Supreme Court of Canada
Guardian Assurance Co. v. Connely, (1891) 20 SCR 208
Date: 1891-02-23
The Guardian Assurance Co. (Defendants)
Appellants;
And
Robert Connely (Plaintiff)
Respondent.
1891: Feb. 23.
Present:—Sir W. J. Ritchie C. J., and Strong, Taschereau, Gwynne and Patterson JJ.
ON APPEAL FROM THE SUPREME COURT OF NEW BRUNSWICK.
Fire insurance—Description of premises—Reference to plan—Variance—Falsa demonstrate non nocet—Canvasser—Agency.
An insurance policy described the goods insured as stock, consisting of dry goods, &c., while contained in that one and a half story frame building occupied as a store house, said building shown un plan on back of application as "feed house" situate attached to [Illegible text] of assured's dwelling house. The plan referred to lad been made by a canvasser for insurance, who had obtained the application, and the building on said plan marked "feed house," did not in any respect conform to the description in the policy, but another building thereon answered the description in every way except as to the designation "feed house." The goods insured were stored in this latter building and were burnt. The company refused to pay, alleging breach of a condition in the policy that no inflammable materials should be stored on the said premises, as well as misdescription of the building containing the goods insured. In an action on the policy it appeared that a barrel of oil was in the building marked "feed house" at the time of the fire. The jury found a verdict for the plaintiff and a nonsuit, moved for pursuant to leave reserved, was refused by the full court.
Held, that the non-suit was rightly refused; that it was evident that the building in which the goods were stored was that intended to be described in the policy; that the building marked "feed house" being detached from that in which the goods were was a suitable place for storing oil, which, therefore, was not a breach of the condition; that the case was a proper one for the application of the maxim falsa demonstratio non nocet, but if not the matter was one for the jury ho had pronounced upon it.
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Held further, that the canvasser who secured the application could not be regarded as agent of the assured, but was the agent of the company which was bound by his acts.
Appeal from a decision of the Supreme Court of New Brunswick refusing to order a nonsuit moved for pursuant to leave reserved at the trial
The application for insurance was written by one Murray, a canvasser for several insurance companies including the defendant company, who had applied to the plaintiff and requested him to insure with the defendants. The application was written by Murray and signed by the plaintiff at Penobsquis, about fifteen miles from his residence, and was taken by Murray, who told the plaintiff that he had seen the buildings and knew their situation and would make a plan of them to accompany the application, to which the plaintiff assented, and Murray accordingly made a plan or diagram on the back of the application which he sent to the defendants, who issued the policy above referred to and sent it to the plaintiff.
The application asked for insurance on the plaintiffs goods contained in a building known as a storeroom and feed house. The plan represented the plaintiff's dwelling-house as facing the west, with an attached to the rear or east side of it marked as a woodshed. On the north side of the woodshed and attached to it (the space between them was about four feet) was another building marked on the plan as feed house.
The plan was admitted to be incorrect. The building marked "feed house" had been built for a pig pen, and was not as high as the building marked "woodshed," which was a story and a half high with a chimney in it extending from the upper flat of the building through the roof for the reception of a stove-pipe. This building was fitted up as a store or shop with a counter and shelves for holding goods, and was used by the plaintiff
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as his store or shop, the goods destroyed being in it at the time of the fire. There were no goods in the other building (the "feed house" as marked on the plan) except a barrel of oil. That building has never been used by the plaintiff as his shop or storehouse there being no floor in it nor any fitting as a store.
The company resisted payment, contending that there was no contract to insure the goods that were destroyed. In an action on the policy a verdict was entered for the plaintiff with leave reserved to defendants to move for a nonsuit on the ground that the misdescription avoided the policy. A nonsuit having been refused on such motion defendants appealed to this court.
Weldon Q.C. for the appellant, cited Wyld v. The Liverpool, London & Globe Ins. Co.; Hastings Fire Ins. Co. v. Shannon; Gore Ins. Co. v. Samo; Lyle v. Richards; Hews v. Atlas Ins. Co..
McLeod Q.C. for the respondent.
