180 Pa. Super. 1 | Pa. Super. Ct. | 1955
Opinion by
This is an appeal by defendant insurance company from the entry of judgment on the pleadings in favor of the plaintiff, trustee of the estate of Samuel Fetterolf, deceased, mortgagee, in an action in assumpsit based on the mortgagee clause contained in two poli
The facts disclosed by the pleadings reveal that on September 14, 1936, Frank Varano and Catherine, his wife, owners of the western half of a two and one-half story frame dwelling located at 926 Scott Street in the Borough of Kulpmont, executed and delivered to the trustee of the estate of Samuel Fetterolf, deceased, a mortgage covering their house and lot to secure the payment of $1,300.00 with interest at the rate of six per centum per annum. The property was insured from loss by fire under two policies of fire insurance totalling $2,900.00 issued by the defendant insurance company to which were attached the standard form of mortgagee clause in favor of the Samuel Fetterolf Estate. The terms and provisions of the printed mortgagee clauses, attached thereto and made part of the policies by the defendant, provide, inter alia, as follows : “Loss or damage, if any, under this policy, shall be payable to Samuel Fetterolf Estate. Address, Mt. Carmel, Penna. as First mortgagee (or trustee) as interest may appear. . . .” Each of these policies also contained the following provision: “No suit or action on this policy for the recovery of any claim shall be sustainable in any court of law or equity unless the claimant shall show compliance with all the requirements of this policy, nor unless commenced within twelve (12) months next after the fire.” On March 6, 1942, while the fire insurance policies were in force and effect, the property of the insured was destroyed by fire. On March 1, 1943, the owners of the insured
The trustee-mortgagee instituted this action in assumpsit by filing a complaint on January 9, 1950. In its answer, the defendant, under the heading of “New Matter” asserted the following defenses: (1) the action of the plaintiff is barred by the Statute of Limitations because it was commenced more than six years after the cause of action arose; (2) the action of the plaintiff is barred by the limitation contained in the policy which bars any action unless commenced within twelve months next after the fire; and (3) the plaintiff abandoned its claim against the defendant.
It has long been well settled that a standard mortgagee clause in a fire insurance policy creates a separate, distinct and independent contract of insurance in favor of mortgagee. Willits v. Camden Fire Insurance Ass’n, 124 Pa. Superior Ct. 563, 189 A. 559; Overholt et ux. v. Reliance Ins. Co. of Philadelphia et al., 319 Pa. 340, 179 A. 554. As stated by Judge, now President Judge, Rhodes in Abbottsford Building & Loan Ass’n v. William Penn Fire Insurance Co., 130 Pa. Su
There were, in the instant case, two separate and distinct contracts of insurance, one in favor of the owners of the property and the other protecting the mortgagee’s interest. Either the owners or the mortgagee could have brought suit to recover for the loss occasioned by the fire. However, in bringing any action on the policy for indemnification of loss both the owners and the mortgagee were bound by the express contractual limitation contained therein which requires that any suit or action on the policy must be commenced within twelve months next after the fire. See Miners Savings Bank of Pittston v. Merchants Fire Insurance Company, 131 Pa. Superior Ct. 21, 198 A. 495. It is clear that the plaintiff in this case could not bring an action on these policies for damages caused by the fire on March 6, 1942. The twelve months limi
In Ebensburg Building & Loan Ass’n v. Westchester Fire Ins. Co., 28 Pa. Superior Ct. 341, decided in 1905, this Court held that the insurer cannot disregard the stipulation of the mortgagee clause requiring payment of the funds to the mortgagee as its interest may appear, as has been done in the instant case. In that case it was held that an action could be brought on a standard policy of fire insurance containing a mortgagee clause in the name of the mortgagee alone; that such mortgagee clause attached to the policy was notice to the insurance company of the rights of the mortgagee; and that, if the company, without the consent of the mortgagee, paid the amount of the loss to the mortgagor, it was still liable to the mortgagee. See Abbottsford B. & L. Ass’n v. William Penn Fire Insur
“The effect of issuing a policy with such a clause is to charge the insurer with a duty to pay the proceeds to the proper person, or persons, if more than one be designated. . . . Upon loss, the holder of mortgage notes recognized by such clause has a superior right to the policy proceeds.”
It thus clearly appears that in paying the proceeds of the fire loss incurred under the policies here involved to the owners, the insurer violated the express provision of the mortgagee clause requiring payment to the mortgagee and the court below properly entered judgment on the pleadings in favor of the plaintiff and against the defendant.
The contention that plaintiff-mortgagee’s claim is barred by the Statute of Limitations of March 27,1713, 1 Sm. L. 76, 12 PS-§31, is without merit. This contention is based on the assumption that plaintiff’s cause of action arose on March 6, 1942, the date of the fire, and therefore cannot be maintained because more than six years had elapsed when plaintiff commenced the action here involved on January 9, 1950. It is true that any action plaintiff might seek to bring on its separate and independent contract of insurance more than six years after the cause of .action on such policy
The contention of the defendant that plaintiff had abandoned its claim is also without merit. The insurer had notice of the mortgagee clause the purpose of which is to protect the mortgagee’s interest. The disposition of any proceeds determined to be payable upon loss incurred under the policies was governed by
Judgment affirmed.