Case ID: ohio-st_10/html/0280-01.html
Source: Caselaw Access Project
Author: {"author": "Brinkerhoff, C. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

The Mount Vernon Manufacturing Company v. The Summit County Mutual Fire Insurance Company.
    1. A total alienation of property insured operates to avoid the policy of insurance from the time of such alienation.
    2. Where personal property, insured against loss by fire in a mutual fire insurance company is sold by a master in chancery, in pursuance of a decree upon a mortgage given by the assured, 'and the proceeds of such sale are, by order of the court, applied to the satisfaction, pro tanto, of such decree, and the property insured is afterward burned, the assured can not recover for the loss, although, subsequently to such loss and before the commencement of the action on the policy, the sale was, by consent of all parties thereto, set aside by order of the court under whose decree the sale was made.
    Reserved in the district court of Summit county.
    This action is brought upon a policy of insurance issued by the defendant on the 10th of January, 1850, insuring the plaintiff in the sum of five thousand dollars, against loss or damage by fire, on the fixed and movable machinery of the plaintiff, then situate in her woolen-mill, in the town of Mount Yernon, Knox county, Ohio, for the period of six years.
    The matter set up in defense to the action is, that at *the timé of the destruction of the property insured, the plaintiff had alienated the same.
    In the court of common pleas, a judgment was rendered pro forma, from which an appeal was taken to the district court. In the latter court an agreed case was made between the parties, on consideration whereof the case was reserved to this court for decision.
    The facts, as they appear in the agreed statement, are substantially as follows:
    In January, 1850, plaintiff, a body corporate, was the owner of a certain property in Mount Yernon, which, to a due comprehension of the question now made, may be divided into three distinct parcels :
    1. Yillage lots 143 and 144, on which it had erected a large woolen-mill. This mill then contained certain machinery used for the manufacture of woolen goods.
    2. The easement of a certain water-power, then appurtenant to tlie last-named premises, and used to propel the machinery con tained in the mill.
    3. Sundry other lots of land in the town of Mount Yernon, not in any way necessary to the enjoyment of the mill premises, or connected therewith.
    These three parcels were then incumbered in the manner following:
    1. The water-power and the last-named lands, together with other real estate not owed by plaintiff, was subject to a mortgage to the Ohio Life Insurance and Trust Company, made on the 14th of July, 1830, to secure a loan of §5,000.
    This mortgage was executed by the then owner of the property covered by it long before the plaintiff acquired its interest therein, and before the water-power had become appurtenant to the mill-lots. On the purchase by it of the water-power and third parcel of lands, the woolen company assumed payment of the entire mortgage debt, which, in January, 1850, remained wdiolly unpaid, and constituted *a valid lien on the water-power and the third parcel of lands. At this time the mill-lots were unincumbered.
    January 10, 1850, the defendant, by policy in due form issued to the plaintiff, insured, to the extent of §5,000, the fixed and movable machinery contained in the mill, for the term of six years. By the application, made part of the policy, the plaintiff is represented as the “ owner ” of this property.
    May 2, 1850, the woollen company executed a mortgage ta Stamp, Buckingham, and H. B. Curtis, upon the “ mill-lots,” waterpower, and machinery contained in its- mill, to secure a debt of §10,000, payable in six months after that date. This debt and mortgage, subsequently vested by due assignment in David Potwin and H. B. Curtis, on the 29th December, 1852.
    After the execution of the mortgage, the projmrty of the plaintiff, in respect to incumbrances, stood in the following condition: .
    1. The water-power was subject to each of the above-named mortgages, of which that made to the Life and Trust Company constituted the first, and that held by Potwin and Curtis the second lien.
    2. The mill-lots and machinery were subject to the mortgage held by Curtis and Potwin, and to that alone.
    3. The “ other lands,” constituting the third parcel, were subject to the mortgage executed to the Life and Trust Company, and to that only.
    December 21,1852, the woolen .company leased to David Potwin its mill, water, and machinery for five years from the first.day of June, 1853, with liberty to take in one or more partners, under which Potwin took possession of the demised, property, and afterward, but at what precise date does not appear, formed a copartnership with Henry B. Curtis for the manufacture of woolen goods, which they continued to prosecute in the mill until its destruction by fire, -'as hereafter stated.
    At the March term, 1853, of Knox county common ^pleas, the Life and Trust Company filed its bill to subject the water-power and the “ third parcel ” of lands, as well as other property not owned by plaintiff, being the premises included in its mortgage, to the payment of the debt secured thereby ; to which bill the company, and Curtis and Potwin were made defendants, and duly served with process.
    Curtis and Potwin answered, and, at the same time, filed a cross-bill, to which the woolen company and others were made parties, and duly served with process, setting up their mortgage; that its condition had been broken ; that a sale of the waterpower separate from the mill-lots would work irreparable injury to them and the company, and praying that the mill-lots and waterpower might be sold in one parcel, and the proceeds equitably apportioned between the company and themselves.
