Dick v. Franklin Fire Insurance

Norton, J. On the trial of this cause in the circuit court of the city of St. Louis, judgment was rendered for the defendant, which, on appeal to the St. Louis court of appeals was affirmed, and the case is before us on plaintiff’s appeal from the said judgment of affirmance. It was held by the court of appeals that a trustee in a deed of trust in the nature of a mortgage, has an insurable interest in the mortgaged premises, distinct from that of the mortgageor, and that a conveyance by the mortgageor of his interest, in no way affects the trustee’s right to insure his interest. It was also held, that when the trustee insures his interest in the mortgaged property, and the policy of insurance stipulates that he shall, in case of loss, assign to the insurer an interest in the deed of trust equal to the amount of loss paid, provided such assignment, shall in no way, prejudice the beneficiary’s claim in the trust to recover the full amount of his loan and proper charges, the trustee cannot recover for a loss until he shall have performed his agreement to assign, and that in such case the subrogation clause is material, and there can be no recovery against the insurer till this condition is complied with, even though the mortgaged property is not worth the amount of the debt secured, less the amount the insured is liable to pay. It [108] was also held that the insurance in this case was of the interest of the trustee and not of the mortgageor. The case is reported in 10 Mo. App. 876, where the court in an elaborate opinion delivered by Judge Thompson, sustains the above propositions, both by reason and abundant authorities therein cited. Being satisfied with the correctness of the conclusions arrived at by the court of appeals, for the reasons given in the opinion, which it is unnecessary here to repeat, the judgment is affirmed. All concur.