Millaudon v. Western Marine & Fire Insurance

Bullard, J., delivered the opinion of the court. This is an action upon a policy of insurance against fire, subscribed by the defendants upon five tenements, three thousand dollars on each. The total loss by fire, is admitted within the time limited by the policy, and it is admitted that the value of the property greatly exceeds the amount underwritten by the defendants. The case would, therefore, be perfectly free of difficulty, independently of a second policy obtained by the plaintiff from another company for a further sum of fifteen thousand dollars,, of which due notice was given to the defendants, and the second policy endorsed on the first. The defence in this case turns upon the question how'far the obligations of the first insurers have been modified or changed by the second policy, according to a just interpretation of the sixth condition of the insurance, which declares that “ persons insuring property at this office, must .give notice of any other insurance made elsewhere on their behalf on the same, and cause such other insurance to be endorsed on their policies, in which case each office shall be liable to the payment only of a rateable proportion of any loss or damage which may be sustained, and unless such notice is given, the insured shall not be entitled to recover in casé of loss.” The second insurance, by the New-Orleans Insurance Company, was on the same property or tenements, “ valued at six thousand dollars each, making in all thirty thousand dollars, of which fifteen thousand dollars are insured in the Western Marine and Fire Insurance Company: this policy covers the other fifteen thousand dollars.” This last is clearly a yalued policy, and according to the general principle of the law of insurance, in case of total loss, such valuation would be binding on the insurers, unless fraud be shown. It cannot be said that the valuation by the second policy, became by notice to the first insurers binding on them,’ and [32] converted their policy from an open, to a valued one. If so, there is an end of the case, for the loss being total, and the valuation conclusive, as to the indemnity to be paid, each office would have t.o sustain one-half of the loss estimated at thirty^ thousand dollars. The second policj?, clearly cannot pUt grs(. jngurerg fo guriori Casu, and it follows, that even jn cage 0f jogs insurers would be liable only to 7 . J make good the loss, if that loss really amounted to the sum subscribed by them. if a subsequent provision in respect to prior m-mount of insdra-ble interest In it ■will be the same policy; Üfor fithe assured may insure again and again the same reeover^but*one tiifs^hctma re? cover ofthe first undeniriteS!ent Those who pay the loss, may demand a propor-tionable contribution from the other underwriters, who are, in this respect, sureties for each other. Insurance on merchandise, furniture or buildings, against lire, the rules as to valuation are the same as in relation to a ship or cargo. If the policy is open in its form, the value of the interest must be proved. The amount of interest insured in a subsequent policy, will depend on the amount insured in previous policies, A cargo valued at twelve thousand dollars, and in a second {Solicy was insured at twenty-seven thousand five hundred dollars; there remained an insurable interest of fifteen thousand five hundred dollars, embraced by the; second msu- [32] ipge secong insurers admit, by their policy, that there remained an interest in the assured, not covered by the first ■. ... . n , ,T . . policy, amounting to fifteen thousand dollars. 1 his interest *s covere(l by them. It appears to be a settled principle, that if the subsequent policy contain no provision in respect to .. 1 A . x prior insurances, the amount of insurable interest for such P°licy will be the same as for the first, for the assured may *r>sure again aud again the same property, against the same risks, if he will pay the premium ; but he can recover but one indemnity, and this be may recover of the first or subsequent underwriters, and those who pay the loss, may demand a proportionable contribution from the other insurers. The different underwriters are, by this means, sureties for each other. 1 Phillips, 326. The same author says expressly, that in case of insurance on merchandise, furniture or buildings, against fire, the rules as to valuation, are the same as in relation to a ship or cargo; if the policy is open in its form, the value of the interest must be proved. 1 Phillips, 320. If the defendants will not adopt the second insurance as to valuation, we cannot well see how they can take advantage of it for the purpose of exonerating themselves from a part of the loss for which they are clearly liable under their own policy. It appears to us, that the sixth condition applies to subsequent insurances, by which the same interest is covered as by the first, or to cases of several successive open policies on the same property, and to guard against double insurances. The same author, above cited, lays down the doctrine, under the authority of decided cases, that the amount of interest to [33] which a subsequent policy applies, will depend on the amount insured in the previous policies; a cargo valued in a prior policy at twelve thousand dollars, the amount insured, was valued in a second policy at twenty-seven thousand five hundred dollars. Though the whole cargo was insured in the first policy,, yet there remained an insurable interest of fifteen thousand five hundred dollars for the second. Since, as the property was valued in the second policy, this excess remained over the amount previously insured. 1 Phillips 327. We are, therefore, of opinion, that the defence here set up, cannot avail the defendants, and that they are liable to pay the full amount underwritten by them. It is, therefore, ordered, adjudged and decreed, that the judgment of the Parish Court be affirmed, with costs.