Sec. Ins. Co v. Eakin

• Decision Date: 05 March 1930
• Docket Number: No. 19900.,19900.
• Citation: 41 Ga.App. 257,152 S.E. 606
• Parties: SECURITY INS. CO. v. EAKIN.
• Court: Georgia Court of Appeals

41 Ga.App. 257

152 S.E. 606

SECURITY INS. CO.

v.EAKIN.

No. 19900.

Court of Appeals of Georgia, Division No. 1.

March 5, 1930.

Syllabus by the Court.

Error from Superior Court, De Kalb County; John B. Hutcheson, Judge.

Suit by the Security Insurance Company against W. S. Eakin. Judgment for defendant, and plaintiff brings error.

Reversed.

Suit was brought by the Security Insurance Company to recover from W. S. Eakin $105 principal, the amount of premium on a certain insurance policy. This policy was issued to J. S. Carter and covered a certain building known as the Decatur Hotel, in DeKalb county, Ga. To the policy was attached what are known as "New York standard mortgage clauses, " making loss, if any, under said policy payable to W. S. Eakin as first and second mortgagee and L. M. Wells as third mortgagee. The petition further alleged that all the interest of said L. M. Wells under the policy was transferred and assigned to the said W. S. Eakin, who, as mortgagee, transferee, and assignee, brought suit on the policy, recovered a judgment thereon, and that the judgment had been paid by Security Insurance Company to W. S. Eakin. The petition alleged that the premium on the policy had never been paid, though demand for such payment had been made on W. S. Eakin. The petition contained a second count similar to the first, except that the second count contained the following additional allegations: "Under date of May 25, 1925, petitioner issued its policy of fire-insurance No. 44112 to J. S. Carter, as assured, covering the building known as the Decatur Hotel, in DeKalb County, Georgia; the said policy having been written by and through its agent, C. G. Aycock Realty Company. The said C. G. Aycock Realty Company has transferred and assigned all its right, title, and interest in and to the account claim, or demand for the premium on said policy to your petitioner by written assignment, a copy of which is hereto attached, marked Exhibit 'C', and made a part hereof." To the peti-tion demurrers were filed. The general demurrer was sustained, and the petition dismissed. To this ruling the plaintiff excepted.

Smith, Hammond, Smith & Bloodworth, and W. L. Bryan, all of Atlanta, for plaintiff in error.

Randolph, Parker & Fortson, of Atlanta, for defendant in error.

BLOODWORTH, J. (after stating the foregoing facts).

1. What is referred to in the petition as "what are known as New York mortgage clauses, " and contained in the policy are in part as follows: "Loss or damage, if any, under this policy shall be payable to W. S. Eakin as first and second mortgagee as mortgagee (or trustee) as interest may appear, and this insurance, as to the interest of the mortgagee (or trustee) only therein, shall not be invalidated by any act or neglect of the mortgagor or owner of the within described property, nor by any foreclosure or other proceedings or notice of sale relating to the property, nor by any foreclosure or other proceedings or notice of sale relating to the property, nor by any change in the title or ownership of the property, nor by the occupation of the premises for purposes more hazardous than are permitted by this policy; that in case the mortgagor or owner shall neglect to pay any premium due under this policy, the mortgagee (or trustee) shall, on demand,, pay the same." (Italics ours.) Two questions are presented for consideration: First, is a mortgagee, who as such mortgagee as well as transferee and assignee of the interest of the original mortgagor, who has brought suit on the policy of insurance and recovered a judgment thereon, and thereby accepted benefits from the said policy, required to pay the premium on said policy, which policy contains the clause just above quoted and underscored? Considering this question, attention is especially directed to the foregoing quotation which is underscored. This clause has been a number of times before the courts for construction, and in their rulings thereon the courts have not been in accord; some holding that this clause is a covenant and others that it is a condition. In this case this court...