Pelton v. Westchester Fire Insurance

Sawyer, J.:

All of the question’s raised by the appeal in this action have been adjudicated adversely to the appellants (Frink v. Hampden Ins. Co., 1 Abbott [N. S.], 343; Grosvenor v. Atlantic Ins. Co., 17 N. Y., 391; Acer v. Merchants' Ins. Co., 57 Barb., 68; Ætna Ins. Co. v. Tyler, 16 Wend., 385; Dohn v. Farmers' Ins. Co., 5 Lans., 279; Maher v. Hibernian Ins. Co., 6 Hun, 353; Rowley v. Empire Ins. Co., 36 N. Y., 550; Owens v. H. P. Ins. Co., 56 id., 565; Pitney v. Glens Falls Ins. Co., 65 id., 6), except the question, what effect was produced in the relations between the insured and the insurer by the fact that at the time of .effecting the insurance Brown, the insured, was in default in making the payments called for by his contract of purchase, such fact not having been brought to the direct knowledge of the defendant.

Brown’s contract of purchase contained, among other things, this provision: “ On failure to perform the contract on the part of Brown, the said Pelton may declare the contract void and retain whatever moneys have been paid thereon.” Brown was confessedly in arrear in making his payments, but he was in possession of the premises and had erected thereon the building called for by the contract which was the subject of this insurance. Pelton, the vendor, had not availed himself of his legal right to declare the contract void. How, then, did this affect the relative rights of the parties ? This provision did not, upon default in payment, render the contract void, but voidable only, at the election of the vendor ; he having not so elected, no change in the relative positions affecting the title was produced. Either party might still insist upon a specific performance. (Lawrence v. Dale, 3 Johns. Chancery, 23; Hutchins v. Munger, 41 N. Y., 155.) The contract, therefore, as between the parties to it, was still a valid and subsisting contract, enforceable by either party upon tendering performance. (Kort *26right v. Cady, 41 N. Y., 343.) Brown’s equitable title to tbe premises and insurable interest in tbe buildings erected tbereon bad not ceased by reason of tbe default, and witliin tbe doctrine of tbe cases cited (supra) be did not misstate bis interest nor violate tbe conditions of tbe policy in not disclosing that fact.

Tbe exceptions, therefore, must be overruled and judgment ordered upon tbe verdict for tbe plaintiff, with costs

Learned, P. J., and Boardman, J., concurred.

Motion for new trial denied, and judgment ordered for plaintiff on verdict, with costs.