318, and in Longhurst v. Insurance Co., 19 Iowa 364, and many other authorities that might be cited. It is urged that the rules of the defendant company forbid the issuing of policies to mortgagees, but require their issue to mortgagors. That the plaintiffs had an insurable interest is not questioned; nor that the company could contract to insure such interest. The agent Stillman had general authority to contract insurance, and did contract to insure the plaintiffs' interest, and receive the consideration therefor, which passed to, and is still held by, his principal. We think the defendant should not be heard to question the authority of its agents under these circumstances. We are of the opinion from the facts that the contract was to insure the plaintiffs, and not Bridget Donegan, and that by a mistake of law on the part of the defendant's agent the policy was made to insure Bridget Donegan instead of the plaintiffs, and should be so reformed as to run to the plaintiff's as the insured to the extent of their interest at the time the policy was issued, not exceeding four hundred dollars.

It remains to be determined whether the policy, as reformed, has been broken by reason of the change in title, resulting from Bridget Donegan's failure to redeem. This was not a diminution of the interests of the assurred, but an increase, and hence not a breach of the policy. See Bailey v. Insurance Co., supra, and authorities cited therein.

Sec. 253. Changed use of the premises. It appears by the testimony that at the time the policy was issued the premises were occupied as a restaurant and dwelling, and at the time of the loss it was being occupied as a wagon and paint shop. The policy provides that "in case use or occupation of the above-mentioned premises at any time during the period for which this policy would otherwise continue in force shall be so changed as to increase the risk thereon, except as may be hereinafter agreed to by this corporation, in writing upon this policy, from thenceforth, so long as the same shall be so used, this policy shall be of no force or effect." This provision is against changes that "increase the risk." Mr. Stillman, who was entirely familiar with both occupations, and with the classifications of risks, testifies: "The occupation of this building was changed, after the policy was issued and before the fire, from restaurant to wagon and paint shop. But I did not think the change increased the risk enough to increase the rate. The rate was high in the first place. I did not

It was kept as a
Without regard

think the change here did increase the hazard. low dive before. I think the risk was improved. to moral hazard, a wagon and paint shop is a greater risk; but, because of a moral hazard, I did not think the risk was increased.”

It appears that the loss was total, and that the plaintiffs were damaged thereby, to the fullest amount of their insurance, four hundred dollars, which became due and payable to them on the fifth day of April, 1885. The judgment of the district court dismissing the plaintiffs' petition is reversed, and decree will be entered in this court reforming the policy of insurance as prayed for, with judgment in favor of the plaintiffs for four hundred dollars, with six per cent. interest from the fifth day of April, 1885, and for costs.

Sec. 254.

ANNOTATIONS.

Reversed.

Insurable interest. Where a leesee of real estate applied for insurance upon a building and machinery therein, and obtained a policy in which it was provided, that, if the insured was not the owner in fee of the realty, the policy should be void, it was held that the policy was valid to the extent of the interest of the lessee, it not appearing that any fraud was perpetrated by him in procuring the insurance. The court say: "A policy of insurance, like any other contract, is to be read in the light of the circumstances that surround it. This policy was issued without any application or written request describing the interest of the assured in the buildings. No actual representation of any sort upon the subject, oral or written, is alleged to have been made by or on behalf of the assured. We ought to assume that a policy written under such circumstances was written upon the knowledge of the representative of the insurer, and intended to cover in good faith the interest which the insured had in the buildings. Fraud is never to be presumed, and in this case no fraudulent representation is shown or alleged, unless it can be deduced from the statements of the insurer, made, as we must presume, on the knowledge of its representative, and for which the insured is in no manner responsible. We must also remember that this policy is to be interpreted most strongly against the company whose contract it is." Philad. Tool Co. v. Assurance Co., 132 Pa. St. 236 (19 Am. St. Rep. 596; 19 Atl. Rep. 77).

Where the policy requires the insured to be the owner of a perfect, legal and equitable title and he is in possession under a Ideed which misdescribes the land and is in fact the owner in fee thereof, the policy is valid. Diehlman v. Insurance Co., 78 Mich. 141 (43 N. W. Rep. 1045). Where the policy provided that the company should not be liable "if the interest of the assured in the property is not one of absolute and sole ownership," it was held that one who had only a life estate could not recover upon such policy. Collins v. Insurance Co., 44 Minn. 440 (46 N. W. Rep. 906). Where a husband causes land to be conveyed to his wife with the understanding that she will convey it to him at his request, and makes improvements thereon with his own money and has possession and use thereof, he has an insurable interest. Horsch v. Insurance Co., 77 Wis. 4 (45 N. W. Rep. 945; 8 L. R. A. 806).

A mortgagee has an insurable interest in the property covered by the mortgage lien to the extent of the indebtedness secured thereby, and so has a vendor to the extent of his lien for unpaid purchase money. Parks v. Insurance Co., 100 Mo. 373 (12 S. W. Rep. 1058). In the case of Tiley v. Insurance Co., 86 Va. 811 (11 S. E. Rep. 120), the court say: "Any person who has any interest in the property, legal or equitable, or who stands in such a relation thereto that its destruction would entail pecuniary loss upon him, has an insurable interest to the extent of his interest therein, or of the loss to which he is subjected by the casualty. And it has been said that any interest, however slight, may be insured, as when A advances money to B in any venture, and by agreement is to be paid out of the proceeds of the property purchased, he has an insurable interest in such property to the extent of his advances." And in support of such proposition the court cite the following authorities: "Sansom v. Ball, 4 Dall. 459; Insurance Co. v. Baring, 20 Wall. 159; Fenn v. New Orleans Mut. Insurance Co. 53 Ga. 578; Wood, Ins., 483."

