Page:Federal Reporter, 1st Series, Volume 4.djvu/280

 266 FEDERAL REPORTER. �This building was totally destroyed in the great fire of Octo- �ber, 1871. ' �In.settlement of the insurance on the same the fire iusur- ance company delivered to the defendant Scammon a draft for $15,000, payable to the order of complainant ; and there- upon Scammon, in a communication addressed to the secre- tary of the complainant, informed him that he had com- menced rebuilding the burned structures, and enelosed therein the draft received for insurance, and requested that authority might be given to complainant's Chicago agent to pay over to him (Scammon) or to the Marine Company, the proceeds of the draft, to be expended in such rebuilding. This request resulted in an agreement, made on the fifth day of January, 1872, between complainant and J. Y. Scammon alone, by ■which ît was agreed that complainant should and did waive its right to apply the insurance money on the mortgage indebt- edness, and that tins money should be deposited in such bank as should be selected by Scammon and assented to by com- plainant, to the credit and at the risk of Scammon, to be usedin the erection of buildings on the mortgaged premises; that this money should be paid out in the erection of such buildings, from time to time, on the drafts or checks of Scam- mon, countersigned by complainant's agent, until it shouki be thus fully expended; further, that such drafts or checks should be so countersigned on presentation thereof to com- plainant's agent, accompanied with the certificate of an archi- tect, that the amount of such check or draft, together with ail previous checks or drafts drawn or paid out on such account, had been actually expended in permanent improvements upon the mortgaged premises; further, that so soon as the building or buildings so erected should be in a situation to be insured, Scammon should cause the same to be insured in the fair insurable value thereof, and assign the policies of insur- ance to complainant, and that thereupon ail the provisions contained in the mortgage should apply to such insurance. �By this agreement it was further provided that any receipt or acknowledgment given by complainant, either alone or ����