Moving Picture Co. of America v. Scottish Union & National Insurance

244 Pa. 358 | Pa. | 1914

Opinion by

Mb. Justice Stewabt,

Assuming the facts to be as set out in the affidavit of defense, it follows, that whatever the subject of this insurance was, whether the premises described in the policy, Nos. 926-928 Market street, Philadelphia, or simply the rent derivable from a portion of the building erected on these two lots, the interest of the plaintiff in the subject continued no longer than the building on the premises remained undestroyed by fire. The plaintiff was a subtenant of the first floor of the building. In turn it sublet to the Royal Amusement Company on precisely the same terms it had acquired the lease. The building was totally destroyed by fire 13th January, 1913, when but six months of the term had expired. Thereafter neither the Royal Amusement Company nor the plaintiff company was under liability to pay further rent; in the one case, that of the Royal Amusement Company, by reason of an express provision in its lease to that effect; in the other, by virtue of a well established rule of law that in case of a demise of an apartment in a building, where no implication arises that by the demise any estate in the land was granted, the whole estate demised is extinguished with the destruction of the building, and the tenant’s liability for rent thereupon ceases. This rule was applied in the case of Paxson & Comfort Co. v. Potter, 30 Pa. Superior Ct. 615, where in an opinion by Judge Henderson, in which we fully concur, the reason and authority of the rule are fully discussed. We have then this situation: the plaintiff was without property right in rent after the destruction of the building, for no such rent could have accrued, and it stood clear of all liability to its lessor , or others for or on account of any such rent. It necessarily results that the plaintiff company sustained no loss whatever by the destruction of the building. This fact has a far deeper significance than the argument for the appellee would allow. That argument is directed to the overthrow of a proposition which has no place in the discussion of the case. It first assumes a loss by the plaintiff, and then proceeds to demonstrate that under a contract of insurance the insurer cannot escape liability by showing that the insured has from some source other than itself been reimbursed for the loss sustained. That this is a correct statement of the law is not open to dispute; the fallacy is in assuming the one and only thing of importance in the case, viz, the fact of loss. If the facts are as set out in the affidavit of defense, it is impossible to discover any loss resulting to the plaintiff. Plaintiff could have derived no benefit from the continued existence of the building, for in such case it could have received no more from its lessee than it was obliged to pay to its lessor; on the other hand, the destruction of the building imposed no liability whatever. It follows that plaintiff without anything to gain, and with nothing to lose, had no insurable interest, and the policy sued on was simply a wager contract unenforceable at law. “An insurance amongst us,” says Yeates, J., in Prichet v. Insurance Co., 3 Yeates 458, “is a contract of indemnity. Its object is, not to make a positive gain, but to avert a possible loss. A man can never be said to be indemnified against a loss which can never happen to him. There can not be indemnity without a loss, nor a loss without interest. A policy therefore made without interest, is a wager policy, and has nothing in common with insurance, but name and form. 1 Marsh, 30-97. It is not subservient to the true interest of fair trade and commerce but is pregnant with as much mischief, both public and private, as can proceed from any specie of gaming, which the legislature has hitherto found it necessary to repress. Ib. 98. Every specie of gaming contracts, wherein the insured having no interest, or. a colorable one merely, or having a small interest, much over-values it in a valued policy, under cloak of insurance, are reprobated both by our law and usage.”

“The rule is valuable and well founded, that, he who has no interest, can have no insurance. That he must show his interest, and that it is the extreme measure of his recovery, are the corollaries of the rule. Without this, insurance would soon become a mere system of gambling.” Sweeny v. Insurance Co., 20 Pa. 337.

The judgment in the present case, admitting the facts set out in the affidavit of defense, is not indemnity. It represents a positive gain, not that it is a recovery for loss which had previously been made good from some other source, but because there was no loss that could be insured against. The judgment is accordingly reversed and a procedendo ordered.