GR 33637; (December, 1931) (Digest)
G.R. No. 33637, December 31, 1931
ANG GIOK CHIP, doing business under the name and style of Hua Bee Kong Si, plaintiff-appellee, vs. SPRINGFIELD FIRE & MARINE INSURANCE COMPANY, defendant-appellant.
FACTS
Ang Giok Chip owned a warehouse insured against fire by several companies, including the Springfield Fire & Marine Insurance Company for P10,000. The warehouse was destroyed by fire. The insurance policy contained a reference on its face to attached warranties, including “Warranty F,” which was a rider pasted on the policy margin. Warranty F limited the storage of hazardous goods to not more than 3% of the total value of the merchandise. The rider was not signed by the insured. The insurance company denied the claim, alleging a violation of Warranty F, as hazardous goods allegedly exceeded 3%. The trial court ruled in favor of the insured.
ISSUE
Whether Warranty F, an unsigned rider attached to the insurance policy and referred to generally in the policy, is valid and binding under Section 65 of the Insurance Act (Act No. 2427).
RULING
No. The Supreme Court, through Justice Malcolm, held Warranty F null and void. Section 65 of the Insurance Act requires that every express warranty made at or before the execution of the policy must be contained in the policy itself, or in another instrument signed by the insured and referred to in the policy as making a part of it. Here, Warranty F was an unsigned rider. Although the policy referred to it, the reference was general (merely as “Warranty F”) and did not incorporate its specific terms into the policy. The law aims to prevent alterations and ensure the insured’s consent to warranties. Since the warranty was invalid for non-compliance with the statutory form, the defense based on its violation failed. The Court affirmed the trial court’s judgment in favor of the insured. (Note: The summary reflects the majority opinion. A separate concurring opinion by Justice Villa-Real, joined by Chief Justice Avanceña, argued the same result but also expressed the view that, even assuming the warranty’s validity, the evidence did not show a violation).
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