Page:Federal Reporter, 1st Series, Volume 1.djvu/80

 73 FEDERAL REPORTER. �really any oonflict of authority upon the subject. AU the cases that I have examined — I have not had time to examine ail of them — that have been cited in the brief of counsel, but thoae which I have examined have been cases where the pol- icy was issued directly to the mortgageee It lias been held by the courts for many years paat that a mortgagee could insure his interest in the premises by a policy of insurance running directly tohimself, in which case the entire privity of the contract is between the insurance eompany and the mort- gagee, to whom the policy runs. Upon that class of policies' there has been a eonflct as to whether, in case the premises were sold by the mortgagor, there was any right of action in favor of the mortgagee. But I think the better rule in refer- ence to this class of questions is the one laid down by the supreme court of the state of New York, that a policy like this is not to be beld as a policy issued to the mortgagee at ail — not the insurance of the mortgagee's interest. It is an insur- ance of the mortgagor's interest in the property; but the mortgagor has, by the terms of the policy itself, directed the payment of the loss to the mortgagee to the extent of the mort- gagee's interest, so that really the privity of the contract is ail between the mortgagor and the insurance eompany. �In the class of cases which I have referred to where the confiict has occurred, it has been claimed on one side that the policy was issued for the purposes of direct indemnity to the assured, and that in case of loss the right of action enured to him, notwithstanding there might have been a complete reparation of the property by some other person than the insurance eompany; yet, a cause of action baving arisen, the assured, having paid his premium, had the right to the indemnity which he had stipulated for. On the con- trary, the other class of cases which have been passed upon, and the rule laid down, holds that where there is insurance eiïected for the benefit of the mortgagee, itmust be concluded to be solely an insurance that the property shall remain unimpaired as security — that is, that there shall be no dimi- nution of the value of the property as security for the mort- ��� �