Upham v. Karres

MIDDLETON, PJ.

It is clear, we think, from the last provision, that to entitle the company to the benefits therein provided, it is not necessary that the company must make it appear to the mortgagee that in fact it is not liable to the assured on the policy nor is such requirement imposed upon it as to any other party. When the insurance company makes a payment to the mortgagee under the claim that it is not liable to the assured and the mortgagee accepts such payment, the company is thereby subrogated to the rights of said mortgagee to the extent of such payment. This transaction between the company and the mortgagee is wholly independent of the contractual rights of the assured. It concerns the company "and the mortgagee only. It does not in any manner foreclose any of the rights of the assured or deprive him of any remedy he may wish to employ against the company to enforce such rights. The adjustment of the assured’s rights against the company and the liability of the latter to the former must be made between them alone.

Now it is shown by the evidence in the instant case that the plaintiff insurance company paid to the mortgagee, its co-plaintiff, the sum of Five Thousand Dollars which was credited on the note hereinbefore described and that such payment was made by the insurance company under the claim that as to the assured no legal claim existed. These facts are recited in the article of subrogation and assignment which was then made by the mortgagee, duly signed and delivered to the insurance company. When this article was entered into and said sum of Five Thousand Dollars was accepted, the insurance company thereby became the owner of the mortgaged note and the mortgage to the extent of Five Thousand Dollars and was subrogated to all of the rights of the mortgagee in respect to that amount, and its payment by the mortgagor.

It is the contention of the defendants that the plaintiff insurance company became liable to them on their policy of insurance for the full amount of the same and that therefore said company has no right to enforce against them any claims which may have come to it by reason of the asignment of the note and mortgage as aforesaid.

From their attitude it would seem that they rely upon the fact that the property was destroyed by fire, as proof sufficient to establish the liability of the insurance company on its contract to them, but a contract of insurance does not differ from any other contract when a party to a contract seeks to enforce its provisions he must ulead and prove full performance of its conditions on his part, or show some legal cause for non-performance. This court does not know what the assured did or what thev may have failed to do. In their answer to the petition they do not plead any facts which standing independent would entitle them to a recovery upon their policy of insurance. They simnly deny that the plaintiff insurance company has any interest in said note or that it was subrogated to the rights of the mortgagee under said note and mortgage.

In this state of the pleadings and the evidence, nothing remains for this court to do but to erant the uraver of the plaintiff’s petition, unless the defendants desire to so amend their answer as to enable them to establish the liability of the company under their policy of in*645surance. If the defendants desire to raise this issue by amended pleadings they may do so and when the court is so advised it will fix a time within which such amended pleadings shall be filed.

Otherwise a decree may be entered in favor of the plaintiffs as prayed for in their petition and the cause is remanded to the Court of Common Pleas for execution.

(Mauck, J., concurs.)