This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
Policies of fire insurance frequently contain provisions that the policy shall terminate if certain specified articles, usually explosives or inflammables, are kept or used upon the premises. If such provisions are clear and unequivocal, full effect is given to them.1 A condition rendering the policy invalid if gasoline is kept or allowed on the premises, is broken if the insured keeps an automobile in the building with a substantial quantity of gasoline in its tank.2 Such provisions are, however, construed very strictly in favor of the insured.3 Conditions of this sort are not broken by keeping such articles if they are a part of the general stock of goods upon which the insurance is effected;4 nor are they broken, at least as a matter of law, by the use of a gasoline torch to remove paint,5 or by the use of gasoline to remove rust,6 or by the presence on the premises of a small quantity of gasoline for the purpose of cleaning,7 or for cleaning an automobile and vulcanizing tires,8 or for use in a gasoline stove used for cooking,9 or for use in an engine which operates machinery necessary for the business.10 Such a condition is not broken by the temporary presence of gasoline which is delivered at such building by mistake and which is removed immediately.11 Unless such a condition is limited to cases in which such articles are kept on the premises with the knowledge of the insured, such a condition is broken if the tenant of the insured keeps such articles upon the premises without his knowledge.12
4 Sumter Tobacco Warehouse Co. ▼. Phoenix Ins. Co., 76 S. Car. 76, 10 L. R. A. (N.S.) 736, 56 S. E. 654.
It has no application to temporary negligence. Nash v. American Ins. Co., - Ia. - , 174 N. W. 378.
5 Farmers' State Bank v. Tri-State Mut. Grain Dealers' Fire Ins. Co., - S. D. -, 170 N. W. 638.
6 Farmers' State Bank v. Tri-State Hut. Grain Dealers' Fire Ins. Co., -S. D. -, 170 N. W. 638.
1 Williamsburg City F. Ins. Co. v. Weeks Drug Co., 103 Tex. 608, 31 L. R. A. (N.S.) 603, 132 S. W. 121.
8 Dabney v. Connecticut Fire Ins. Co., 104 Kan. 796, 180 Pac. 784. (In this case cattle were insured and subsequently shipped from the pasture to the stockvards.)
1 United States. Liverpool and London Ins. Co. v. Gunther, 116 U. S. 113, 29 L. ed. 575; Gunther v. Liverpool and London and Globe Ins. Co., 134 U. S. 110, 33 L. ed. 857.
Georgia* "Edwards v. Farmers' Mut. Ins. Association, 128 Ga. 353, 12 L. R. A. (N.S.) 484, 57 S. E. 707.
Kansas. Morgan v. Germania Fire Ins. Co., 104 Kan. 383, 179 Pac. 330.
Pennsylvania. Lutz v. Royal Ins. Co., 205 Pa. St. 159, 54 Atl. 721.
Virginia. Norfolk Fire Ins. Co. v. Talley, 112 Va. 413, 71 S. E. 534.
2 Morgan v. Germania Fire Ins. Co., 104 Kan. 383, 179 Pac. 330.
3 England. Thompson v. Equity Fire Ins. Co. , A. C. 592.
California. Arnold v. American Ins. Co, 148 Cal. 660, 25 L. R. A. (N.S.) 6, 84 Pac. 182.
New Jersey. Garrebrant v. Continental Ins. Co., 75 N. J. L. 577, 12 L. R. A. (N.S.) 443, 67 Atl. 90.
Pennsylvania. Lebanon County v. Franklin F. Ins. Co., 237 Pa, St. 360, 44 L. R. A. (N.S.) 148, 85 Atl. 419; McClure v. Mutual F. Ins. Co., 242 Pa. St. 59, 48 L. R. A. (N.S.) 1221, 83 Atl 921.
rONTRACTS - VOL. V - 8