Boot & Shoe Manufacturers' Mutual Fire Insurance Company v. Melrose Orthodox Congregational Society

• Decision Date: 12 February 1875
• Citation: 117 Mass. 199
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: Boot & Shoe Manufacturers' Mutual Fire Insurance Company v. Melrose Orthodox Congregational Society

117 Mass. 199

Boot & Shoe Manufacturers' Mutual Fire Insurance Company v. Melrose Orthodox Congregational Society

Supreme Court of Massachusetts

February 12, 1875

Middlesex. Contract for the amount of a premium note and assessments thereon. Trial in the Superior Court, before Lord, J., who allowed a bill of exceptions in substance as follows:

On December 1, 1868, the plaintiff issued to the defendant a policy of insurance for $ 2000 for the term of five years and the defendant paid a cash premium of $ 60, and gave a premium note of $ 180. In February, 1869, the building insured by the defendant was totally destroyed by fire, and on or about April 19 following the plaintiff paid the defendant the full amount insured, reserving nothing therefrom on account of the premium note. At that time the defendant gave up or surrendered the policy to the plaintiff and gave a receipt in writing thereon for the $ 2000. The premium note was retained by the plaintiff, and there was no demand made for it by the defendant. The plaintiff was rendered insolvent by the fire of November 9 and 10, 1872. The assessment in this case was made in February, 1873.

The following by-laws of the defendant were put in evidence:

"In all cases of the total loss of property insured the directors may require security for the payment of the deposit note which shall be liable for its just proportion of losses, till its full expiration.

"Any policy may be surrendered at the discretion of the insured; and in case of such surrender, the deposit note shall be liable to assessment for a just proportion of all losses and expenses during its continuance, and for no more; but until the surrendered policy is returned to the office, the deposit note shall be held liable to assessment for its just proportion of loss and expense."

Upon this evidence, the judge ruled that the defendant had no defence; to which the defendant excepted, and asked the judge to rule as follows:

"1. That a contract for insurance is ended by the payment of a total loss under it, the risk terminated, and all liability of either party on account of it then ceases. 2. That by the termination of the risk, and payment of a loss under a policy of insurance in a mutual company, the insured ceases to be a member of the company. 3. That by the surrender of a policy by the insured, and its acceptance by the company on an occurrence of a total loss, and the insured receipting...