Summary
In Insurance Co. of North America v. County of Hall, 188 Neb. 609, 198 N.W.2d 490 (1972), this court held that 44-380 was not applicable to recovery on a fire insurance policy because a 1951 enactment of the Legislature, codified at then Neb. Rev. Stat. § 44-501 (Reissue 1952), required that all policies of fire insurance conform to the 1943 Standard Fire Insurance Policy of the State of New York, which allows recovery only up to the actual value of the loss.
Summary of this case from Heady v. Farmers Mut. Ins. Co.Opinion
No. 38136.
Filed June 16, 1972.
1. Insurance: Statutes. Section 44-501, R.R.S. 1943, directly conflicts with section 44-380, R.R.S. 1943. 2. Insurance: Statutes: Contracts. Section 44-501, R.R.S. 1943, as amended and reenacted by the 1951 Legislature, provides that a fire insurance policy shall conform as to provisions, agreements, and conditions with the 1943 Standard Fire Insurance Policy of New York, and declares that no other or different provision, agreement, or clause shall be made a part of such fire insurance policy. 3. Insurance: Statutes: Contracts: Damages. Under section 44-501, R.R.S. 1943, as amended in 1951, an insured's recovery on a fire insurance policy is limited by the provisions of the policy as written in conformity with the 1943 Standard Fire Insurance Policy of New York.
Appeal from the district court for Hall County: DONALD H. WEAVER, Judge. Reversed and remanded with directions.
Luebs, Tracy, Huebner Dowding, James A. Beltzer, and D. Steven Leininger, for appellant.
Sam Grimminger and Robert Paulick, for appellee.
Heard before WHITE, C. J., SPENCER, BOSLAUGH, SMITH, McCOWN, NEWTON, and CLINTON, JJ.
A house owned by the defendant was completely destroyed by fire. Pursuant to section 44-501, R.R.S. 1943, the policy insured the dwelling "to the extent of the actual cash value of the property at the time of the loss," the "amount of insurance" written in the policy was in the sum of $8,500. Section 44-380, R.R.S. 1943, provides: "* * * the amount of the insurance written on such policy shall be taken conclusively to be the true value of the property insured and the true amount of loss and measure of damages." The question involved is whether the insured may recover the full face value of the policy in the sum of $8,500 or only the actual cash value of the property at the time of the loss. The district court held that the insured could recover the full face amount in the sum of $8,500. We reverse the judgment of the district court.
Section 44-380, R.R.S. 1943, requires a "valued" policy in which the face amount of the insurance becomes liquidated damages and is recoverable irrespective of the actual value of the loss. Section 44-501, R. R. S. 1943, on the other hand, incorporates the provisions of the 1943 Standard Fire Insurance Policy of the State of New York, the provision in the insurance contract here, and requires an "open" policy providing recovery of the actual value of the loss, and the amount of the insurance designated in the policy being a limitation on recovery. Borden v. General Insurance Co., 157 Neb. 98, 59 N.W.2d 141 (1953). As a matter of original analysis and on authority, there is a direct conflict between the two statutory provisions. Borden v. General Insurance Co., supra; State ex rel. Martin v. Howard, 96 Neb. 278, 147 N.W. 689 (1914); Fadanelli v. National Security Fire Ins. Co., 113 Neb. 830, 205 N.W. 642 (1925). Prior to 1951, section 44-501, R. S. 1943, read in part as follows: "No fire insurance company shall issue any fire insurance policy covering any property or interest therein in this state other than on a form prescribed by the Department of Insurance as nearly as practicable in the form known as the New York standard as adopted by the state in the year 1913 * * *." (Emphasis supplied.) The words "as nearly as practicable" in the pre-1951 statute were seized upon in State ex rel. Martin v. Howard, supra, and Fadanelli v. National Security Fire Ins. Co., supra, to reconcile the two statutes. Section 44-501, R.R.S. 1943, in its original context, was adopted in 1913, and in 1914 this court in State ex rel. Martin v. Howard, supra, stated as follows: "The act which we are now considering consists of nearly 200 sections. Scattered throughout there are sections which are inconsistent with the New York standard form, such as * * * the provision in Section 74 providing for valued policies." That case also stated: "The only matter in which any discretion in this regard is left to the board is that the form it is required to prepare shall be `as nearly as practicable in a form known as the New York standard, as now or may hereafter be constituted' This is an exceedingly narrow limitation which was no doubt inserted in order that the form of the New York policy might be modified so as to conform to a number of other provisions in the act which would be inconsistent with it if copied in its original form." In 1925 this court in Fadanelli v. National Security Fire Ins. Co., supra, again ruled on the question as follows: "`We are of the opinion that it was the intention of the legislature that the New York form should be adopted as the basis of the insurance contract, and that the words "as nearly as practicable" should be construed to mean as nearly as practicable considering the other provisions contained in the insurance code which in anywise are inconsistent with or modify the provisions of the New York standard form of contract.'" See, also, Mayfield v. North River Ins. Co., 122 Neb. 63, 239 N.W. 197 (1931).
This reconciliation was eliminated by the Legislature in 1951 when it enacted a new version of section 44-501, R.R.S. 1943. The new section, as amended in 1951, provides: "No policy or contract of fire and lightning insurance, including a renewal thereof, shall be made, issued, used or delivered by any insurer or by any agent or representative thereof, on property within this state other than such as shall conform in all particulars as to blanks, size of type, context, provisions, agreements and conditions with the 1943 Standard Fire Insurance Policy of the State of New York, a copy of which shall be filed in the office of the Director of Insurance as standard policy for this state, and no other or different provision, agreement, condition or clause shall in any manner be made a part of such contract or policy or be endorsed thereon or delivered therewith except as provided in subsections (1) to (9) of this section." (Emphasis supplied.)
Extended analysis is not indicated. The intent of the Legislature is abundantly clear. The holdings of Howard and Fadanelli were destroyed with the elimination of the words "as nearly as practicable." In this new amendment and act not only were these words of reconciliation eliminated, but the statute affirmatively declares that no other or different provision, agreement, condition, or clause shall in any manner be made a part of such contract or policy.
The fundamental principle of statutory construction is to determine the intent of the Legislature. There is no ambiguity or gap in the new statute which indicates or requires us to resort to any of the traditional rules of statutory construction in order to ascertain the intent of the Legislature. The new statute says what it means and means what it says, and that declaration is that no other or different provision, agreement, condition, or clause shall in any manner be made a part of such contract or policy.
We observe that the Legislature, when enacting the 1951 amendment, is presumed to have known the preexisting law. In enacting this later amendatory statute there could be no other conclusion but that the language was intentionally changed for the purpose of effecting a change in the law itself. Familiar rules on statutory construction also strongly support this conclusion. See, Hills v. Burnett, 172 Neb. 370, 109 N.W.2d 739; Hurley v. Brotherhood of R.R. Trainmen, 147 Neb. 781, 25 N.W.2d 29; Chilen v. Commercial Casualty Ins. Co., 135 Neb. 619, 283 N.W. 366.
We therefore come to the conclusion that section 44-501, R.R.S. 1943, as amended in 1951, and now the present existing statute, controls the conflict between these statutes and that the defendant's recovery is limited by the provisions of the policy as written in conformity with the 1943 Standard Fire Insurance Policy of New York.
This is a declaratory judgment action to determine which provision of the statute prevails. No issue is presented to us, therefore, as to the resolution of the amount of the actual loss of the defendant under the terms of the policy.
The judgment of the district court is, therefore, reversed and the cause remanded with directions to enter a judgment in conformity with the conclusion reached herein.
REVERSED AND REMANDED WITH DIRECTIONS.