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Rickerson v. German-American Insurance

6 A.D. 550 Court N.Y. App. Div. English

Delivered by Barrett, J.:

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p. 550
Martin L. Rickerson, Respondent, v. The German-American Insurance Company, Appellant, Impleaded with The Washington Life Insurance Company.

Headnote

Insurance — ambiguous description of property—pan'ol evidence, as to the real intent, admissible — an action for reformation unnecessary — the escape from liability of one company bound to contribute does not increase the liability of the other.
Where the language of a policy, descriptive of the property insured, is ambiguous, parol evidence is admissible in order to enable the court or jury to determine, as a question of fact, the intent and meaning of the parties in the use of such language.
It is not necessary, in order to justify the admission of such evidence,, that the action be one in equity for a reformation of the contract, .but. such evidence may be received upon the trial of an action at law to recover the amount of a loss under such policy.
Where two policies of insurance upon the same property are concurrent and contain a contribution clause, the clause should be enforced in favor of one of the insurance companies, although the other company may escape liability; the company held liable should not be charged with any greater liability than its proportionate- amount of a loss-which it contracted to pay.
p. 551
Appeal by the defendant, The German- American Insurance Company, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of New York on the 12th day of November, 1895, upon the verdict of a jury rendered after a trial at the New York Circuit, and also from an order entered in said clerk’s office on the 4th day of November, 1895, denying said defendant’s motion for a new trial made upon tiie minutes.
The action was brought to recover for a loss alleged to have been covered by a fire insurance policy issued by the appellant to the plaintiff’s assignors.
William D. Murray, for the appellant.
George Riohards, for the respondent.

When this case was before the General Term upon the previous appeal, it was held that the policy in question did not cover the rear building upon the lot No. 160 Mott street. ( 85 Hun, 266 .) Since then the same question was presented to the Court of Appeals in another case. This other case was an action against the Hartford Fire Insurance Company upon a policy similar to that now under consideration. These policies were upon the same property, and the descriptions were precisely alike in each. The Court of Appeals held in the action (upon the other policy) against the Hartford Fire Insurance Co. ( 149 N. Y. 307 ), that the description in that policy of the property insured was ambiguous, and that parol evidence was admissible “ to place the court in the position of the parties and enable it to appreciate the force of the words they used in reducing the contract to writing.” In other words, the Court of Appeals decided that the description contained in the policy did not clearly and unmistakably limit the property insured to the front building upon the lot; that such description was ambiguous; that to clarify 'it the surrounding circumstances might be resorted to; and that' the intent and meaning of the parties in the use of the language employed was a question of fact to be. determined by a court or jury upon all the evidence. ■

p. 552
Before this latter decision was made the plaintiff. in the present case under the stress of. the General Term opinion moved at Special Term for an amendment to his complaint, setting up facts which would justify the reformation of the policy so that. it should in terms cover the rear building as well as the front. This motion was granted upon terms, and the complaint was amended accordingly. When the case came to trial a second time the court was embarrassed by this amendment. The trial again took place at Circuit before a court and jury. The learned trial judge suggested that the policy could not be reformed at that branch of the court nor upon a jury trial. He also intimated that apart from the question of reformation the case stood precisely as it did before, and that consequently the opinion of the General Term seemed to call for a dismissal of the complaint. The plaintiff’s counsel then abandoned the claim of reformation and stood upon his right to recover upon the policy according to its true intent and meaning. Although- the learned trial judge was not aided by the opinion of the Court of Appeals in the other case—for that other case had not then been decided-—he fortunately yielded to the views pressed upon him by the plaintiff’s counsel, and submitted the question raised by the ambiguity to the jury. Such submission was entirely in line with the opinion subsequently handed down by the Court of Appeals. The charge was in fact a correct presentation of the question to be solved by the jury, and the verdict thereupon rendered should not be disturbed. Ordinarily the rule laid ' down by the appellate branch of a-court in which an action is pending should govern as to the construction of a contract sought to be enforced therein. It is the law of the case until directly reversed in the same case. Here, however, the contract was precisely the same in the one case as in the other. It would, therefore, be unjust to the plaintiff to treat the decision rendered upon the previous appeal herein as the law of the case. It is obvious that such a ruling would, without benefiting the appellant, merely delay the plaintiff and involve him in further expense with no prospect of ■ a different result from that already attained. There was nothing in the complaint as amended which prevented the trial of the original issues of fact before a jury at Circuit. The testimony given was admissible upon the question of the intent and meaning of the parties and consequently of the
p. 553
intent and meaning of the ambiguous phrase in the contract without reference to the averments which were added with a view to reformation. These averments certainly did not close the door to proof of the surrounding circumstances with a view to a recovery upon the policy as it read. Nor did they limit the plaintiff to a trial in equity. He elected to proceed at law and there was enough in his complaint to warrant a common-law trial upon' the policy, and a common-law recovery for the loss.

The case was properly tried throughout within the views expressed by the Court of Appeals and the proceedings are an example of all parties building better than they probably knew.

There was no substantial error in the charge or in the admission or exclusion of evidence.

The judgment, however, should be reduced. The appellant’s policy contained the regular contribution clause, and the Hartford Company’s policy for the same amount, on the same property, was proved. The appellant’s counsel asked the court to charge that the recovery could, in no event, exceed $2,781.50, or one-half the loss, which was denied and an exception taken. The only reason that can be assigned for this ruling is that the judgment in the Hartford Company case, then unreversed, had been introduced in evidence and showed that it had been adjudged that that company was not liable for any of the loss. But this did not make the policies non-concurrent. If the other company was by any chance so fortunate as to escape, that would be no reason for holding the appellant to a greater liability than that contracted for.

The judgment should be reversed and a new trial ordered unless the plaintiff stipulate within twenty days to reduce the judgment to the sum of $2,781.50, with proportionate interest and costs (including in the latter five per cent extra allowance upon the reduced amount). If he so stipulates the judgment should be modified accordingly, and, as modified, affirmed, with costs.

Yan Brunt, P. J., Rujvisby, O’Brien and Ingraham, JJ., concurred.

Judgment reversed and new trial ordered unless plaintiff stipuate within twenty days to reduce the judgment to $2,781.50, with

p. 554
proportionate interest and costs (including in the latter five per cent extra allowance upon the reduced amount). If he so stipulates judgment- modified accordingly, and, as modified, affirmed,, with costs.

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