v. Hall, 15 B. Monroe, 411 (Ky.) 73.— The assured effected an insurance with the defendants on certain buildings for $1,100, stating their value to be $3,000. In an action on this policy, it appeared, that a few days before, he had insured the same houses, together with a driving shed, worth $400, in another office for $900, and had then valued the whole at from $1,200 to $1,400. The evidence as to the actual value was contradictory, and the great difference in the assured's two valuations was not explained. The jury having found for the plaintiff; held, that the evidence supported a plea of fraudulent over-valuation, and a new trial was granted, with costs to abide the event. Note-This case has since been again tried, and a second verdict having been rendered for the assured, on evidence not |