Sec. 255. Occupancy of the premises. In a recent case it was held that an agent who was a mere solicitor had no power to waive a condition in a policy; and that a policy issued by such an agent, containing a clause to the effect that the policy should become void if the property should become vacant without the consent of the secretary of the company endorsed thereon, could not be enforced if the property became vacant, even

though such solicitor gave his consent that the property might be unoccupied. Burlington Ins. Co. v. Gibbons, 43 Kan. 15 (19 Am. St. Rep. 118; 22 Pac. Rep. 1010). Where the policy contained a provision that its protection should be suspended "if the risk be changed in the occupation of the building," it was held that a change in the occupation of another portion of the building over which the insured had no control, could not be pleaded by the company as a defense to an action on the policy. McKee v. Insurance Co., 135 Pa. St. 544 (19 Atl. Rep. 1067). A building is occupied when it is devoted to the ordinary uses and purposes to which it is adapted. Fritz v. Ins. Co., 78 Mich. 565 (44 N. W. Rep. 139). Where the policy contained these words "occupied as a dwelling house," it was held that these words do not necessarily exclude the idea that some portion of the building might be used as a stable. The court say: "If the family live in the building, it is not deprived of its character as a dwelling because the domestic animals are also housed there," Hannan v. Insurance Co., 81 Mich. 556 (45 N. W. Rep. 1120; 9 L. R. A. 127); but a dwelling house in which no one lives is "vacant and unoccupied," notwithstanding a former occupant has left there some trifling articles of furniture. Moore v. Insurance, Co. 64 N. H. 140 (6 Atl. Rep. 27); Snyder v. Insurance Co., 78 Iowa, 146 (42 N. W. Rep. 630); Continental Ins. Co. v. Kyle, 124 Ind. 132 (19 Am. St. Rep. 77; 24 N. E. Rep. 727; 9 L. R. A. 81).

Where a vacant dwelling is insured and the policy contains the usual provision, that it shall become void if the premises become vacant and so remain for more than thirty days, without consent of the company, and the further provision that permission is given to remain vacant thirty days without pejudice, and the the building remains vacant with the knowledge of the company for six months and was then consumed by fire, it was held that the policy was void. Newmarket Savings Bank v. Insurance Co., 150 Mass 374 (23 N. E. Rep. 210). Non-occupancy of the building was held to increase the risk. Lancy v. Insurance Co., 82 Me. 492 (20 Am. Rep. 79). Forfeiture for non-occupancy may be waived by the acquiescence of the company. Jerdee v. Insurance Co., 75 Wis. 345 (44 N. W. Rep. 636). Where the insured at the time of obtaining the insurance represented that the building was "occupied as a hotel, with bar and

billiard-room attached," when in fact it was used as a saloon, it was held that the policy was void the representation as to the occupancy being incorporated in the policy. Baker v. Insurace Co., 124 Ind. 490 (24 N. E. Rep. 1041). The court say: "The statement that the building insured was 'occupied as a hotel, with bar and billiard-room attached,' inserted in the face of the policy, constituted an express warranty that the building was so occupied at the time the policy was issued, and the validity of the contract depended upon the truth of the stipulation." In support of this proposition the following anthorities are cited: "Commonwealth's Ins. Co. v. Monninger, 18 Ind. 352; Wall v. East River Mut. Ins. Co., 7 N. Y. 370; Alexander v. Germania F. Ins. Co., 66 N. Y. 464; Goddard v. Monitor, etc., Ins. Co., 108 Mass. 56 (11 Am. Rep. 307); Texas Banking, etc., Co. v. Stone, 49 Texas, 4."

Sec. 256. Estoppel.

leased ground and issues applicant, containing a policy is void unless the

Where the application for insurance is verbal and the agent of the company has actual knowledge that the house stands upon and delivers the policy to the printed clause to the effect that the assured be the absolute owner of the premises, the company after accepting the premium will be estopped to defend an action on the policy on the ground that the insured did not own the prop erty. Insurance Co. v. National Bank, 88 Tenn. 369 (12 S. W. Rep. 915). The court say: "The ground of the company's liability in such cases is that the knowledge of the agent is in law the knowledge of the principal; and to permit the insurance company, possessed of such knowledge, and itself required to do the writing upon the policy, to accept the premium and deliver the policy containing such condition without writing the fact thereon, would be to allow the company to perpetrate a fraud upon the assured. It would virtually be allowing the company to accept the money of the assured in payment for a policy known to the company to be void and inoperative at the moment of its issuance, and with this knowledge permit it to retain the money, leaving the assured under the false impression that he has a valid insurance upon and protection to his property, and to remain under such impression until his property is destroyed. He is then to be told by the company that 'You have no insurance, and you have never had any under the policy, as was known