RHUFPINE COMMERCIAL LAWS VOLUME Sereda Fansal habitation ang Sy Toy At 200 nme sto give theater an ample opportunity to negotiate (erate euance. Te tice shouldbe persona to thensana ror tough any wauthorzed person. Je other than if, une the nay Ges tgs insdvnc of teen tthe poly pee, a ee enced nara theses Showa ane aes teion ott rene te ply oto cond, san a ateduton otis or elimintion af coverage an Steroid tt be cied wren the pay open pope Seafoam aot onr ofc aoe reel Ai a tine erate tes thon one) yar sal be conde of Tinea fostemafonet yer Any poly water forstens anys Tunnel yerorany pty with no facdexpraton date a ele ied yp orto NOTES The stanly the same as Seton 46 Inranee Cade 197 the nly changes tan the irons of ‘arn figure anergy) Saye? ‘Rew mmr prin me anc pies ae ‘cpio pry marry pe a hep sSendechetataanuen Larose oe mae he rte of nen ee me? WARRANTIES, SEC. 67.A warranty is either expressed or implied, SEC. 68. A warranty may relate to future ortoanyoraliefthce) st 1 Ps SEC. 68. No patclar form of of words waranty. the present, the necessary to create 2 NOTES. Secon 76 an 6 wo or cE ten let en nse Sanpete consfonding secon tian tame dl nt "arp pert Cr msuaace cone ” WARRANTY DEFINED. Warranty is written statement ‘oe stipulation inserted on the face of the contract ite, or clearly or siyated therein 36 pat thereof by proper words of reference, invert the insured exprenly contract a othe existence of certain an cecumstances or conditions the teal ruth of whichis essential (ete validity of the contac of insurance ™ KINDS OF WARRANTIES. Thefolowingarekndsof warranties: 1. Affirmative warranty is one which relates to matters which ‘exist at or before the insurance ithe policy” 2. Promissory warranty isone in which the insured undertakes that something shall be done or omitted after the policy takes effect and tdring itscontinuance™ 13, Express warranty isa statement in a policy, of a matter relating to the person o thing insured, oF the rik, asa fact. “A. Implied wartanty is an agreement or stipulation not expressed in the policy but the existence of which is admitted or pre: xP rem the act thatthe contract of insurance has been executed." [AFFIRMATIVE AND PROMISSORY WARRANTIES DISTIN- GUISHED. Affirmative warranty consists of statements in the policy Sethi fac o slate of things ator previous t, the time of making the pli It teefore, relates tothe pastor the present. On the other aaa omiasory waranty refers to the happening of some future ‘vent onthe performance of some actin the Future. ILLUSTRATIONS: A warcany thatthe person insured was never operated « Jeeta wasany since eae oe past on for cae Sth presen. {@) _ Awacany hat he ins! ei ot store intammable mates in eae rns agai re ea proenry wacTaNty Soe atest he are ‘Spatehiy Egat ie Ae So of US. 97, sea un a ‘Metin Life Co, Godan 850 6810 Abn Ap 4,1” aryecommencnt ars rOut, Sac In cme of doubt the warranty is presumed 10 be affirmative nly Tu ina cae in anewer tthe question, “Who sleeps in the or TH poured had writen, "Watchman on premises at right" This aor pad a fer ony the tne of making the contrat, and aan santy thats watchman would be kept continuously on the Dremises thereat ™ 'EXPRESS AND IMPLIED WARRANTIES DISTINGUISHED, [An expres waranty must be contained inthe policy oF i another ‘Meaabent tigned by the insured and referred t0 in the policy as reeks partoui Wh a implied waranty ist contained in the ‘Ratu Bat its exstene is presumed by dhe mere fact tha the contract, Sena into" Furthermore, an express warranty is specifically Shoced upon by the parties while implied warranty need nt be agreed pon ase eitence presumed ILLUSTRATIONS: (3) Avarany sae nth poy hatte insu wil ot str gas he nee spit Bre an express as (t) In maine insane, the ship insured ic presumed seaworthy Seaworhnss othe veel here, am pint sana WARRANTY DISTINGUISHED FROM REPRESENTATION. ‘The ‘following. are the distinctions between warranty and representation 1. Representations while they. precede the contrat, are collateral thereto and nota part thereot, whereas warranties actually fteand must bea part of the contac isell™ 2. Mateviaty of waranty is presumed, while representation anustteshown tobematral= e “Pm nn Vn 28, ‘Rect en Mayan Cay Ca, 6.2428, o (CHAPTER THE CONTRACT OF RSURANCE " 3, _ Misrepesentaton sts aside policy onthe ground of fraud, white tasty or no flfillment of» warranty operates a 2 breach of| 4. Representation may be made by both the insured and insurer, while waranty is made only by the insured In case of doubt, the statement is presumed to be 3 mere representation and not warranty CONSTRUCTION OF WARRANTIES, Warranties smust not only te svelly construed against the insurer but must likewise be ‘Easonably interpreted in favor ofthe insured The reasonableness i 0 {eascertaned inthe ight ofthe factual onsideration. Thus, where the Aorrantyrequlted the isured to mainain in efficient working order Ue the premises insured, the following: portable extinguishers, internal Fydrants exeral hydrants; fre pump and 2thour security service, but the insured fae t install internal fie hydrants the court raed thot there was no more reed for an intemal hydrant considering that there were numerous portable fire extinguishers, emergency fie ensine hd irc howe connected toanestermal re hydrant" What the warranty RShdated was thatthe insured should maitan in efficient working Condition within the premises rsute, firefighting euipment a fst Tine of defense againt Sr, which the insured did™ FORM OF WARRANTY. “No particular form of words is necesary fo create a warranty ‘SEC. 70, Without prejudice to Section SI every express warran- before tne excuton of policy, must be contained in {he policy ello in another instrument signed by the insured and feferred toi the policy a5 making a pat of. ‘SEC.71.Astatementina policy of matter relating tothe person orthing invured orto the sk ae fact isan express warranty thereof eres Rene Me asa Ste anPee esanaadonns 7 NOTES. These sections were frmesly provided for in Sectons 65, and 6h wspectvely ofthe Insurance Act. Section 70 amended Section Joo the surance Code of 1978 by inserting, “Without prejudice to ‘ection SI” atthe beginning ofthe sentence andthe word, "express? before the word, "warranty" Such amendment did not change the ‘meaning and intent ofthe provision and merely stressed that sald Section plies ony to express warranty ‘Section 71s the same as Seton 71 ofthe Insurance Code of 1978, [WHERE EXPRESS WARRANTY IS CONTAINED. Every express warranty made ato befor the execution of policy, must be contained ther (aim the poi Helo () in another instrument signed bythe Insured and refered fo nthe policy as making part oft. tis tobe note that the signatre ofthe insured is necessary only wen the warranty is contained in anther instrument and not hen ‘Bcontaned inthe policy sel Anexpress warranty is apart ofthe contrat ofinsurance fr which reason it mst be contained inthe policy self o at least refereed tin the poicy a+ making part of = Thus, statements inthe application fr medical examination ar representations only and not warans i the application or medical examination isnot incorporated the picy ‘ormades par of by erence.” WARRANTY CONTAINED IN RIDERS. A sider is a prt of ‘the policy and, therefore a warranty contained in a rider need not be ‘Signe bythe nsured™ unles such rider was sued after the orginal 1 imparts that st i hich materially affects the risk, ‘a warranty that such ator omission shall take place. [NOTES. This section isthe same ab Section 67 of the Insurance ‘Act and Section 72 of the Insurance Code of 1978 PROMISSORY WARRANTY. Ths section rlersto a promisiory warranty Such Kind of warranty isin the nature of condition TSyaaa Nt ar ame Rit ike os