Stipulations in Policy Affecting Carrier's Liability or Insurance of Carrier.

58. A policy of insurance on the excess of value above $20 per barrel of spirits to be forwarded by a carrier, conditioned that assured should assign his 63.- An advance of the insured value claim against the carrier, upon payment by an insurer to a shipper of goods, pendof loss, and that it should be avoided ing the determination of the carrier's liaupon any act of the assured defeating or bility for their loss, is not a payment of decreasing any such claim before or after the insurance which can be pleaded in the insurance, is not avoided by the ship-avoidance of such liability, where the ment of 75 barrels of spirits, worth $7,308, policy stipulates that it shall not cover at a stipulated valuation with the carrier the carrier's common law liability, and at $20 per barrel. The policy does not that the insured shall be reimbursed out provide that any liability of the carrier of the recovery, if any, against the carrier.. shall be perfected, but that, if one is per- | Id.

When Release by Insured no Defense to Wrongdoer-Remedy of Insurance Company.

68.- Where a person who has property injured by an explosion of gas, brought an action against the gas company for such portion of his loss as was not covered by insurance, and gave a release which was expressly declared not to affect his claim against the insurance companies, such release is no defense to an action on policies of insurance. North America Ins. Co. v. Fidelity Title & Trust Co., 2 L. R. A. 586; 23 W. N. C. 174; 16 Atl. Rep. 791; 123 Pa. 523.

64. When release by insured no de-ance company while refusing performance fense to wrongdoer. Building insured on his part. In such case the release was burned through negligence of railroad given by the insured to the party causing company. Assured settled with it for a the loss is a defense to an action on the sum less than the actual damage and gave policy. Niagara F. Ins. Co. v. Fidelity a release, in which it was stated: "This Title and Trust Co., 23 W. N. C. 171; 16 settlement is not intended to discharge Atl. Rep. 790; 123 Pa. 516; 46 Phila. Leg. the Connecticut Fire Insurance Company Int. 262. from any claim, etc." It was insisted that as the assured had settled and released all his claim for damages, the insurance company could take nothing by subrogation or assignment. Held, that as the insurance company could not have interposed the release as a defense in an action by the assured upon the policy, and the assured having released only such damages as he could without interfering with his claim against the insurance company, the legal consequence-subrogation-must be regarded as part of the exception. That insurance company acquired the claim by subrogation, and was entitled to recover. Connecticut Fire Ins. Co. v. Erie R. R. Co., 73 N. Y. 399; rev'g, 10 Hun, 59; and see *People's Natural Gas Co. v. Fidelity Title and Trust Co., 21 Ins. L. J. 751; 24 Atl. Rep. 339 (Pa.); *Ins. Co. N. A. v. Id.; 123 Pa. 523; and compare as to effect of release by a warehouseman defeating subrogation; *Pelzer Mfg. Co. v. Sun Fire Office, 15 S. E. Rep. 562 (S. C.)

65. Effect of release by insured on right to recover on policy. If the insured refuses to assign a cause of action belonging to the insurance company by virtue of the subrogation clause in the policy, it is a defense to an action on the policy. Dick v. Franklin Fire Ins. Co., 81 Mo. 103; aff'g, 10 Mo. App. 376.

69. An insured who, on settling for a certain sum with the landlord, whom he claims was responsible for the loss, gives the landlord a general release, thereby discharges the insurer to the full extent to which he has defeated the latter's remedy over against the landlord by right of subrogation. *Dilling v. Draemel, 30 N. Y. S. Rep. 435; 9 N. Y. Supp. 497; 16 Daly, 104.

70. Insured entitled to recover entire loss without regard to insurance. The entire loss is recoverable from the wrongdoer who has caused it, without reference to the insurance, which can not be applied in mitigation of the damages. Cunningham v. Evansville and Terra H. R. R. Co., 14 Ins. L. J. 752; 3 West. Rep. 305; 102 Ind. 478.

71. The acceptance of a given sum 66.-Assured can not recover on the from insurance companies in full discharge policy from the insurance company if he of their liability for cars destroyed by fire has by his own act or contract deprived does not affect the right of the insured to the insurance company of its right to sub-recover from a railroad company which rogation. Carstairs v. Mechanics and had become responsible for all damages Traders' Ins. Co., 12 Ins. L. J. 810; 18 Fed. Rep. 473.