Sir W. J. RITCHIE C. J.—I have no doubt whatever as to this case, and have had none since I first heard the statements made by the counsel. There was an application for insurance on a general stock consisting of dry good's, &c., and on the margin were these words: "Describe particularly how the property is built, where situated, how occupied, &c." To this there was annexed a plan made by a Mr. Murray, a canvasser of the respondents, in which it appeared that there was a building marked "feed house," and another marked "woodshed," attached to the kitchen of the dwelling-house. The application was accepted, and the goods of the applicant were insured for one year in consideration of the premium of thirty dollars.
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Now let us see what the property was that was insured. It was $2,000 on a general stock consisting of dry goods, groceries, &c., while contained in that one-and-a half story building with shingled roof, occupied as a storehouse for storing horse feed and provisions for lumber camps, said building shown on plan on back of application for insurance as "feed house," situate attached to woodshed of assured's dwelling-house, &c. Now, it is contended that this building marked "feed house" on the plan, which is stated to have been originally, whatever it is now, a pig sty and which was without windows, and was not attached to any other building but stood alone, is the one intended to be described in this policy; but it cannot be contended, I think, that the assured so intended; there was a barrel of oil in this building and it would be a very suitable place for storing oil which they were not allowed to keep on the premises, but it would be a most unsuitable place to keep the stock which was insured in this case. Then again the building described in the policy had a shingled roof and was occupied as a storehouse for storing feed and provisions. This building was shown never to have been occupied for doing any of these things. It was also said to be a one-and-a-half story building attached to assured's dwelling-house, and this building was not attached but was a separate building, entirely distinct and apart from the dwelling-house. But the building in which the goods actually were was a one-and-a-half story building attached to the dwelling-house and occupied and known as a storehouse and entirely answers the description in the policy.
Now it appears, to me, so far as my judgment in this matter goes, that if ever there was a case where the maxim falsa demonstratio non nocet would apply that this is peculiarly such a case; but suppose the maxim does
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not apply, it is quite clear that it is a question for the jury who have already determined that the building in which the goods were which were intended to be insured was the building occupied as a storehouse for storing feed and provisions. Under these circumstances I cannot entertain a doubt that the insured is entitled to recover his loss under the policy.
I cannot look upon a party who goes around for the purpose of obtaining insurance in any other way than as acting for the company, and I cannot see how the company is free from liability for his acts where, as in this case, he undertakes to put in with the application a plan of the building, and it was necessary that this plan should be inquired into. If all the other indicia are present, which is the case here, we have all the material necessary to determine the question put before us, and I do not think it possible to submit the case to any jury who would not find that the goods were kept in a proper building and not in a building erected for a pig-sty, and it having been left to the jury, and the court having determined that the evidence established the fact that the building really described in the policy was the one in which the goods were stored, the finding should not be interfered with. The appeal should be dismissed.
STRONG J.—I am of the same opinion. The principle upon which the Supreme Court of New Brunswick proceeded, as appears from the very full and able judgments of the learned judges who took part in the decision, was in my judgment perfectly sound. The case appears, as I said during the argument, to be one of latent ambiguity, one in which, though upon the face of the policy no difficulty or inconsistency appears, yet difficulty does arise in applying the description contained in the policy to the buildings as they actually
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appear on the grounds. This being so parol evidence is admissible to remove such a latent ambiguity. The first thing we have to inquire is, whether the goods described in the policy are the same as, or are different from, those on the premises which were burnt. To do that we must be able to identify the stock of goods burnt with those mentioned in the policy. In the policy the goods are described as being in a one-and-a-half story frame building, with shingled roof, shown on the plan on the back of application for insurance, as "feed house." But when we come to look at the premises we find that the feed house is not a one-and-a-half story building with shingled roof; then the further description is that the goods are in a building occupied as a storehouse for storing horse feed, and the feed house was not at the time so occupied, but another building was. And then, we also find that the goods are said to be in a building attached to the woodshed of the dwelling-house. Now the feed house does not appear to have been so attached; therefore this examination of the premises and the evidence of the surrounding circumstances show that it was impossible to apply the description in the policy to the plan. That is the very case in which parol evidence is admissible.
