36. About September, 1946, the Bureau was requested to quote a rate on a property located in New Madrid County, Missouri, adjoining the City of Sikeston, and commonly known as the Cotton Club, the description of the property accompanying the request being, 'East side of U.S. Highway 61, part of Survey 1062, Township 24, Range 14, New Madrid County, Sikeston, Missouri.'
37. In compliance with this request, the Bureau did inspect the property and did publish a building rate thereon of $ 1.75, naming the occupant as Sikeston Tent and Awning Manufacturing Company, and indicating that the building was of mixed construction, hollow concrete block and frame in the walls.
38. The Bureau had made a previous inspection of the same property in 1938, and again in 1945, and in May of 1945 published thereon a rate of $ 1.60, applying to a hollow concrete block building, then occupied as a restaurant-dance hall and liquor stocks and known as Cotton Club. The rate quoted in 1938 was also $ 1.60.
39. The buildings at the time of the 1938 and 1945 inspections were the same, to wit, a building of hollow concrete block wall, occupied as restaurant-dance hall and liquor stocks and known as Cotton Club, also a frame building occupied as a retail liquor store.
40. Between the inspection of 1945 and 1946, the hollow concrete block and the frame buildings had been joined to constitute one building.
41. The rates as published on this property when used as a restaurant-dance hall and liquor store were at all times lower than the rates quoted when the premises were occupied by Sikeston Tent and Awning Manufacturing Company.
42. The change of occupancy and use of plaintiff's building after May, 1947, did not increase the hazard of fire over the occupancy and use of the building by Sikeston Tent and Awning Company.
43. Under date of May 21, 1947, Powell wrote to Miller requesting an endorsement changing the name of the assured in both policies here in suit from Sikeston Tent and Awning Company to Paul Jones, Jr. This letter, as originally written, carried a postscript reading, 'The Sikeston Tent and Awning Company have just this week moved out. The building is again occupied as a restaurant and dining room.'
44. Miller forwarded Powell's letter of May 21, 1947, to Arthur F. Houts & Co.
45. Endorsements on both policies in suit were issued dated May 26, 1947, and both signed by Charles T. easterby, as agent, changing the name of the assured to Paul Jones, Jr., as requested, and were forwarded by Arthur F. Houts & Co. to Miller, who in turn forwarded them to Powell.
Conclusions of Law.
1. The requirements of diversity of citizenship and jurisdictional amount are satisfied and this Court has jurisdiction of both actions.
2. Since the insured building was imperfectly described in each policy, extrinsic evidence was admissible to show the intent of the parties and to resolve the latent ambiguity in the description. Koplin v. Franklin Fire Insurance Company, 158 Pa.Super. 301, 44 A.2d 877; University City, Mo., v. Home Fire & Marine Ins. Co., 8 Cir., 114 F.2d 288.
3. The knowledge of Miller with respect to a fact material to the risk was the knowledge of Easterby, by whom he was appointed, and the knowledge so imputed to Easterby must also be imputed to his principals, the defendant companies. Restatement of the Law of Agency, Sec. 283b; Isaac et al. v. Donegal & Conoy Mut. Fire Ins. Co., 308 Pa. 439, 162 A. 300; Headley's Express & Storage Company, Inc., v. Pennsylvania Indemnity Corporation, 319 Pa. 240, 178 A. 816; Harris v. Meyers, 160 Pa.Super. 607, 52 A.2d 375.
4. The burden of proving that the change of occupancy and use after the policies were issued increased the hazard of fire is upon the insurer asserting that defense. Harbridge et ux. v. Mutual Fire Insurance Company of Chester County, 151 Pa.Super. 278, 30 A.2d 360. Defendant failed to sustain the burden of proving that the change of occupancy and use increased the hazard of fire.
5. An insurer who is informed of a change of occupancy and use after the policy is issued and who thereafter issues an endorsement correcting the name of the insured but making no reference to the change of use and occupancy, accepts the premium for the policy and so conducts itself as to lead the insured to believe the policy is in full force and effect, is estopped to deny liability upon the ground that the change of use created an increase of hazard and thereby created a forfeiture of the policy. Hoffman v. Neshannock Mutual Fire Insurance Co., 156 Pa.Super. 13, 39 A.2d 145.
6. The mortgaging of the premises by insured without endorsement on the policy is not such change in insured's right, title and interest or in his sole and unconditional ownership as o void the policy in the absence of a specific prohibition against mortgages. This is the rule followed by the Federal Courts, the Courts of Pennsylvania where the contracts of insurance were countersigned, and in Missouri where the business was solicited, the premises located, and the insured domiciled. Royal Ins. Co. v. Bailey, 6 Cir., 35 F.2d 916; corporation for Relief of Poor Presbyterian Ministers v. Wallace, 3 Rawle, Pa., 109; Bulger v. Wilderman and Pleet, 101 Pa.Super. 168; Harper v. Consolidated Rubber Co., 284 Pa. 444, 131 A. 356; Bushnell v. Farmers' Mut. Ins. Co., 110 Mo.App. 223, 85 S.W. 103. Fur 103. Furthermore, a mortgage is not a violation of the sole and unconditional ownership clause of the insurance contract. Fox v. Connecticut Fire Ins. Co. of Hartford, Mo. App., 268 S.W. 393, 395; Terminal Ice & Power Co. v. American Fire Ins. Co., 196 Mo.App. 241, 194 S.W. 722, 724.
7. Since the plaintiff suffered a total loss on the building insured, and his loss was the same as the value of the property immediately before the fire occurred and exceeded the total insurance carried, the co-insurance clause will not reduce his recovery and plaintiff may recover up to the full amount of his policies. The formula relating to adjustment of losses and appearing in Goldin, The Law of Insurance in Pennsylvania, Vol. I., Page 252, Illustrations 3 and 6, as applied to the instant case would be
17000 (the insurance) 17
/-- equals /-- , or 17000, of the loss
18000 (100% of valuation) 18
on the insurers, and
1000 (the deficit) 1
/-- equals /-- , or 1000, falls on the
18000 (100% of valuation) 18
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