This is an action on an insurance policy, covering a cargo of automobile parts, in transit by motorized equipment and rendered junk by fire occasioned by a collision, caused, it is claimed, by act of a tortfeasor. The motorized equipment was insured by the Insurance Company of North America, which has paid, been subrogated and brought suit in its own name in the Muskegon circuit against the alleged tortfeasor.
Over the protest of defendant herein the insured, upon rejection of the cargo by the consignee, paid *Page 76 the consignor. This was proper under the evidence. Defendant herein demanded that the insured become a party to the Muskegon case in protection of its subrogation rights upon payment. This the insured refused to do.
The assignment to the insurer of the motorized equipment, with authorization of suit in the name of that subrogee, constituted a split of the cause of action against the tortfeasor, capable, however, under the record before us, of being composed by joinder of the insured therein as a party plaintiff in behalf of subrogation rights of defendant herein when it meets its policy obligation. Subrogation rights follow and do not precede payment.
If the total damage to the insured, by act of the tortfeasor, exceeded the insurance carried on the cargo and equipment then one suit in the interest of the three damnified parties is the remedy. 3 Comp. Laws 1929, § 14010.
If the insured is fully compensated by the insurance then both insurers have right to equality of subrogation and one action, in behalf of both, should be made possible. The equitable and legal rights of defendant herein, under the doctrine of subrogation, if and when it meets its insurance obligation, command observance on the part of the insured but, inasmuch as such observance immediately follows performance of the contract obligation by the insurer, we are constrained to affirm the judgment.
Plaintiff will recover costs.
NORTH, C.J., and FEAD, BUTZEL, BUSHNELL, EDWARD M. SHARPE, and POTTER, JJ., concurred.
The late Justice NELSON SHARPE took no part in this decision. *Page 77