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It may be added, that our fire-policies now in use frequently give the insured the right of keeping the property in repair. The failure of the insured to repair a defect in the building, arising after the contract is made, does not prevent the insured from recovering unless he was guilty of gross negligence.

SECTION III.

THE INTEREST OF THE INSURED.

ANY legal interest is sufficient. And if it be equitable in the sense that a court of equity will recognize and protect it, that is sufficient; but a merely moral or expectant interest is not enough. So one has an insurable interest in a house placed on another's land with that other's consent, but not if placed there without license or shadow of title. So, too, one who has made only an oral bargain with another to purchase the other's house, cannot insure it; but if there be a valid contract in law, or if by writing or by part performance it is enforceable in a court of equity, the purchaser may insure. So, if a debtor assign his property to pay his debts, he has an insurable interest in it until the debts are paid, or until the property be sold.

A partner may have an insurable interest in a building purchased with partnership funds, although it stands upon land owned by the other partner. A mortgagor may insure the whole value of his property, even after the possession has passed to the mortgagee, if the equity of redemption be not wholly gone. So he may if his equity of redemption is seized on execution, or even sold, so long as he may still redeem. And in case of loss he recovers the whole value of the building, if he be insured on it to that amount.

A mortgagor and a mortgagee may both insure the same property, and neither need specify his interest, but simply cali it his property. The mortgagee has an interest only equal to his debt, and founded upon it; and if the debt be paid, the inter est ceases, and the policy is discharged; and he can recover no more than the amount of his debt.

It has been held, that if a mortgagor is bound by his contract

415 with the mortgagee to keep the premises insured for the benefit of the mortgagee, and does keep them insured in his own name, the mortgagee has an equitable interest in or lien upon the proceeds of the policy.

One who holds property only in right of his wife may insure the property, even if his wife be only a joint tenant.

And a tenant for years, or from year to year, may insure his interest, but would recover only the value of his interest, and not the value of the whole property.

We have said that, generally, any one having any legal interest in property may insure it as his own. But there is one important exception to or modification of this rule. By the charters of many of our mutual insurance companies, the com pany has a lien, to the amount of the premium note, on all prop erty insured. It is obvious, therefore, that no such description can be given, or no such language used, as would induce the company to suppose they had a lien when they could not have one, or would in any way deceive them as to the validity or value of their lien. In all such cases all incumbrances must be stated, and the title or interest of the insured fully stated in all those particulars in which it affects the lien.

A trustee, agent, or consignee may insure against fire, as he may against marine loss. Generally, the consignee is not bound to insure against fire, but may, at his discretion. He may insure, expressly, his own interest in them for advances, or the owner's interest. It has been held that a consignee may, by virtue of his implied interest and authority, insure, in his own name, goods in his possession against fire, to their full value, and recover for the benefit of the owner. And if the interest be not expressed, the policy will be construed as not covering the interest of the owners, if, upon a fair construction of the words and facts, it seems to have been the intention of the parties only to secure the consignee's interest. And an insurance against fire upon merchandise in a warehouse, "for account of whom it may concern," protects only such interests as were intended to be insured at the time of effecting the insurance.

It is now common for a commission merchant to cover in one policy, in his own name, all the goods of the various owners

who have consigned goods to him. It has been held, that the words "goods held on commission," in fire-policies, have an effect equivalent to the words "for whom it may concern," in marine-policies.

A person having a lien on a building under a State law has an insurable interest in the building.

A consignee of goods, sent to him, but not received, may insure his own interest in them. So, any bailee (which means any person to whom property has been delivered for any pur pose) who has a legal interest in the chattels which he holds, although this be temporary and qualified, may insure the goods against fire. Thus a common carrier by land, who has a lien on the goods, and is answerable for them if lost by fire (unless it be caused by the act of God or the public enemy), may insure the goods to their full value against fire.

