settled and paid pro rata with the reinsured, and at the same time and place, and upon the same terms and conditions." In October, 1893, the plaintiff, Hunt, was appointed by the court receiver of the People's Company, and is now acting as such under the direction of the court. The People's Company is in process of liquidation and settlement of its affairs by the receiver, and it is not now known whether the assets are sufficient to satisfy the liabilities. The plaintiff claims that the defendants are bound to pay to the People's Company one-sixth of the total loss, without waiting for the settlement of the People's Company affairs, and without regard to the dividend that may be ultimately paid to their creditors. The defendants claim that they are liable to pay to the plaintiff onehalf only of the sum which the People's Company may ultimately pay. Upon notice given them of the action, the Granite State Company appeared, and claimed to be entitled to whatever sum the defendants are bound to pay.

D. Cross, for plaintiff. Leach & Stevens, for defendants. Granite State Ins. Co., pro se.

CARPENTER, J. There is no suggestion that the action is brought for the benefit of the Granite State. The question presented is whether the defendants are bound to pay to the People's Company the entire amount of the loss against which they agreed to indemnify the People's, or only such a part thereof as the insolvent People's may ultimately pay. The defendants received a full consideration for the risk against which they insured, and there is no reason why they should not be required to pay the full amount of the loss. Blackstone v. Insurance Co., 56 N. Y. 106. The premiums received by them, and the sum to be paid by them in case of loss, were intended to be, and in theory of law are, precisely equivalent. King v. Insurance Co., 7 Cush. 1, 9. Their position is, in legal effect, the same as it would be if the People's, for the purpose of paying the loss, had deposited with them the full amount of it in money. But the further question whether the money due on the contract equitably belongs and should be paid to the People's or to the Granite State arises on the face of the case. For convenience of consideration, a simpler parallel case may be taken. The People's insure A.'s house for $10,000, and immediately reinsure for the same amount with the defendants. The house is burned, and shortly after the People's become insolvent, and, as may be supposed, unable to pay any part of their indebtedness. The defendants, willing to perform their just obligations, file a bill of interpleader against A. and the People's, and pay the $10,000 into court. To which party-A. who has lost that amount, or the People's, who have lost nothing-does the money, in equity, belong? The particular terms of the policy issued by the defendants are not mate

rial. It must be assumed that by it the defendants merely stipulate to indemnify the People's to the extent of the sum named, against loss by reason of the destruction of A.'s house by fire, because they have no power to make any contract of insurance except contracts of indemnity. In Bank v. Herrick, 62 N. H. 174, Jarib Herrick, as principal, and John W. Herrick, as surety, were indebted to the plaintiffs upon a promissory note. January 27, 1877, Jarib gave John W. a mortgage of real estate conditioned to indemnify him against loss by reason of his having signed the note. In 1878, Jarib obtained his discharge in bankruptcy. His assignee sold the land, subject to the mortgage, to the defendant S. In 1879, John W. died, insolvent. No part of the note being paid, the plaintiffs brought their bill in equity against Jarib, the administrator of John W., and S., praying that the mortgage be assigned to them, and prevailed. The condition of the mortgage was not that Jarib should pay the note, but that he should save his surety harmless. The surety paid, and could pay, nothing. The condition, according to its literal terms, was not, and apparently never could be, broken. The court said that equity disregards mere form, and held that the transaction was, in substance, an appropriation of the mortgaged property for the payment of the debt in case it was not otherwise satisfied by the mortgagor. The purchaser at the assignee's sale took the property with notice. In equity it belonged to the plaintiffs for the purpose of satisfying their debt, and to the extent necessary for that purpose. Their right did not depend upon privity of contract. In fact, there was none. It did not appear that the plaintiffs had any knowledge of the mortgage until they filed their bill. It was immaterial that the relation of principal and surety existed between the mortgagor and mortgagee. The result would have been the same had they been joint principals, or if the mortgage had been given by the surety to the principal. It was equally immaterial that the mortgagee was bound to pay the debt, except that his liability was essential to the form of the security given. The result would have been the same if Jarib had given a deed of the same property to a stranger on condition that the grantee indemnify and save him harmless from his liability on the note. In short, the decision rested wholly upon the broad ground that in equity and good conscience the mortgaged property should be applied to the satisfaction of the plaintiffs' debt. The facts, in all material respects, and the judgment of the court, in Holt v. Bank, 62 N. H. 551, and Barton v. Croydon, 63 N. H. 417, were the same as in Bank v. Herrick. These cases establish the propositions that a creditor, for the satisfaction of his debt, may, in equity, avail himself of any subsisting provision made by his insolvent debtor for its payment, and that an appropriation or pledge of property by the debtor for the purpose of

