| Tenn. | Jun 7, 1890
OPINION OP COURT.
This case has been very ably and elaborately argued, and we deem it not inappropriate to acknowledge our very great indebtedness to the learned counsel who have appeared in the cause.
The first question which we shall consider is as to the liability of the railway defendants for a breach of their obligation as carriers of goods. The decree of the Chancellor against them was predicated up'on a supposed obligation by contract to cover with insurance the cotton of complainant. It has been, however, very .much pressed upon us
The primary object in making the railway companies defendants, as indicated by the form of the original bill and the relief especially prayed, seems to have been to reach the compress company through subrogation to the rights of the railway company having a contract witli the former for insurance covering cotton while in its warehouse for compression.
The bill concludes with a prayer for general relief; and if the facts stated in the pleadings are such as would entitle complainant to other or different relief than that especially prayed, then, under well-settled rules of equity pleading, such other appropriate remedy may be granted. The facts which involve any question of direct liability of the railway defendants as carriers, which are stated in the bill, are, briefly, as follows:
First.- — -That the Newport News and Mississippi Yalley Company had issued its permit for the admission of this cotton into the press designated for cotton intended for shipment over its line, on account of the Indiana, Bloomington and Western Railway, a connecting carrier.
Third. — That the dray receipts of the compress company had been delivered to the Indiana, Bloom-ington and Western Railway, and its through bill of lading accepted for carriage of the cotton at through rate of freight from Memphis to Clinton, Massachusetts.
Fourth. — That the cotton was burned Avbile yet in the actual custody of the compress company, but after issuance of bill of lading.
This bill of lading is made an exhibit to the bill, and contains, among other things, the following special stipulations:
First. — That any carrier over whose line the cotton may pass shall have the privilege, at its OAvn expense, of compressing the cotton for convenience of carriage.
Second. — That the carrier shall have exemption from liability for loss or damage by fire “ while at depots, stations, yards, landings, warehouses, or in transit.”
Third. — That each connecting carrier shall have the benefit of all the stipulations of the bill of lading.
Fourth. — That each connecting carrier shall be responsible only for loss or damage occurring on its oavii -line.
The liability of both the Indiana, Bloomington and Western Railway and the Newport News and Mississippi Valley Company is to be determined by the common law, except in so far as modified by valid stipulations contained in the bill of lading. The exemption from liability for loss by fire at any “depot, station, yard, landing, or ware
The validity of this fire clause is not questioned in the pleading, either by allegation that it was without consideration, or imposed by duress, or unreasonable for any cause. In such case, it appearing that it was contained in a through bill of lading, wherein a through rate was granted, for carriage over line of more than one carrier,' it will be presumed that the stipulation was upon a sufficient consideration and reasonable. This exemption would, however, be invalid as a protection against a loss by fire the result of the negligence 'of the carrier or of its agent for compression. The bill fails to charge that the loss was due to any want of care, either upon «the part of the carrier or of any of its agents or servants. Where, therefore, the pleadings show a valid stipulation for exemption from loss or damage by fire, and it is further shown that the failure of the carrier to safely carry and deliver was due to a loss by fire, no case is made against the carrier unless the fire be charged to have been the result of negli
We are therefore of opinion that, under the pleadings, no such facts are stated as would entitle complainant to any decree against either of the railway defendants for any breach of duty as carriers. The decree pro confesso against the Indiana, Bloomington and Western Railway did not authorize any final decree fixing liability upon it for this loss. No relief can be granted upon a bill in equity taken for confessed, beyond the fair scope of the allegations and prayer of the bill. McGavock v. Elliot, 3 Yer., 374; Ross v. Ramsey, 3 Head, 16.
The decree actually pronounced was based upon the supposed liability of that company under an obligation to insure, and not by reason of any, breach of carrier duty. That decree is not before us for review, inasmuch as that company has not appealed; but as it is now sought to affect the defendants who have appealed, by reason. of the assumed liability of the non-appealing carrier, we have felt it necessary to consider the weight to be attached to the decree against the'Indiana, Bloom-ington and Western Railway.
