Had there been no change in the relation of the iriginal parties to this contract of insurance from that which existed when the policy was effected by David H. Plumb, it would have presented the ordinary case of a policy where the mortgagor causes insurance to be made on the mortgaged premises payable to the mortgagee in case of loss. In such case the *283insurer would be bound to pay the whole loss, and the mortgagee would receive it and be holden to apply it so far as was necessary to discharge the mortgage, and, in case the mortgage debt had been previously paid, the mortgagee would receive the sum paid for the loss for the use of the mortgagor. King v. State Ins. Co. 7 Cush. 1.
It is equally clear that, in the case stated, the continued existence of the mortgage debt or right in the mortgagee to take to his own use the money paid for the loss is not essential to a recovery for such loss, the mortgagor continuing to hold his interest in the property. The reason is obvious. The policy was rhe policy of the mortgagor, and was obtained upon his interest, and his interest is in no way diminished by the discharge of the mortgage. But on the other hand if a mortgagee obtains a policy on his interest, the validity of the policy does wholly depend upon such interest not being extinguished by payment of the debt, and in case of such payment the policy expires. In such case the mortgagee is not bound to account to the mortgagor for any part of the money received by him from the insurance company as a payment on the mortgage debt.
The present case is to be treated as a policy on the interest of the mortgagor, but payable in case of loss to the mortgagee, qualified by a provision that no sale of the property shall affect the right of the mortgagee to recover in case of a loss. We are then to assume that this policy was procured by the mortgagor and at his cost, and was one which he might cause to be enforced for his benefit, and the avails to be applied, first, to discharge the mortgage debt, and the surplus to his own benefit unless that right has been lost by alienation of his interest. Ii is conceded that such alienation has been made. In September 1863, Plumb who obtained this policy parted with all his interest in the property insured, and the same was transferred to Chaffee, Plumb surrendering to his own grantor the unrecorded deed to him by Foster, and Foster thereupon conveying the equity to Chaffee. After the loss, the right in equity was conveyed to Graves the plaintiff. Thus Plumb ceased to have any interest *284in the property insured. The sale to Chaffee of the equity would not pass this policy to Chaffee. It was a mere personal contract of indemnity made with Plumb for the benefit of himself and the mortgagee Bigelow. Wilson v. Hill, 3 Met. 66.
The further inquiry is as to the effect of the clause in the policy, “ No sale of the property shall affect the right of the mortgagee to recover in case of loss under this policy.” In terms the provision is wholly confined to the mortgagee. Such alienation shall not affect his right to recover. He might undoubtedly have enforced this indemnity against loss to the extent of his mortgage, but the question is, can he be compelled to do it by the plaintiff? Does the fact that he might recover for this loss to the amount of his mortgage debt operate to require him to do so, and to cancel bis mortgage debt to the amount he is thus entitled to receive ? It is not the question whether Plumb could have required this, had he not parted with all his interest in the property before the loss. The question is, whether a mere holder of the equity by purchase can require the mortgagee to avail himself of his right thus to recover as mortgagee, and apply the proceeds in discharge of the mortgage debt. Has the plaintiff any such interest in the policy that he can require this ?
It appears that, by virtue of an original stipulation in the mortgage deed to Bigelow, the mortgagor had agreed to keep the buildings on the mortgaged premises insured against fire in a sum not less than $2500 for the benefit of the mortgagee, and under this agreement the original mortgagor and those succeeding to his right in equity to redeem had caused such a policy to be made, and continued to the time of the loss. This policy thus made legally secured to the mortgagee the payment of the sum of $2500 by the Hampden Fire Insurance Company as a -ested right. There was upon the happening of this loss a change in the relation which the mortgagee sustained to the policy. What was before contingent became an absolute right to receive $2500 from a source which the mortgagor and the owner of the equity had provided as a means, in a certain event, *285of paying that amount upon the mortgage. Having this available fund thus provided by the mortgagor and those succeeding to his rights, and the contingency having happened upon which he was to receive it, we think it must be held to be his duty to receive it and apply it to the payment of the debts secured by the mortgage. As to the Hampden Fire Insurance Company, they certainly can stand in no better situation than Bigelow, having received the transfer of the mortgage with full knowledge of the existence of the policy, and that a loss had accrued thereon by reason of which he was entitled to receive from them the sum of $2500 as mortgagee. The Hampden Fire Insurance Company now holding the relation of assignees of the mortgage by assignment from Bigelow, and also that of debtors under the policy for $2500 to be paid to Bigelow in discharge of the mortgage debt, the law will treat it as paid, the same hand being entitled to receive which was bound to pay.
In the opinion of the court, the money which the mortgagee was thus entitled to receive from the insurance company and as to payment of which no objection intervened, the same having accrued under the circumstances we have stated, should be applied in part payment of the mortgage debt.
A bill in equity may properly be maintained in behalf of the plaintiff, and a decree must be entered to the effect that the defendants be required to receive the amount due upon the mortgage over and above the amount due and payable upon the policy of insurance; and thereupon to cancel and discharge the mortgage and execute proper releases thereof.