The rule of
ejusdem generis is a rule of
interpretation, and even if it should be applied more liberally to
contracts of insurance than to contracts of other kinds, it cannot
be so applied as to exclude "blasting powder" from a prohibition to
keep or allow on insured premises certain specified explosives and
"other explosives."
Where the policy furnishes the only way by which its terms can
be
Page 216 U. S. 312
waived and expressly provides against modification by custom of
trade or manufacture or by agents, and are unambiguous, courts
cannot admit parol testimony to alter the written words of the
contract.
Northern Assurance Co. v. Grand View Building
Association, 183 U. S. 308.
151 F. 961, affirmed.
The facts, which involve the liability of a fire insurance
company on a policy of insurance, are stated in the opinion.
Page 216 U. S. 314
MR. JUSTICE McKENNA delivered the opinion of the Court.
This is an action to recover the sum of $2,600, with interest,
upon a fire insurance policy for the value of a building
destroyed
Page 216 U. S. 315
by fire. The action was brought in the Court of Common Pleas of
Jefferson County, Pennsylvania, and by the insurance company, the
respondent herein, removed to the United States Court for the
Western District of Pennsylvania.
Plaintiff's statement, to use the local name for her pleading,
alleged a contract of insurance whereby the insurance company
insured, for the term of three years, against direct loss by fire,
"a two-story shingle-roofed building, 28 x 96, and additions,"
etc., to be occupied by tenants as dwellings, and situated in
Punxsutawney, Jefferson County, Pennsylvania. Payment of the
premium and charges was alleged, also the total loss of the
building by fire. A copy of the policy was attached to the
statement and made a part of it. The policy contained the following
covenant:
"This entire policy, unless otherwise provided by agreement
indorsed thereon or added hereto, shall be void . . . if (any usage
or custom of trade or manufacture to the contrary notwithstanding)
there be kept, used, or allowed on the above-described premises,
benzin, benzole, dynamite, ether, fireworks, gasolene, Greek fire,
gunpowder, exceeding 25 lbs. in quantity, naphtha, nitroglycerin,
or other explosives."
The policy also contained the full covenant:
"This policy is made and accepted subject to the foregoing
stipulations and conditions, together with such other provisions,
agreements, or conditions as may be indorsed hereon or added
hereto, and no officer, agent, or other representative of this
company shall have power to waive any provision or condition of
this policy except such as, by the terms of this policy, may be the
subject of agreement, indorsed hereon or added hereto, and as to
such provisions and conditions no officer, agent, or representative
shall have such power, or be deemed or held to have waived such
provisions or conditions unless such waiver, if any, shall be
written upon or attached hereto; nor shall any privilege or
permission affecting the insurance under this policy exist or be
claimed by the insured unless so written or attached. "
Page 216 U. S. 316
The case was tried to a jury, and resulted in the verdict for
the plaintiff, upon which judgment was duly entered. A motion for a
new trial was denied. The judgment was reversed by the circuit
court of appeals. 151 F. 961. This writ of certiorari was then
allowed.
The question in the case is the effect of the covenants which we
have quoted. It was raised in the circuit court by objection to
certain testimony, which was admitted, and the denial of certain
instructions which were requested.
The property is situated in the coal mining regions of
Pennsylvania, and the testimony shows that an explosion preceded or
was coincident with the fire as its cause or effect. Indeed, it
seems to be clear that the explosion was caused by one of the
tenants' throwing lighted "squibs" in the air "for fun." And there
was testimony that it was the custom of miners to keep more or less
blasting powder in their dwellings. The custom seems to have arisen
on account of a law of Pennsylvania which provides that
"no powder or high explosive shall be stored in any mine, and no
more of either article shall be taken into the mine at any one time
than is required in any one shift unless the quantity be less than
five pounds."
In supplement to this testimony the circuit court admitted, over
the objection of the company, the testimony of the agent who placed
the insurance upon the property, to the effect that he had taken
considerable risks as agent for defendant company on miners'
dwellings; that he knew of the custom of miners to keep blasting
powder in their dwellings; that he knew that the building insured
was in seven compartments, "seven miners' dwellings," to be
occupied by seven different families, and that he
"increased the rate by reason of the fact that this building was
to be occupied by miners, and having knowledge that they kept more
or less blasting powder about their dwellings."
And he also testified that, after he had placed the risk, the
special agent of the company went with him, looked at the risk, and
said it was satisfactory, after
Page 216 U. S. 317
having made inquiry as to the rate. He expressed the increase in
percentage as "one and a quarter for one year, or two and a half
for two years." He also charged an extra premium for finishing.
