26 Ga. App. 241 | Ga. Ct. App. | 1921
Lead Opinion
(After stating the foregoing facts.) We think the court erred in overruling the-demurrer to the petition. The sole question is: Was the suit brought in the name of the proper party? 'In other words, where property is insured and a mortgage given by the insured and owner covering the same property, and to the policy is attached a “ New York standard mortgagee clause,” with loss, if any, payable to the mortgagee “ as to the interest of the mortgagee only therein,” can the mortgagee, under the laws of Georgia, by virtue of said clause maintain an action at law in its own name for a total loss under the policy when the amount of its debt is less than the amount of the insurance? To this we answer: No. The Civil Code (1910), § 5516, provides as follows: “As a general rule, the action on a contract, whether express or implied, or whether by parol or under seal, or of record, must be brought in the name of the party in whom the legal interest in such contract is vested, and against the party who made it in person or by agent.” An insurance contract is no exception to this general rule. In St. Paul Fire & Marine Insurance Co. v. Brunswick Grocery Co., 113 Ga. 786 (3) (39 S. E. 483), it was held: “An assignment of a policy of fire insurance must be in writing.” See Northwestern National Insurance Co. v. Southern States Phosphate & Fertilizer Co., 20 Ga. App. 507 (4 a) (93 S. E. 157), and cases cited. In National Fire Insurance Co. v. Grace, 106 Ga. 264 (32 S. E. 100), the Supreme Court held, that “ in order to transfer the legal title to a policy of fire insurance from the person to whom the policy was issued to another, the assignment thereof must be in writing, and one other than
There was no transfer in writing from the assured to the plaintiff
Under the ordinary loss-payable clause the mortgagee has no greater rights than the insured so far as keeping the policy alive and valid, and should the insured violate any of the terms of the policy and thus invalidate it, the mortgagee could not recover, though in absolute ignorance of the conduct of the mortgagor, but under the “ New York standard mortgagee clause” the mortgagee is not affected by any act or neglect of the mortgagor in violation of the conditions of the policy of which the mortgagee is ignorant. In construing this form (New York standard) this court, in Southern States Fire & Casualty Co. v. Napier, 22 Ga. App. 361-362 (2) (96 S. E. 15), held that “this agreement operates as a separate and distinct contract of insurance upon the mortgagee’s interest, and gives to the mortgagee such an independent status as might authorize a recovery by him on the policy even though the circumstances were such as would prevent a recovery by the mortgagor.” Had the policy in this case been invalidated by reason of any act or neglect of the insured, and if under this policy she had no rights, then the mortgagee, whose interest is less than the amount of the policy, could have brought suit, not for the whole amount of the policy, but for the amount of its interest therein as shown by the amount due on the indebtedness to it. Such-is not this case. The insured still has an interest in the policy, the title to which is still in her, but the suit is in the name of another, and for the full amount of the policy, and in addition thereto is for damages and attorney’s fees. In Trust Company of Georgia v. Scottish Union & National Insurance Co., 119 Ga. 672 (1) (46 S. E. 855), it was held that “ a mortgagee may maintain an action at law, in his own name alone, for loss under an insurance policy payable to him as his interest may appear, when the amount of his debt exceeds or equals the value of the insurance,
After patient, prolonged, and diligent search in text books, encyclopedias, and reports, we find that in passing on the right to sue under insurance policies containing loss-payable clauses, the decisions of the courts of the several States are as different and divergent as the ingenuity of attorneys has found ways in which to bring suits where these clauses are involved. This is largely due to a difference of statutes of the several States and to the difference between the common law and code practice. Under the laws of Georgia we are convinced, as stated above, that the plaintiff had no right to maintain the action in this case, and that the court erred in-overruling the demurrer to the petition.
Judgment reversed.
Dissenting Opinion
dissenting. I do not agree with the conclusion reached in this case. There are apparently some conflicts in the decisions, and perhaps if I looked no further than''the letter of some of the decisions quoted to sustain the majority view, I might agree with it, but a careful consideration of these cases differentiates them from the case under consideration.1 The majority opinion in this case, in effect, sustains a general demurrer, which demurrer is upon the ground that the'plaintiff can not maintain an action at all upon this policy, because it has no legal- title-. Indeed, the majority opinion holds that the legal title to the policy remained in the insured, and as long as this was true the Jefferson Life Insurance Company '(the mortgagee) could not maintain an action at law thereon in its own name, or for the use of, or for the benefit of, or aS the appointee of- the insured. It will be seen from this that they base their' opinion' upon the fact that the mortgagee had no legal title. Perhaps so, but I can
The writer thinks that the principle of law governing this case is announced by this court in Northwestern National Insurance Co. v. Southern States Phosphate & Fertilizer Co., 20 Ga. App. 506 (2) (93 S. E. 157), where it is held that “in a policy of insurance, a loss-payable clause which contains a stipulation to pay a named mortgagee to the extent of his interest in the policy does not amount to an assignment of the policy, but is a provision merely that the mortgagee is an appointee to collect the insurance money due to the insured in case of loss, and the mortgagee must claim in the right of the insured and not in his own.” The plaintiff in the instant case was an appointee and claimed in the right of 'the insured, as shown by the amendment above quoted. In fact, the cáse referred to and the case under consideration are almost parallel so: far as this feature is concerned. See also Hartford Fire Insurance Co. v. Liddell Co., 130 Ga. 13 (60 S. E. 104, 14 L. R. A. (N. S.) 168, 124 Am. St. Rep. 157). And in applying that ease to the one under consideration it will be borne in mind that the plaintiff in the instant case had the consent of the insured, as shown by the amendment to the petition.
The judgment should, in my opinion, be affirmed.