Wenzel v. Commercial Insurance Co.

Morrison, C. J. This is an action on a policy of insurance issued by defendant to plaintiff on the 7th day of October, 1881, by the terms of which, in consideration of a certain premium paid the former by the latter, defendant insured the plaintiff, for the term of one year, on his certain quartz-mill, situated in the county of Tuolumne, and on other property in the policy enumerated, against loss by fire.

Among the conditions contained in the policy are the following : “ It is understood and agreed that a watchman shall be employed by the assured to guard the premises during such time as the mill is idle. ..... Any false representation by the assured of the condition of the property .... or any over-valuation thereof .... or any false or fraudulent representation to the authorities touching the property hereby insured .... or any change in the possession without the written assent of the company shall render the policy void.” These are the important conditions affecting the policy which it is material to consider in [439]this case, and all of which, it is claimed by the company, have been violated and disregarded by the plaintiff. The mill was destroyed by fire on the 2d day of August, 1882, and within the time covered by the policy of insurance. The company refused to pay the loss incurred, and this action was brought to recover the same of the company. Plaintiff had judgment in the court below. Appellant moved for a new trial, which was denied by the court, and the appeal is from the judgment as well as the order denying the motion for a new trial. At the time of his application for insurance the plaintiff represented to one Deickman, the agent of the company, that the property covered by the policy was of the value of $12,000, and the defendant, believing such representation to be true, insured the property on the basis of a valuation thereof at $12,000. This is the fourth finding of the court. The court further finds in the same finding that the property was of no greater value than between $8,000 and $9,000, but the plaintiff did not intentionally deceive Deickman, the agent of the defendant, but on the contrary the plaintiff estimated the property at its cost, which was the sum of $12,000. How far did this false representation of value, although not made fraudulently, affect the validity of the contract? Was it a breach of a condition of the policy ?

Another important fact iu the case appears clearly from the evidence that the insured reported to the authorities in giving in this property for assessment, that its value was only $500, and on that amount only he paid taxes on the property for the fiscal year 1881 and 1882.