ARK.] FRANKLIN FIRE INSURANCE CO. -V. HOLMES. 1053 FRANKLIN FIRE INSURANCE COMPANY V. HOLMES. 1-3406 Opinion delivered March 12, 1934. ' 1. INSURANCE—TITLE OF INSURED — EVIDENCE.—A decree cancelling a correction deed on account of the grantor's incompetency would nOt affect the title conveyed under the prior deed sought to be corrected as respects the insured's—title. 2. DEEDS—EVIDENCE OF INcomPorENci.A decree declaring a grantor incoinpetent when a certain deed was executed is not kvidence .that she was. incompetent when a prior deed was executed., . 3. INSURANCE—TITLE OF INSURED—ESTOpPEL.—Thet a fire insurance company settled the claims: of a mortgagee and another who claimed to own the insured property held not a waiver of defense against the insured. 4. EXECUTORS AND ADMINISTRATORS—ESTOPPEL TO CLAIM INSURANCE. The administrator of insured's estate who stood by while the surer . negotiated with a mortgagee and with one claiming to have owned the insured * property without intimating that the estate was claiming any ihterest in the insurance until a year after the fire held estopped to claim the inSUrance. - 5. INSURANCE—SOLE OWNERSHIP.—A stipulation in 'a fire policy that insured must be the sole and unconditional owner of the property or the owner in fee-simple of the ground on which the building is situated held valid. 6. INSURANCE—PROOF OF LOSS.—Provision in a fire policy requiring proof of loss within 60 days 'after a fire is valid, and 'a failure to make such proof within such period forfeits the insured's rights. 7. I pISURANCE—OWNERSHIP OF PROPERTY INSURED.—Insurer in paying the insurance loss could rely upon the record title to the insured property where insured's administrator did not make claim and furnish proof of loss within the time . Specified in the policy. Appeal from Prairie Circuit Court, Northern District; W. J. Waggoner, Judge; reversed. - Verne McMillen, for appellant. Emmet Vaughan and. Gem'ge W. Craig; for appellee, BUTLER, J. On -November , 9,, 1930, _Mrs. Frank L. Goodwill, as owner, secured a policy of fire , insurance
1054- FRANKLIN- FIRE INSURANCE C■:).- V. -HOLIVIES. [188 in the sum of $800 on a dwelling house situated on lots 7 and 8, block 28, Watkins' Survey to the town of Des Arc, loss, if any, payable to Henry Nichols, mortgagee.. The policy provided that it should be void if the interest of the insured -be other than unconditional and sole ownership, or if the subject of the insurance be a building on ground not owned by the insured in fee simple ; also, that in the event of the destruction of the property by fire, as a condition -precedent to recovery, proof . of loss should be made within 60 days. • Mrs. Goodwin died in. December, .1930, and on Jan-uary 19, 1931, J. J. Holmes was . appointed administrator of her eState. On April 2, 1931, the property was de.; stroyed by fire, and the insUrance company was so notified. Henry iNichols, acting for himself as mortgagee, made the proof of loss necessary to effect a settlement between him and the company, which paid him the amount of his debt secured by the , mortgage in the sum of $401, and, under a stipulation in the policy, the company took an assignment of the mortgage from NichOls on June 20; 1931. During -this time an investigation was made concerning the title . to the property, and it was found that on July 8, 1926, 'Mrs. Goodwin. had conveyed the property by warranty deed to Mrs. Frank . Hall Murphy, a . niece, who lived with- her, and, on April 11, 1927, follOwing, - Mrs. Goodwin had executed another deed to Mrs. Mur-phy to correct the descriptions contained in the deed executed in 1926. / Mrs..Frank Hall Murphy, claiming to be the owner of the property and entitled to the insurance thereon, employed E. F. West and J. P. Kerby, of Little Rock, attorneys, to represent her in an attempt to effect a settlement, and, on October 1, 1931, signed a letter ad: dressed to the insurance company- advising it - that she had authorized West and Kerby, as her agents and 'attorneys, to settle for the insurance loss " on‘what is known as the Goodwin or Murphy property, consideration that I get an assignment of the Henry Nichols mortgage, which is the mortgage that was transferred and- assigned to your company,: the same being of record in record book "Y," at page 625, records of Prairie County, Arkansas, and you are requested to assign this mortgage and de-
ARK.] FRANKLIN FIRE INSURANCE CO. V. HOLMES. 1055 liVer same to my said attorneys, making a fulFs'ettlement with them for all conSideration, etc." This'was Witnessed by Mrs. Ruth Johnson, a' sister of . Mrs. Mnrphy, and' by a Miss Mary Hall. ' Mrs. Murphy . claiined there was some writing in -the letter not there when she signed it,' but there was no claith that West and , Kerby 'did not have authority to settle for , her with the company. The 'insur-ance-company' settled' With the said attorneys 'by- assigning to them the Nichola Mortgage and 'paying the . sum of
$100 in cash. After this . Settlement was effected, on May '3, 1932; Mark Bell filed a complaint in the Prairie Chancery . Court against' Mrs. Frank Hall , Murphy, on which sumniOnS was 1.SSned, 'Mit 'Which , Mrs.' Murphy answered, and there appeared on the jiidge'S dOcket the following notation . ."5-7,32 -, d . e c • re e . setting aside deed. No summons." . . On . August 23, 1932:J. J. Holmes, .as adininistrator of the estate:of Mrs. , Goodwin, bronght the action from whence this 'appeal corneS, to recover on the policy Of insurance. On issue. joined, testiinony Was adduced, the .ca.Se was submitted to a jury, which returned a verdict in fa*r of the plaintiff for the sum' deinanded; The conrt there-'upon rendered judgment for that sum 'with interest, .12 per cent. penalty, and- attorney's:fee. On appeal it is insisted that the court -erred in giVing Certaininstructions for the plaintiff and in refusing others requested by' the defendant, which we need -not- mike for the reason that it is our opinion that the court erred in refusing tO direct the jury, at the requeSt of- the defendant, to return a verdict in its favor: The testimony established beYend . question the faCts heretofore stated. During the •trial the- 'plaintiff, in ré-srionSe to the contention that his intestate. was- not the owner of the property, offered in 'evidence the 'chancellor's notation which we have quoted supra, and a'.decree was entered purporting to be based upon the notation .aforesaid, in whieh the court found as the basis for its decree cancelling the deed :from Mrs. Goodwin to Mrs. Murphy of -Apra 12, 1927, was:that the same . "was executed while -the' said. Frank L. Goodwin (Mrs. Goodwin)