66

to the cars occasioned by accident or casuality the whole amount of the loss for which the latter was responsible. *Chicago, St. L. & N. O. R. Co. v. Pullman Southern Car Co., 139 U. S. 79; 35 L. ed. 97; 11 Sup. Ct. Rep. 490.

67.— Where an insurance policy contains a covenant that the party to whom the loss is payable shall, on receiving payment, assign" to the company his claim against the party causing the loss, 72. Remedy of insurance company. the act of payment and that of assign- Where property insured has been maliment are made concurrent, and the cove- ciously and wilfully burnt by a third pernants are dependent; and the insured son; no action can be sustained by the incannot compel performance by the insur-surance company, which had paid the

Remedy of Insurance Company.

junction was proper, and should be continued until the case against the railroad company was finally determined. Hartford Fire Ins. Co. v. Pennell, 2 Bradwell,

loss against such third person, in its own
name; and the statute inflicting against
the incendiary a penalty of three times
the loss in favor of the party injured, will
not give such right of action. Rocking-| 609 (Ill.)
ham Mut. Fire Ins. Co. v. Bosher, 39 Me.
253.

73.- Where insured property has been burned by the carelessness of a railway company, and the insurance company has paid the loss, it cannot maintain an action in its own name against the railway company. The suit must be brought in the name of the owner of the property for the use of the insurer. The different rule applied in cases of marine insurance rests upon the doctrine of abandonment, and subrogation of the insurer to the rights and title of the insured; a doctrine which has no existence in cases of fire insurance. Peoria Marine & Fire Ins. Co. v. Frost, 37 Ill. 333.

74.- Where the loss is caused by a railroad company, and the insurance company pays it, money paid by the railroad | to the assured, as damages, is held by him in trust for the insurance company. If the railroad does not pay damages, or pays with knowledge that the insurance company has paid, the latter may recover of the former, and may use the assured's name in bringing the suit, and a release by the assured to the railroad is fraudulent. A remedy against both the railroad and the assured could not be pursued in one action, there being no joint liability. Monmouth Co. Fire Ins. Co. v. Hutchinson & Camden & Amboy Railroad, 6 C. E. Green, Ch., 107 (N. J.) 75.- On payment of loss, company cannot sue wrongdoer who occasioned it in its own name, either at common law or under statute of Missouri. Suit, although for use of insurer, must be in name of person whose property was destroyed. Etna Ins. Co. v. Hannibal & St. J. R. R., 3 Dill. 1 (U. S. Cir.)

76.- Assured, being insolvent, after payment of his loss by an insurance company, commenced an action against a railroad company whose engines, it was alleged, caused the fire. The insurance company filed a bill in equity for an injunction restraining the settlement of such claim, and asked to be subrogated to the extent of the insurance. Held, that such in

77. If a loss is occasioned by the wrongful act of another, company is subrogated to the rights and remedies of the assured, and may maintain an action in its own name against the wrongdoer. If the assured receives the damages from the wrongdoer before payment by the insurer, the amount so received will be applied in discharge of the policy. If the wrongdoer pays assured after payment by the insurer, with knowledge of the facts, it is regarded as a fraud upon the insurer, and he will not be protected from liability to the latter. Connecticut Fire Ins. Co. v. Erie R. R. Co., 73 N. Y. 399; rev'g, 10 Hun, 59.

78.- If insured retains any interest in the claim it would probably be necessary to make him a joint party plaintiff, or a party defendant under the provisions of the Code of Civil Procedure, if he refused to join. See Pratt v. Radford, 52 Wis. 114; *State Ins. Cos. v. Oregon Nav. Co., 20 Ins. L. J. 737; 20 Ore. 563; *Home Ins. Co. v. Id., 20 Ins. L. J. 639; 20 Ore. 569.

