New York Belting & Packing Co. v. Washington Fire Insurance

Majority

p. 428

The New York Belting and Packing Company, Plaintiffs and Appellants, v. The Washington Fire Insurance Company, Defendants and Respondents.

Headnote

1. Ambiguous words in a policy of insurance may be construed by extrinsic evidence of accompanying circumstances and the usages of the business in which the property insured was employed.

2. Thus where, in an action on a policy of insurance upon a two story factory, with attic and basement, which contained a provision in these words: “Water on each floor, with hose, and a watchman is to be kept on the premises at night;” the insured gave evidence that the factory was provided with a steam pump in an adjoining building and a force pump in the basement, connected with a water pipe passing through the two stories above to a tank in the attic, which was so constructed that its overflow would flood the attic floor, that hose was kept upon the premises, attached to couplings to 0such water pipe in the first and second stories, by means of which and the force pump, water could be thrown upon those floors and into the basement, by the steam pump, and that, according to the usage of the “ factory parlance,” neither the attic nor the basement were spoken of as “floors;”—Held, that it was error to dismiss the complaint on the"ground that the plaintiff had not shown a compliance with such provision in the policy.

(Before Moncrief, Robertson and White, J. J.)

Heard, November 11, 1862;

decided, April 6, 1863.

This was an appeal from a judgment entered in favor of the defendants upon a dismissal of the complaint at the trial.

The action was brought on a policy'of insurance against fire, made by the defendants on the plaintiffs’ factory and contents, describing it as their “ two story and attic frame factory, situate atHewtown, Fairfield County, Connecticut, as per diagram filed in the office of the Metropolitan Eire Insurance Company of Hew York.”

The policy, after designating the property insured, contained this clause: “ Said buildings are warmed by steam.

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Water on each floor with hose, and a watchman is to be kept on the premises at night,” as described in report Ho. —. Subsequently to the original policy, a privilege was granted t<* erect a frame building of one story and a half and basement in height, to adjoin and connect on the northerly side of the north wing of the main building, to be occupied as a rubber hose factory by steam heat. Injury by fire to such building having occurred during the time fixed by such policy, this action was brought to recover damages therefor. The defendants, among other defenses, denied that at the time of making such policy, or at any time since, “ there was ivater on each floor of such building with hose suitable and in a condition for use in case of fire”

On the trial, which was had on the 8th day of March, 1861, before Mr. Justice Moítobiep and a Jury, the engineer and machinist of the plaintiffs (Glover) testified that there was a force pump driven by a belt on the west side of the building, which supplied water, and from which an iron three-inch pipe ran to the top of the building into a tank on the other floor. Two floors had hose attached. There was a safety valve in the tank in the attic story, and if the water was not let out by opening the hose below, it could be forced by the pump upon the attic floor. He called the two main floors and the attic the floors of the building. He also testified there was water on all the floors; the hose were attached to couplings on such perpendicular iron pipe.. He further testified that the building had four stories, including the basement; the first one above that was a calendar floor, then came the floor for making belting, then the attic floor, for drying materials; the hose remained screwed on the coupling pipe all the time; the water did not descend from the tank into the hose but was forced into the latter by such pump.; there was also another pump to throw water into the boilers.

The superintendent of the plaintiffs (Gately) testified that there was a basement, two regular floors and an attic in the building; the first and second floors were designated

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as floors; there were buckets on the first and second floor and attic, and also hose on the first and second story. Being asked “what was understood in the common par- “ lance and general understanding of the factory as floors “of the building,” he answered, “we considered them the “main principal floors in the upright part of the building. “There were two.” He also testified, on cross-examination, there was a floor in the attic the entire length of the main building.

A previous superintendent (Humphrey), introduced as a witness by the defendant, testified that there were two pumps in the building; one a “Worthington punip,” worked by steam, to be used in filling the boiler and in case of fire; the other a “Dodge” pump, operated by a water wheel, by which water was driven into the attic. There was no means of conducting water in a hose into the basement by that pump to put out fire; the only means of putting out fire there was by hose attached to the steam pump. The hose attached to the other pump could be taken out and directed into the basement; in order to r operate there the hose must be brought down from the floor above. There was hose attached to the pipe on the first and second floors above the basement, but none on the other floor; the attic was only lighted by end windows under the roof; there was a water tank in the attic and an upper valve to the pipe; there may have been means for attaching hose to the pipe, but there was none actually attached. He did not consider it expedient to use hose in the attic; he thought the hose in the lower rooms sufficient; any one in the attic could use the hose as effectually as in the lower room, being at the lower end of the building from the stairway.