The insurers must know whom they insure, for they may have a choice of persons, and it is important to them to know whether they are to depend on the care and honesty of this man or that man. The insured must so describe the owner as not to deceive them on this point, and so he must the kind of owner ship. Thus, if he aver an entire interest in himself, he cannot support this by showing a joint interest with another; and if in his action he declare the latter, proof of the former is not sufficient.

So, too, there must be actual authority to make the insur ance. This may be express, or implied, in some cases, as it seems to be implied with the consignee, or the carrier, and per haps, generally, with any one who has an actual possession of, interest in, and lien on, the property. But a tenant in common does not derive from his cotenancy authority to insure for his cotenant; nor could a master of a ship or a ship's husband, merely as such, insure the owner's interest against fire.

SECTION IV.

DOUBLE INSURANCE.

By this, the party originally insured becomes again insured. If. by a double insurance, the insured could protect himself over

and over again, he might recover many indemnities for one loss. This cannot be permitted, not only because it is opposed to the first principles of insurance, but because it would tempt to fraud and make it very easy.

In this country, fire-policies usually contain express and exact provisions on this subject. They vary somewhat, but, generally, they require that any other insurance must be stated by the insured, and indorsed on the policy; and it is a frequent condition, that each office shall in that case pay only a ratable proportion of a loss; and it is often added, that, if such other insurance be not so stated and indorsed, the insured shall not recover on the policy. And it has been held that such a condi tion applies to a subsequent as well as to a prior insurance; or to an insurance of any part of the property covered by the other policy. Nor will a court of equity relieve, if sufficient notice and indorsement have not been made. But it has been held that a valid notice might be given to an agent of the company, who was authorized to receive applications and survey property pro posed for insurance.

In some instances the charter of the company provides that any policy made by it shall be avoided by any double insurance of which notice is not given, and to which the consent of the company is not obtained, and expressed by their indorsement in the policy. But this would not apply to a non-notice by an insured of an insurance effected by the seller on the house which the insured had bought, if this policy were not assigned to the buyer.

SECTION V.

WARRANTY AND REPRESENTATION.

A WARRANTY is a part of the contract; it must be distinctly expressed, and written either in or on the policy, or on a paper attached to the policy, or, as has been held, on a separate pape. distinctly referred to and described as a part of the policy. Then it operates as a condition precedent; that is, as a condition of the policy, which if it be not performed, the policy never takes effect; if it be not performed, there is no valid contract; nor can the non-performance be helped by evidence that the thing

warranted was less material than was supposed, or, indeed, not material.

It may be a warranty of the present time, or, as it is called, affirmative, or of the future, and then it is promissory. And it may be, although of the present and affirmative, a continuing warranty, rendering the policy liable to avoidance by a noncontinuance of the thing which is warranted to exist. Whether it is thus continuing or not must evidently be determined by the nature of the thing warranted. A warranty that the roof of a house is slated, or that there are only so many fire-places or stoves, would, generally, at least, be regarded as continuing; but a warranty that the building was five hundred feet from any other building, would not cause the avoidance of the policy if a neighbor should afterwards put up a house within one hundred feet, without any act or privity of the insured.

We have seen, that statements made on a separate paper may be so referred to as to make them a part of the policy. And it is usual to refer in this way to the written application of the insured, and to all the written statements, descriptions, and answers to questions, which he makes for the purpose of obtaining insurance. But a fair and rational, or, in some cases, a liberal construction, will be given to such statements.

It is quite certain that the word warranty need not be used, if the language is such to import unequivocally the same mean. ing. And an indorsement made upon the policy before it is executed may take effect as a part of it.

A statement may be introduced into the policy itself, and be construed not as any warranty, but merely as a license or permission of the insurers that premises may be occupied in a certain way, or some other fact occur without prejudice to the insurance.

A representation, in the law of insurance, differs from a war ranty, in that it is not a part of the contract. If made after the signing of the policy or the completion of the contract, it cannot of course affect it. If made before the contract, and with a view to effecting insurance, it is no part of the contract; but if it be fraudulent, it makes the contract void. And if it

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