Gen. Insurance & Surety Corp v. NG Hua - Misrepresentation

106 PHIL 1117

Facts:

>  In 1952, General issued a fire policy to Ng Hua to cover the contents of the Central Pomade Factory owned by him.

>  There was a provision in the policy that should there be any insurance already effected or to be subsequently procured, the insured shall give notice to the insurer.

>  Ng Hua declared that there was non.  The very next day, the building and the goods stored therein burned.

>  Subsequently, the claim of Ng Hua for the proceeds was denied by General since it discovered that Ng Hua had obtained an insurance from General Indemnity for the same goods and for the same period of time.

Issue:

Whether or not General Insurance can refuse to pay the proceeds.

Held:

Yes.

Violation of the statement which is to be considered a warranty entitles the insurer to rescind the contract of insurance.  Such misrepresentation is fatal.