i S318 Ap 72 Nae “sang Chip Sing ac Martine om Co. 5PM. 375 Seton pa 3 7 APTN TE CONTRACY OF ROURANCE ” seubsequent and a breach thewot invalidates the policy from the time ‘rtreach™ ‘SEC. 73. When, before the time asves fr the performance of a warranty relating to the future, «lou insured against happens, ar performance becomes unswfal atthe place ofthe contract. OF posible, the omission to ful the warranty doesnot avoid the policy. NOTES. This ithe same as Section 8 ofthe Insurance Act and ‘Section 73 ofthe insurance Code of 1978. [NON-PERFORMANCE OF PROMISSORY WARRANTY. As 3 general rule, non-performance of a promissory warranty entitles the Faure to rescind the contact except 1. When before the time asves forthe performance of 3 promissory warranty, the oss insured aginst happens. uLUsTRATION: A waranty in ee surance policy tated ha within non ro the sence the pot the sued wl costa ‘Tinea: One mah se he poly wa ed and Pefr he inoue coud emp ith be wean he ous wa bur eS he nolline othe pomasory warranty will not SeSU GR pet sce thos occured below th eprint eo foe perormane ot 2, When before the tine aves for the performance of & promsory waranty, the pesfrmance becomes unlawiul tthe place tthe contract. muiusrRATION: Intheexmple given above cane an ordinance wp elon he egpton othe pe linet the waranty. Fist a sonst ot ee wal fo the type the Rowe Fae onperormane othe waranty wil pt avid the Pee tua iment came egal efor the expan Tie pee puALPINE COMMERCIAL LAWS VOLUME 2 irae oind hems Rataeand Tnnivecy ate 10 3. When before the time arrives for the performance of promissory waranty, the performance becomes impossible, ILLUSTRATION: In the example given above incase the lay required the consent ofthe ang owner for he constuction o's rewal fete anng own tensed fae to pie hi conse, the rorpertomance othe waranty will ot aeok the Palicy noe filinent wos impose ‘SEC. 74, The violation ofa material warranty, or other materia, provision ofa policy, onthe part of either party thereto, entiles the ‘ther to rescind NOTES. This section i the same as Section 60 ofthe Insurance ‘Act and Section 74of the Insurance Code of 1978, ‘VIOLATION OF WARRANTY. Violation ofa material warranty, ‘or any ther material provision ofthe policy, entitles the other party to rescind the contrat A causal connection between the violation and the loss not necessary. Thus, even though the vilaion of material ‘warranty didnot in any way contribute fo the loss, the other party ay sill rescind the policy.” ILLUSTRATIVE CASE ‘Young Midland Tesi ns Co, 3 Phi 617: ‘A insured « bling agai ie. A waranty sated that no hazardous goods woul be store inthe Bling nue ‘The iroured sored Inthe ding we bores of fewer preparation forthe Chinese New Yt. The ling was pray {ned and th fireworks were found in part of uling not dsiroyed by fe The reworks, hero, did ot ian ay ‘onuribte the fe Question: War tere abe? Anse ‘The irouer was not hale Becse the inured lated the waranty Even vilton id cnt thease ‘inner be denied hat he placing ft craters inthe balding Insure erased the ik” The ured had et pd 2 prem ‘ied upon the incesed snk ote had Ge eure oud Pay Upon the cory of dierent rs An crease ota hc Sms Hand Tele fn Co, 3a ts ebstantial and which continued or comer pr of ime a drt and certain ny othe nse a henge he fois upon which the cnt rnc ea WARRANTY NOT VIOLATED, A warranty prohibiting the storage of hazardous or inflammable materiale not vila! by Sdeposit in small quantities n'a bulking for daily se Nether i Juch warsanty violated when the inflammable or harardous goods a incidental tothe busines ofthe isured™ ILLUSTRATIVE CASE (0) Qua Chee Gan Law Union Rock nt. Co, td, 520.6. avi. (Qua Cee Gan insured» warhead forthe tora of ‘ops aed fem. The mae owed ae not whi wed for trcportioy se merfandoe He sed he ued premises [Pnolne sutiget or te day sap ot hs motor seis The