insured is jointly interested with others, as in the case of copartners or trustees, or where he is intrusted with goods of other persons, as in the case of a common carrier or warehouseman or factor, he may either insure his own interest, or his own liability in respect to the property, or he may insure the property to its full value for the benefit of all concerned.1 § 27. Insurable Interest: Life.-Every person has an insurable interest in the life and health of himself, of any person on whom he depends wholly or in part for education or support, of any person under a legal obligation to him for the payment of money, or respecting property or services of which death or illness might delay or prevent the performance, and of any person upon whose life any estate or interest vested in him depends.? 7 6 Thus a partner has an insurable interest in the life of a co-partner, a creditor of a co-partnership in the life of each copartner, and all creditors in the lives of their debtors. This is true, although the debt is voidable, or not enforcible on account of the Statute of Limitations. A clerk has an insurable interest in the life of his employer, and a master in the life of his servant if he has a legal claim to his services. A woman in the life of her fiancé." A surety on a bond in the life of the principal.10 A creditor of an infant for necessaries sold to the infant has an insurable interest in his life."1 A voidable note given for a debt contracted during the minority of the debtor is sufficient to give an insurable interest, because the infant 1 Fire Ins. Asso. v. Merchants, &c., Trans. Co., 66 Md. 339. Waters v. Assurance Co., 5 E. & B. 870. 2 Bevin v. Conn. Mut. L. Ins. Co., 23 Conn. 244. Morrell v. Trenton Mut. Ins. Co., 10 Cush. 282. Baker v. Union Mut. L. Ins. Co., 43 N. Y. 283. Thompson v. American, &c., Ins. Co., 46 N. Y. 674. Warnock v. Davis, 104 U. S. 775. Wright v. Mutual Ben. Life Assn., 118 N. Y. 237. Conn. Mut. Life Ins. Co. v. Luchs, 108 U. S. 498. Morrell v. Trenton Mut. L. and F. Ins. Co., 10 Cush. 282; s. c., 57 Am. Dec. 92. "Goodwin v. Mass. Mut. Life Ins. Co., 73 N. Y. 480. Rivers v. Gregg, 5 Rich. Eq. 274. Rawls v. Amer. Mut. Life Ins. Co., 27 N. Y. 282; s.c., 84 Am. Dec. 280. "Hebdon v. West, 3 Best & Smith, 578. Chisholm v. National Capitol Life Ins. Co., 52 Mo. 213; s. c., 14 Am. Rep. 414. 10 Hebdon v. West, 3 Best & Smith, 579. Branford v. Saunders, 25 Weekly Reporter, 650. 11 Rivers v. Gregg, 5 Rich. Eq. 274. alone can avoid the note.1 Ties of affection or kinship do not of themselves constitute an insurable interest. Thus an adult son has no insurable interest in the life of his father simply by virtue of the relationship. Nor a nephew in the life of an uncle. Nor a son-in-law in the life of a mother-in-law. Nor a brother in the life of a brother. But certain relationships are so apt to involve a legal claim to support or pecuniary obligation or advantage that their existence is held to establish conclusively an insurable interest." Thus a wife has an insurable interest in the life of her husband, and the validity of the policy will survive a divorce." And the illegality of the marriage will not defeat it. And, ordinarily, at least, a husband has an insurable interest in the life of his wife. And a father in the life of his minor son.10 Any element of dependency coupled with the relationship will furnish the basis for an insurable interest. Thus where the brother had supported and educated his sister it was held that she had an insurable interest in his life.11 The interest which one has in his own life, being incapable of exact pecuniary estimate, may be valued at any amount which the parties agree upon, and so generally of all insurable interests which are founded upon relationship; 22 but if a creditor takes out an insurance upon the life of the debtor greatly in excess of any loss that he could sustain by the death of the insured, the transaction may be held to amount to a wager.1 13 § 28. Insurable Interest: Marine.-The same general principles are applicable as in fire insurance. Thus the 1 Dwyer v. Edie, Park on Ins. 432. 2 Guardian Mut. L. Ins. Co. v. Hogan, 80 Ill. 35; s. c., 22 Am. Rep. 180. 'Mowry v. Home Life Ins. Co., 9 R. I. 346. 4 Rombach v. Piedmont & A. Life Ins. Co., 35 La. Ann. 233; s.c., 48 Am. Rep. 239. Lewis v. Phoenix Mut. Life Ins. Co., 39 Conn. 100. 8 Equitable Life Ass. So. v. Paterson, 41 Ga. 338; s. c., 5 Am. Rep. 535. Currier v. Continental Life Ins. Co., 57 Vt. 496. 10 Mitchell v. Union Life Ins. Co., 45 Me. 104; s. c., 71 Am. Dec. 529. 11 Lord v. Dall, 12 Mass. 115; s. c., 7 Am. Dec. 38. 12 Bevin v. Conn. Mut. Life Ins. Co., 23 Conn. 244. 19 Fox v. Penn. Mut. Life Ins. Co., 4 Big. Ins. Cas. 458. Grant v. Kline, 115 Pa. St. 618. owner of a ship has in all cases an insurable interest in it, even when it has been chartered by one who covenants to pay him its value in case of loss; and he also has an insurable interest in expected freight which he would have earned but for the intervention of the peril insured against. And the charterer of a ship also has an insurable interest in it.1 The insurable interest of the owner of a ship hypothecated by bottomry is only the excess of its value over the amount secured by bottomry. The lender on bottomry may insure his interest in the ship to the amount of the loan. § 29. The Payee or Assignee of Life Policy need not have Insurable Interest.