Hosford v. Hartford Fire Ins. Co., 127 U.S. 404 (1888)

U.S. Supreme Court

Hosford v. Hartford Fire Ins. Co., 127 U.S. 404 (1888) Hosford v. Hartford Fire Insurance Company

No. 264

Argued April 26-27, 1888

Decided May 14, 1888

127 U.S. 404

ERROR TO THE CIRCUIT COURT OF THE UNITED

STATES FOR THE DISTRICT OF NEBRASKA

Syllabus

An application for fire insurance, warranted to be

"a just, full, and true exposition of all the facts and circumstances in regard to the condition, situation, value, ownership, title, encumbrances of all kinds, insurance and hazard of the property to be insured,"

contained these questions: "Is there a mortgage, deed of trust, lien, or encumbrance of any kind on property? Amount, and in whose favor?" Held that the questions related only to encumbrances created by the act or with the consent of the applicant, and that an omission to disclose an existing lien created by statute for unpaid taxes was no breach of the warranty.

This case was substantially like that of Hosford v. Germania Ins. Co., ante, except that no question arose as to smoking on the premises, that the policy itself contained no provision on the subject of encumbrances, and that so much of the application as related to that subject was in this form:

"13. Encumbrances. -- Is there a mortgage, trust deed, lien, or encumbrance of any kind on property? Yes. Amount, and in whose favor? $3,000; I. May. What is the entire value of property encumbered? $21,000. "

Page 127 U. S. 405

"And the said applicant hereby covenants and agrees to and with said company that the foregoing and diagram annexed hereto is a just, full, and true exposition of all the facts and circumstances in regard to the condition, situation, value, ownership, title, encumbrance of all kinds, insurance and hazard of the property to be insured, and the same is hereby made a condition of the insurance, a part of the contract, and a continuing warranty on the part of assured for term of policy or any renewal thereof of which this survey and application form a part."

MR. JUSTICE GRAY, after stating the case as above reported, delivered the opinion of the Court.

In this case, I am instructed by the majority of the Court to announce its opinion that the warranty concerning encumbrances includes only encumbrances created by the act or with the consent of the assured, and not those created by the law, and therefore the policy was not avoided by the omission to disclose the fact that "delinquent taxes" on the premises for previous years were due and unpaid, although by the statutes of Nebraska, taxes are made a lien on the real estate taxed.

Judgment reversed and case remanded to the circuit court with directions to render judgment for the plaintiffs upon the special verdict.