of $10,000, due upon the re-insurance, or whether that fund belonged to all the creditors of the insolvent company ratably? Chancellor Walworth decided that where an insurance company has underwritten a policy, and afterwards causes itself to be re-insured, and after the loss of the property insured, such company becomes insolvent, the person originally insured. has no equitable lien upon the sum of money due on the contract of re-insurance; but that fund belongs to all the creditors of the insolvent company ratably.1

§ 88. A re-insurance, we have seen, differs very essentially from a double insurance.2 The latter occurs when several policies are effected for the benefit of the same person, and upon the same subject-matter; whereas the former is entered into by the insurer for his own protection. There is no illegality in England, in the practice of the latter, as it appears there is by statute in the former; nor is the latter prejudicial, in its ordinary effects, to the assured, or to the insurer. To the assured it is attended with advantage, as it provides with greater certainty for the protection of the whole amount of his interest; and the several underwriters on different policies being in the nature of co-insurers, he is enabled to select any whose responsibility he may prefer for satisfaction of the amount of his loss. No inconvenience, on the other hand, is sustained by an underwriter in the case of a double insurance, for his contract is not varied by it; and if the underwriter in one policy should pay the whole amount of the loss, he would be entitled to recover a ratable contribution from the underwriter in the other policy. The principle of contribution has

'Herckenrath v. American Ins. Co. 3 Barb. (N. Y.) Ch. R. 63.

2 See ante, § 26.

3 Gordon v. London Assur. Co. 1 Burr. R. 492 - opinion of Lord Mansfield; Hughes on Ins. 59; Park on Ins. 422; Bousfield v. Barnes, 4 Campb. R. 228; Stacy v. Franklin Fire Ins. Co. 2 Watts & S. (Penn.) R. 506 ; Peters v. Del. Ins. Co. 5 S. & Rawle, 475.

its foundation in the clearest principles of natural justice; for as all are equally bound, and are equally relieved, it is obviously but just that, in such a case, all should contribute in proportion towards a benefit obtained by all. Any other rule. in case of double insurances, would put it into the power of the assured to select his own victim; and, upon motives of mere caprice or favoritism, to make a common burden a personal oppression.

§ 89. It is generally a condition of the policy when the same property is insured with several insurers, that the assured shall give notice of any other insurance on the same property;1 one of the objects of which is to apprise the insurer of his claim to contribution from his co-insurers.

§ 90. Where there is a clause in a policy of insurance, that persons at that office must give notice of any insurance made on their behalf by the same, and shall cause such other insurance to be indorsed on their policy, in which case each office shall be liable to the payment only of a ratable proportion of any loss or damage which may be sustained, and unless such notice is given, the assured will not be entitled to recover in case of loss, the condition applies to a subsequent, as well as to a prior insurance.2

§ 91. A policy of insurance contained a stipulation, that if the assured then had, or thereafter should have any other insurance upon the same property, notice thereof should be given to the company, and the same indorsed upon the policy, or otherwise acknowledged by the company in writing. A

1 Beaum. on Ins. 56. Potter v. Ontario and Livingston Mutual Ins. Co. 7 Barb. (N. Y.) Sup. Co. R. 147; Illinois Mutual Fire Ins. Co. v. O'Neille, 13 Peck, (Ill.) R. 89.

2 Stacey v. Franklin Fire Ins. Co. 2 Watts & S. (Penn.) R. 506; Harris v. Ohio Ins. Co. 5 Ham. Ohio, R. 461.

bill was filed by the assured against the company alleging that notice was given of another insurance, and praying that the company might be compelled to indorse the notice upon the policy, or acknowledge the same in writing; but the proof of the notice being insufficient, the bill was dismissed with costs. "If," said Woodbury, J., who delivered the opinion of the court, "the plaintiff omitted to comply with so substantial a provision in the contract itself, we see no way, equitably or legally, to prevent the consequences falling on himself, rather than others, being the result either of his own neglect, or that of some of the agents he employed." If notice is given to an agent of the company, or to one empowered to make surveys and to receive applications, it is sufficient.2