He increased the premium, he further testified, because he
"thought it was going to be occupied by coal miners," and "because
there was seven of them." The increase was from one and one quarter
percent to two and one-half percent, but he did not know what he
would have charged if the building had not been for coal miners.
And further that he was not told that the building was to be
occupied by coal miners, he knew that from his experience in the
business. Mrs. Penman did not tell him, nor did he tell her that he
had increased the rate because she might possibly have it occupied
by miners, but he told the special agent of the company "that that
entered into the calculations." He did not report it on the form,
because it was not his custom to do so. To the question whether it
was special business he was "performing, rather than acting for the
company," he answered, "Yes."
The policy recited that the building insured was "in process of
erection, with privilege to finish and to be occupied by tenants as
dwellings," and that "in consideration of the extra premium of
three and 90-100 dollars ($3.90) thirty days' permission is hereby
granted to finish the building." There was evidence showing that
blasting powder is a lower degree of explosive than gunpowder or
dynamite, and that the latter is a higher degree than
gunpowder.
In view of this testimony, the circuit court decided, as it
said, that though ordinarily it was "the duty of a court to
construe a written instrument, and instruct the jury what its terms
meant," he would leave to the jury "as a question of fact" for it
"to determine, whether, under the evidence and the facts proven
here, blasting powder" was "included in the term
other
explosives.'" Entertaining that view, the court refused to instruct
the jury, as requested by the company, "that, under the evidence,
the verdict should be for the
Page 216 U. S.
318
defendant." The court refused other requests which were
based on the controlling effect of the policy.
In passing upon the motion for a new trial, the circuit court
reasserted the view that it was for the jury to "determine whether
blasting powder was one of the prohibited articles which were to
invalidate the policy." The court observed: "It was contended by
one side that it was embraced under the term
other explosives;'
by the other, that it was not." The court further said:
"While, of course, blasting powder is an explosive, and is
therefore covered by the generic term 'other explosives,' yet the
fact that other explosives of the general character of blasting
powder, and those of a much more dangerous character than blasting
powder, to-wit, dynamite and gun powder, of which twenty and five
pounds were permitted, were specified, it was contended that the
expressed mention of these more dangerous powders evidenced an
intent not to cover the less dangerous article of blasting powder
under the general term 'other explosives.'"
To the last contention, the court, as we have seen, yielded, and
rejected the case of
The Northern Assurance Co. v. Grand View
Building Assn., 183 U. S. 308, as
not decisive, by saying that
"in that case there was no question as to what the policy
provided; in the present, the crucial question was as to what the
policy in question covered by the term 'other explosives.'"
The majority of the circuit court of appeals took another view.
It found nothing obscure in the language of the policy, and nothing
therefore to excuse the circuit court from exercising the duty of
construing it. Answering the contention that the words "or other
explosives" should not be held to include explosives of lower power
than gunpowder or dynamite, it was said: "Such an application of
the maxim
noscitur a sociis is too narrow."
It was pointed out that the enumeration of explosives included
other explosives than gunpowder and blasting powder, and that there
was nothing in the record to show their relative degrees of power,
nor whether they or any of them were
Page 216 U. S. 319
of less explosive power than gunpowder or dynamite. Their
relative power, it was said, was not a matter of common knowledge,
and if the general words "or other explosives" were to be or could
be limited by such relation or their relation to blasting powder,
the burden was upon the plaintiff to show it, as those words, "in
their literal and natural meaning, included blasting powder." It
was hence concluded that
"to hold, under the present proofs, that the general words 'or
other explosives' do not include blasting powder, merely because it
is a less dangerous explosive than dynamite or gunpowder, when it
may be more dangerous than Greek fire, benzin, benzole, ether,
gasolene, or naphtha, is virtually to decide arbitrarily that no
meaning or effect shall be given to the general words. We are
satisfied that this cannot be done, and that, as the proofs stand,
the general words include blasting powder."
The court, thus deciding that the words of the policy included
blasting powder, further decided that the circuit court erred in
admitting parol testimony to vary its terms, and also erred in not
directing a verdict for the company.
