First Presbyterian Society of Green Bay v. Goodrich Transp. Co.

• Decision Date: 12 May 1881
• Citation: 7 F. 257
• Parties: FIRST PRESBYTERIAN SOCIETY OF GREEN BAY and another v. GOODRICH TRANSPORTATION CO.
• Court: U.S. District Court — Eastern District of Wisconsin

7 F. 257

FIRST PRESBYTERIAN SOCIETY OF GREEN BAY and another v. GOODRICH TRANSPORTATION CO.

United States Circuit Court, E.D. Wisconsin.

May 12, 1881

Cameron, Losey & Bunn, for motion.

Finches Lynde & Miller, contra.

DYER D.J.

This is an action brought to recover damages for the loss of a church edifice and parsonage, belonging to the plaintiff society, by a fire alleged to have been negligently set by the defendant company's steamer Oconto while she was navigating Fox river at Green Bay. The plaintiff insurance company was an insurer of the property, and has since paid the loss to the extent of the insurance, which was $5,000, and to the extent of such payment has become subrogated to the rights of the society. The entire loss is alleged to have exceeded the amount of the insurance in the sum of about $4,400, and the plaintiffs join to recover the total loss. The action was commenced in the state court, and removed to this court under the removal act of 1875, at the instance of the defendant. The plaintiffs move to remand, and this is the motion now to be determined. The plaintiff society and the defendant company are corporations within this state. The plaintiff insurance company is a corporation of the state of New York. In the petition for removal it is stated that there is a controversy between the parties which is of such character that a final determination thereof can be had as to the plaintiff society and the defendant without the presence of the plaintiff insurance company, and which is also of such character that a final determination thereof can be had, as between the plaintiff insurance company and the defendant without the presence of the plaintiff society.

The complaint alleges the destruction by fire of the church and parsonage buildings belonging to the plaintiff society; that the fire was caused by sparks emitted from the defendant's steamer, and resulted from defendant's negligence; that the total loss was $9,457.23; that at the time of the loss the plaintiff society held a policy of insurance, issued by the plaintiff insurance company, insuring the property to the extent of $5,000; that the amount of the insurance was duly paid, and that the plaintiff society thereupon made to the plaintiff insurance company an assignment of its claim against the defendant by reason of the loss, to the extent of the insurance paid, and judgment is demanded for the full value of the property destroyed.

If the removal of the case to this court can be sustained at all, it must be under the second clause of section 2 of the act of 1875, which is as follows:

'And when, in any suit mentioned in this section, there shall be a controversy which is wholly between citizens of different states, and which can be fully determined as between them, then, either one or more of the plaintiffs or defendants actually interested in such controversy may remove said suit into the circuit court of the United States for the proper district.'

The disposition of the present motion involves an inquiry into the nature of the plaintiffs' cause of action. It has been long settled, both in England and in this country, that such a cause of action is single and indivisible, and that in a case like the present the insurer could not, at common law, sue the wrong-doer in his own name to recover the amount paid to the assured, but must bring his action in the name of the assured. London Assurance Co. v. Sainsbury, 3 Doug. 245; Mason v. Sainsbury, Id. 60; Yates v. Whyte, 4 Bing. (N.C.) 272; Hart v. Western R. Corporation, 13 Met. 105; Rockingham Mut. Fire Ins. Co. v. Bosher, 39 Me. 254; Conn. Mut. Life Ins. Co. v. N.Y. & N.H.R. Co. 25 Conn. 270; Peoria Ins. Co. v. Frost, 37 Ill. 333.

In the case last cited, Lawrence, J., speaking for the court, says:

'It very often happens that valuable property is insured in several companies at the same time. If the property is burned through the carelessness of some third person, can such person be liable to as many suits as there are insurances? Is there more than once cause of action against him? And can that be indefinitely divided? What is the measure of damages? Is it the injury done by him to the property, or the amount the insurance companies have paid? Clearly the former. If the several insurance companies have paid more than the actual loss, they cannot make him liable for what they have paid. He is liable to the owner of the property for the injury he has done to it, and although a wrong-doer, it is still his right to have that loss adjusted in a single suit. The companies may unite in bringing an action for their use in the name of the assured. The recovery will be for injury done to the property, and when the judgment is obtained the court will determine, as between the different companies, how the proceeds of the judgment are to be divided.

In Hall v. Railroad Co. 13 Wall. 370, it was held that an insurer of goods, destroyed by fire in course of transportation by a common carrier, is entitled, after payment of the loss, to recover what he has paid by suit in the name of the assured against the carrier. And in the opinion it is said that--

'In respect to the ownership of the goods and the risk incident thereto, the owner and the insurer are considered but one person, having together the beneficial right to the indemnity due from the carrier for a breach of his contract, or for non-performance of his legal duty.'

In Ins. Co. v. Erie Ry. Co. 73 N.Y. 399, it was held that the action was rightfully brought in the name of the insurer alone; but the fact was that the owner had fully settled his personal claim against the defendant, and so the insurance company was the only remaining party in interest. The action being one under the Code of that state, which required suit to be brought in the name of the real party in interest, and the owner having no interest, it was held that the insurance company might sue.

In this state it has been decided (Swarthout v. The C. & N.W. Ry Co. 49 Wis. 625) that where the owner of property destroyed by fire, and several insurers, have rights of action for different portions of the value, all arising out of the same wrongful act, they may join in a single action against the wrong-doer. And it appears to be the view of the court that under the state Code the insurer, on payment of the loss insured against, may sue in his own name. At the same time, however, the court characterizes the act of the wrong-doer as a single...