§ 92. To secure from, and on the part of, the owner, due care and vigilance over the property insured, it is the practice of fire insurance companies to cover by their policies a part only of the loss. They secure no property for its full value, or for an amount greater than the value, because it is found necessary to guard against negligence on the part of the assured, and sometimes against his dishonesty. It is necessary also, for the same reason, to provide, that the assured shall not effect other policies at his pleasure, upon the same property, in other insurance companies. The subject is considered of so much importance, that it is provided in the act of incorporation of some companies, that if insurance on any building insured by the company, shall subsist at the time in any other office, the insurance by the company shall become void, unless such double insurance subsist with the consent of the directors or agents, signified by indorse

1 Carpenter v. Providence Washington Ins. Co. 4 How. (U. S.) R. 185. 2 Sexton v. Montgomery County Mutual Ins. Co. 9 Barb. (N. Y.) Sup. Co. R. 191.

ment on the back of the policy, signed by the president and *secretary.1

§ 93. Where by the terms of the policy, it is provided, that in case the assured shall already have any other insurance, not notified, the policy shall be void, and it is declared, that in case of any other insurance upon the property, whether prior or subsequent, there shall be only a pro rata recovery in case of loss, and one of these conditions attached to the policy is, that notice of all previous insurances shall be given at the peril of forfeiting the policy; it was held, that a purchaser of a dwelling-house, who effected insurance upon it, was not bound to give notice of a previous policy effected by his vendor, unless such previous policy was assigned to him.2 The clause in the policy related only to a double insurance, and to constitute a double insurance, both policies must be upon the same insurable interest, either in the name of the owner of that interest, or in the name of some other person for his benefit.3

§ 94. In the case of Lucas v. The Jefferson Insurance Company, in New York, a construction was given to the clause in a policy of insurance against fire, providing for only a ratable payment in case of other policies on the same sub

1 Stark County Mutual Ins. Co. v. Hurd, 19 Ohio R. 149.

2 Etna Fire Ins. Co. v. Tyler, 16 Wend. (N. Y.) R. 385. "No one can suppose," said Chancellor Walworth, "for a moment, that these underwriters intended to be so unreasonable as to require a person insuring with them, under the penalty of a forfeiture of his policy, to give notice of every insurance which any former owner of the property might have made thereon, although he had no interest in that insurance, and the rights of the company could not in any way be affected thereby.”

3 Mutual Fire Ins. Co. v. Hone, et al. Receivers of the American Mutual Ins. Co., Defendants in Error, 2 Comst. (N. Y.) R. 235.

4 Lucas v. Jefferson Ins. Co. 6 Cow. (N. Y.) R. 635.

ject. That company insured the plaintiff against loss by fire, to the amount of $4,000, on certain cotton and woollen machinery. The Chatham and Etna Fire Insurance Companies also insured the plaintiff on the same property, the former for $5,000, the latter $6,000; and a loss had been sustained by fire. The evidence, on the part of the plaintiff, made the amount of loss about $20,000; and that on the part of the company, between nine and ten thousand dollars. The policy underwritten by the company, contained the following clause: "In case of any other insurance upon the property hereby insured, whether prior or subsequent to the date of this policy, the assured shall not, in case of loss or damage, be entitled to demand or recover on this policy, any greater portion of the loss or damage sustained, than the amount insured shall bear to the whole amount insured on the said property." The Chatham and Etna Companies had each paid the amount of their insurance, deducting one sixth, making together $9,583.34. These were voluntary payments without suit, by arrangement between the parties. It was held, that there was no contribution between policies containing the above clause. But where there are several policies and one only contains this clause, and the others pay to the extent of their subscriptions, which is more than their ratable share, this will be a defence pro tanto, in an action. against the underwriters on the policy containing that clause; and if the policies, without the clause, have paid enough to cover the loss, it is a complete defence for the others; for they are liable to contribute to the underwriters who have paid. Where there are several policies on the same subject without the clause in question, it is a double insurance; they are all deemed but one policy; the assured can recover but one indemnity, and contribution prevails between the insurers.

§ 95. There is one other species of insurable interest referred to in the books, namely, a policy effected by the assured