Second. — Is the defendant compress company
The seventh issue submitted to.the jury involved the degree of care and diligence required to be exercised by the cotton-press company, with regard to precautions against fire and saving cotton from fire at and before this loss.
The jury were instructed upon this issue that “if you find that the defendant compress company held this cotton at the time of its destruction as warehouseman only (that is, for storage and compression without any superadded obligation, and in this connection you need not consider the question of insurance), then the law imposed on it as the measure of its duty, ordinary care, or, as specifically stated by an eminent law writer, ‘ the care and diligence which good and capable warehousemen are accustomed to show under similar circumstances, or that which business men experienced and faithful in the particular department, are accustomed to exercise when in the discharge of their duties.’ The warehouseman must erect a good building, reasonably suited and adapted for safe-keeping of the particular property intended to be taken care of (it need not be fire proof), and he must keep it watched in proportion to the risks he is subject to, and the value of the goods with which he is likely to be intrusted, having of course in view the position in which his building is to stand, and his capacity of thus burdening himself without incurring unjustifiable expense.”
The response of the jury to this issue, as defined by the charge quoted, 'was in the following words:
“ In response to the seventh issue they find and answer: The jury are unable to determine from the evidence the immediate cause of the fire. As to the measure of care and diligence used in protecting and caring for the cotton as warehouseman, the jury are of the opinion that ordinary care and diligence was used in the warehouse proper, or upstairs, both before and at the fire, the water supply seeming ample, and the engine and hose were handled with promptness and intelligence; but, in the opinion of the jury, the construction of the warehouse was faulty in some respects, especially in not being closed up on the west side, or riverfront, below the level of the floor where cotton was held. The jury think this space or opening should have been closed up, or there should have been a watchman stationed under the warehouse or on the levee in front of the warehouse.”
The finding of the jury must be construed as a finding that the compress • company was liable only as a warehouseman, and that 'neither by “ agreement or confidence” had it assumed any other or higher responsibility than that of warehouseman for storage and compression. If it had assumed absolute responsibility for. the safe-keeping of the goods, or direct liability for a loss by accidental fire, the jury should, under this charge, have reported such superadded duty or responsibility. Under the rule of ordinary care, this finding acquits the defendant of negligence, unless the defect in the building pointed out by the jury in some way was the proximate cause of the loss or contributed to the loss. ¥e -have carefully examined the very voluminous proof upon this question of negligence, and are entirely satisfied with the finding of the jury, and with the decree of the Chancellor holding that no negligence was established.
The defect in the building referred to by the jury does not appear to have in any way contributed to the loss, ■ or to have been the cause of the fire. There is a total want of connection between the negligence and the injury. This want of causal connection is fatal to any demand that a decree should pqss finding a loss by negligence. The rule, as we understand it, is that “the bur
Under this rule the burden of proof was upon complainant to show that this fire was the probable result of negligence. If this defect in construction of building can be shown to have been the proximate cause of the fire, or to have contributed to the loss, then the liability is made out; but the proof makes it absolutely certain that this fire did not originate from beneath the building— the exposed part — but that it originated upon the heads of bales of cotton standing on end upon the floor. At the time it was discovered it did not cover more than the heads of three bales. If it had appeared that the fire originated on the floor, or beneath the floor, then a connection between the defective and exposed building and the fire would have been rendered probable. The loss, therefore, was not, in the opinion of the Chancellor, attributable to this exposure of the under parts of the warehouse 'to the invasion of the tramp or the torch of the incendiary. In this view we agree with him.
The answer of the defendant compress company presents an issue of negligence which was wholly
Third. — It is next insisted that under the facts of this case the obligation of the compress company is that of an insurer against loss or damage by fire; that its liability is not for a breach of obligation to take out insurance, nor for damage resulting from false representation that its policies were sufficient in terms' and amount to cover owner’s interest in all cotton while in its compress, but that it is liable as an insurer.
