Hanover Fire Insurance v. Hodges , 37 Ga. App. 229 ( 1927 )

Stepiiens, J.

1. Where a person had purchased land and paid therefor, without taking a deed of conveyance into himself, but where the legal title thereto was, with his consent, conveyed by his vendor to the purchaser’s brother for the sole and specific purpose of being by the brother transferred to another to secure a debt of the purchaser, and where the brother had fully executed and discharged this trust by making a deed of conveyance thereunder as security for the purchaser’s debt, the entire legal and equitable interest in the property, subject to the loan deed made by the brother, became by operation of law vested in the original purchaser. A second loan deed afterwards executed by the brother, conveying the property to secure his own debt, without the knowledge or consent of the original purchaser in possession as the true owner holding the entire legal and equitable interest in the property, subject to the first loan, vested no title in the grantee to secure the second loan, where the grantee took with notice of the original imrehaser’s right, title, and interest in the property. Where, at the time of the execution by the brother of the second conveyance, the original purchaser occupied a house on the land and was in sole possession of the house, and therefore of the land upon which the house rested, this possession constituted notice to the grantee in the second loan deed of the right, title and interest of the person in possession to the house and the land upon which it rested.

2. Where, after the execution of the second conveyance by the brother, the original purchaser took out a policy of fire insurance upon the house located upon the land, such second conveyance constituted no encumbrance upon the insured’s title to the property. In a suit by the insured against the insurance company to recover under the policy for a loss-of the property insured by fire, where the • defendant denied liability upon the ground that the second conveyance constituted an encumbrance upon the property without the defendant’s knowledge and consent, in violation of the terms of the policy, a finding that the title to the property insured, at the time of the issuance of the policy, was not encumbered as alleged by the defendant, was as a matter of law demanded.

Decided September 28, 1927.

3. Where the policy further provides that it will be void if the insured has concealed or misrepresented any material fact or circumstance concerning the insurance or the subject thereof, a failure on the part of the insured to inform the insurer of the existence of the above-described alleged encumbrance upon the property insured is not a violation of this provision of the policy, whore the insured at the time of the issuance of the policy was ignorant of the existence of the alleged encumbrance.

4. Under the above rulings, there was no evidence to authorize an inference that the title to the property insured was not in the plaintiff at the time of the issuance of the policy, or that it was otherwise encumbered without the knowledge of the defendant. A verdict for the plaintiff was therefore demanded as a matter of law in an amount representing his loss under the policy.

5. In view of the above rulings, it is immaterial that the insured acquired from the trustee a deed of conveyance to the property after the trustee had executed the deed to secure debt which created the alleged encumbrance upon the property, and before the issuance of the policy. It follows that the admission of this deed in evidence over the defendant’s objection, upon the ground of insufficient description of the property, was, if error, harmless to the defendant.

6. The secon'd proof of loss contained in the amendment to the petition not having been filed with the defendant within the time required by the terms of the policy, was filed too late, and the amendment should . have beeix rejected. The proof of damage to the property destroyed should therefore be limited to the amount represented in the original proof of loss, which was $2225.43. The plaintiff having received $300 upon the payment of this loss from another insurance company, in which he held concurrent insurance upon the property destroyed, a verdict for the plaintiff in an amount in excess of $1925.43 is unauthorized. Since the error in allowing the amendment to the petition can be cured by writing from the principal of the verdict found in the sum of $2000 the sum of $74.57, and by writing from the interest found in the sum of $104.94 a proportionate amount, so that the verdict shall read as finding for the plaintiff in the sum of $1925.43 principal, plus the interest thereon, which will equal $104.94, less the amount of interest written off, the judgment will be affirmed upon condition that the plaintiff write off the verdict the sums indicated above at the time the remittitur from this court is made the judgment of the court below; otherwise the judgment will be reversed. Travelers Ins. Co. v. Thornton, 119 Ga. 455 (6) (46 S. E. 678).

Judgment affirmed on condition.

Jenkins, P. J., and Bell, J., concur. Smith, Hammond & Smith, Evans & Evans, for plaintiff in error. M. L. Gross, contra.