The Worthington pump was proved by an expert to be one of the best for extinguishing fires. There was no evidence to show what the report was referred to in the policy. Considerable evidence was taken as to increase of the risks by changes made in the boilers, flues, pumps, and otherwise.

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After the testimony was closed, the defendants’ counsel moved to dismiss the complaint, on the ground that it appeared from the evidence that there was not water on each floor, with hose; which motion was granted; to which dismissal of the complaint an exception was taken on behalf of the plaintiff, and the exceptions were ordered to be heard in the first place at General Term.

Edwards Pierrepont, for plaintiffs, appellants.

I. The learned Judge erred in taking the case from the Jury.

II. It was plainly a question for the Jury to decide upon the evidence, whether the provisions, “ water on each floor with hose,” had been substantially complied with as the parties understood its meaning; and whether there had or had not been a breach of that condition as fairly and reasonably, and in fact understood by all parties to the contract when made. The error was in refusing to allow the Jury to decide the very question which it was their especial province to decide. (Daniels v. Hudson R. Ins., 12 Cushing, 416; The Farmers’ Ins. Co. v. Snyder, 16 Wend., 482 ; Fowler v. Etna Ins. Co., 7 Wend., 271 ; The Jefferson Ins. Co. v. Cotheal, 7 Wend., 82 ; Gates v. The Madison County Ins. Co., 2 Comst., 43; Gates v. The Madison County Ins. Co., 1 Seld., 469; Murdock v. Chemung Ins. Co., 2 Comst., 224.)

III. There was a full compliance with the spirit, and a strict compliance with the letter of the agreement. As to the proper construction of the policy see Gates v. Madison County Mut. Ins. Co., (1 Seld., 474,) Hovey v. American Mut. Ins. Co., ( 2 Duer, 569 ,) Kemble v. Rhinelander, ( 3 Johns. Cas., 130 ,) Hyde v. Bruce, ( 3 Doug., 213 ,) Bond v. Nutt, (Cowp., 601,) 1 Arnold on Ins., 588, § 215; Ripley v. Etna Ins. Co., ( 29 Barb., 552 .)

IV. If the agreement were indefinite or equivocal, it should have been left to the Jury to say how the parties to the contract understood it. (See the authorities above.)

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V. The substance of the thing, the true meaning and fair understanding of all the parties, is what justice and the law looks after. (Turley v. North American Ins. Co., 25 Wend., 374 ; Coffin v. Coffin, 23 N. Y. R., 16.)

E. W. Stoughton, for defendants, respondents.

I. This clause of the policy constituted an express warranty by the insured that there was, at the time said policy was executed, water on each floor of said building with hose. This warranty was of a material fact, on which the defendants would naturally rely in making the policy; for their risk depended essentially upon the means at hand for extinguishing fires, and with water and hose suitable for the purpose, placed upon each floor of a building, two hundred and thirty feet in length, very efficient instruments would be provided for flooding the floors with water, and thus arresting the progress of flames.

Whether the warranty was of a material fact or not is, however, wholly unimportant, for in whatever form or for whatever purpose a warranty may be created in a policy, it is a condition precedent, and no contract exists unless it is strictly and literally fulfilled. (Angel on Fire and Life Ins., §§ 140-146, and cases there cited; Delonguemare v. Tradesmen's Fire Ins. Co., 2 Hall’s Sup’r Ct. R., 608; Duncan v. Sun Fire Ins. Co., 6 Wend., 494 ; Trench v. Chenango Co. Mutual Ins. Co., 7 Hill, 122 .)

II. It appeared by the proof on the trial that there was no hose upon the attic or upper floor of the building when the policy was executed, or at any time afterwards; by reason whereof the complaint was properly dismissed.

Whatever was the meaning of the phrase in the policy in this case, “ said buildings are warmed by steam. Water on each floor with hose, and a watchman is to be kept on the premises at night, as described in report Fo. —,” it is a warranty of something already existing or an undertaking that something shall be done. And therefore its influence on the

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risk is wholly immaterial. (Angel on Life and Fire Ins., Co., §§ 144, 146, and cases cited.) As such warranties are wholly independent of any inquiry into their materiality, they must be literally construed, and nothing more than a literal fulfillment can be required, (Hovey v. Am. Mut. Ins. Co., 2 Duer, 570 , and cases cited,) and no intendment can be made from them against the assured. (1 Arn. on Ins., § 215, p. 585.)

