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Page:Harvard Law Review Volume 1.djvu/400

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“The mistake would seem to have originated in the supposition that a policy of insurance should be construed as if it were an engagement to indemnify the person first insured and could not be carried farther without a new contract. If the premise be conceded we must admit the conclusion, for no argument can be necessary to show that a promise to save A harmless cannot be enlarged by a transfer to B, nor enforced by him for his benefit, unless A has been injured, and then only to the extent of that injury. An assignment passes the right which the assignor has as he has it, and simply entitles the assignee to claim whatever is or may become due to the assignor. Hence, if the obligation imposed by the insurance of a house or vessel were limited to indemnifying those by whom or on whose behalf the insurance is effected, no recovery could be had after a sale, whether the suit were brought in the name of the vendor or in that of the purchaser, and whether the sale was or was not accompanied by an assignment of the policy; because it would be sufficient answer to say that the person to be indemnified had parted with his interest before the property was destroyed, and, consequently, had sustained no damage by the loss, which would be a good defence in the nature of a plea of non damnificatus. But if the policy is construed as a contract for the benefit, not only of the insured but of those who claim under him subsequently, as purchasers of the property and the insurance, the necessity for resorting to a new contract will disappear, and there will be no difficulty in adjusting the rights of the parties on their true basis. Thus interpreted, the operation of a policy of insurance would be somewhat analogous to that of the numerous covenants which run with land, and entitle those who claim under the covenantee by descent or purchase to the full benefit of the stipulations made by the covenantor.”

In effect, then, Judge Hare’s explanation is, that the agreement of the underwriters is to indemnify not only the person originally insured, but all persons who shall become legal assignees of the property and the policy. And this seems to the writer to be the true explanation.

It is obvious that this explanation accords with the intention of the parties at the time the contract is made. It cannot be said that i the person originally insured contemplates only his own indemnity. He regards an insurance policy more in the nature of an insurance of the property than an insurance of his own interest in