It may be assumed that the corporate powers of this defendant were ample to authorize it to contract with its customers that it would assume liability for any loss by fire, whether -accidental or the result of its negligence. But did it do so ? The contracts between the railway lines and the
Memphis, Tenn., Oct.'20, 1887.
Received at the Merchants’ Cotton-press and Storage Company No. 4, from Jones Bros. & Co., the following cotton in good order:
N. B. — It is agreed anid understood that the cotton enumerated below is fully covered by the policies of insurance of the Merchants’ Cotton-press and Storage Company, of Memphis.
Marks. No. Cotton Bales.
ETON 25 Twenty-five B. C.
Jones. Cooper.
Me. I.
Memphis, Tenn., -, 188
Received of A. A. Patón & Co., by Merchants’ Cotton-press and Storage Company, for compressing, and covered by them with insurance, the following cotton in good order at press No.-:
If held in press over fifteen days before bill of lading issues, or if sold while in press, fifty cents per bale per month charges will be collected before delivery or shipment.
Oct. 21, 1887.
Memphis, Tenn., ■-, 188
Received by the Merchants’ Cotton-press and Storage Company, from E. L. Topp & Co., the following cotton in good order and condition, to be compressed:
If held in the press over fifteen days before the bill of lading issues, or if sold while in press, fifty cents per bale per month charges will be collected before delivery or shipment.
Oct. 22, 1887.
*39 Memphis, Tenn., 10-1887.
Received of C. E. F. Hall, Agent, in good order, the following cotton, marked as per margin, by-.
Memphis, Tenn., 9, 28, 1887.
Received at the Merchants’ Cotton-press and Storage Company No. 4, from Alsobrook, Bowling & Co., the.following cotton in good order:
N. B. — It is agreed and understood that the cotton enumerated below is fully covered by the policies of insurance of the Merchants’ Cotton-press and Storage Company.
Subject to storage and insurance if held in the press over fifteen days before bill of lading is issued. Not transferable without charges from date of receipt.
The voluminous proof as to “course of business,” “general understanding,” and “local custom” has been carefully examined, and we concur with the Chancellor in. holding that there was no such uniformity in the “course of business” or concurrence in “general understanding” between the compress company and the buyers and shippers at Memphis as to constitute proof of any assumption of the liability of an insurer. . As to verbal agreements and representations concerning this obligation and its extent, the finding of the jury seems, conclusive against the claim now asserted by complainant.
In response to the third issue of fact the jury responded that “they assumed a liability verbally and according to terms of the written contracts to carry insurance for the benefit of railroads, transportation lines, or owners upon -all cotton in bales while in their possession.”
In response to the fourteenth issue, which called for a finding as to representations made as to its
These, findings 'are abundantly sustained by the evidence, and we decide that' the compress company did not agree or promise, verbally or otherwise, to assume the responsibility of an insurer against loss or damage by fire.
Fourth. — This brings us to a consideration of the alleged obligation of the - compress company to carry insurance in terms and amount sufficient to cover the interest of owners until actual delivery to the carrier.
The learned Chancellor, in an able and elaborate opinion, reached the conclusion “that both the Newport News and Mississippi Yalley Company and the compress company assumed an obligation to fully insure the cotton in the press from the moment it was received there until it was delivered on the cars for transportation.”
