Cummings v. Cheshire County M.F. Ins. Co.

• Decision Date: 15 June 1875
• Citation: 55 N.H. 457
• Parties: Cummings v. The Cheshire County M. F. Ins. Co.
• Court: New Hampshire Supreme Court

55 N.H. 457

Cummings v. The Cheshire County M. F. Ins. Co.

Supreme Court of New Hampshire

June 15, 1875

Insurance---Assignment of policy.

Insurance is a contract of indemnity, appertaining to the person or party to the contract, rather than to the property subjected to the risk against which its owner is protected.

The assent of the insurer to an assignment of a policy of insurance, upon a sale of the property named therein constitutes a new and original promise to the assignee to indemnify him in like manner as the original insured was indemnified; and the exemption of the insurer from further liability to the vendor, and the premium already paid for insurance for a term not yet expired, are a good consideration for such promise, and constitute a new and valid contract between the insurer and the assignee.

A mutual fire insurance company insured A, "his heirs executors, administrators, and assigns," on his dwelling-house a certain sum, and "on furniture and clothing therein" a certain other sum. During the life of the policy, A sold the real estate to B, and assigned the policy to him, with the consent of the insurers. A did not sell his furniture and clothing to B, but removed it. B took possession of the house, and placed therein his own furniture and clothing, of equal character and value, and it was burned with the house. Held, B may recover of the insurers the amount of the original insurance upon the furniture and clothing of A

ASSUMPSIT on a policy of insurance issued by the defendant to Stephen Pettigrew, dated May 11, 1868, for the term of five years ending May 11, 1873, insuring said "Pettigrew, his heirs, executors, administrators, and assigns," in the sum of $1,425, "on his buildings and other property situated in Claremont, owned and occupied by himself; that is to say,---on dwelling-house, woodshed, and carriage-house $500; on furniture and clothing therein, $200; on provisions in said house, $100; on the east barn, $175; on hay and grain therein, $150; on south barn, $200; on hay and grain therein $100."

The property insured was burned June 13, 1872. The land and buildings were sold by Pettigrew to Paul Cummings, the plaintiff, March 12, 1870. On the same day, Pettigrew executed the following assignment, using a printed blank upon said policy for that purpose: "Having sold and conveyed the buildings within insured, and the land whereon they stand, to Paul Cummings, I hereby assign to him the policy of insurance within written; to hold the same, subject to all the liabilities and entitled to all the rights and privileges to which I am liable or entitled by virtue thereof.

STEPHEN PETTIGREW.

The directors consent to the above assignment.

ALBRO BLODGETT, Agent.

May 12, 1870."

Pettigrew did not sell his furniture and clothing to Cummings, but removed them; and Cummings moved his furniture and clothing into the house: and it was Cummings's furniture and clothing that were burned.

The action was brought to recover for loss of the furniture and clothing that Cummings brought to the house. Pettigrew never owned it, nor did Cummings ever own the furniture originally insured. The plaintiff claimed that this was an insurance on the furniture and clothing that might be in the house at any time during the existence of the policy. The defendant claimed that a naked assignment of the policy, without also assigning or conveying the property insured, or some interest therein, is not a valid assignment.

The loss upon the buildings has been paid.

The action was tried by the court; and it was agreed that, if upon the foregoing statement of facts the superior court should be of the opinion that this action can be maintained, judgment shall be rendered for the plaintiff for $157, and interest from the time the same became payable, and costs; otherwise, judgment to be rendered for the defendant for his costs.

Wait and Parker, for the plaintiff. Allen and Wheeler, for the defendants

^[*]FOSTER, C. J., C. C. What is the nature of the contract of insurance? In Lucena v. Craufurd, 2 Bos. & Pul. (N. R.) 300, Mr. Justice LAWRENCE gives precedence to the definition of Grotius in his Introduction to the Jurisprudence of Holland, published in 1631, the English translation of which definition is,---"Insurance is a contract by which the one party, in consideration of a price paid to him adequate to the risk, becomes security to the other that he shall not suffer loss, prejudice, or damage by the happening of the perils specified to certain things which may by exposed to them."

This definition commends itself to the judgment of Mr. May, "alike by its brevity, its logic, and its comprehensiveness." May on Insurance, see. 1. These commendable qualities, however, seem to me even more conspicuous in the language of Sir Wm. Blackstone: "A policy of insurance is a contract between A and B, that, upon A's paying a premium equivalent to the hazard run, B will indemnify or insure him against a particular event." 2 Bl. Com. 458.

Insurance, then, is a contract of indemnity, and it appertains to the person or party to the contract, and not to the thing which is subjected to the risk against which its owner is protected. It is not a contract running with the land, in the case of real estate, nor running with the personalty, so to speak, in the case of a chattel interest of the insured. Carpenter v. Ins. Co., 16 Pet. 495. "The principle of

indemnity," says Mr. Angell, "is the general principle which runs through the whole contract of insurance. A contract of indemnity is given to a person against his sustaining loss or damage, and cannot properly be called one that insures the thing, it not being possible so to do; and, therefore, as Lord HARDWICKE has said, it must mean insuring the person from damage; that is, damage to the thing or to his property." Angell on Insurance, sec. 1; May on Insurance, secs. 2, 6; 2 Bl. Com. 459; Lucena v. Craufurd, 2 Bos. & Pul. (N. R.) 300; Sadlers Co. v. Badcock, 2 Atk. 554; Wilson v. Hill, 3 Met. 66; Ellis on Insurance 1; Williams on Pers. Prop. *179; 1 Phillips on Insurance 1; Lane v. Maine M. Fire Ins. Co., 12 Me. (3 Fairf.) 44, 49.

The original contract in this case was, that, in consideration of a sum of money advanced by Pettigrew, and his agreement to be assessed at a certain rate upon another sum, the defendants would indemnify him and his assigns against loss by fire, to the amount of $1,425, for the term of five years,---to wit, on his dwelling-house $500, on furniture and clothing therein $200, and on other property the remainder of the gross sum of $1,425. The defendants were paid for insuring the whole property during the entire period of five years; and they agreed, upon this consideration, to keep the whole property insured, whoever might during that time be its legal owner, by force of their expressed obligation to indemnify Pettigrew and his assigns.

An alienation of the property, with the consent of the defendants, was therefore contemplated and provided for by the parties to the original contract. Pettigrew sold his house, removed his furniture, and assigned the policy to Cummings (the defendants assenting thereto), who bought the house and placed therein other furniture of equal character and value. If he had sold his own furniture, or left it somewhere else, and bought the furniture of Pettigrew and retained it in the house, the defendants would unquestionably be liable for its loss. It makes no difference, in reason, equity, or common sense, whether the furniture which they were paid for insuring was bought of Stephen Pettigrew or anybody else; and I apprehend it makes no difference in law.

The contract of insurance, we have seen, does not, unless by extraordinary and express stipulation of the parties, run with the subject-matter of insurance. Satisfaction is to be made to the person insured for the loss he may have sustained. In fulfilment of the defendants' agreement with Pettigrew that they would insure his assigns, on the 12th of May, 1870, the defendants, in writing, signified their consent to the assignment by Pettigrew to the plaintiff of "the policy of insurance...