Geagonia vs.

Court of Appeals, 241 SCRA 152

Facts: Geagonia, owner of a store, obtained from Country Bankers 1year fire insurance covering
the stock trading of dry goods. The policy noted the requirement that
"3. The insured shall give notice to the Company of any insurance or insurances already
effected, or which may subsequently be effected, covering any of the property or properties
consisting of stocks in trade, goods in process and/or inventories only hereby insured, xxx
The petitioners stocks were destroyed by fire. He then filed a claim which was
subsequently denied because the petitioners stocks were covered by two other fire insurance
policies issued by PFIC. The basis of the private respondent's denial was the petitioner's alleged
violation of Condition 3 of the policy. The Insurance Commission found that the petitioner did
not violate Condition 3 as he had no knowledge of the existence of the two fire insurance
policies obtained from the PFIC; that it was Cebu Tesing Textiles which procured the PFIC
policies w/o informing him or securing his consent; and that Cebu Tesing Textile, as his creditor,
had insurable interest on the stocks.
Issue: Whether or not Geagonia is prohibited from recovering from the Country Bankers ?
Held: A policy may declare that a violation of specified provisions thereof shall avoid it,
otherwise, the breach of an immaterial provision does not avoid the policy. To constitute a
violation of the other insurance clause, the other insurance must be upon the same subject
matter, the same interest therein, and the same risk.