-If the insured has an insurable interest to support the policy when it is taken out, he may make it payable to any one, or, according to the weight of authority, he may subsequently assign it to any one, whether such transferee has an insurable interest or not, unless the transaction from its inception is a mere cover to avoid the statute against gambling contracts.3 § 30. When must Insurable Interest Exist.-In fire and marine insurance the insurable interest must exist not only at the commencement of the risk, but also at the time of loss; but in life insurance it may cease at any time after the making of the contract. A creditor, for example, who has taken a policy upon the life of his debtor, may, on the death of the insured, recover the full amount of the insurance, notwithstanding the debt may have been previously paid. Thus it will be seen that the contract of life insurance is not one of strict indemnity, but is sufficiently controlled by that doctrine to prevent it from being a wager in its inception. The leading English case of Dalby v. India & London Life Assur. Co., 15 C. B. 365, which overruled Godsall v. Boldero, 9 East, 72, unquestionably gives the sound and sen 'Oliver v. Greene, 3 Mass. 133. Barber v. Fleming, L. R., 5 Q. B. 59. Robertson v. United Ins. Co., 3 John. Cas. 499. Olmsted v. Keyes, 85 N. Y. 593. Contra, Warnock v. Davis, 104 U. S. 4 Dalby v. The India & London Life Assurance Co., 15 C. B. 365. St. John v. Am. Mut. Life Ins. Co., 13 N. Y. 31. Scott v. Dickson, 108 Pa. St. 6; s. c., 56 Am. Rep. 192. sible rule, though Porter endeavors to defend the doctrine of the latter case.1 The rate of premiums in life insurance is based upon the supposition that the event upon which payment is to be made to the insured will certainly occur at some time or other, and if a creditor after paying premiums for a long term of years was likely to lose all the benefit of his insurance, it would practically prevent the use of this important kind of security. § 31. Temporary Suspension does not Avoid.If there is no provision in the contract prohibiting a change of interest, a temporary suspension of the interest of the insured does not vitiate a policy of insurance, but only suspends its operation.2 32. Insurable Interest as Related to Measure of Recovery: Fire and Marine.3-The general rule is indemnity to the insured commensurate with his insurable interest at the time of loss, as shown by proof, or by appraisal, or as previously established by agreement in a valued policy. If the insured is the owner of the property destroyed, he is entitled to recover its market value at the time of the loss, without making any deduction for the amount of mortgage or other incumbrances upon it, for these incumbrances are held to be of no concern to the insurers.1 A mortgagee recovers the amount of the mortgage debt existing at the time of the loss without regard to the value of the mortgage or other security which he may hold on account of the same debt.5 Inasmuch as the right of subrogation which has already been described does not arise until the loss occurs, the policy of insurance will not be affected by any release or disposition which the mortgagee may make of his other securities before the fire. 1 Porter on Ins., p. 15. 2 Worthington v. Bearse, 12 Allen, 382. Lane v. Maine Mut. Fire Ins. Co., 12 Me. 44. 3 In this section I have followed, to some extent, the arrangement given by George M. Sharp, Esq., of the Baltimore bar, in his admirable synopsis of fire insurance law prepared for the Columbian Ins. Co. v. Lawrence, 5 Sussex Co. Mut. Ins. Co. v. Woodruff, 2 Dutch. (N. J.). 541. Kernochan v. N. Y. Bowery Fire Ins. Co., 5 Duer, 1. 1 But after the loss has occurred any release of such securities will discharge the insurers pro tanto in case they are entitled to the right of subrogation.1 Where a common carrier, warehouseman, or other bailee, or a broker or factor, insures for his own benefit, he recovers the value of his interest in the subject of insurance, whether it be his commissions or profits or advances. If he has insured against his liability as bailee for the loss of the property, he will be entitled to recover its cash or market value at the time of loss; and so, also, if he insures for the benefit of the owners of the goods intrusted to him as well as for his own benefit, he will be entitled to recover the full value of the property insured, holding any balance above his own interest as trustee for the owners. A lessee is entitled to recover for the value of his term. A lessor under a rent policy is entitled to recover the value of his rent, which is generally agreed upon in advance by a valued policy, and such value in the absence of fraud is conclusive. A vendee under an executory contract of purchase is entitled to recover the full value of the property insured by him, for the purchase price of which he is obligated. A vendor under such a contract, having an insurable interest in the property of which he still holds the title, has a right to recover its full value unless the policy limits. his interest. The court cannot assume that the executory contract will be completed, and the rights of the insured become fixed, at the time of the fire. But in England it is held that after the vendor has received the amount of his purchase price the insurers can recover back the insurance moneys under the doctrine of subrogation. This decision carries the doctrine of subrogation to an extreme limit, and it would appear that the views of Justice Chitty in the lower court are more convincing than the opinion of the appellate court. The position of the 'Thomas v. Montauk Fire Ins. Co., western Ins. Co., 34 Me. 487. Kane |