(dissenting).
My brethren hold, first, that fraud on the part of the plaintiff conclusively appears on the face of the record without considering any evidence; and, second, that fraud on the part of the plaintiff with respect to a certain item in the proof of loss was so conclusively established by the evidence that the defendant was entitled to a directed verdict. On neither point am I able to agree.
As to the first point, passing by immaterial matters, the record before us consists of the complaint with the papers annexed to it; i. e., the policy and the proofs of loss, the answer which sets up many defenses including fraud, and the verdict which was for just about one-half the amount claimed in the proofs of loss. Looking at these papers and nothing else, my brethren hold that fraud on the part of the plaintiff is conclusively established by the discrepancy between the amount of the claim and the amount of the verdict. In the opinion they say, “The evidence introduced at the trial and brought here by bill of exception is not to be considered, for that is no part of the record paper.” No precedent for the decision is referred to, and none has come to my attention.
Fraud as used in this policy means conscious dishonesty. It is a matter of fact. The majority opinion holds, in effect, that, when the amount claimed in a proof of loss under a fire insurance policy is cut down one-half by the jury on the trial of the case, fraud is thereby conclusively established, and the proofs cannot under any circumstances have been honestly made. It seems to me, on the contrary, very easy to conceive circumstances under which the amount honestly claimed in a proof of loss might be cut down one-half by a jury. On questions of valuation and sometimes also on questions of ownership for insurance purposes, there is wide room for honest mistakes and honest difference of opinion. If we assume, as I think we must, that the jury were properly instructed" that fraudulent statements by the plaintiff in the proof of loss would entitle the defendant to a verdict, then the verdict for the plaintiff necessarily involved a finding-on the evidence presented that the proofs of loss were not fraudulent. This finding is set aside without considering the evidence.
*389If the verdict for the plaintiff be regarded as inconsistent with the finding on damages, that point should, I think, have been brought to the attention of the trial judge on a motion to set the verdict aside, which was not done. It cannot be presented indirectly in this way. How can we say that the error in the verdict, if there was one, did not consist in awarding inadequate damages on an honest claim, rather than awarding any damages on a dishonest one? Such questions necessarily involve an examination of the evidence. Again the instructions to the jury as to the law under which damages should be assessed, which are not before us, may have been very different from what the plaintiff had in good faith supposed the law to be. Such a mistake is not fraud. For these reasons and others which might be mentioned I do not think that the discrepancy between the claim and the verdict conclusively proved that the claim was fraudulent.
As to the second point, viz. the item of $2,524.50 for “goods in process”: The evidence on this is before us and my brethren hold that fraud by the plaintiff with respect to it was established as a matter of law, so that the defendant was entitled to a directed verdict. The opinion states, “The only evidence in the record relating to that subject (the item in question) is that given by Soler himself,” etc. This would seem to be a clear mistake. The plaintiff’s expert accountant (Gorbea) refers explicitly to this item as being in the plaintiff’s books, “According to what the books show the plaintiff has * * * ” (various items) “ * * * goods in process $2,524.” After discussing other matters, he continued, “Now goods in process $2,534. Here is a voucher which is — •” Objection was made by the defendant to the introduction of the vouchers. The witness (Gorbea) continued, “I did find an entry in the inventory book corresponding to that voucher,” etc. During a rather lengthy discussion, plaintiff’s counsel said there were “hundreds, perhaps thousands, (of vouchers) which would encumber the record unnecessarily.” Eventually the vouchers were not admitted. The same witness testified that the plaintiff’s books and vouchers to which he had referred “are a complete record of the business transacted by that company (the plaintiff).” The $2,524.50 item was repeatedly referred to and discussed. Soler’s testimony about this item was in part as follows:
“As to the item of $2,524.50 for labor and goods in process I would have to get the assistance of my bookkeeper; I really never participated in the work of the accounting department; if he explains to me; * * * labor and goods in. process means work that is not finished; unfinished work; sometimes one goes to the machine department and finds a piece that is finished, but still has to be embroidered, but others that are embroidered but not sewn together yet. We did work for firms outside of Puerto Rico; the American houses supplied us with the material and we supplied the labor and thread for sewing and embroidering; we got the material from the United States and the company supplied the labor and thread and other necessaries to complete the work; then I made out my invoice and took it to the bank, and they gave me credit for it and discounted it. * * *
“The item that I have included in my claim for labor on merchandise in stock refers exclusively to the articles that I was manufacturing for these New York houses; I don’t know if in that item there is included also the thread; no, in that item there is included only the price that we collected from the people in New York; that is to say, if my contract price was 75 cents a dozen for creepers, a certain class of creepers, and I had ten dozen of those on hand, that $7.50 was insured.”
This shows the charges which went into the item. They are of a kind as to which honest mistake is easily conceivable. I suppose that the last statement above quoted is the one on which my brethren rely as conclusively establishing fraud on Soler’s part, in the face of the jury’s finding to the contrary. There is no evidence that Soler was making any profit on this work, or did not take it at cost. That possibility ought to be eliminated before it is held that his statement above quoted affords conclusive evidence of fraud by him. His testimony by no means shows, as it appears to me, that he may not have acted under honest mistake as to his rights. Apparently, this item was fully supported by the vouchers which were not put in. Conclusive fraud with respect to it does not seem to me to have been shown. ,