A member of the court dissented from both propositions. His
argument was elaborate, and would not be adequately represented by
condensation. It asserted the view of the circuit court and the
contention of the plaintiff. It considered that, by the rule of
ejusdem generis, blasting powder was not covered by the
words "other explosives," and by them were meant explosives of the
same power as those enumerated, which it seems to have been assumed
blasting powder was not. It was considered, besides, that the words
could be given a meaning by the custom of miners and the industrial
conditions which existed in the neighborhood, and also from the
knowledge and conduct of the company's agent when the insurance was
placed. Cases from Pennsylvania were cited to support that
proposition, of which we may select as representative
Machine
Company v. Insurance Company, 173 Pa. 53, where the policy of
insurance on two buildings, one a
Page 216 U. S. 320
foundry and machine shop, and the other a pattern shop, was
considered. The policy covered the patterns in the pattern shop by
these words, "on patterns therein one thousand dollars." The
pattern shop was from fifteen to twenty feet from the foundry in
which the fire occurred, and in which the patterns were destroyed,
where they were taken the evening before the fire for actual use
next day, in accordance with the orders and customs in that and
other shops in the use of patterns. It was found by a jury
returning a special verdict that such use was a reasonable one and
answered the convenient operation of such plants, and that the
agent of the defendant company examined the shops and patterns and
buildings before taking the insurance. The court said:
"The policy sued on in this case was issued to a manufacturing
company, and covered the buildings, machinery, fixtures, and
appliances in daily use in the business of the company. The rules
of construction applicable to such a contract of insurance are well
settled. The object of the contract is indemnity against the loss
by fire of the business plant, or any portion of it, while used and
occupied by the owners in the manner and for the purposes for which
it was designed. If its provisions are susceptible of two or more
interpretations, that one should be adopted that will make the
contract effective for the protection of the insured. In other
words, the contract should be liberally construed in aid of the
indemnity which was in contemplation of the parties who made it.
W. & A. Pipe Lines v. Insurance Co., 145 Pa. 346."
"Again, an insurance company issuing a policy upon a business
plant, or any portion of it, is chargeable with knowledge of the
customary methods of conducting the business in which the property
insured is used.
Ibid. This rule is not limited to
insurance upon property in use for manufacturing or other business
purposes. It was applied in the construction of a policy issued
upon a dwelling house in
Doud v. Citizens' Insurance Co. 141
Pa. 47, 23 Am.St.Rep. 263, 21 A. 505, and in Roe v. Dwelling House
Ins. Co., 149 Pa.
Page 216 U. S. 321
94. It was applied to a policy of insurance upon a horse in
Haws v. Fire Association of Phila., 114 Pa. 431. Still
another rule of construction is that the circumstances surrounding
the making of the contract, and affecting the subject to which it
relates, form a sort of context that may properly be resorted to
for aid in determining the meaning of the words and provisions of
the contract.
Bole, Assignee v. New Hampshire Fire Ins.
Co., 159 Pa. 53;
Graybill v. Penn Township Mutual Fire
Ins. Co., 170 Pa. 75."
We have stated the rulings of the courts below because they
accurately exhibit the contentions of the parties and the questions
for decision, and with such fullness of argument that there is not
much more for this Court to do than to select and concur. The court
of appeals decided, as we have seen, that, under the terms of the
policy, blasting powder could not be "kept, used, or allowed" on
the insured property, and that such prohibition was not waived by
the knowledge and acts of the company's agent. We concur in this,
and we think the reasoning by which it was supported is conclusive.
The rule of
ejusdem generis is rule of interpretation, and
granting,
arguendo, it should be applied more liberally to
contracts of insurance than to contracts of other kinds, yet we
think it would be giving it too much force to yield to the
contention of petitioner. Blasting powder is an explosive, and one
of power; it is therefore capable of producing the result that the
provision of the policy was intended to guard against. We are given
no tests, as the court of appeals said, and we certainly may not
assume them, of a comparison of it with the explosives which are
enumerated, except dynamite and gunpowder. The law of Pennsylvania,
as we have seen, has given it character and has guarded against its
destructive force.
We think also that the policy furnishes the only way by which
its terms can be waived. It provides against modifications by the
usage or custom of trade or manufacture. It guards against any acts
of waiver of its conditions or a change of them by agents. It
provides that such waiver or change
Page 216 U. S. 322
"shall be written upon or attached" to the policy. The company
could have used no words which would have been more explicit. There
is no ambiguity about them. Parol testimony was not needed nor
admissible to interpret them. They constituted the contract between
the company and the insured. No agent had power to change or modify
that contract except in the manner provided. This was decided in
Northern Assurance Company v. Building Association, supra.
Any other ruling would take from contracts the certain evidence of
their written words, and turn them over for meaning to the disputes
of parol testimony.
The Pennsylvania cases cited by the petitioner do not militate
with the rule there announced. If they did, it might be open to
controversy how far they were binding on this Court.
Kuhn v.
Fairmount Coal Company, 215 U. S. 349.
Judgment affirmed.