The position of counsel representing the compress company, presented in pleadings and in argument, is that its contract for insurance of owner’s interests is found alone in its dray ticket receipts, and that upon the surrender of this contract to the carrier, and the acceptance of bill of lading, the compress company ceased to bear any relation, by contract or otherwise, to the depositor of cot-/ ton, and that the carrier- was substituted in the
The evidence establishes that at the date of this transaction, and for several years previous, the railway companies had no rate for compressed cotton. The rate was exclusively for uncompressed cotton in bales. The carriers were accustomed in their bills of lading to stipulate for the privilege of compression at their own expense. For many years the defendant compress company had had an absolute monopoly at ■ Memphis of the compression business. During this time it had contracts with every railway entering Memphis, identical in substance with the one set out in statement of the case. Under their contracts each carrier contracted to give to this defendant all cotton shipped over its line for compression. The agreement by which the carrier contracted with the compress company to issue bills of lading upon its dray tickets was undoubtedly the result of an arrangement between the carriers and shippers and compress company, and was intended to facilitate the prompt issuance of bills of lading and avoid delay while awaiting compression. Th'e consignor of cotton was thus enabled, so soori as he could have his cotton drayed to the compress, to obtain a bill of lading, upon which he could draw for
The fourth clause in the compression contract with the Newport News and Mississippi Valley Company, constituting the compress company the agent for the carrier for the receipt of cotton, is the important feature of this contract. It was an essential part of the arrangement by which the carrier accepted a deliveiy at the cotton-press as a delivery to it, and by which the consignor as-, sented to the stipulation permitting the carrier to have all cotton intrusted to it for transportation compressed before shipment. This agency for any particular carrier could not, with reference to any particular lot of cotton, begin until the cotton had been received for compression, and for shipment over line of a designated carrier with whom a compression contract existed. Hence arose the permit system, under which no cotton was received into the compress (as a general rule) until a permit had been granted by the carrier controlling the particular press in which the shipper wished his cotton deposited. It is true that permits were not in every instance demanded, and it is likewise true that the depositor obtaining such permit was not thereby obligated to ship'his cotton out over the line granting the permit. It was regarded, however, as indicating that the depositor expected to “route” his cotton out over the line granting per
The liability of the carrier to the shipper unquestionably began when it issued its bill of lading. To protect itself it contracted that the compress company should stand responsible to it as a bailee for hire, and that it should carry insurance covering the cotton against loss by fire while in its custody. It might have limited the ■ obligation of the bailee to an insurance of its interest in the cotton from date of issuance of bill of lading, or to insurance against liability upon its bill of lading. In such case, if the insurance had issued in these terms, the owner’s interest in the insurance would have depended upon the primary liability of the carrier to the owner by reason of some breach of carrier obligation. But the carrier did . not limit the obligation of the compress company to a procurement of insurance protecting only its insurable interest. In the same terms by which the compress company contracted to compress all cotton, it contracted to carry insurance upon all cotton in
An insurance for the benefit of a carrier upon the goods in its custody, not limited to an insurance of its liability or interest, is an insurance of the whole value, and one in which the owner has an interest. The ease of Home Insurance Company v. Baltimore Warehouse Company is an instructive and well-reasoned case, and meets our approval. The insurance in that case was taken out by warehouse-men against loss by fire “on merchandise their own, or held by them in trust, or in which they have an interest or liability,” contained in a designated warehouse. It was held that the policy •covered the merchandise on storage itself, and not merely the interest or claim of the bailee. The assured was allowed to recover the entire value, holding the 'remainder; after satisfying their own loss, as trustees for the owners. The warehouse-
Evidence was offered tending to show that the insurer and assured intended only to insure the interest or liability of the warehousemen. This proof was rejected upon the ground that there was no ambiguity; that the merchandise itself was insured, and not the interest of the assured; and these plain words could not be explained away by parol. 93 U.S., 527" court="SCOTUS" date_filed="1876-11-20" href="https://app.midpage.ai/document/home-insurance-v-baltimore-warehouse-co-89405?utm_source=webapp" opinion_id="89405">93 U. S., 527.
The case of London and North-western Railway Company v. Glynn, 1 Ell. & Ell., Q. B., 652, is a leading case much cited. The policy was for £15,000, “on goods their own and in trust as carriers” in a certain warehouse. In an action on the policy it was held that, to the extent of the policy, the whole value of goods in the warehouse in the carrier’s possession was insured by it, and not merely their interest in the goods, and that the carriers would be regarded as trustees for the. owners of the amount thus recovered, after deducting their charges as carriers.