    Such proceedings were afterward had that, at the August term, 1853, a decree was rendered in the cause, by which the court, after finding the liens of the respective mortgages to be as above stated, and that a separation of the water-power from the factory premises would work great injury, directed rhat all the property, real and personal, of the plaintiff, covered by the two mortgages, should be sold by a master in the manner following:
    1. The land disconnected from the mill promises, which constitute the third parcol, and on which the Trust Company had the exclusive lien. The proceeds to be applied to the decree of the Trust Company alone.
    2. The mill-lots and the water-power, in one parcol; and that out of the proceeds of this parcel, the Trust Company should first receive, if necessary to satisfy their claim, such proportion as the value of the water-power bore to the value of the mill-lots; which proportion was to be' ascertained by the master and reported to court. Curtis and Potwin to have the residue of the proceeds from this parcel.
    3. The machinery in the mill and “ other personal property’’ *in another parcel, the proceeds to be paid to Curtis and Potwin alone, as they held the exclusive lien thereon.
    December 10,1853, due notice having been given, and the waterpower and real estate (but not the machinery or any part of it) having been appraised, the master, acting under a proper-writ, sold all the parcels, both of real and personal property, to Curtis and Potwin, as follows:
    1. The lands not connected with the mill premises, for the sum of $2,667.
    2. The mill lots and water-power, for $10,667 ; and,
    3. The machinery and other personalty, for $2,000; of this Curtis and Potwin had possession at the time of sale, and continued therein till its loss.'
    The master reported these several sales to the court—that the proportionate value of the water-power was $3,333, the mill-lots being worth $7,334, and -that no money had been paid to the master by the purchasers.
    December 20, 1853, Curtis and Potwin paid to the Trust Company $423.92, which left a balance of $5,000 due it on the decree, and gave to its solicitors their due-bills for that balance, with a written stipulation that, if it was not paid or satisfactorily arranged with the Trust Company, before the next term of Knox common pleas, then the solicitors might, at their option, cause the sale to them (Curtis and Potwin), of the real estate named in the master’s return, to be set aside. In that event, the due-bill and money paid were to be restored.
    This arrangement was made known to the court on the day it was made (December 20, 1853), and on the same day it confirmed the sale of “ the several parcels of said real estate in said writ and decree named,” and ordered deeds to be made to the purchasers. By the same order, the court, after approving the finding of the master as to the relative value of the water-jnower and mill-lots, directed the proceeds arising from the sales of all the property, to be applied as follows:
    1. To payment of costs.
    *2. To satisfy the decree in favor of the Trust Company, the proceeds of the water-power and the other lands on which it held exclusive lien being more than sufficient for that purpose; and that,
    3. “ The remainder, including the moneys made from the personalty, be applied as a credit on the amount decreed to the said Curtis and Potwin.”
    The master was required to report, at the next term, the balance then due on the decree of Curtis and Potwin.
    On the morning- of the 23d December, 1853, the mill, with all the machinery contained therein, was destroyed by fire.
    The same day, but in ignorance of the fire, Curtis, who was then in Cincinnati, made a written arrangement with the Trust Company, in which it authorized its solicitors to receive, as payment on the decree, the note of Curtis and Potwin for $5,000, pajrable in a year, with seven per cent, interest, provided the note was secured by a mortgage on real estate, to the satisfaction of their solicitors, and a third person named.
    Curtis and Potwin were abundantly able to have given this security, but in consequence of the fire, declined to do so.
    At the March term, 1854, of the Knox common jfieas, an order was made, by which, after reciting that it ajjjneared to'the court “ that no pai't of the jpurchase money arising from the sale heretofore made and confirmed in this case, has been jjaid, and all parties consenting thereto, it” was directed “that the sale and confirmation be set aside and held for naught.”
    By a subsequent order, made at the same term, the apjmaisal of the water-power and mill-lots was also set aside.
    Afterward the water-power, mill-lots, and other lands, were sold by the master, in the same parcels as before, to Curtis and Potwin, for sums amounting in the aggregate to $8,001, and sufficient of the jproceeds for that purpose was applied to joay the decree of the Trust Company, *and the residue as a credit on the decree of Curtis and Potwin. These sales were confirmed at the August term, 1854, and the master again ordered to report the balance due to Curtis and Potwin. No such rejport, however, had been made ujd to Sejrtember, 1856, when this case was reserved here.
    At the time of these sales and of the fire, Curtis was jmesident and Potwin general agent of the manufacturing company. Both were then and still are directors and stockholders,- and Curtis ever since hath continued to be president.
    
