Opinion
December 9, 1927.
Appeal from Supreme Court of New York County.
Frank C. Laughlin of counsel [ Stewart W. Bowers with him on the brief; Goldstein Goldstein, attorneys], for the appellant.
Frederick T. Case of counsel, for the respondent.
Plaintiff, as trustee in bankruptcy, sues to reform and recover upon a fire insurance policy, which, by its terms, covered a brick building in which the bankrupts had their store, but which the plaintiff claims should, in accordance with the actual agreement of the parties, have been written to cover the merchandise contained in the store. The bankrupts did not own the realty and there was no possible reason for the procurement by them of an insurance policy thereon. They instructed their broker, Kriegel, to secure the renewal of a policy, covering merchandise, which had been issued to their predecessors by the defendant company and previously canceled. Kriegel testified that he requested Burns, the defendant's agent, to issue the policy as a renewal; that Burns replied that he would have to look up "in the book" to see if the policy should be renewed; that Burns later telephoned to him that the policy had been canceled some time ago on account of changing hands; that Kriegel answered: "This is new insurance and good insurance and I wish you would renew it for this contents again," and that Burns replied that he would do so. To meet this testimony the defendant did not call Burns to the witness stand, although he was in court, but relied solely upon his examination before trial which was read by the plaintiff. He there stated merely that he wrote down "the information which I received over the phone for this insurance" in his memorandum book. That book contained the entry "On Bk," which indicated that the insurance was to be upon a brick building. He made no denial of any of the details of the conversation as testified to by Kriegel. Indeed, he admits that before issuing the policy he looked at a map book in which the defendant kept the insurance history of various parcels of property. In this book there was an entry referring to the canceled policy of the letters "C.S.," which meant covering stock. In effect Burns thus admits that he knew he was issuing a policy to take the place of a previous one that had been canceled and that this canceled policy covered merchandise and not realty. The inference is very strong that Burns erred in making the entry in his memorandum book and that the defendant's reason for not calling him as a witness was his inability to deny circumstantially the version of the agreement given by Kriegel. The evidence, therefore, justifies the conclusion that Kriegel and Burns agreed upon the issuance of a policy to cover merchandise and that by mistake the policy was issued upon the brick store.
For these reasons the judgment appealed from should be reversed and a new trial ordered, with costs to the appellant to abide the event.
MERRELL and O'MALLEY, JJ., concur; DOWLING, P.J., and MARTIN, J., dissent.
Judgment reversed and a new trial ordered, with costs to the appellant to abide the event.