indemnifying against the debt any person liable upon it is equitably equivalent to a provision for its payment. The principle of the first proposition is often applied in actions at law. Burr v. Beers, 24 N. Y. 178; Reed v. Paul, 131 Mass. 129; Butterfield v. Hartshorn, 7 N. H. 345; Berry v. Gillis, 17 N. H. 9; Hodgdon v. Merrill, 26 N. H. 18. If A., for a good consideration, agrees with B. to indemnify him against his indebtedness to C., A., as between him and B., becomes the principal debtor. The debt is, in equity, his debt, and not B.'s. Having received a full consideration for his undertaking, he is morally and equitably as much bound to pay the debt to C. as he would be if B. had delivered to him and he had accepted the amount of the debt in gold coin, in trust for its payment. If, for technical reasons, the law is powerless to enforce the duty, equity is subject to no such weakness. Philbrick v. Shaw, 61 N. H. 356. It will not permit him to retain the money, the consideration of his agreement, and escape its performance on the flimsy pretext that, until B. is compelled to pay the debt, or a part of it, he has fulfilled the letter of his obligation. He may be compelled at law to pay the debt if B. is solvent, and in equity, at least, he is not relieved from the duty by the accident of B.'s insolvency. Whether the agreement may be revoked at any time before C. is informed of and assents to it need not be considered. It is enough for present purposes that it cannot be annulled after C. intervenes and asserts against B. his claim for its performance. An insurance contract is a contract of indemnity. "It does not differ from a bond of indemnity or a guaranty of a debt, since the obligor or guarantor takes upon himself certain risks to which the obligee or creditor would otherwise be exposed. The only difference is in name and form of the instrument, the consideration for an insurance being always called a premium, and the instrument containing the terms of the contract, a policy." 1 Phil. Ins. (2d Ed.) 2. By a contract of reinsurance, in whatever language expressed, the obligation of the reinsurer is to indemnify the insurer against his liability for the loss by fire of the property insured. They stand in a relation to each other much like that of principal and surety. The only material difference is that the reinsurer is not, in law, directly liable to the insured. As between the two, he is the principal obligor. In the case supposed (as in the actual case), as long as the People's are solvent there is no difficulty or question. A. recovers of them the full amount of his loss, and they recover the same sum of the defendants. The contracts of both companies are performed. There is no occasion for this circuity. The sole duty of the defendants under their contract is to hold the People's harmless. They have the right to pay directly to A. the amount of his loss. By so doing they fully perform their contract. The People's obligation to A. is discharged. But, whichever

method is adopted, A. is indemnified, and the People's, assuming that the same premium is paid for the insurance and for the reinsurance, neither gain nor lose by the transaction. The plaintiff claims that, by the mere accident of the People's insolvency and inability to pay more than say 10 per cent. of their liabilities, the defendants' contract is materially modified. They are no longer at liberty to perform it by paying directly to A. the amount of his loss. It is not now enough that, in compliance with the literal terms of the contract, they protect the People's from loss. They must, it is said, pay the full amount of the loss to the People's, and A., in common with their other creditors, is entitled to 10 per cent. only of the sum justly due to him. In other words, the People's, for the sole reason that they can pay 10 per cent. only of their indebtedness, are, it is claimed, justly entitled to realize out of A.'s loss of $10,000, which, by their contract, they are bound to pay, a net profit of $9,000. They are to profit by their losses. It is for their interest-for the interest of every one of their creditors-that all the property insured by them, and by them reinsured in a solvent company, be destroyed by fire. Such a result equity will not tolerate. It is not good law or good morals that one should profit by the destruction of his neighbor's property (1 Story, Eq. Jur. § 493), especially if he has himself agreed to make the loss good. "A contract to tempt a man to transgress the law *** is void by the common law." Collins v. Blantern, 2 Wils. 347, 350. The People's, under their contract with defendants, are entitled to protection against loss by reason of the destruction of the insured property, and to nothing more. They cannot object to a judgment or decree which has that effect. The defendants cannot object to a judgment that they pay the money to the insured, because it is to them immaterial whether they pay it to him or to the insurer. Upon the filing of a proper bill in equity by the Granite State, there will be a decree in their favor, or they may, upon reimbursing the plaintiff for all expenses hitherto incurred by him in the prosecution of this action, take judgment therein for their use. Herckenrath v. Insurance Co., 3 Barb. Ch. 63, and the later cases which have followed it, have been considered, and their doctrine is not approved. Case dis. charged. All concur.

JENNE v. PIPER.

(Supreme Court of Vermont. Windsor. July 17, 1897.)

TRESPASS QUARE CLAUSUM-RIGHT OF WAY-LO CATION-PLEADING-WITNESSES-COM

PETENCY OF Wife.

