Farmers' Fire Insurance v. John W. Bates & Co.

Mr. Justice Boggs

delivered the opinion of the Court.

The action was assumpsit upon a policy of insurance issued by the appellant company to John W. Bates & Company whereby a stock of dry goods, groceries, clothing, etc., belonging to that firm was insured against loss by fire for the term of one year from May 17, 1893. The property insured was destroyed by fire December 1, 1893. A trial before the court and a jury resulted in a verdict and judgment against the appellant company in the sum of $1,000, to reverse which, this appeal was taken.

The policy contained the following stipulation : “ It is expressly stipulated that the insured shall take an inventory at least once a year, and shall keep books of account correctly detailing purchases and sales of their stock, and that failure to observe such conditions shall work a forfeiture of all claim under the policy.” It appeared in the evidence, without dispute, that daily sales for cash and upon credit were made from the stock after the policy was issued and also that the books kept by the assured did not contain a detailed account of such sales. Sales made for cash did not appear upon the book. The appellant company asked and the court refused to give the following instruction:

“ If the jury find from the evidence in this case that the assured failed to keep a book of account of the sales for both credit and cash, if they sold for both credit and cash, then such failure worked a forfeiture of this policy and they should find for the defendant.”

The stipulation in the policy hereinbefore set out constituted an express promissory warranty and expressly declared a forfeiture in case of non-compliance. The validity of the contract of indemnity depended upon its fulfillment by the assured.

The effect of the stipulation was to make void the policy if its requirements were not observed. 11 Amer. & Eng. Ency. of Law, p. 290, 291, 292; Biddle on Insurance, Secs. 557, 566; Wood on Insurance, Secs. 174, 449; May on Insurance, Secs. 156, 157, 186; Pelican Ins. Co. v. Wilkerson, 53 Ark. 353. It was error to refuse the instruction.

The judgment must be reversed and the cause remanded.