Wagner v. Peters

• Decision Date: 25 June 1925
• Citation: 142 Va. 412
• Parties: G. S. WAGNER v. H. G. PETERS, TRUSTEE, AND CALEDONIAN INSURANCE COMPANY.
• Court: Virginia Supreme Court

Page 412

142 Va. 412

G. S. WAGNER v. H. G. PETERS, TRUSTEE, AND CALEDONIAN INSURANCE COMPANY.

Supreme Court of Virginia, Wytheville.

June 25, 1925.

1. FIRE INSURANCE — Liability on Policy — Liability to Assured who Destroys the Property. — If the owners of property insured destroy the property, clearly there is no liability to the assured under the policy, even though the insurance company may be liable thereunder to a creditor under the mortgage clause.

2. MORTGAGES AND DEEDS OF TRUST — Liens — Records — Entry of Satisfaction — Section 6456 of the Code of 1919. — Section 6456 of the Code of 1919, providing for the entry of satisfaction upon the record of liens, mortgages, etc., when the debt has been paid, affords a summary and expeditious remedy for a debtor who has paid the debt secured, "upon proof that it has been paid or discharged," to have the record show this, and the consequent release of the lien. Under the statute there is only a single fact to be established, that is, payment or discharge of the debt; an the statute cannot be construed to authorize the decision of such decisive collateral issues as must arise in order to determine whether an insurance company is liable to the plaintiff under a policy of insurance, of which the question as to whether plaintiff forfeited all of his rights thereunder by destroying the property himself is only one.

3. MORTGAGES AND DEEDS OF TRUST — Liens — Records — Entry of Satisfaction — Section 6456 of the Code of 1919 — Fire Insurance — Case at Bar. — The instant case was a motion under section 6456 of the Code of 1919 to require the trustee in a deed of trust to cancel and mark satisfied the lien of the deed of trust. Plaintiff claimed that the deed had been satisfied by payment of a fire insurance policy to the trustee. The trustee and the insurance company, however, claimed that there was no liability of the insurance company to the maker of the deed of trust because he had destroyed his own property.

Held: That it was not error to dismiss the motion as the court had no jurisdiction under section 6456 to litigate the question presented.

4. MORTGAGES AND DEEDS OF TRUST — Liens — Section 6456 of the Code of 1919 Providing for Entry of Satisfaction — Trial of Collateral Issues. — Under section 6456 of the Code of 1919, providing for the entry of satisfaction upon the record of liens which have been paid, there is only a single fact to be established, that is, the payment of discharge of the debt secured. The statute does not confer jurisdiction to litigate other decisive collateral issues.

5. FIRE INSURANCE — Mortgages and Deeds of Trust — Discharge of Company's Obligation to Creditor under Mortgage Clause not Proof of Payment of the Debt of the Mortgagor — Case at Bar. — Under the usual standard mortgage clause in a policy of insurance the liability of the company to the mortgage creditor does not depend upon its liability to the mortgagor, for that liability cannot "be invalidated by any act or neglect of the mortgagor or owner" of the property; and it is an express contract that, if there is no liability to the assured, the company, to the extent that it discharges its obligations to his creditor, shall be subrogated to that creditor's right of recovery and to the collateral pledged to secure the debt. So where all that appeared by the evidence was that the company had discharged its obligation to the creditor, had denied all obligation to the mortgagor, and had exercised its rights under the contract to an assignment of the note secured by the mortgage, these facts did not prove that the mortgagor had paid the debt, and was, therefore, entitled to sustain a motion against the trustee in the deed of trust to have the deed of trust marked satisfied under section 6456 of the Code of 1919.

6. FIRE INSURANCE — Mortgage Clause — Validity. — The usual standard mortgage clause of a fire insurance policy is valid.

Error to a judgment of the Corporation Court of the city of Bristol, in a proceeding by motion under section 6456 of the Code of 1919 to have a deed of trust canceled and marked satisfied. Motion dismissed and movant assigns error.

The opinion states the case.

J. S. Ashworth, for the plaintiff in error.

D. T. Stant and H. T. Campbell, for the defendants in error.

PRENTIS, P., delivered the opinion of the court.

This is a motion under Code section 6456, made by Wagner, the owner of certain real estate, to require H. G. Peters, trustee, to cancel and mark satisfied the lien thereon created by a certain deed of trust executed by a former owner of the property to secure the payment of a note for $1,500.00, alleging that the lien has been fully satisfied and paid by the Caledonian Insurance Company in accordance with its policy of insurance for $2,000.00.

The answer of the insurance company, in resisting the motion, alleges:

"Said deed of trust required the owner of the property to keep it insured in at least the sum of $1,500.00 for the benefit of the indebtedness secured by said deed of trust and in pursuance thereof, plaintiff and said trustee had attached to defendant's policy No. 3075940 the usual and standard mortgage clause, making loss payable to the defendant (Peters) as trustee, as his interest may appear.

"When thereafter the building covered by said policy of insurance was destroyed by fire this defendant claimed and now claims that as to the owner of the property...