Crossan v. Pennsylvania Fire Insurance

ELLISON, J.

This is an action on a fire insurance policy in which plaintiff recovered judgment in the trial court for $500, the full amount of the policy.

The policy insured the plaintiff against loss on personal property, for a gross premium, in the gross sum of $500. That sum was the total made up by the separate insurance of three classes of property in the same building, with the amount of insurance stated on each class. Two hundred dollars was on stock of general merchandise; two hundred and twenty-five dollars was on furniture and fixtures in- the store; and seventy-five *539dollars was on household and kitchen furniture. The insurance was taken on the 3d day of July, 1907, and the fire occurred three days thereafter. The loss was not total on either of the three classes of property. Plaintiff placed the aggregate value of the property saved at $100.

An instruction for plaintiff put the case to the jury as an insurance in solido for the gross sum of $500, and though there was a saving from the fire of $100 in value, yet the.theory of the instruction was that the provision of section 7979, Eevised Statutes 1899, in the following words, — “No company shall take a risk on any property in this State at a ratio greater than three-fourths of the value of the property insured, and when taken, its value shall not be questioned in any proceeding” — bad the effect, so far as defendant was concerned in this action, of fixing the value of the property at a sum of which $500 was three-fourths,— that is to say, $666 2-3; therefore, when he saved $100 in value from the fire, he yet lost more than $500, and consequently was entitled to recover the full sum of the insurance.

We have heretofore construed the foregoing statute as being a direction to insurance companies not to insure for more than three-fourths of the value of property, and that when they did fix a value and issue insurance for the sum fixed upon, they should not be allowed to dispute that such sum was three-fourths of the value. [Gibson v. Insurance Co., 82 Mo. App. 515.] In support of that case are the following cases: Siegle v. Insurance Co., 107 Mo. App. 456; Hanna v. Insurance Co., 109 Mo. App. 152; Stevens v. Insurance Co., 120 Mo. App. 88. See also, on the general subject, Daggs v. Insurance Co., 136 Mo. 382, 394. The instruction in question embodied this view of the statute; but when it is applied to the special provisions of the policy in suit, it cannot be approved.

*540As already stated, the policy, though insuring the plaintiff, for a gross premium, in the aggregate sum of $500, this amount was divided into separate sums as insurance on the separate classes of property, and should he considered, in ascertaining the rights of the parties, as though each class of property was valued at such sum and insured in separate policies, and the recovery should he allowed on each class according to its separate valuation and loss, as though there was hut one class and one valuation. In short, the contract is sever-able into as many contracts as there are separate classes of property insured on separate valuations. The reasons for so regarding such policies are so well and so fully stated by the Supreme Court, after a thorough examination, in Trabue v. Insurance Co., 121 Mo. 75, that Ave need only refer to that case.

It is true that that case, and many of the cases therein discussed, were Avhere the contract was severable into complete and distinct parts, so as to prevent the fraud or untrue representation as to one part from affecting other parts not so contaminated or affected. But we see no reason why the principle should not apply where fraud or misrepresentation is not involved. It is sustained by the best reason, as is, we think, evidenced by the following extract from a leading case in New York (Merrill v. Insurance Co., 73 N. Y. 452), cited in the Trabue case: “It is plain from the fact of a separate valuation having been put by the parties upon the different subjects of the insurance, that they looked upon them as distinct matters of contract. The effect of the separate valuation was to make them so. No matter how much value there might have been in any one of those subjects, even to the whole amount of the policy; had it been totally destroyed, the defendants could not have been made liable to an amount greater than that named in the policy as the valuation of it. Thus it was at the inception of the contract, distin*541guisbed from tbe other subjects of insurance, and tbe contract so made as to be capable of application to it alone. So too, if but one of tbe subjects of insurance' bad been burned, tbe defendants (ceteris paribus) could not have avoided liability to pay for that, up to tbe value put upon it; and if not wholly destroyed, but so far damaged as to reach in deterioration tbe value put upon it in tbe policy, tbe defendants would have to pay that damage; and that subject would no longer form a part of tbe general matter insured, and hence not a part of the continuing contract. Thus there would of necessity be a severance of tbe contract, worked out by tbe operation of its own terms.”

Tbe result is that the judgment should be reversed and tbe cause remanded.

All concur.