      
      Curtis & Scribner, for plaintiff:
    I. So long as the assured has an interest in the preservation of the property insured, he has an insurable interest therein, sufficient to support his policy; and proof of any interest in the subject-matter insured, however indirect it may be, and even though it do not amount to the legal or equitable ownership thereof, is sufficient to entitle the assured to a recovery. 2 Amer. Lead. Cas. 394, 402-404, 406, 435; Buck v. The Chesapeake Ins. Co., 1 Peters, 163; Hancock v. The Fishing Ins. Co., 3 Sumner, 132; Carroll v. The Boston Marine Ins. Co., 8 Mass. 515; Powles v. Innes, 11 M. & W. 16; Locke v. The N. A. Ins. Co., 13 Mass. 61; Strong v. The Manufacturers’ Ins. Co., 10 Pick. 40; Gordon v. The F. & M. Ins. Co., 2 Pick. 249; Wilson v. Hill, 3 Met. 66; Stetson v. The Mass. M. & F. Ins. Co., 4 Mass. 330; Vairin v. The Canal Ins. Co., 10 Ohio, 223; Trumbull v. The Portage M. F. Ins. Co., 12 Id. 305; Tettemore v. The V. M. F. Ins. Co., 20 Vt. 546; Read v. Cole, 3 Burr. 1512; Norcross v. Martel, 6 Harris, —; The F. & M. Ins. Co. of Wheeling v. Morrison, 11 Leigh, 354; Columbia Ins. Co. v. Lawrence, 2 Peters, 25; Marshall on Ins. (1 ed.) 91; Clark v. The New England Fire Ins. Co., 6 Cush. 342; Masters v. The Madison Co. Mut. F. Ins. Co., 11 Barb. 624; Conover v. The Mut. Ins. Co. of Albany, 3 Denio, 254.; 1 Comst. 290; Bouvier’s Inst. *(2 ed.) 1992; 2 Bla. Com. 287; Cruise’s Dig. title 32, ch. 11; Etna F. Ins. Co. v. Tyler, 16 Wend. 385; 12 Ohio, 305; 23 Pick. 418; Angell on Ins., sec. 206; 18 Miss. 262; Rice et al. v. Tower et al., 1 Gray (Mass.), 426; Crowley v. Cahon, 3 Barn. & Adol. 478; 1 Hall (N. Y.), 84; Marks v. Hamilton, 9 Eng. L. & E. 503; Protection Ins. Co. v. Harmer, 2 Ohio St. 474, and cases there cited.
    II. At the time of the loss, the plaintiff had an interest in the preservation of the property covered by the policy issued to her by the defendant, and is, therefore, under the rule established by the authorities above cited, entitled to recover.
    1. Potwin and Curtis, at the time of the destruction of-the property, were in possession, under a lease from the plaintiff, for fivo years from June 1, 1853, and only about seven months of the time had expired. The plaintiff was interested to the extent of the rents for the unexpired part of the term. At the date of the lease and entry under it, Potwin and Curtis were the holders of the only mortgage or incumbrance upon the factory building, the lots whereon it stood, and all the machinery therein contained, being the same machinery covered by this policy of insurance, the condition of which mortgage had then been broken for more than two years.
    
    Unless the sale of this machinery to the lessees themselves, on the mortgage held by them at the date of the lease and under their own cross-bill, determined the lease and put an end to the rights of the plaintiff thereunder, her interest in the preservation of that machinery, and “the existence of such a connection between her and it as deduces a loss to her from the injury to it,” are as palpable as any axiom in mathematics.
    The lessees could not, after having, by covenants in writing, recognized the title of the plaintiff, accepted the possession and use of the property as her tenants for a term, of years, turn round upon the next day, or during the *next month or year, and of their own motion, and by their own act, put an end to that contract by investing themselves with the title to the demised premises. The well-known rules regulating the relation of landlord and tenant, forbid it. A tenant can not dispute the title of his landlord. He can not set up, or purchase in, an outstanding title, to defeat the claims of his landlord. He can not put an end to his contract by his own act, or evict himself under his own proceedings.
    