The first part of such clause is a warranty of an existing fact, (Wall v. East River Mut. Ins. Co., 7 N. Y. R., 370,) that the building insured was “ warmed by steam.” It would be doubtful whether the part relating to “ water” and “hose,” was a warranty of an existing fact or an undertaking for the future, unless the words, “is to be kept,” applies to them as well as to “the watchman.” Coming after the warranty as to the mode of warming, it may fairly be implied to relate to the future. “ Water on each floor,” .is ambiguous. Literally interpreted it would imply that the floors were to be kept wet. Accompanied by a reference to the mode of warming, to hose, and keeping a watchman at night on the premises, in a policy of insurance against fire, it may fairly be construed to refer to some means of protection against such risk. It was testified in this case that there were but two floors in the building insured, known as such in factory language, the first and second; neither the basement nor attic being considered such. The building itself was described in the policy as a two story frame one, and permission was given to erect a building one and a half stories high, with a basement; showing that the parties did not consider the basement or attic any of the stories of the building. These considerations are admissible in interpreting the word “ floor.” (Daniels v. Hudson River Ins. Co., 12 Cush., 416 ; Dana v. Fiedler, 12 N. Y. R., 40.) Accompanying circumstances are always admissible to construe a contract, (Moore v. Meacham, 10 N. Y. R., 207 ; Blossom v. Griffin, 13 Id., 569,) particularly a commercial one. (Agawam Bank v. Strever, 18 N. Y. R., 502.) Even declarations

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and acts of the parties as to what they understood by an indefinite phrase, at the time of making the contract, have been admitted. (Almgren v. Dutilh, 5 N. Y. R., 28.) Houses have been shown thus to come within the term “ brick buildings,” although they had wooden partitions merely filled in with brick. (Mead v. N. W. Ins. Co., 7 N. Y. R., 530.) The capture of sea elephants has been established to be part of a “whaling voyage,” (Child v. Sun Mut. Ins. Co., 3 Sandf. S. C., 26,) and glass in tight casks has been shown- not to be intended by glassware in casks. (Bend v. Georgia Ins. Co., 1 N. Y. Leg. Obs., 12 .) So that there was fair ground for interpreting the policy in this case as not requiring water or -hose to be kept on any story except the two above the basement, if it was to be kept continually there at all. ' If there was any conflict of evidence as to the meaning’of the word floor, in “ factory parlance,” it should have gone to the Jury. (Daniels v. Hudson River Ins. Co., ubi sup.)

“Water on each floor, with hose,” is not a very clear description of what the plaintiffs meant to undertake; The parties differ materially in their construction of those words. At the time of executing the policy there were no reservoirs of or for water on any floor except the attic. There would be water in every floor, except the basement, or not, according as the perpendicular iron pipe was filled or not; and “hose” was attached to such pipe on every such floor. It is to be remarked that the policy does not call for hose on every floor as well as water, and there was evidence that the hose attached to the apparatus in the building could be used on every floor to extinguish a fire in it. There is nothing said in the policy of the attachment of the hose to anything, and, therefore, “with hose” can only be construed to mean having hose in the building or on the premises, in a condition to be used on every floor in connection with the means of supplying water for that floor.

There is a peculiar- fitness in applying the term “at night,” to the hose as. well as the watchman. During the

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day, there were probably enough persons present to attach the hose and apply the steam engine and water wheel to forcing water through the building to extinguish a fire. At night it was necessary to have the tank full, the hose attached to the pipe, and a person specially charged to guard against fires and use the water and hose. The word described seems more appropriate to the hose than the watchman.

There can be no doubt, I think, if the report referred to ■had been produced, it would have cleared up considerable confusion in the terms of such warranty. As the defendants claimed the benefit of it, they were bound to show clearly what it meant. In the absence of such report, such warranty is only susceptible of an interpretation to be derived from its apparent object, its terms and the connection in which it is found. And as the object of a policy is indemnity, it is the business of the insurers to see that if they hamper the insured with the performance of conditions, these conditions are expressed in their policy in the clearest terms.

No evidence was offered of the meaning, in the language of factories or insurers and insured, of “water on each floor, with hose.” Possibly they may have some technical meaning. I think, however, there was error in not submitting to the Jury the meaning of the word “floor” in the contract, which, if they had found in favor of the plaintiffs, would have rendered the contract to mean facilities for throwing water upon each floor, by means of hose to be kept on the premises.

The dismissal of the complaint was therefore erroneous, and the judgment upon it should therefore be reversed, and a new trial had, with costs to abide the event.