Then the Supreme Court of New Brunswick has dealt with the case as a question of fact, and treating the question as ore of fact, of course they have come to the only conclusion which is inevitable. If parol evidence is admissible any reasonable person, considering the evidence and all the circumstances and looking at the plan, must hold that the goods which were in the building marked "woodshed" on the plan, and which were destroyed, were the goods intended to be insured by the policy.
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As regards misrepresentation, I do not think that the plan and the application are to be looked upon as emanating from the insured, but must be regarded as emanating from the company. Murray was really an officer of the company, and what he did unless the contrary is clearly shown, was the act of the company. Therefore I do not think that there was any misrepresentation by the assured in the case.
The appeal must be dismissed with costs.
GWYNNE J.—I am of opinion that the correct construction of the policy is not that the goods insured are only insured in the small building on the place called "feed shed." The policy says distinctly that the goods insured are in a one-and-a-half story building, covered with shingles, occupied as a storehouse. What that building was was a matter of evidence, and the "feed shed" is not pretended to be such a building. The only error in truth is that of the person who drew up the policy and who made it say, rather ridiculously, and without any authority for so doing, that the building covered with shingles used as a storeroom for storing horse feed, &c., of the height of one-and-a-half stories, which the feed shed is not, is the feed shed. In my opinion the appeal must be dismissed with costs.
PATTERSON J.—I understand that in this case several wooden buildings attached to each other were destroyed by the same fire. The goods in question were deposited in one of those buildings. The premium of insurance in one would be just as much as in any of the others. The company say "these goods which were insured in one of these buildings were not in the one which we understood to have been described in
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our policy." Now if the company can succeed in that defence it must be upon some principle of law or upon the contract between the parties. I know of no principle of law, and none has been indicated, which apart from the terms of the contract would lead to any such result as the company contend for. If there was any wilful misrepresentation the principle of fraud would come in, but that is not suggested.
Let us see what the contract was. We have the policy with a number of conditions set out in the declaration. Of these conditions the two which may apply to this case are nos. 1 and 2.
No. 1 deals with two things: first, the insurance on the building; secondly, on goods. Next it deals with the application:
Every person desirous of effecting an insurance must state his name, place of abode, and occupation. He must describe the construction of the buildings to be insured, where situate, and in whose occupation, of what materials the same are respectively composed, and whether occupied as private dwelling houses or how otherwise.
Then with respect to the goods:
Also the nature of the goods, or other property on which such insurance is proposed, and the construction of the building containing such property, &c.
That is what the condition says is to be stated with respect to the goods. "The construction of the building containing such property, &c." The form of application which is presented to the proposed insurer says the same thing:
Describe particularly how the property is built, where situated, how occupied, and the nature of the goods deposited therein.
So we have in the first condition and on the margin of the application paper the same language, and we find both complied with in the application. The description is:
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On general stock consisting of dry goods, &c., all contained in one-and-a-half story frame building with shingled roof, occupied and known as store-room and feed house for storing horse feed and provision for lumber camp; situated east side of Mechanic Settlement Highway.
Thus the condition is complied with and also the directions upon the form of application.
Then we look at the second condition, and that requires the good faith which is the essence of the contract of insurance perhaps to a greater extent than most other contracts. The terms of this condition do not avoid the policy for mere misdescription or misrepresentation, but
If any misrepresentation is given so that the insurance be effected upon a lower premium than would have been charged had such risk been fairly stated.
There is no pretense here that the company insured at too low a premium.
The policy adds to the description these words: "Such building shown on plan on back of application for insurance as feed house." Who made the plan on the back of the application in that way? We know as a matter of evidence that it was not the applicant unless he can be said to have done it by the company's agent. There is as much reason for holding that when the policy says "said buildings shown by plan, &c.," it means shown by the company in that way as for saying it was shown by the applicant in that way. Murray was an agent for the company, and there is nothing in the case to show that he was an agent of the insured.
There is no ground of prejudice to the company or of construction of the contract for holding that the plaintiff cannot recover. I think the judgment appealed from was perfectly right. The facts seem to have scarcely required so much consideration of the
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doctrine of falsa demonstratio non nocet as it received in the court below.
Appeal dismissed with costs.
Solicitors for appellants: Weldon & McLean.
Solicitors for respondent: E. & R. McLeod.
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