Hamburg-Bremen Fire Ins. Co. v. Ruddell

• Decision Date: 29 October 1904
• Citation: 82 S.W. 826
• Parties: HAMBURG-BREMEN FIRE INS. CO. v. RUDDELL.
• Court: Texas Court of Appeals

82 S.W. 826

HAMBURG-BREMEN FIRE INS. CO. v. RUDDELL.

Court of Civil Appeals of Texas.

October 29, 1904.

Appeal from Denton County Court; I. D. Ferguson, Judge.

Action by John L. Ruddell against the Hamburg-Bremen Fire Insurance Company. From a judgment in favor of plaintiff, defendant appeals. Reversed.

Alexander & Thompson, A. H. McKnight, and Andrew T. Baker, for appellant.

SPEER, J.

Appellee, J. L. Ruddell, recovered judgment against the appellant fire insurance company upon a policy of insurance issued by it to E. D. Hokett, insuring him against loss or damage by fire in an amount not exceeding $400 on a dwelling house and $200 on certain household and kitchen furniture, which policy contained the following stipulation: "Loss, if any, payable to J. L. Ruddell, as his interest may appear, on the first-named item." To the petition of appellee the appellant answered, among other things, that the fire which destroyed the building insured was caused or procured by the assured, E. D. Hokett, for the purpose of collecting the insurance upon the property; that Hokett was not the sole and unconditional owner of the property; and that no proof of loss had been made, as required by the terms of the policy.

The first question demanding our notice, and the one of controlling importance in this case, is presented by the second assignment of error, complaining of the court's action in sustaining a special exception to that part of appellant's answer alleging that the property destroyed was burned by E. D. Hokett, the insured. We are not favored with a brief by the appellee in this cause, but his contention, and the trial court's view, doubtless is that the insertion in the policy of the mortgage clause quoted constituted such privity of contract between the insurance company and the mortgagee as that the mortgagee would not be precluded from a recovery on such policy by an act of the mortgagor in no way participated in by him. But we are inclined to the view, both upon principle and the great weight of authority, that this is not the correct view of the contract. The contract proper is between the insurance company and the owner of the property, and the effect of the clause directing that the loss, if any, shall be payable to the mortgagee, is but to name or appoint that person as the party entitled to receive payment of the fund in the event a loss becomes payable under the terms of the policy. But whether or not any loss is payable at all is dependent entirely upon the performance of the terms of the contract between the insurer and the insured. The policy in this instance expressly stipulated that the same should be void in case of any fraud upon the part of the insured; and, if it did not, a sound public policy would not permit him to recover by his own criminal act, and, since the appellee must claim whatever rights he has through and by virtue of the mortgagor's contract, his claim also falls to the ground. Hocking v. Ins. Co. (Tenn. Sup.) 42 S. W. 451, 39 L. R. A. 148, 63 Am. St. Rep. 862; Scania Insurance Company v. Johnson (Colo. Sup.) 45 Pac. 431; Franklin Insurance Company v. Wolff (Ind. App.) 54 N. E. 772; Keith v. Ins. Co. (Wis.) 94 N. W. 295; Delaware Insurance Company v. Greer, 120 Fed. 916, 57 C. C. A. 188, 61 L. R. A. 137, and...