    A much stronger reason would exist for enforcing the rule in the. present case, where the lessees made their contract with full knowledge of all their rights and the exact situation of the title. Assuming, in this connection, that the sale was good, yet the lessees, who were tho complainants in the decree, purchased and held the property subject to their contract of lease, and could only assert their rights as purchasers upon the expiration thereof. Until that time, and after a surrender of the premises to the landlord, the relation of landlord and tenant would exist in full force between them and the plaintiff.
    See the following authorities upon the subject: Galloway v. Ogle, 2 Binn. 468, 471; Willison v. Watkins, 3 Pet. 43; Peyton et al. v. Stith, 5 Pet. 484; 13 Pet. 1; Reed v. Shepley, 6 Vt. 602; Love v. Dennis, Harper, 70; Norton v. Saunders, 1 Dana, 14; Chambers v. Peak, 6 Dana, 426; Mason v. Bascom, 3 B. Mon. 273, 623; Lively v. Ball, 2 B. Mon. 53; Wilson v. Smith, 5 Yerger, 379; Byrne v. Beeson, 1 Doug. 179; Wood v. Turner, 7 Humph. 517; Bank of Utica v. Mercereau, 3 Barb. Ch. 528; Fisher v. Millikin, 8 Barr, 111; Stearns v. Godfrey, 16 Maine (4 Shep.), 158; 25 Maine (12 Shep.), 209; Moshier v. Reding, 12 Maine (3 Fairf.), 478; Lockwood 
      v. Walker, 3 McLean, 431; Jackson v. Harper, 5 Wend. 248; Jackson v. Stewart, 6 Johns. 34; Wilson v. Townsend, 2 Ves. Jr. 696.
    2. The sale by the master was, in substance, a conditional one; it was not a sale for cash, and was, therefore, ineffectual to divest the plaintiff of her title to the property.
    *Sales by judicial officers (except in special cases when the statute otherwise provides) must be unconditional and for cash. The following are some of the authorities bearing upon the point: 1 Pet. 241; Gwynne on Sheriffs, 305; 2 Black. 82; Swope et al. v Audley, 5 Porter (Ind.), 213; 8 Johns. 400, 428; 1 Dall. 419.
    3. The plaintiff being in possession of the property (by her tenants) at the time of the sale, and continuing in the possession until the happening of the loss, and the purchase money being unpaid, she had an insurable interest therein which preserved the vitality of her policy. Upon this point, reference is made to the authorities cited under the first division of the argument. It is established by those authorities that where the vendor retains the legal title in his hands, as a security for the purchase money, “ an insurable interest will survive the sale either of real or personal property.”
    Where a sale is made by a master acting under a decree in equity, the court, under whose authority the sale is made, is careful to see that the purchaser does not obtain title to, or possession of, the property, until the terms of the sale are complied with, and that the lien thereon for the purchase money is fully preserved. Dudley S. C. 250, 254; 2 U. S. Dig. Supp., sec. 372; 2 Har. & G. 346; 2 Eq. Dig. 541, sec. 68.
    III. Had the sale been unconditional and the purchase money paid, yet the action of the court by which the sale was afterward set aside, and the plaintiff placed back where she stood before the sale, restored' her to all her rights, and among them to a right of recovery upon the contract of insurance. Collier v. Whipple, 13 Wend. 224, and cases there cited; Tripp v. Cook, 26 Wend. 143; Williamson v. Dale et al.. 3 Johns. Ch. 290; Requa v. Rea, 2 Paige, 339; 2 Wend. 260; Millspaugh v. McBride, 7 Paige, 509; 7 Ohio (pt. 2), 48; Thompson v. Dimond, 3 Edw. Ch. 298; Laight v. Pell, 1 Edw. Ch. 577; 2 *Danl. Ch. Pr. 1464; 1 P. Wms. 745; Price v. Price, 1 Swin. & Stu. 386; Barb. Ch. Pr. 537; 2 Ohio, 400.
    
