Riggs v. Commercial Mut. Ins. Co.

• Citation: 25 N.E. 1058,125 N.Y. 7
• Parties: RIGGS v. COMMERCIAL MUT. INS. CO.
• Decision Date: 02 December 1890
• Court: New York Court of Appeals

125 N.Y. 7

25 N.E. 1058

RIGGS

v.COMMERCIAL MUT. INS. CO.

Court of Appeals of New York.

Dec. 2, 1890.

Appeal from superior court of New York city, general term.

Action by John S. Riggs against the Commercial Mutual Insurance Company. Defendant issued to Joseph L. Tobias a policy of insurance upon the steamer Falcon for $1,000, loss payable to Andrew Simonds. Tobias was, at the time of effecting this insurance, a stockholder in the Merchants' Steam-Ship Company, which then owned the steamers Sea Gull and Falcon. Simonds, by an indorsement on the policy, directed the insurance company to ‘pay to John S. Riggs.’ Plaintiff recovered judgment at special term, which was reversed at general term, and a new trial ordered. 51 N. Y. Super. Ct. 466. At the same time a judgment in a similar action rendered at special term, in favor of Merchants' Steam-Ship Company against the defendant, was affirmed at general term, (Id. 444,) and the defendant appealed to the court of appeals. The parties to this action thereupon entered into a stipulation which provided as follows: The plaintiff in this action being about to appeal to the court of appeals, it was considered by both parties that, if the judgment in the Steam-Ship Co. Case should be reversed on the ground that the vessel insured under the policy in this case and in that was not a total loss, both actions would necessarily fail; but if the decision of this court in the Steam-Ship Co. Case, holding that the vessel was a total loss, should be affirmed by the court of appeals, the plaintiff herein would then be entitled to recover, if J. L. Tobias had an insurable interest in the vessel; and it was thereupon agreed that the plaintiff herein should waive his right to appeal to the court of appeals, upon the consent of the defendant, that, if the judgment of this court in the Steam-Ship Co. Case should be affirmed, then the question of J. L. Tobias' insurable interest in this case should be reargued at the general term, and that the decision of the general term on such reargument should be final so far as the plaintiff was concerned, but without prejudice to any right in defendant to appeal therefrom. The court of appeals thereafter affirmed the decision of this court in the Steam-Ship Co. Cose. 13 N. E. Rep. 939. On this case coming on for reargument at general term on the question of the insurable interest of J. L. Tobias, that court reversed its former decision, and affirmed the judgment of the trial term, (5 N. Y. Supp. 183,) and from this judgment of affirmance defendant appeals.

David Willcox, for appellant.

George Zebriskie, for respondent.

ANDREWS, J.

This defendant is, we think, precluded by the stipulation of Janary 10, 1889, from raising any question on this appeal except as to whether Tobias, the assignor of the plaintiff, by reason of his being a stockholder in the Merchants' Steam-Ship Company, had an insurable interest in the Falcon when the policy was issued, and perhaps the further question whether that interest, if it existed, was covered by the policy. The situation when the policy was made was this: The judgment which the plaintiff recovered at the trial term had been reversed at the general term, and a new trial had been ordered, and the plaintiff was about to appeal from the order of reversal to this court. The Merchants' Steam-Ship Company had recovered judgment against the defendant in the same court on its policy on the same vessel similar to the policy issued to the plaintiff, and this judgment had been affirmed by the general term, and the defendant had brought an appeal to this court, which was then pending. There was one question common to both cases, viz., whether there had been an absolute total loss of the vessel insured, without which it was conceded there could be no recovery. In the Case of the Merchants' Steam-Ship Co. this was the sole question. In this case there was the additional point whether the plaintiff had an insurable interest. The parties to the stipulation assumed that the question of total loss would be conclusively determined as to both cases by the result of the appeal in the Case of the Merchants' Steam-Ship Co., but if the judgment in that case was affirmed it would still leave open in this case the question of insurable interest. Under these circumstances, the parties entered into the stipulation by which the plaintiff waived his right to appeal to this court from the order of reversal upon the defendant's consenting that if the judgment in the Steam-Ship Co. Case should be affirmed there should then be a reargument in this case before the general term of the question of the plaintiff's insurable interest, which consent was given, and the stipulation further provided ‘that the decision of the general term on such reargument should be final so far as the plaintiff was concerned, but without prejudice to any right in defendant to appeal therefrom.’ This court affirmed the judgment in the Steam-Ship Co. Case, and the reargument on the question of the plaintiff's insurable interest was then had before the general term; whereupon the general term reversed its former decision upon the point, and affirmed the judgment of the trial term. The present appeal is from this judgment of affirmance.

It was the plain purpose of the stipulation that the defense common to both actions should abide the decision in the Steam-Ship Co. Case, leaving open in this action the distinct and separate question of insurable interest only. The stipulation was valid, and governs this appeal. Townsend v. Stone Dressing Co., 15 N. Y. 587. The question whether a stockholder in a corporation, as such, has an insurable interest in the corporate property, which he may protect by an insurance of specific, tangible property of the corporation, is the question now presented. The policy does not disclose the nature of the interest of Tobias in the vessel insured; but this was not necessary, unless required by some condition in the policy....