3 Barb. Ch. 63 | New York Court of Chancery | 1848
The question presented in this case is one of considerable importance. But as the contract of reassurance was virtually prohibited in England more than one hundred years since, and before the principles of the law of insurance had been well settled there, nothing is found in the English reports upon this point. And, so far as I have been able to discover, the question has not heretofore arisen before any of the courts of this country for decision. The validity of the contract of reassurance was early acknowledged among the maritime nations of Europe; being found in the Guidon. and also in the marine ordinances of Louis the fourteenth. (Le Guid. ch. 2, art. 19; Ord. of 1681, tit. Assur. art. 20.) It is
Valin, if he lias not confounded a reinsurance of the- first in surer, against the risk he-has assumed; with what is said in ,the 20th article of the Guidon, as, to a reassurance' obtained .by the person originally insured, against the insolvency of -his first insurer, decides "the question in favor of" the claim of -the complainants "in' this suit. For, in his commentary upon the 20th article of the ordinance of 1681, relative to insurances,- he says, the insurer, who procures a .reassurance, remains subject to the same Obligation to the person previously insured by him, while he causes his own solvency to he insured. That the effect of it is, that the person insured has two. insurers, instead of one, with a perfect right of action directly, and in solido, against each of them ; so that he is not obliged to proceed against the first insurer before attacking the second, provided tile engagement in solido has been stipulated in the policy of reassurance -; otherwise a discussion will be necessary. (2 Becane’s Valin, b. 3, tit. 6, art. 20, p. 278.) Emerigon, however, is óf ah entirely different opinion. He says, the risk which the first insurer-has assumed, forms, as between him and the reinsurer, the stibject matter of the -reinsurance; which is a new contract, eñtirely' distinct from the first which still subsists in all "its force. For that reason, the premium of reinsurance may bé greater, or it may be less, than that upon the,first insurance., If the' premium is less, it is a gain which the first insurer makes'; if it is more, it is his loss. It is no concern of the person first insured, who is not'brought into this new con
Delvincourt, a very recent French writer, in his institutes of commercial law, after stating the opinions of Yalin and of Emerieon, upon the questions now under consideration, arrives
The law on this subject appears to be understood in the same way in Scotland. For Bell, after stating that the insurer has himself an insurable interest, which he may protect by a reinsurance, says : “ This transaction, in the event of the original insurer’s insolvency, the person originally insured has no interest in, and cannot recover from the last insurer in any other way than in common with the other creditors of the first insurer.” (2 Bell’s Law Dict. 93, art. Insurance.) Millar says a reinsurance is a hedging contract, by which the underwriter withdraws himself from all risk ; and'that an insurance against insolvency is a contrivance by which the assured strengthens his former security. (Mill. on Ins. 233.) And Marshall understands the law.in England, on this subject, to be the same that it is stated by Emerigon to be in France ; although he refers to no English decisions. (1 Condy’s Marsh. 143.) Judge Livingston also, in the case of Hastie v. De Peyster, says there is no privity at all between the person originally insured and the reinsurer. (3 Caines’ Rep. 196.)
The weight,of authority, therefore, is decidedly against Valin upon this question. And from the nature of the contract, of reinsurance, and the want of privity between the reinsurer and the person first insured, I think it does not come within the rule, that the principal creditor is, in equity, entitled to the benefit of all counter bonds and collateral securities given by the ' principal debtor to his surety.
The claim of the complainants, therefore, cannot be sustained;