79.- When a fire has occurred occasioned by negligence of a third party, and destroying property insured by several companies, the latter, by their payment of the loss, are subrogated to the rights of the assured against such third party, and may maintain an action in their own names jointly with the assured. Swarthout v. Chicago & Northwestern R. R. Co., 49 Wis. 625.

80.- When fire is caused by wrongful or negligent act of a third party, the cause of action is indivisible. At common law action must be brought in name of the assured, and when rules of common law have been modified by Code or Statute, action may be brought in names of the companies and the assured jointly. First Presbyterian Society et al. v. Goodrich Transportation Company, 10 Ins. L. J. 452; 7 Fed. Rep. 257; Id. v. Phoenix Ins. Co., 10 Biss. 312 (U. S. Cir.)

81.- Several insurance companies upon payment of a loss, caused by negligence of a third party, become subrogated pro tanto to claim of assured against wrong

Remedy of Insurance Company.

doer. Where common law procedure alleging destruction by the latter of wood prevails action of insurance companies insured by the former is demurrable as would necessarily be brought in name showing no privity, but it is amendable of the insured. But under Code of Practice (Wis.) companies must be joined with assured as plaintiff, unless made defendant, on account of refusal. Pratt v. Radford, 52 Wis. 114.

by inserting the name of the owner of the wood as the plaintiff suing for the use of the insurance company. Holcombe v. Richmond, etc., R. Co., 78 Ga. 776; 3 S. E. Rep. 755.

83.- An insurance company cannot in its own name sue a railroad company for the price of wood alleged to have been burned as the result of the railroad com

the insurance company, the insurance on which had been paid; but the owner of the wood burned may sue for the use of the insurance company. Id.

83a.- Insurers who pay part of a loss are subrogated pro tanto, and with the owner of the property destroyed may sue jointly for their respective claims against the wrongdoer who caused the loss. North Shore R. R. Co. v. McWillie, 5 Mont. Q. B. 122 (Can.)

81a.- Insured having been paid $50,000 insurance under several policies on lumber destroyed by fire caused by sparks from an engine on the C. C. R. R. Co., afterwards brought suit against the rail-pany's negligence, which was insured by road company and recovered a verdict of $100,000; the jury finding that to be "the actual value of the lumber destroyed." The insurance companies then brought this action, claiming that the insured was a trustee for them for so much of the $100,000 as represented the excess of the total moneys received by him over the amount of his loss, contending that he was estopped by the verdict from asserting his loss to be greater than that amount. Defendant contended that his actual loss had exceeded the whole $150,000. Held, that the verdict of the jury was not conclusive; that it did not operate as an estoppel. That the utmost right of the plaintiffs was to have the amount recovered from the railroad brought into account with what had been previously paid for insurance in order to ascertain whether the defendant had been more than fully compensated for his total loss by fire and other loss and out-owner assigns his claim against the wronglay connected with the litigation, and for these purposes matter was referred to the master. National Fire Ins. Co. v. MeLaren, 12 Ont. 682 (Can.)

81b. In case of partial insurance, when a third party is liable to make good the loss, the assured does not become a trustee for the insurance companies until he has recovered sufficient from the wrongdoer to fully satisfy his loss in full as well as expenses incurred in recovery. When assured is fully indemnified, then as to any surplus beyond that the insurance companies become subrogated to extent of amount paid under their policies. Id. And see also Commercial Union Assur. Co. v. Lister, L. R. 9 Ch. App. 483 (Eng.)

84. Suit can be maintained in the name of the assured for the use of the insurer to recover, of a carrier through whose negligence the loss occurred, the amount paid upon such loss. *Louisville & N. R. Co. v. Manchester Mills, 88 Tenn. 653; 14 S. W. Rep. 314.

85.- Where the value of property destroyed by fire occasioned by the act of a wrongdoer is in excess of the amount of insurance money paid thereon, and the

doer to the extent of the insurance money paid to the insurer, the latter has only a joint interest with the owner in a single cause of action and cannot sue at law thereon alone. *State Ins. Co. v. Oregon, etc., Nav. Co., 20 Ore. 563; 20 Ins. L. J. 737; 26 Pac. Rep. 838.

