Majority
Headnote
Although the operation of a fire insurance policy may be suspended by the sale or transfer, without the consent of the company, required by a clause in the policy, of the property insured, yet, if a union of the ownership of the property and the interest in the policy in the assignee subsequently occur, and the company assent thereto, the policy again becomes effectual and reattaches to the property.By the Court:
It is now firmly settled that no transfer of interest will work a forfeiture under the clause contained in a policy, forbidding a transfer of the interest of the assured in the policy, or úi the property insured thereby, without the written consent of the company, wMch does not so entirely deprive the assignor of all insurable interest as to prevent Ms recovering on the policy for his own benefit, if that clause was not contained in it. To take away the cause of action in one case, and to render void the policy in the other, equally requires a transfer or termination of the entire insurable interest. So long as the insured retains such an interest that he may be a sufferer by the loss, the policy remains valid to protect that interest (Hitchcock v. North-western Ins. Co., 26 N. Y., 68 ; Van Deusen v. Charter Oak Fire and Marine Ins. Co., 1 Rob., 55 ; Fernandez v. The Great Western Ins. Co., 3 Rob., 458 ; Phelps v. Gebhard Fire Ins. Co., 9 Bosw., 405 ).
And, in case of an actual transfer of the entire insurable interest, the following additional propositions, arising under the same clause, have been established as the law of tMs State:
After a sale of the property insured, and previous to the assignment of the policy to the purchaser, the effect of the policy as an
If á fire occurs during this time no recovery can be had against the underwriters, not because the policy had become void, but because, at the time of the fire, the insured had no goods covered by the policy, and the purchaser had no policy to cover his interest in the goods. ■
But the moment the interests become again united by the union of the ownership of the goods and the interest in the policy in the same person, the policy again becomes effectual and reattaches to the goods.
And when the assignment of the policy, with the consent of the insurers, is absolute to one who has become the entire owner of the subject of insurance, it becomes a new contract of insurance between the underwriters and the assignee. If the assignment, taken in connection with the policy, plainly transfers the assured’s whole interest, the underwriters’ consent to it is evidently equivalent to their agreement to become directly answerable to the assignee. In such case the proceedings to enforce payment may be in the assignee’s name, and he becomes, to all intents and purposes, the substituted party to the contract (Hooper v. The Hudson River Fire Ins. Co., 17 N. Y., 424 ; Wolfe v. The Security Fire Ins. Co., 39 N. Y., 51 ).
It is true that in the last-named two cases the property insured consisted of a stock of goods kept for sale ; and for that reason it may be claimed that the propositions therein laid down should be confined to that particular class of cases, on the ground that it must be considered as the intention of the parties to the policy that the assured may sell and replace his entire stock as often as his own interests may require, and that the policy is to protect whatever goods he may chance to have on hand at the time of the fire. But I can perceive of no good reason why the same propositions should not be applied in the decision of the case at bar. The cases cited by defendants on the argument afford no reason to the contrary. In Smith v. The Saratoga Mutual Fire Ins. Co. ( 3 Hill, 508 ) and Neely v. The Onondaga County Mutual
These remarks dispose of the claim set up by the defendants that, because L. J. Shearman conveyed the property to his brother, the policy became a mere wager policy, and that consequently the renewal of it, notwithstanding the acceptance of the payment of the premium, was null and void. The subsequent consent of the defendants, indorsed upon the policy, that the interest of L. J. Shearman in the said policy, not merely in the renewal receipt, but in the policy, be assigned to the plaintiff, subject to all the terms and conditions mentioned and set forth in the policy, revived the policy in favor of the plaintiff and reattached it to the property described therein just as effectually as if a new policy had been issued to the plaintiff therefor. In Wolfe v. The Security Fire Ins. Co. ( 39 N. Y., 49 ) the property had been transferred from John Engleheart to one Stupp, who afterwards transferred the same to Margaretta, wife of John Engleheart. The company never consented to the transfer to Stupp, but some months afterwards consented to the transfer of the interest of
The defendants also claim that, inasmuch as their policy provided that if the property should be sold or transferred * * * or if the policy should be assigned without the consent of the company, to be indorsed thereon, the same should be void, it was necessary for plaintiff to show not only defendants’ consent to the assignment of the policy, but also their consent to the transfer of the property covered by it, and that they cannot be held liable in the absence of evidence that in point of fact they did consent in writing to the transfer of the property. It requires hut little argument to demonstrate the hollowness of this claim. The assignment of the policy, in order to be of any benefit to the plaintiff as assignee, had to be accompanied with a transfer to ■ him of the interest of the assignor in the subject of insurance. Such being the case, the request made to the defendants, to consent to an assignment to plaintiff, was of itself notice to them that plaintiff had acquired or was about to acquire an interest in the insured property. Besides that they had actual notice of the fact that the said property had been conveyed to plaintiff. Their jDolicy contained but one printed blank to be executed by the assignor to the assignee in case of an assignment, and but one blank to be filled up and to be executed by the company for the purpose of demonstrating the company’s assent to the assignment. What then was the intention of the defendants, and what was the legal effect of the return of the policy, after full knowledge of all the facts, with the company’s consent indorsed thereon, that the interest of L. J. Shearman in the said policy be assigned to William H. Shearman, subject to all the terms and conditions therein mentioned ? In the language of Hunt, J., in Solms v. The Rutgers Fire Ins. Co. (5 Abb., N. S., 211), the intent could honestly be no other than to insure anew the property described for the plaintiff. If the defendants can be supposed to have reasoned with themselves that “ There is a defect in the consent as to the property, but we will say nothing about it, we will keep the unearned premium and avoid a liability if a loss should occur,”
The only remaining point urged by the defendants is that there was a change of possession of the property, contrary to the terms of the policy, which provided that if any change should take place in title ob possession, whether by legal process or judicial decree, or voluntary transfer or conveyance, without the consent of the company indorsed thereon, the policy should be void. The evidence shows that after the conveyance of the property to the plaintiff, and up to the time of the fire, L. J. Shearman remained in possession as tenant of the plaintiff, and that Hr. HcGreal, the city marshal, lived with him; that shortly before the fire L. J. Shearman took his wife and children to Brattleboro’, Vermont, for their- health; that before leaving Wilmington, H. 0., said Shearman requested one Hr. Brown to occupy part of the house and take care of it, together with Hr. HcGreal, until his (the said Shearman’s) return; that Brown complied with such re
The judgment should be affirmed, with costs.