rete wasbuebt th aoe sed peyote ud oN worse e's warty pening he ee ot sole Question. ute sre abe? Ano The set ACerioble becuse the rape gaine was mae othe ince te nsred Rep of iflanmate or materia rake pease hugh pots yt ply dos not ro Toh Reps era bine he woe (2) Bachrach Brsh American Assurance Co, 17 Pi SS: owed fri et gre fle om insu apie er The py probed org of larimate (tris At ache kp he re whee he tar wg wasn ot waranty, Queton Was te ues Spey cms amen the ere wa wrong Keeping cba meet ttcaa te preseason the ture sein and ero octal such uses Setery IPP COMMERCIALLAWS VOLUME ‘etna Ce aml Pranc Rebates ang 78% Inmtoracy At 10 (0) Y Hun & Co. Bitih Traders Ins Co, Lt, L371 May 16 18H Storage of naphthalene alls na drgstore not Waton of the warranty prohibiting storage of ivammable materia {kero phn lane conaiered pharmaceutical product Uh terete storage thom fea mere indent he uns SEC. 75. A policy may declare that 2 violation of specied provisions thereat shall avoid i, otherwise the breach of an {Immaterial provision doesnot avai the policy NOTES. This is the same a Section 70 ofthe Insurance Act and Section 75a the Insurance Code of 1978 IMMATERIAL PROVISION CONVERTED TO MATERIAL ONE. Ordinarily a violation of immaterial provision shall not avoid ‘the policy Hoveever thi section allows the partes t stipulate that volition of any provision of the paliy, material or immaterial shall ‘oid fe thenby converting an inmate provision iva poly into ‘material provision™ oe r Le SEC. 76.A breach of warranty without fraud merely exonerates an insurer from the time that i curs, or where Its broken in its inception, prevents the poicy from attaching t the risk, NOTES. This is the same as Section 71 of the Insurance Act and Section 76 the Insurance Cade of 1978, [BREACH OF WARRANTY WITHOUT FRAUD. The effect of a ‘breach of warranty without fraud depends on the ime such beach is ‘committe. I exists or is committed at Ue effectivity of the py, it prevent the policy from attaching to the risk tha a the insect not lable from the beginning. On the ahr hand where the breach ‘occurs after the effectivity ofthe poi the insures exempted irom lability for losses incured afer stich beac, Accordingly where alos ‘sustained blr the bres waranty toutes sl le oe ‘such loss. * missles a PART — THE INSURANCE COOE w (CHAPTER ~ TE CONTRACT OF INSURANCE rms PREMIUM, SEC. 77. An insure is entitle to payment of the premium as soon as the thing insured is exposed Yo the pell inured against Notwithstanding any agreement to the contrary, no policy or RMauact of insurance issued by an insurance company is vald Sha binding unless nd until the premium thereof has been paid, ‘Kecpt im the cae of if o an industrial life poicy whenever the {pace period provision applies, or whenever under the broker and Rremcy agreements with daly licensed intermediates, a ninety (0)- diy credit extension is given: No credit extension toa duly icensed {nvermediar should exceed ninety (90) days fom date of souance of the policy NOTES, This section amended Section 7 ofthe Insurance Code of 1978 by ding the following atte end ofthe lter provision. “ot Grhenever under the broker and agency agreement with dul censed Intermec, ninety (90-day crt extension i given. No credit (Mencion toa duly licnsed intermediary should exceed riety (0) ‘Says rom dateofsuance ofthe poi” EFFECT OF NON-PAYMENT OF PREMIUMS. ow-pymento Pee iee tie of Payne pray of the ence of the ree hc burden sane resto hep plc in oce by the ‘pent of premiums eran he iesurer exert every ft © Poymer ge ere rm allowing» poy 0 ape tough fare © Fe im payment The contnance of fe sure’ obligation Benet een te pen ene fen doe ee d= This pane hutressed by Seton 77 of FMR aN Cae which proves tht no conract of insurance wn uimgunensand unt he pens herweot Ras een pai otwihtaning any sement he ont Leal Cou Apes 10 SERA Ashe Na