Lewis v. London & Lancashire Fire Insurance

Bijur, J. Plaintiff sued to recover the unearned premium under a policy of fire insurance issued to her which contained the standard mortgagee clause including the provision “ loss, if any, payable to Mary J. Kingsland as mortgagee.” The cause of action is based on section 122 of the Insurance Law, which provides that a fire insurance company “ shall cancel any policy of insurance upon the request of the insured,” and shall return the amount of the premium paid less the short-rate premium. When she applied for repayment of the premium, she presented no authorization [177] from the mortgagee, nor did she have, nor undertake to surrender, the policy. It is quite evident that “ the insured ” under section 122 includes a mortgagee for whose benefit a mortgagee clause has been inserted in the policy. Indeed, the principle is well settled that, so far as any_ interference by the original assured may be concerned, the mortgagee holds an independent contract with the insurer. Hastings v. Westchester Fire Ins. Co., 73 N. Y. 141, 147, 154; Eddy v. London Assurance Co., 143 id. 311. Respondent cites Griffey v. New York Cent. Ins. Co., 100 N. Y. 417, as authority for the proposition that “ such a provision in a policy is at most a mere appointment to receive, a direction to the company to pay, in the event of loss.” This reference is utterly irrelevant, for not only was there no such provision in ihe policy .in the Griffiey case, but the statement of fact, referring to the transfer of the policies as collateral security, says (at p. 418) : “ The consent of the defendant (Insurance Company) was not endorsed upon the policy, nor does it appear to have been given or asked for.” Plaintiff’s other reference (Lewis v. Guardian Assur. Co., 181 N. Y. 397) is unfortunate, because the point held in that case, namely, that the mortgagee’s interest was so complete and vested that he must be made a party to a suit by the insured upon the policy, confirms the view which I have taken. Plaintiff seems also to make some point of a claim that the company had without her consent transferred on its books or elsewhere her interest in the policy to some other person. Without expressing any view on the question whether that might give her a right to obtain some degree in equity fixing her interest in the policy, it certainly does not constitute the basis of an action for the return of the premium, nor do I see how plaintiff has been damaged thereby. Seabury and Guy, JJ., concur. Judgment reversed and new trial ordered, with costs to appellant to abide event.