So in the case of California Insurance Company v. Union Compress Company the policy was taken out by the compress company to cover cotton “their own, or held by them in trust or on commission.” It was conceded that this policy covered owner’s interest; but the ‘contention was that railway companies which had issued bills of lad
In the light of these authorities, we are of opinion that the contract between the Newport News and Mississippi Valley Railroad Company and the Merchants’ Cotton-press and Storage Company imposed an obligation upon the latter to insure all cotton in their presses against loss by fire, and that this obligation was imposed in such broad and unambiguous terms as to require insurance upon the full value of the cotton, and covering every interest in such cotton.
The compress company was under no duty to insure owner’s interest, unless this contract imposed the duty and furnished the consideration. That it regarded this obligation as imposed would seem to be indicated by the terms of its policies of insurance on cotton in press No. 4. This insurance amounted, at date of this loss, to $301,000, and was in about forty different offices. All of this insurance was (in so far as the written parts of the policy show) in the same terms and upon same interest, and was in these words:
*48 “ On all cotton in bales received by tliem as agents, for the benefit of railroads, transportation lines, or owners, in the boundaries of the Merchants’ Cotton-press and Storage Company’s west navy-yard compress, situate and bounded as follows: East by the west line of Eulton Street, west by the Mississippi River, north by Auction Street, and south by Market Street.
“The liability of the insurers is to begin on the receipt of said cotton on premises of the assured, as herein described, for compressing, and is to cease and terminate when removed from the platforms of the Merchants’ Cotton-press and Storage Company for transportation.”
In express terms these policies covered “ all cotton in bales received by them as agents,” and for the benefit of railroad or owner. We attach no importance to the disjunctive “ or.” The clear contract was to insure the cotton itself in the hands of" the assured as agents; whether agents for railroads, transportation lines, or owners, it was alike insured, and for the benefit of these different classes of persons having insurable interest. There is no ambiguity in the policies, and evidence offered to show an understanding limiting the plain and obvious meaning of the written contract of insurance was not admissible, and was properly rejected. 93 U.S., 527" court="SCOTUS" date_filed="1876-11-20" href="https://app.midpage.ai/document/home-insurance-v-baltimore-warehouse-co-89405?utm_source=webapp" opinion_id="89405">93 U. S., 527; 133 U. S., 418; 36 Md., 898; 66 Md., 339" court="Md." date_filed="1887-01-04" href="https://app.midpage.ai/document/fire-insurance-assn-of-england-v-merchants--miners-transportation-co-7897234?utm_source=webapp" opinion_id="7897234">66 Md., 339.
That this obligation was imposed upon the compress company primarily to secure the railway
The obligation thus imposed upon the compress company to insure' .the cotton itself against any loss, during the entire period of its custody, explains the representations made by the officers and agents of that company concerning its liability to carry insurance. It accounts for and explains its representations — made orally and in writing and printed upon its dray tickets — that cotton was insured for benefit of owners; and the finding of the jury that it represented that cotton was so insured while in its press is abundantly supported. This obligation was co-extensive with its custody. It was not limited by the life of the dray ticket. It was not affected by the issuance of the bill of lading. The actual 'possession of the cotton remained with the compress company. The effect upon the possession of the compress company of the issuance of a bill of lading while the cotton was in fact in the custody of the compress company, was discussed in Insurance Company v. Compress Company, supra. What was there said is so applicable that we quote a paragraph: “As to the suggestion that by the bills of lading the possession of the cotton was transferred to the railroad companies, and that the policy was avoided thereby,
Fifth. — What is the liability of the Newport News and Mississippi Valley Company by reason of the failure of the cotton-press company to carry insurance sufficient in amount to cover full value of owner’s interest? Was this railway company under any obligation as to insurance? The Chancellor on the facts, and upon a construction of its contract with the compress company, reached the conclusion that “the railroad company, by its contract with the compress company, in express terms assumed this obligation, and appointed the latter its agent to carry it out.”