86.- Where loss was caused by negligence of railroad company, and insurance is partial with several insurance companies interested in the loss and claim against the railroad acquired by subrogation, there is but one cause of action against the railroad company which cannot be split into as many suits as there are companies. The insurance companies and the owner must join as parties plaintiff, or if latter refuses he must be made a 82.- A declaration by an insurance defendant. *Home Mut. Ins. Co. v. Oregon company against a railroad company R. and N. Co., 20 Ins. L. J. 639; 20 Ore. 569.

Eight of Company When it has Refused to Join Insured in Action.

him his whole claim, the insurer will be entitled to all the securities. Sussex County Mut. Ins. Co. v. Woodruff, 2 Dutch. 541 (N. J.)

87. Right of company when it has have paid; and if they pay the insured refused to join insured in action. the whole amount of his claim for which When a loss, partially covered by insur- he holds such security, they will have a ance, is occasioned by a wrongdoer, right to the whole of the security held against whom the insured, after pay-by him. If the insured holds other sement of the insurance, recovers judgment curities for the same debt, on paying to for such loss, and the insurer has refused to contribute to the prosecution of the action, the assured when sued for reimbursement by the underwriter is answerable, if for anything, for no more than the surplus of the amount recovered of the wrongdoer, which may remain after full satisfaction of his uncompensated loss and the expenses of the recovery. Newcomb v. Cincinnati Ins. Co., 22 Ohio St. 382.

88. Other special cases. Policy on house, which was destroyed by rioters. The insurance office paid the loss, and an action was brought, in the name of insured, for the benefit of the insurance office, against the hundred for damages. Action sustained. Mason v. Sainsbury, 3 Doug. 61 (Eng.); and see London Assur. Co. v. Sainsbury, 3 Doug. 245 (Eng.)

91. A party procured insurance on whisky, held by him as collateral security for a note. A loss having occurred and been paid, the company took an assignment of the note and proceeded against the maker. Held, no discharge of the debt, and they were entitled to be thus subrogated. It seems, that had the insurance been effected at the request of the maker of the note, or at his expense, or he been chargeable for the premium, no doubt he would have been entitled to its benefits by applying the money in extinguishment of the debt. Honore v. Lamar Fire Ins. Co., 51 Ill. 409.

party responsible for the loss, although it was not legally bound to indemnify the assured. Ins. Co. v. C. D., Jr., 1 Woods, 72 (U. S. Cir.)

92. Where property is negligently 89.- Policy on 1,027 bales of cotton, lost or destroyed in transportation, and "for whom it may concern," stored in company pays the loss to the assured, it New Orleans, provided that "a prior in-can recover the sum so paid from the surance, not notified and expressed in the policy, should render it void." Before the taking out of this policy, 333 bales of the same cotton had been insured for £2,000, by the Alliance Marine Insurance Company in London, and upon due notice and proof of loss, the latter paid up the amount of its policy, and brought suit against defendant to recover the amount thus paid. Held, that the owners of the 333 bales could not have recovered from the defendant more than the amount of loss not covered by the assurers in London, because of the non-compliance with the above condition; and that the plaintiffs could not therefore justly claim to be subrogated to rights and claims which the owners themselves had not acquired. Alliance Marine Assurance Co. v. Louisiana State Ins. Co., 8 La. 1.

93.-- Policy on factory and its machinery contained a clause that a claim against the company by one "holding this policy as collateral security shall not be payable until" the debt was enforced, as far as possible, against the original debtor. The owner of the premises contracted to sell them to C., to execute the deed when the whole price was paid, C. to pay for insurance. Plaintiff insured, C. paying the premium. After the fire, C. refused further paying, and the contract was canceled. Held, plaintiff had an insurable interest in his lien for price, and as he held the legal title also, could insure the property itself. That the 90.- When a party, holding a lien insurance being really for C.'s benefit, as upon real estate to secure a debt, effects he paid the premiums, the policy was an insurance upon such property to se- not a collateral security, and the comcure the debt; in case of a loss the in-pany had no right of subrogation. surance company, on paying the insur- Wood v. Northwestern Ins. Co., 46 N. Y. ance, will be entitled to the benefit of 421.

the security held, to the amount they 94. The amount paid by an insurance