Friemansdorf v. Watertown Ins. Co.

• Decision Date: 21 November 1879
• Citation: 1 F. 68
• Parties: FRIEMANSDORF v. WATERTOWN INSURANCE CO.
• Court: U.S. District Court — Northern District of Illinois

1 F. 68

FRIEMANSDORF v. WATERTOWN INSURANCE CO.

United States Circuit Court, N.D. Illinois.

November 21, 1879

Gary Cody & Gary for defendant.

Hoyne Horton & Hoyne, for plaintiff.

BLODGETT J.

This is a suit brought on a policy of insurance issued by the defendant insurance company, dated the second day of February, 1877, to one Nigg, whereby the defendant insured George Nigg to the amount of $1,500, against loss by fire or lightning, etc., on a two-story frame dwelling house, situate on lot 2, in block 31, in Cooksville, Illinois, loss, if any payable to Henry Friemansdorf, as his interest may appear.

The suit is brought in the name of Friemansdorf, and the plaintiff avers that the policy was issued for the sole purpose of insuring the plaintiff, Friemansdorf; that a full disclosure was made to the defendant's agent of the plaintiff's interest, and that the defendant chose the form of policy which was issued; that the plaintiff paid the premium and has the sole right of action. The declaration, of course, avers the loss by fire of the property insured, and states that the plaintiff Friemansdorf had an interest to the extent of $1,000 in the premises as mortgagee.

There are three pleas interposed to this declaration The first is, that the policy contained a clause that other prior or subsequent insurance, without the written consent of the defendant, should void the policy; and avers that there was at that time a policy outstanding held by Nigg, the mortgagor, issued by the Farmers' Fire Insurance Company, of Philadelphia, which was in full force at the time of the loss.

The second plea invokes the same clause of the policy, and avers that in violation of that clause of the policy there was outstanding at the time of the loss another policy of insurance issued by the Farmers' & Drovers' Insurance Company of Louisville, Kentucky, to Henry Nigg, and that the same was in force at the time of the first aforesaid.

The third plea states that after the loss Nigg, the mortgagor, and owner of the equity of redemption of the premises, fully repaired the premises, without any expense to the plaintiff, whereby the plaintiff has sustained no loss or damage by reason of the said fire.

To these pleas the plaintiff has interposed a general demurrer, and on the part of the defendant it is claimed that as no plea of the general issue now appears upon the record, that this demurrer should be carried back to the declaration, and the question is made upon the argument of the demurrer that this suit cannot be maintained in the name of Friemansdorf, the mortgagee, and to whom the loss is to be payable.

I have no doubt but what the authorities, both in the state of Illinois and the United States, have now settled the law beyond all question or challenge, as far as this court is concerned, that upon a policy like this, issued to a mortgagor, and with the loss, however, directed to be paid to a mortgagee or any other encumbrancer or lienholder, the suit must be instituted in the name of the mortgagor, and cannot be instituted in the name of the mortgagee or the person to whom the loss is made specifically payable. The contract is really between the insurance company and the owner of the property, to whom the policy is issued. Legally, the contract is between the insurance company and the person to whom the policy runs, not to whom it or some portion of it may be made payable in the event of a loss. Such is the uniform holding of the Illinois cases; and in the case of Bates v. The Equitable Insurance Company, reported in 10 Wall. 33, the same principle is established. In that case Philbrick, the party insured, received a policy, and afterwards he wrote upon the back of the policy, 'Payable in case of loss to E. C. Bates,' and signed 'W. E. Philbrick,' who was the original party to whom the policy was issued, and the agent of the company wrote underneath this indorsement by Philbrick as follows: 'Consent is hereby given to the above indorsement. Equitable Insurance Company, by Frederick W. Arnold, Secretary;' so that it, in legal effect, made the policy precisely like the one now before us; that is, a case of a policy with loss, if any, payable to E. C. Bates, as his interest may appear. And the supreme court there held that the suit must be maintained in the name of Philbrick; that Philbrick was the insured, and any breach of the conditions of the policy by Philbrick voided the policy.

The same...