Unless the imposition of an obligation upon the compress company is the same thing in law as an express assumption of a like obligation, then this conclusion is not to be sustained. Nowhere in that contract does the railway company assume that
The compress company was regarded by all who had dealings with it as the only obligated party as to insurance. The bill nowhere charges an obligation, imposed by law or assumed directly or indirectly by the carrier, to insure or cause to be insured the interest of shippers. As stated in a foregoing part of this opinion, the relief which seems to have been contemplated by the pleader was a mere substitution of complainant to the rights and equities of the railway company under its contract . with the compress company. That
"Whatever loss complainant has sustained by failing to protect itself by its own insurance, was wholly due to reliance upon the representations concerning insurance made by the compress company. The railway company entered into no direct obligations with owners concerning insurance, and made no representations, misleading or otherwise, on the subject. The obligations and representations of the compress company were not the obligations .or representations of any authorized agent of the railway company, and there is nothing in this record which entitles complainant to any decree whatever against the railway company.
Sixth. — We come now to a consideration of the damage resulting to complainant by the breach of the obligation of the cotton-press company to carry insurance sufficient to cover full value of the cotton destroyed by fire. To the extent that it took out policies of insurance in good and solvent companies, in terms covering owners of cotton against loss or damage by fire until actual delivery to the carrier, it has complied with its obligation. As to such insurance-it is a trustee for the, owners, and
Assuming that the insurance in force shall be collected and distributed pro rata, it will leave .about four-sevenths of the value uninsured by policies carried by the warehousemen. Is the defendant liable for this uninsured loss? This will depend upon the legal effect of a contract to carry insurance. A contract to carry insurance, or to cover with insurance, or a representation to a depositor that his deposit is insured, is very different in its legal effect from the absolute liability of an insurer. In the latter case the' action would be upon the risk or policy for the value of the property destroyed, if within the amount of the risk. In the other cases the action would be for such damage as resulted from breach of the- obligation to carry insurance. The measure of damages may in both cases be- the same — the value of the property destroyed. The difficulty in this case arises from the fact that complainant at the time of this loss was covered by a marine risk in the Insurance Company of-Rorth America, containing a fire clause covering “ goods on shore prior to shipment” for ten days. That this risk covered this cotton at time of loss is not disputable. Prior to the bringing of this suit an amount of money equal to the full value of the cotton burned, plus ten per cent, (that being the. terms of the policy), was paid over to complainant, and a paper executed styled in the record a “borrowed and re
“Boston, Mass., January 23, 1888.
“ Borrowed and received of the president and directors of the Insurance Company of North America, of Philadelphia, Pa., the sum of twenty-two thousand thirty-seven dollars and sixty-nine cents ($22,037.69), being a loan pending the investigation and determination whether the loss of four hundred and thirteen (413) bales of cotton, being part of a lot of 500 hundred bales marked <L> K, 1 — 500, shipped by ¥m. Bowles & Sons, Memphis, under a bill of lading of the Indiana, Blooming-ton and Western Pailway Company, dated Memphis, November 16, 1887 — said cotton reported burned at Memphis on or about November 17, 1887 —is a .loss for which the carrier should be held liable; and if the carrier should be held liable, the undersigned agrees to return to the said president and directors the amount thus loaned when and to the same extent same shall be recovered from the carrier.
“(Signed) LancasteR .Mills,
“By HaRCouRT Armort, Treas.”
The Chancellor, in speaking of this defense to this suit, thus states the issue presented by this receipt:
“ The only question for judgment between the parties to this suit is whether the transaction between the complainant and the Insuranc Company of North America is a payment of this loss. If*57 it is, the defendant’s breach of duty and of contract has not damnified it, and there can be no recovery here.”
