Court Opinion

ID: 7184421
Source: CourtListenerOpinion
Date Created: 2022-07-24 16:51:08.426837+00
Date Added: 2024-06-11T16:16:01.617253
License: Public Domain

Lea, J.
I fully concur with the other members of the court, in the opinion which has been read, so far as it recognizes the liability of the defendant upon the contract of insurance; the only difference between us, has reference to the measure of that liability. The plaintiff, Samuel 3. Kennedy, insured the life of his debtor, Matthews, for the sum of $5,000. The latter having died within the period covered by the policy, Kennedy brought this suit in his own name to recover the amount for which his debtor’s life is insured. It appears to me, that assuming the defendant’s liability on the contract, but one inquiry can be entertained in examing this case, and that is, what is the interest which is protected by the policy ? I deem it immaterial to inquire whether, under the plea of general denial, it was or was not necessary, that an allegation and proof of interest should be made.
The answer in the absence of a special allegation of an interest, might have contained a special averment of the want of it, but the petition does contain a special averment of the plaintiff’s interest as a creditor, and the evidence introduced by the plaintiff himself conclusively shows the precise amount of that interest. Now as we have the means of determining in dollars and cents the full amount of the plaintiff’s insurable interest, as fixed by his own proof, the question is, whether the court shall, notwithstanding the evidence, give him a judgment for the whole amount expressed in the policy.
The evidence in this case is quite as conclusive with reference to the plaintiff’s insurable interests, as the most formal admission could possibly make it. We know that it is based upon a debt due to the late firm of Kennedy & Foster, for the sum of $5,642, with interest from the 31st of December, 1848. The fact is established by the plaintiff himself. It is not disputed. Now, should we take this undisputed fact as the basis of the judgment in this case, or should we ignore it altogether, on the ground that the averment of an insurable interest and the evidence offered in support of it, were alike unnecessary and will therefore be rejected as surplusage?
It appears to me, (it is urged with deference to the opinion of the majority of the. court,)'that the adoption of such a doctrine results in a judgment in favor of the plaintiff for a sum largely exceeding the amount which his own evidence establishes as due to him.
Acting upon the assumption that evidence adduced on the trial, furnishes ample materials for a judgment upon the merits, it is proper next to inquire what was the amount of the plaintiff’s insurable interest in the policy, for which, and for which alone, as it appears to me, he is entitled to ajudgment. The plaintiff was a member of the commercial firm of Kennedy & Foster, since dissolved by the death of Foster. Matthews was a debtor of this firm as before stated, in .the sum of. $5,462, with interest from the 31st of December, 1848. It is not shown that there were any other partners besides the plaintiff and Foster, and the presumption of law, in the absence of proof to the contrary, is, that their interest as partners was equal. The plaintiff’s interest, therefore, in the debt due by Matthews, which it was the object of the in*813surance to protect, is one half of $5,462, with interest as above stated. The decree of the court, however, awards him the sum of $5,000. What the judgment of the court should be in such a case, depends, it appears to me, upon the solution of- the question, whether a partner, who insures in his own name, and sues in his own name, can recover more than his individual and separate interest in the object insured ?
Although on this point there is a conflict of opinions among the French writers on insurance, it appears to me that neither in England nor America is there any division of opinion. The authorities, so far as I have had access to them, are unanimous and unequivocal. Mr. Duer, in his work on insurance, discusses this question elaborately, and concludes with the opinion that, “ in the United States, the doctrine may be considered as established, that although each partner has a right to insure the partnership property in the name or on account of the firm, yet where the insurance is expressed to be on his sole account, it must be limited in its application to his individual share. See 2d Duer, sec. 20, lect. 9. In the case of Graves v. The Boston Marine Insurance Company, the decision of which, the author considers “ conclusive evidence of the existing law on this subject” Chief Justice Marshall remarks, “that under no rule of proceeding on a special contract, can the interest of a co-partnership be given in evi-evidenee on an averment of individual interest, or an averment of the interest of a company be supported by a special contract, relating in its terms to one individual.” In the copious notes annexed to his lecture, Mr. Duer has with great care collated many of the English authorities, and reconciles them with each other and with our jurisprudence on this subject. Mr. Philips, in the last edition of his work on insurance, fully supports the opinion of Mr. Duer. See vol. 1, p. 219, see. 391, et sequiiur.
In the reasons given for the judgment rendered in this case, it is intimated that a distinction is made between the liability on contracts for the insurance of property, and contracts of life insurance, and that, “ as a general rule, in life insurance there is no distinction as to total and partial losses.”
From the necessity of the case, a life policy is always against a total loss, but whether it is for the whole amount specified in the policy, or the whole amount of the interest of the assured, depends entirely upon the character of each particular contract. “ Where the interest of the party effecting a life insurance, or in whose favor it is made, is manifestly indefinite, as in case of dependance for support, the interest is valued at the amount insured.” See 2d Philips, sec. 1755, p. 441. No proof of the extent of the interest of the insured is necessary in such a case. It will he sufficient to prove a beneficial interest without showing its extent. But I apprehend no such rule of recovery, even in contracts of life insurance, can be extended to cases where the interest is fixed and determinable, as in the case at bar, viz., that of a creditor in the life of his debtor for the security of the debt due to him. The right of the insured to recover in such case will be regulated precisely as in eases of insurance of property against fire or marine risks, viz., by the extent of the interest of the insured. This very question appears to have engaged the attention of the writers on life insurance. Mr. Philips, in the last edition of his work on insurance, 2d vol., sec. 1755, remarks : “ Where a policy of insurance is taken out by a creditor on the life of his debtor, or in favor of any party having a definite computable interest in the insured life, the amount of the interest being precisely determinable, a total *814loas by the death of, the insured subject is only the amount of such interest, although it may be less than the amount specified to be insured.” And again. 'see. 1216: “ In a policy in favor of a creditor on the life of a debtor, as security for a debt in a fixed sum, the amount of the insurable interest may be estimated as in any insurance upon property.” And in such case it is manifest the amount recoverable cannot exceed that interest. See, also, sec. 1247; also, vol. 1, sec. 208.
I think the plaintiff is entitled to recover of the defendant a sum equal to one-half of the amount due by Matthews to the firm of Kennedy & Faster, and that his recovery should be restricted to that amount.