      Wolcott & Upson, for defendant:
    I. The sale of the machinery under the decree of the court of common pleas of Knox county, divested the plaintiff of all title or right thereto, and so avoided the policy.
    1. By the general rules of law, which do not jjermit an insurance (always a mere indemnity against loss on property itself) unless the assured has some title to, or pecuniary interest in, the very subject matter of the policy, as distinguished from a mere general interest in its preservation unattended by any ownership of the thing itself. Here the insurance was of machinery owned by the manufacturing company; the loss indemnified against was the value to the company of that “ ownership.” But the sale of the machinery divested the company of the whole beneficial fight therein, and the after-destruction of the. property could not of course prejudice a right which no longer existed.
    2. By the terms of the policy itself, which, in its twelfth condition, declares that upon any alienation or sale of the property, the policy shall be void. This condition is uniformly held to mean a transfer of the title and ownership. Conover v. Mutual Ins. Co., 3 Denio, 254; Same Case, 1 Comst. 290; Masters v. Madison Co. Ins. Co., 11 Barb. 56, 624; Trumbull v. Portage Co. Ins. Co., 12 Ohio, 305; Bouv. Institutes, 1992.
    The sale in this case effected, beyond all question, a transfer of the title to and ownership in the machinery to the purchaser.
    3. Whether therefore the plaintiff had or had not, under the terms of the lease to Curtis and Potwin, such an interest in the preservation of the property as could be insured, is beside the question. The loss here indemnified against, was the right to, and property in, the machinery itself; and not a loss growing out of some agreement ^touching the use of the machinery, the performance of which might be hindered by its destruction. If the company had desired to protect itself against liability for repairs, or to secure the rents, these should have been insured eo nomine. Certainly these are' not covered under a policy which warrants the title to property to be owned by the assured, and which insures the value of the title and ownership aloné. Phillips v. Knox Co. Ins. Co., 20 Ohio, 174.
    II. The rule of law which prevents the tenant in possession from setting up title against his landlord, relates merely to titles adverse to that of the landlord. There is no rulewhich precludesthe tenant from acquiring the very title of his landlord, either by the voluntary conveyance of the landlord, or by the purchase of it at judicial sale. The tenant has as much right as any other person to buy that reversion, when offered for sale on execution. Curtis and Potwin did not dispute the landlord’s title, but on the contrary gave to it the strongest possible recognition, by investing a large sum of money in its acquisition. In any event, however, the objection comes too late; for,
    III. The right of Curtis and Potwin to set up against the plaintiff the title acquired under their mortgage, and to enforce a sale of the demised property to satisfy the mortgage debt, notwithstanding the lease, was a question fairly arising in the proceedings instituted by them, to foreclose that mortgage, to which the landlord was a party. In that proceeding, the court affirmed the validity of the title set up by Curtis and Potwin, and that judgment can not be collaterally questioned.
    IV. The machinery sold was personal property, as well in contemplation of law, as in that of the court below, and of all the parties to the cause, who dealt with it on that footing. Confirmation, therefore, was not essential to the validity of the sale; but, if an approval be held necessary, the agreed case shows that it was sufficiently satisfied by the court, by the order directing the purchase *money to be applied as a credit on the decree of Curtis and Potwin. This order has never been vacated or disturbed.
    
    V. The fact that there was no change of possession after the sale, is not material. The object of delivery in sales of personal property, is to put the thing sold in the possession and under the control of the purchaser. Here the purchasers already had possession, so that the object of a delivery was fully accomplished. Besides, a completed sale without delivery, always passes the property as between the parties, in cases where the statute of frauds does not apply. 1 Parsons on Contracts, 440; 2 Kent’s Com. (9 ed.) 492; Hooban v. Bidwell, 16 Ohio, 509, and reports passim.
    
    VI. The sale of the machinery was not conditional; the arrangement with the Life and Trust Company did not relate to that sale; and, in any case, those objections, and all others which go to the regularity of the sale or other proceedings below, can not be considered here. All these circumstances were, as the agreed case shows, communicated to the court having jurisdiction in this behalf, and it thereupon confirmed the sale by the order directing the application of its proceeds. Whether this was right or wrong, is a question which can not be mooted in this collateral proceeding.
    