Upon a construction of this receipt, and upon the authority of the case of Inman, Swan & Co. v. Railway Company, 129 U. S., 129, the Chancellor reached the conclusion that this was not intended as a payment, hut as a mere loan pending determination of the liability of the other parties supposed to he primarily liable for the loss. It would seem that if the Lancaster Mills, not relying upon the obligation of the compress company to carry insurance, had, for itself, procured other insurance in good and solvent companies, it would not be heard to say that it had been damnified by the failure of the defendant to do for it what it had done for itself. It is not, however, necessary. to determine this, for we are convinced that the transaction between the Insurance Company of Rorth America and the complainant, and evidenced by this receipt, is in fact and law a payment and satisfaction of the loss sustained by the burning of this cotton. The substance of this transaction is that the insurer has paid the amount of its liability under the policy, subject alone to be repaid upon the contingency that the assured shall recover same from the carrier as being primarily liable. The precaution taken in calling it a loan was doubtless due to a fear that payment might affect the right of the insurer to the benefit of a recovery against the carrier.
If the carrier or compress company is, as between it and the insurer of the owners, primarily liable, then an action in the name of the assured may be maintained for the benefit of the insurer, and the fact of ’payment will not affect the recovery. This we expressly decided at this term in the case of Railroad v. Manchester Mills, 88 Tenn., 653.
The case of Inman, Swan & Co. v. Railroad, supra, is not in any way in conflict with the conclusion we reach as to effect and meaning of this borrowed and received note. In that case it appeared that cotton in the custody of a railway company was destroyed by fire. The carrier’s bill of lading stipulated that it should have the benefit of any insurance held by owner on goods destroyed by fire while in its possession. On the other hand, the owners held open policies of insurance on the burned cotton, which provided the assured should, in case of loss, transfer to the insurer his claim against the carrier, and
The Court held that this stipulation did not amount to a payment; that the policies were not available to the carrier, inasmuch as the liability of the insurers depended upon the condition of resort over against the carrier. It was also held that the insurers under their contract had the right to require the assured to proceed first against the carrier, and to decline to indemnify them until the question of the carrier’s responsibility was first settled. That case and this are totally unlike both with respect to the fact of payment (for no money was paid or loaned to the assured) as well as in the more important distinction that there the carrier’s liability was primary as between it and "the insurer. So we hold: Eirst, that in point of fact the complainant has- received payment for its loss from its own insurer; second, that this fact of payment would not prevent the maintenance of a suit for the benefit of the insurer of the owner in the name of the assured, provided the loss is one which the defendants ought to have
As this case has been much relied upon by the learned counsel for complainant, we briefly state the facts of the case. The case was this: A firm of warehousemen “ being -by express agreement,, or a local custom of London,” liable for any loss or damage which occurred to grain warehoused with them, for their own protection took out policies on grain in their custody. The owners of certain grain so warehoused, although they had the primary liability of the wharfingers, 'for their better protection took ■ out policies in another company upon their interest in the same grain, A loss occurred. The wharfingers’ companies and the bailors’ companies contributed to a fund to re-imburse the warehousemen, who had paid the loss to the owners of the grain. The suit was one between the respective companies to determine how the loss should- be borne between themselves. It was held
Here the essential fact which would entitle the insurer of the owner of the warehoused cotton to recover is missing — that is, the primary and absolute liability of either the carrier or compress company. The liability to the owner for a breach of obligation to carry insurance is not a primary liability as between the compress company and the insurer of the owner. By subrogation the insurer obtains no right which ' the assured could not enforce. As the assured did for itself just what the compress company agreed to do for it, and having no right of action save for premiums, its insurer, who has paid the loss, has none. "Whatever rights the insurers of the complainant have against the insurers of the defendant compress company for contri
The decree of the Chancellor holding that complainant had not been indemnified by its own insurer, was erroneous, and this results in dismissal of complainant’s bill, with costs.