Riggs v. Commercial Mutual Insurance — 51 N.Y. Super. Ct. 466

Majority

p. 466

JOHN S. RIGGS, Respondent, v. THE COMMERCIAL MUTUAL INS. CO., Appellant.

Decided March 3, 1885.

Headnote

Insurance—what interest is insurable.

The stockholders in a corporation have no insurable interest in the property of the corporation.

Before Sedgwick, Ch. J., and Truax, J

Appeal from judgment entered in favor of plaintiff, upon the findings of a judge sitting at trial term, without a jury.

The action was on an insurance policy which purported to insure J. T. Tobias on account of whom it may concern, in case of loss to be paid to Andrew Simonds. The subjects of insurance were the same as in the case of The Merchants’ S. S. Co. v. The Commercial Mutual Ins. Co. (ante, p. 444). The judge found and decided that the plaintiff was entitled to recover.

Other facts appear in the opinion.

Oliver Drake Smith, attorney, and David J. H. Will-cox, of counsel for appellant,

on the question on which the court decided the appeal, argued :—The parties claiming herein had no insurable interest. Stockholders in a corporation cannot insure the property of the corporation in their own names as belonging to them (Phillips v. Knox, &c. Co., 20 Ohio, 174 ). This is fatal to a recovery by any of these parties, because whatever interest any of them have is merely a claim upon the stock of Tobias.

Burrill, Zabriskie & Burrill, attorneys, John E. Burrill and George Zabriskie,

of counsel for respondent, on

p. 467

the question on which the court decided the appeal, urged :—Tobias as a stockholder of the Merchants’ Steamship Co., the owners of the Falcon, had an insurable interest (Seaman v. Enterprise Co., 18 Fed. Rep. 250 ).

This was an action to recover for the same loss that was the subject of the case of The Merchants’ S. S. Co. v. The Commercial Mutual Ins. Co. In the present case, the plaintiff is assignee of one Tobias, whose interest, if any, was insured. The defendants claim that Tobias had no insurable interest. The only ground of claim that he had an interest was his owning thirty-six shares of the capital stock of the plaintiff in the above mentioned case, the .owner of the vessel. It is not perceived that he had any interest in the vessel. He was not legal or equitable owner of any part, nor of its earnings, nor any lien in respect of either.

For this reason the judgment should be reversed and a new trial ordered, with costs to abide the event.