Supreme Court, February, 1918. [Vol. 102. MARGARET D. FORT, as Administratrix of the Goods, Chattels and Credits of FRANK A. FORT, Deceased, RAYMOND N. FORT and CHARLES H. FORT, as Administrators of the Goods, Chattels and Credits of CLARENCE V. FORT, Deceased, and RAYMOND N. FORT and CHARLES H. FORT, Plaintiffs, v. THE GLOBE AND RUTGERS FIRE INSURANCE COMPANY, Defendant. (Supreme Court, Albany Trial Term, February, 1918.) Insurance (fire) — reformation of policy of actions - condemnation proceedings - title statutes stipulation municipal corporations. Where by the mistake of the insurer's agent, though he was told the names of all the persons interested in the property and what their respective interests were, the name of the life tenant, as owner, was written in a policy of insurance covering a building on the property devised, and the remaindermen and their attorney, all of whom were consulted as to the insurance before the policy was issued, failed to see to it that it was properly written, there can be no reformation of the policy on the ground of mutual mistake. In an action to recover on the policy for damage by fire to the building it appeared that the title to the devised property was just the same as it was when the policy was issued, because, though before the fire the property had been taken by the city for a public use and a certified copy of the order of confirmation of the award made to the owners had been recorded in the proper county clerk's office as required by the statute applicable in the condemnation proceedings, it was not until sometime after such recording that the fire occurred and subsequently thereto a trustee appointed for the purpose of receiving the proceeds of the award for the benefit of those interested therein. Held, that as the title to the property had not passed to the city and it had not before the fire entered upon the property as owner and was not entitled so to do under the statute, a contention that there had been a forfeiture of the policy because of a change in the title, interest or possession of the insured building resulting in the order of con Misc.] Supreme Court, February, 1918. firmation of the award made in the condemnation proceeding, was untenable. A contention that because of a written stipulation, entered into by all the parties in interest, providing, in substance, for the distribution of $95,000, the amount of the award, made in the condemnation proceeding and an order entered thereon whereby in the event that the insurer was held to the extent of $10,000, the amount of the insurance, the city should be released from the payment thereof on account of the award, the defendant's right of subrogation was impaired and, therefore, plaintiffs were not entitled to recover, held untenable, defendant having refused to pay the amount of the policy and no claim being made that the city in any way was responsible for the fire. ACTION tried before the court without a jury. Joseph A. Murphy, for plaintiffs. Cardozo & Nathan (Michael D. Cardozo, Jr., and Charles B. Sullivan, of counsel), for defendant. RUDD, J. Since the taking of the testimony two of the parties plaintiff died and the failure for some time to revive the action in the names of their legal representatives has caused some delay in the final submission of the issues. The action is brought to reform a policy of fire insurance issued by the defendant for the sum of $2,500, covering. a building located in the city of Albany, devised under the will of Peter V. Fort, deceased, to Frank A. Fort, Raymond N. Fort, Charles H. Fort and Clarence V. Fort, giving to Frank A. Fort a life interest and to the others the remainder. Under the will of Peter V. Fort, Frank A. Fort was charged with the keeping of the property insured as against fire. The real estate in question was involved in a condemnation proceeding brought by the city of Albany, Supreme Court, February, 1918. [Vol. 102. which resulted in the appointment of commissioners to award just compensation to the owners for the taking of the premises for public use. The report of the commissioners fixing the amount of the award was confirmed at the Special Term, by an order entered and recorded in the Albany county clerk's office on September 27, 1913. In July, 1912, Frank A. Fort, who had a life estate in the premises, went to the office of the agent of the defendant insurance company to secure policies of insurance upon the property, requesting the defendant's agent Dolan to issue policies in the aggregate amount of $20,000. At the time that this request was made Raymond N. Fort, one of the plaintiffs, told the agent Dolan that it was the duty of Frank A. Fort to keep the property insured for the benefit of himself and the remaindermen; and he further told him that he, Raymond N. Fort, had threatened Frank A. Fort with legal proceedings if he failed to keep the property insured. The agent Dolan was at that time also told by Frank A. Fort the names of the persons interested in the property, and what their respective interests were. Plaintiffs requested their attorney, Mr. Joseph A. Murphy, to attend at the office of the agent Dolan, and Mr. Dolan and Mr. Murphy talked concerning the persons interested in the property and the amount of the insurance, and this talk was had in the presence of Frank A. Fort and Raymond N. Fort. Mr. Murphy told the agent Dolan that the obligation was upon Frank A. Fort to pay the premiums and that as his attorney he would see that the premiums were paid. It was finally arranged that Mr. Dolan, as agent, would issue $10,000 of fire insurance in companies which he represented, one of which was the defendant Misc.] Supreme Court, February, 1918. in this action, and thereafter and on the 24th day of July, 1912, policy No. 48737 for $2,500 was issued for one year. This policy was delivered at the office of Mr. Murphy, in which was written as the insured the name of Frank A. Fort. The premium was paid. In the month of July, 1913, one year thereafter, the defendant issued policy No. 95728 covering the same premises for the same amount, written in the name of Frank A. Fort, which policy was also delivered at Mr. Murphy's office. The premium on the second policy was paid; both policies were kept by Mr. Murphy with other papers belonging to Frank A. Fort, who did not see either policy until October, 1913, and the plaintiff Raymond N. Fort never saw either policy until the same time. On the 7th day of October, 1913, a fire occurred. The policy involved in this action, the one issued in July, 1913, No. 95728, was outstanding at the time of the fire in the name of Frank A. Fort. Within sixty days after the date of the fire, proofs of loss were made by the plaintiffs and sent to the insurance company. These proofs were returned and the defendant refused to go to the expense of making an appraisal upon the loss, and refused to pay any part of the loss, for the reasons that: I. The property was not insured in the name of the true owner. II. The title to the property had passed from the insured and the owners upon and by the order of confirmation made in the condemnation proceedings on the 26th day of July, 1913, and that at the time of the fire, October 7, 1913, the insured or owners mentioned in the policies were without an insurable interest and that the policies were void. This action seeks a reformation of the policy by Supreme Court, February, 1918. [Vol. 102. inserting therein the names of the owners of the premises instead of the name of Frank A. Fort, and seeks to recover the amount of the insurance, $2,500. The answer of the defendant sets up that the policy was void because of the failure on the part of the insured to correctly state the interest of the insured; that the title to the property had passed to the city of Albany upon the confirmation of the report of the commissioners in the condemnation proceeding and that the insurer, the defendant, is entitled to be subrogated to the rights of the insured as against the city of Albany, to the extent of the amount which the defendant may be obliged to pay under the policy involved herein. The amount of the damage sustained by the fire was $11,181.92. The insurance outstanding, covered by four policies, one of which is here in question, aggregated $10,000. Considering first the question of the reformation. The policy cannot be reformed, as sought by plaintiffs, unless the insertion of the name of Frank A. Fort in the policy as the owner of the premises, and as such having an insurable interest therein, was the result of a mutual mistake. The words " mutual mistake," in the rule that equity will reform contracts therefor, mean a mistake shared by both parties and such mistake generally relates, as here, to a mistake concerning the contents of a written instrument. The evidence shows that when the parties sought insurance from the defendant, through defendant's agent Dolan, whose counter-signature of the policy was necessary in order to give it force and validity, certain of the plaintiffs had the title to the property, subject to the life estate of Frank A. Fort; that had been the subject of conversation as testified by |
