March 1877 ground when they paid their pro rata shares of the Term. loss aforesaid, from the fact that their representatives, who supervised the ascertainment of that loss, had full access to, and availed themselves of the records of the clerk's office of the corporation court of this city in regard to the title." Manhattan Fire Ins. Co. V. Weill & Ullman. The first question we have to determine is whether the court below erred, in admitting this testimony. The rule of evidence invoked to exclude it is, that which does not permit the written contract to be contradicted and varied by parol testimony. The great value of this rule of evidence cannot be easily overestimated, and merits the eulogies it has received. In a proper case its application always promotes the ends of justice, by protecting parties against fraud and false swearing, against carelessness and inaccuracy, by furnishing evidence of what was intended by the parties, which can always be produced without fear of change or liability to misconstruction. But expe rience has shown that it is not a rule of universal application. And if there did not exist some authority to correct the universality of its application, then a rule of evidence adopted by the courts as a protection against fraud and false swearing, would, as was said in regard to the analagous rule known as the statute of frauds, become the instrument of the very fraud it was intended to prevent. In the case before us the general agent of the plaintiff in error filled up the policy and took the description of the property from a policy on the same house, which had been issued by the Maryland Fire Insurance company. This agent says he knew at the time that the building stood upon leased premises. This knowledge of the general agent must be imputed to the principal. Regarding the fourth clause of the policy 1877. March Term. Manhattan V. Weill as a warranty, then there was a breach of warranty eo instanti of the making of the contract. This the company knew when it issued the policy. It knew when it accepted the premium the policy was void: that when it took the premium they took no risk, and that Ins. Co. the insured had paid his money for a policy of insurance which the company knew was void at the moment when it was issued. To allow this would be to permit the company to receive a premium when they incurred no risk, and would encourage and promote the grossest fraud. It is precisely in such cases as this, that the courts. of law in modern times have introduced the doctrine of equitable estoppels, or as it is sometimes called estoppels en pais. The principle is that where one party has by his representation or his conduct, induced the other party to a transaction to give him an advantage which it would be against equity and good conscience to assert, he would not in a court of justice be permitted to avail himself of that advantage. See, Insurance Company v. Wilkinson, 13 Wall. U. S. R. 222; Plumb v. Cattaraugus Insurance Company, 18 New York R. 392. Rowley v. Empire Ins. Co. 36 New York R. 550; 31 Conn. R. 526; 42 Missouri R. 148; Bidwell v. North Western Ins. Co. 24 New York R. 302. In the last named case the court says: "Indeed it is not easy to perceive why an insurance company by reason of the formal words or clauses (of a general and comprehensive nature), inserted in a policy, intended to meet broad classes of contingencies, should ever be allowed to avoid liabilities on the ground that facts, of which the company had full knowledge, at the time of issuing the policy were then not in accord & Ullman. 1877. March Manhattan V. Weill & Ullman. ance with the formal words of the contract, or some of Term. its multifarious conditions. If such facts are to be held a breach of such a clause, they are a breach eo instanti of the making of the contract, and are so known Ins. Co. to be by the company as well as the insured. And to allow the company to take the premium without taking the risk, would be to encourage a fraud. It would, as a legal principle, be equivalent to holding that the warranty of the soundness of a horse is a warranty that he has four legs, when one has been cut off." In the case before us the knowledge of the agent must be taken as the knowledge of the company, and to avoid the policy upon the ground the building insured was upon leased ground, would be to permit the company to say, "it is true, we knew that the building was upon leased ground; we knew that our agent, and not the insured, bad filled up the description of the property, and had omitted to state the fact; but we hold it to be void because one of the conditions of the policy makes it void, if the fact that the property stands on leased ground is not so represented or expressed in the policy; and while we have received your money, we issued to you a policy which we knew to be void, eo instanti of its delivery. We took the premium, but took no risk." Where good faith and fair dealing are of the very essence of a contract of insurance, insurance companies will be estopped from asserting a defence which not only tends to a breach of good faith, but to actual and positive fraud. I am, therefore, of opinion that the evidence admitted by the court below was properly admitted because it proved such a state of facts as constituted an estoppel, and that the court did not err in overruling the motion to exclude the same. In addition to the authorities above cited, see Judge Burks' opinion in March the case of Georgia Home Insurance Co. v. Kinnier's 1877. adm'x, and cases cited by him, supra. 88. Term. Manhattan V. Weill & Ullman. The second ground upon which the company seek to relieve itself against liability for loss is, that at the time the insurance was effected, there was an incum- Ins. Co. brance in the form of a deed of trust. Now it is not pretended that there was any misrepresentation or fraudulent concealment, as to the fact of the existence. of such incumbrance. On the contrary it does not appear that any question was asked the assured on that subject: but as has already been seen, the agent of the company filled up the description of the property, copying it from a policy in another company. But it is insisted that this incumbrance, existing at the time, of itself avoided the policy, under that condition which declared: "If the interest of the assured in the property be other than the entire unconditional and sole ownership of the property for the use and benefit of the assured, * * * it must be so represented to the company, and so expressed in the written part of the policy. Otherwise the policy shall be void." It was held by this court, in West Rock. Mutual Fire Ins. Co. v. Sheets, 26 Gratt. 871, that unless there be a warranty, or a representation that amounts to a warranty, a policy cannot be avoided for incumbrances unless upon the applicants false and fraudulent answers to interrogatories. Of course if there be a warranty, or a representation amounting to a warranty, that there are no incumbrances on the property, whether such answer be given in answer to a question or not; if it be untrue, the policy would be void, even though the insured might not be guilty of actual fraud. The question then in this case turns upon the con-struction to be given to the condition in the policy above quoted. Can that be construed to be a warranty 1877. March Term. Manhattan Fire V. & Ullman. on the part of the assured that there was no incumbrance on the property insured? This condition does not refer to the legal title, but to the interest of the assured in the property; that he warranted to be no Ins. Co. "other than the entire unconditional and sole ownerWeill ship of the property." This was no warranty against liens and incumbrances. His interest was the sole ownership. The fact that he had mortgaged the property did not make the mortgagee a joint owner with him. The fact that he may have incumbered it with a deed of trust does not make the cestui que trust a joint owner. The fact that there may have been liens. for taxes, or liens by judgment, did not affect his ownership. He is still the sole owner, though he may have incumbered it, or liens may exist against it, and the existence of such is no breach of a condition declaring sole ownership. This is the doctrine of the courts, settled by repeated decisions. Strong v. Manufacturers Ins. Co., 10 Pick. R. 40; Etna Fire Ins. Co. v. Tyler, 16 Wend. R. 385; 12 Wend. R. 507; Smith v. Columbia Ins. Co., 17 Penn. State R. 253; Hough v. City Fire Ins. Co., 29 Cow. R. 10. In the last named. case, it was a condition of the policy, that "if the interest in the property insured is not absolute, it must be so represented to the company and expressed in the policy in writing, otherwise the insurance shall be void. The applicant represented the property as his house, and it was so represented in the policy. In fact he had only agreed to purchase the property, but under his agreement had paid part of the purchase money, had taken possession, and made valuable improvements. It was held that the statement made by the assured, that the property was his was true, and his interest was an absolute one. The court said, "the subject of insurance was an interest, not a title. It is |