      VII. The sale as to the machinery has never been vacated. The •order of vacation applies “ to the sale heretofore made and confirmed.” No sale had theretofore been made and specifically confirmed, except the sale of the two parcels of real estate. As to the •effect -upon the title of the judgment debtor, of a confirmation of the sale of his real estate, see McLaren v. Hartford Ins. Co., 1 Selden, 151.
    VIII. But independent of this, the order recites that the sale was set aside “ by the consent of all the parties.” It is not, therefore, to be treated as simply a judicial act, but is precisely equivalent, in its legal effect, to a voluntary resale of the property, by Curtis & Potwin, to the plaintiff. In the latter case, the policy clearly would not *reattach. Cocherill v. Cincinnati Ins. Co., 16 Ohio, 148.
    IX. If, however, the sale of the machinery had been vacated, it would not aid the plaintiff. The fact would still remain, that at the time of its loss, the plaintiff had no interest covered by the insurance, in the machinery. ' No power on earth can obliterate that fact. If the plaintiff chose voluntarily to revive its liability to Curtis and Potwin, notwithstanding it had once been extinguished, it might, of course, do so ; but it could not divest any right •of other persons growing out of the fact of its extinction. If, after .the sale and before the destruction of the machinery, Curtis and Potwin had sold it to a third person, would an order setting aside ■the sale on execution, have divested the third person of the property he had bought from its actual owners ?
    X. The plaintiff here has no equity, for it has sustained no loss. In effect, it has voluntarily parted with this machinery before its •destruction, and received the full value of it, in the application of its proceeds to the payment of the very debt for which the property was pledged, by itself, as security. The debt still remains extinguished to the extent of the value of the machinery, and to permit a recovery here, would not only charge the insurance company with .a liability which it never assumed, but give to the plaintiff a very large sum of money, on the theory that it had lost something, contrary to the undeniable fact that it lost nothing, because it had nothing to lose.
   Brinkerhoff, C. J.

If the sale, by the master commissioner of the court, of “the fixed and movable machinery” insured, worked .a complete transfer and entire alienation of the property insured, the plaintiff can not recover for any loss happening during the time such alienation and transfer remained operative; and this,

On what seems to be a settled principle of the general law of insurance. “ If ju’operty insured is sold, so *tkat the assured

retains no interest in it, and is subject to no risk or responsibility .on account of it, and no assignment, or agreement for the assignment of the policy is made, and afterward a loss happens, and after the loss the policy is assigned to the vendee, the assignment will be ineffectual in respect to such loss, and neither the party originally insured nor his assignee can recover the loss; the original assured .can recover nothing, for, having no interest in the property at the time ■of the loss, he has sustained no damage; nor can the assignee recover .anything, because, at the time of the loss, he was not a party to the insurance.” 1 Phil, on Insurance, 63, and cases there cited. And,

From the terms of the defendant’s act of incorporation and 'by-laws, indorsed upon the policy, and by which its stipulations must be considered as limited.

The 12th section of the defendant’s act of incorporation is this:

“ That when any building shall be alienated, the policy shall thereupon be void, and surrendered to the directors to be canceled; the note shall be given up upon the payment of all assessments upon the same prior to such surrender; the policy may be assigned to .the grantee or alienee, who may have the right thereto confirmed, for the use of said grantee or alienee, upon application to the directors within thirty-days, and their consent, on giving proper •security to the deposit note, and shall herebj^ become a member of «aid company.”

This section of the act of incorporation, it will be seen, relates, in terms, only to buildings insured; but section 4, article 4, of the by-laws of the defendant, also indorsed on the policy, is as follows:

“Whenever any member of this company, who has an insurance •on goods or other personal property only, shall bona fide alienate or sell out said goods or other personal property, he may have the same privilege of surrendering or assigning his policy; and in the same form and manner *as is provided for in the 12th section of the act of incorporation, in the case of the alienation or sale of buildings.”

Now, this provision of the by-laws, though not an express stipulation against alienation, proceeds throughout on the assumption that alienation would avoid the policy, and shows, at least, that the parties contracted in view of, and by their contract recognized,, the rule of the law above given, to wit, that total alienation of the property insured would avoid the policy.

But one question then remains : Hid the sale by the master under the decree work a complete transfer of the “ fixed and movable machinery ” insured ? For, if the property was effectually sold and disposed of under a mortgage made by the assured, it is, in effect,, a sa,le by the assured.

In considering this question, it is important to notice, that there-was but one lien upon this persona] property insured, to w,it, that of Potwin and Curtis, who were, at the time of the sale, already in possession as lessees 'of the assured; while upon the real estate-sold there were other and conflicting liens. But to the proceeds of the sale of the personal property, aud to which alone the insurance-extended, Potwin and Curtis alone were entitled.