1056- FRANKLIN -FIRE INSURANCE 00:- V. HOLMES. [188 was mentally- incompetent. to execute the same.'', _Without determining bow this. decree would, affect the, right of the defendant company, no notice having been given it of the pendency. of that action, in _so far as the deed of April 12, 1927, is concerned, it, was not sufficient to divest the title of Mrs. Murphy, for that title rests not on the deed of April . 12, *1927, but on the . deed executed July 8, 1926, the latter dead being executed merely to correCt a description id the former. There was . no finding by the court that Mrs... Goodwin was mentally incompetent fo execute a deed on the first-mentioned date, and, in the absence of a finding to that effect, the.presumption is that . she was Jegally Competent tO make the conveyance. follows that Mrs. Goodwin, .at the time of the execution Of the contract of insfirance and at all times thereafter, was not the owner in fee simple of the property on which the building insured . was located. . • 'During the progress Of tbe trial _a letter, dated Sep-' ` ..tember 12; 1931, .froM Mrs. Frank Hall Murphy to her attOniey, John P. .Kerby, was introduced. 'This letter was in response to a letter she had received from . him a few days preceding and in which she stated that Holmes was appOinted -administrator for Mr.: Nichols, .and, if it .was necessary, sbe would prefer to have one appointed '• of her own . choice, but that . she had . heen informed that Mr. Nichols . and Mr. Holmes were willing to do all they could to assist her in collecting the insUrancem. Tbe, case was heard on . the testimony of witnesses .present before the court, and not by deposition, and neither Nichols nor Holmes denied. the implication contained in Mrs. Murphy's- letter to her attorney. From this, the inference, follows. that -Holmes, the administrator, was apprised of Mrs Murphy's claim' and of the effort-she was making to effect a settIementWith the -insurance company. Holmes, in• testifying, did not claim that he had . mada proof of loss or claim for the -estate, bUt stated in effect that he merely accepted the appointment as administrator and did nothing regarding the claim for insurance:MI% Nichols, the mortgagee, -testified that he made no proof for the estate, but simply did what was necessary to protect bis own interest.
ARK.] FRANKLIN FIRE INSURANCE CO. v. HOLMES. 1057 • The settlement of the mortgagee's claim and that made with Mrs.- Murphy were beyond sixty days from the fire, and the company's action in making these settlements could not be deetned to be a waiver of any defense it might have against the estate of Mrs. Goodwin, or to constitute an estoppel to assert the same, for there was nothing in its action which could be said to have misled the administrator or to have prejudiced the rights of the estate. On the contrary, it appears that an estop-pel works to preclude the claim of the administrator, for it is clear that he stood by while the company was negotiating with Nichols and Mrs. Murphy without intimating that the estate was claiming any interest in the insurance. By his silence, he permitted the insurance company to conclude its negotiations which clearly it would not • have done had he, with any reasonable diligence, asserted a claim for the estate of the proceeds of the policy. Manifestly, there was no act of the insurance company which placed the adininistrator in a position to suffer loss, whereas hiS conduct was such as to reasonably mislead the company. The loss occurred on April 2, 1931, and we -gather it was at least. a year' before the administrator gave any indication 'of an intention to claim the insurance. Certainly, far beyond the time for making the proof of loss had elapsed, and there was none siA ever made. The stipulation in the policy that the' insured must; be the sole and unconditional owner of the property, or the owner of the fee-simple title to the ground on which the building is located, is a valid provision, and, where the ownership is otherWise, the policy of insurance is void. Phoenix Ins. Co. v. Public Parks Amusement Ass'n, 63 Ark. 187, 37 S. W. 959 ; Planters Mut. InS. Co. v. Loyd, 67 Ark. 584, 56 S. W. 44; ' Western ' Assurance Co. v. White, 171 Ark. 733, 286 S. W. 804. It is equally well settled that the prOvision for making proof of loss within sixty days after the fire is a reasonable and valid provision and that failure to make such proof within the time prescribed forfeits the rights of the insured. Teutonia Ins. Co. v. Johnson, 72 Ark. 484, 82 S. W. 840 ; Home Fire Ins. Co. v. Driner, 87 Ark.
171, 112 S. W. 200 ; Commercial Fire Ins. Co. v.. Waldron, . 88 Ark. 120, 114 S. W; 210; Queen of Arkansas,Ins. Co. v. Laster, 108 Ark. 261, 156 S. W. 848 ; Ill. Bankers Life Ins. Co. v. Byassee, 169 Ark: 230; 275 S. W. 519. As suggested by counsel for the appellant, if the administrator had made his claim and proof of loss within the time provided by the policy, the.company then would have had an opportdnity to determine who actually owned the propertY at the time of the loss, and, the claim not having been made, it had a right to rely upon the record title, and the administrator is now estopped from making ally such claim. It follows that the judgment of the trial court is reversed, and the case is dismissed.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.