Brichta v. New-York Lafayette Insurance — 2 N.Y. Super. Ct. 372

Majority

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Francis A. C. Brichta versus The New-York Lafayette Insurance Company.

Headnote

The plaintiff effected a policy of insurance against fire, on goods contained in his counting-room, and after a loss had happened, he made an assignment of his pro, petty for the benefit of certain creditors, and among other things, assigned his claim on the defendants, without their consent. Held that this transfer did not render the policy void, under the 4th condition of insurance.

Among the items of loss allowed by the jury, were certain advances made by the plantiff upon some musical instruments, watches, &c., belonging to other per, sons, which had been deposited with him for sale, As these articles were not stated to be held upon “ trust or commission,” according to the third condition of insurance, it was held that they were not covered by the policy.

This was an action upon a policy of insurance against fire. It appeared, that the plaintiff had effected insurance in the office of the defendants, to the amount of 800 dollars, “ on furniture and “goods contained in his counting-room, No. 3 Phoenix Build?

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“ings.” At the trial, the plaintiff proved his loss, and the due exhibition of his preliminary proofs; but it appearing that he had, after the loss took place, made an assignment of his property for the benefit of his creditors, and among other things, of his claim upon this company. The defendants contended, that the assignment rendered the policy void, according to the 4th condition of insurance annexed to it.

Among other items of loss; the plaintiff claimed, that he was entitled to recover the sum of 280 dollars for damages, to three piano fortes, twenty-four watches, a quantity of watch materials, and some violin and guitar strings, belonging to other persons, which had been deposited with him for sale, and on which he had made certain advances. On the pianos, he had advanced 400 dollars, and the loss upon each was estimated at 20 dollars; on the watches, materials, &c., he had advanced 200 dollars, apd these articles were totally destroyed. To reimburse himself for his advances, the plaintiff was to sell the articles deposited with him; but- it did not appear that there was any agreement whereby he was to receive a commission for selling them, nor was his business that of a commission merchant.

The defendants contended, that the plaintiff could not recover the amount of his advances on the pianos, watches, &c., according to the third condition of the policy, which provides, that “ goods “held in trust, or on commission, are to be insured as such,” otherwise they are not covered by the policy.

The Judge charged the jury, I. that as the policy was not transferred until after the loss had happened, it was not rendered void by the assignment.

Secondly, that the plaintiff was entitled to recover for the loss upon the pianos, watches, &c., to the extent of his advances thereon.

The jury returned a verdict in favour of the plaintiff, for the full amount of his claims, including the loss upon the articles deposited with him for sale; and the defendants having excepted to the opinion of the Judge, now moved for a new trial.

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Mr. James Smith, in their behalf, contended,

I. That as the policy was assigned without the consent of the defendants, it became void under the fourth condition of insurance. The Judge should, therefore, have non-suited the plaintiff. [Lynch v. Dalligan, 3. Bro. P. Cas. 497. Park on In. 596. Marsh. on In. 698, 9.]

II. The pianos, watches, &c., were not the property of the plaintiff They were held by him, as collateral security, for advances made to the owners, and, according to the third condition of insurance, they were excluded from the risk. There is a manifest error, therefore, in the Judges charge, which sustained the plaintiff’s claim to the amount of his advances.

Mr. S. P. Staples, contra, for the plaintiff, insisted,

That the assignment of the policy, was not such a transfer of it, as was provided against, in the conditions of insurance. It was the transfer of a right to recover a loss which had already happened, and it was such a claim, as ought in equity to pass to the plaintiff’s creditors, [1. Pick. Rep. 76.]

II. The plaintiff was entitled to recover for his advances on the goods, which were held by him, as security for his money loaned, to the amount of his interest therein, at the time of the loss. [De Forest v. The Fulton Fire Insurance Co. 1. Hall’s R. 84.]

The plaintiff effected a policy of insurance against fire, with the defendants, “on goods and furniture contained in his “ counting-room.” After a loss had happened, he made an assignment of his property, for the benefit of certain creditors; and assigned, among other things, his claims on the defendants. The defendants now contend, that this assignment rendered the policy void.

The restriction in the policy, against an assignment of the interest of the assured in it, without the consent of the company, evidently applies to transfers made before the loss happens. After lhat event, the rights of the plaintiffs are fixed. His claim besomes a mere chose in action, and like any other chose in action,

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it is assignable in equity. The reasons, which induce the Insuranee Companies to insert the restrictive clause in their policies, have no existence, or application after the risk has ceased.

Among the items of loss allowed by the jury, were the advances made by the plaintiff on certain piano fortes, watches, &c. The Judge charged the jury, that the plaintiff had a right to recover to the extent of his advances on those articles, and the defendants insist, that the charge was in this respect erroneous.

The third condition annexed to the policy, declares, that “ goods held in trust or on commission,” shall not be covered, unless they are insured as such. The articles in question, were not the property of the plaintiff; they were held by him “in trust or on “ commission.” He had a lien upon them for advances, which could have been defeated, by a repayment of the money advanced. His interest was not absolute, but conditional; and it could not be covered by a mere insurance upon his own property. If the goods in question were to be covered by the policy, they should have been specified in it as goods held in trust or on commission, and it would be violating the plain terms of the third condition annexed to the policy, if this claim were to be allowed. The Judge’s charge was, therefore, in this respect erroneous, and there must be a new trial, unless the plaintiff will strike from the amount of his verdict, the advances upon the property deposited with him. In that case, the verdict for the residue may stand, and the plaintiff can enter up his judgment for that amount.

New trial granted, unless the plaintiff comply with the condition expressed in the opinion of the court.

[James Smith, Att'y for the defendants.]