This personal property was properly ordered to be sold separately, and was sold separately, and for a separate price, to Potwin and Curtis, for a sum less than the amount due them under the decree, and the amount of this sale was applied, by the subsequent order of the court, to the satisfaction,pro tanto, of their decree. No change-of possession was.necessary or possible in order to complete the sale, foi the purchasers were already in possession ; no payment of the-purchase money to the master was necessary, for it was all coming to the purchasers. The property sold being personalty, no order of confirmation was required. Nothing further was required, if anything, but an order applying the proceeds of the sale to the satisfaction, *pro tanto, of the decree standing in-favor of the-purchasers; and this was made; and it seems.to us that the sale then stood, for the time being, a transaction perfected and complete. We can see no act or element which was wanting to its-completeness; we can imagine none which would have rendered it more complete.

While this state of things continued, it is clear, we think, that, the jmrchasers, as such, could have vindicated by any aj>prop>riate action, their perfect title to this property as against all the world. It would have been perfectly Competent for an utter stranger to-have bought this property separately from the real estate, at the master’s sale. Sujjpose one had done so, had paid the amount of his bid, and that amount had been, by order of the court, applied to the decree in favor of Potwin and Curtis. It seems to us clear that his title to it would have been perfect; that he might have ■removed and transported it wheresoever he pleased, and have maintained his title to it against all parties. And wherein is there •any essential distinction between his supposed condition and rights and those of Potwin and Curtis, after their purchase and the application, by order of the court, of the amount of their bid to the payment of their decree ? We can see none.

A question of construction is made, as to whether the subsequent •order of the court setting aside the sale, really embraced the sale of this personal property, or whether it extended only to the sale •of the real estate. But, granting that such order did extend to the personalty as well as realty, and that it was competent for the -court to make such order, still, this was the condition of things for several months before the sale was set aside; and in this state •of things the property was destroyed by fire.

Now, suppose this property had never been destroyed by fire, but that large losses, by the burning of other property insured by the defendant, had occurred during the interval between the making and the setting aside of this sale. Could the plaintiff have been assessed on its *premium note to make good such losses ? It seems to us very clear that it could not, and that on a suit being brought for the collection of such supposed assessment, an answer .alleging an alienatioñ prior to the occurrence of such losses, and proof of the facts apparent in the record of the case in which the .■sale to Potwin and Curtis was made, would have been a conclusive ■defense.

Does the fact, that the sale was, subsequently to the destruction ■of the insured property, set aside by the order of the court under whose decree it was made, alter the case? We think not. But two reasons are stated in the order for setting aside the sale; first, that the purchase money had not been paid; and second, that all parties consented thereto. The first reason could have no application to the sale of the personal property; for, there being no occasion for the payment of the purchase money as to it, its non-payment could afford no reason for setting it aside; The consent of all parties may have been a good reason to justify the action of the court in setting aside the sale as to those parties j but we can not rid ourselves of the impression that such action of the court, based upon and obedient to the will of parties, ought not to be permitted to affect the rights, previously fixed, of persons who were notparties, and whose interests were not consulted in the matter. It ought not to be in the power of the plaintiff, or of parties similarly situated, to-escape the burden of assessments in case the insured property remains unscathed, and to insist on compensation, in case of its destruction, at their mere will and pleasure.

It may be, and, indeed, it would seem—though the question is-not before us, and we therefore do not now undertake to decide it —that had this insured property not been destroyed during the interval between the time of the sale and of the order of setting' it aside, the obligations of the policy would, on the setting aside of the sale, have revived; and that the defendant would have-been liable for any loss occurring subsequently to that time, and. during the period .*covered by the terms of the policy. 1 Phil. on Insurance, secs. 107, 180; Lane v. Maine M. F. Ins. Co., 3 Maine, 46; Dadmun Man. Co. v. Worcester Mut. F. Ins. Co., 11 Met. 429: Power v. Ocean Ins. Co., 19 La. 28.

Be this as it may, we ax*e of opinioix that the plaintiff is not entitled to recover for any loss occurring between the time of the sale- and the time of setting it aside. As to that intex’val, we think the-rights of the plaintiff under the policy were, at least, suspended.

The consent of the plaintiff to the ox’der setting aside the sale, may have been ill-advised and unfortunate to some of its stockholdex'S; but with that question we have, in this case, nothing to do..

Judgment for defendant.

Scott, Sutliee, Peck, and Gholson, JJ., concurred.