1. Defendant in an action of trespass on the freehold need not plead or prove his defense of right of way by necessity, when such right is con ceded by plaintiff.

2. On an issue of the position of a right of

way as located by the owner of the servient tenement, evidence of what position he assigned it, in remarks made before the conveyance to defendant, to prospective purchasers, who would necessarily use it, and also of what land had actually been used for the purpose by those entitled to the right, was admissible.

3. A wife being incompetent to testify in her husband's behalf, except as to her acts committed as his authorized agent, the offer of her testimony may be refused, unless accompanied by an offer to show her agency also..

Exceptions from Windsor county court; Tyler, Judge.

Trespass by H. N. Jenne against S. H. Piper. From judgment for defendant, plaintiff brings exceptions. Affirmed.

Gilbert A. Davis and Sanford E. Emery, for plaintiff. W. W. Stickney and J. G. Sargent, for defendant.

ROSS, C. J. On the trial the plaintiff conceded that the defendant had a right of way of necessity across the premises where the alleged trespass was committed. This concession relieved the defendant from the necessity of pleading it. He need not plead what he need not prove. He had no occasion to prove that he had a right of way across the premises, when the plaintiff conceded that he had. The court had no occasion to admit, and admitted no testimony to establish that the defendant had such right of way. The exceptions do not raise the point made by the counsel for the plaintiff that a right of way or license must be specially pleaded when relied upon by the defendant to justify the alleged trespass. Such plea is only necessary when the defendant has to establish such right of way or license by proof, to make out a justification. The exceptions show that no proof was offered by the defendant to establish that he had a right of way across the premises, but that the fact that he had it was conceded by the plaintiff. There is no foundation for the contention that there was error because the defendant must plead a right of way or license to justify his walking across the plaintiff's premises. The plaintiff conceded that he had that right. The only contention on the trial, made by the testimony offered, was with reference to the location of the defendant's right of way. Where one has a right of way of necessity across premises owned or occupied by another, unless he waives it, the other has the right to fix the location of the way, provided it is reasonably convenient for the use of the one having it. The testimony of both parties, so far as shown by the exceptions, was to the point that the plaintiff had exercised this right, and located the right of way. The plaintiff's testimony tended to show that he had located it on the east side side of the tenement house, and the defendant's testimony tended to show that the plaintiff had located it on the west side of the tenement house. This same way would accommodate other lots owned by the plaintiff's wife in the immediate vicinity of the lot sold to the defendant's wife. on which he had

erected a dwelling, and was residing. On this contention, in regard to which party was right as to the location made by the plaintiff of the way, either party had the right to introduce any fact or circumstance which would render his claim in regard to its location more probable. To establish his claim the defendant could show, as he did, that the plaintiff had said to others, when speaking of selling the other lots, that the way was to be on the west side of the tenement house. Such declarations, although made before the sale to the defendant's wife, could be shown, as they tended to render it more probable that at the time of the sale to defendant's wife he located the way where he had before said he should locate it, to accommodate this and his other lots. The use of the way, without objection on the part of the plaintiff, and with his knowledge, by the defendant, and by others who had occasion to go to defendant's house, was clearly admissible on this contention. These principles cover all the testimony admitted against the plaintiff's exception.

The court properly refused to allow the plaintiff's wife to testify. She could only do so in matters in which she acted in the premises as the agent of the plaintiff. In offering her to testify in his behalf, the plaintiff did not offer to show that he ever authorized her to act in the matter for him, or ever recognized her as his agent in that matter. Being incompetent on the ground of public policy, because of the marital relations existing between her and the plaintiff, except when she acted as his agent, the agency must first oe shown, to render her competent to testify in his behalf. Judgment affirmed.

POWERS v. NEW ENGLAND FIRE INS.

CO.

(Supreme Court of Vermont. Windham. July 20, 1897.)

ASSUMPSIT-PROMISE PLEADING INSURANCE MORTGAGEE-RIGHT OF ACTION.

1. In assumpsit on a fire insurance policy the declaration set forth the policy, showing a contract by which the loss was "to be paid sixty days after proof" thereof. Held that, on general demurrer, this was a sufficient allegation of the promise to pay.

2. An action on a fire insurance policy containing a mortgage subrogation clause should be brought in the name of the insured, for the benefit of the mortgagee.

Exceptions from Windham county court; Start, Judge.

Assumpsit by Lafayette C. Powers against the New England Fire Insurance Company on a fire insurance policy. A general demurrer was overruled, and, defendant having waived his right to plead over, judgment was enAftered for plaintiff. Defendant excepts. firmed.

Clarke C. Fitts and Waterman, Martin & Hitt, for plaintiff. Butler & Maloney, for defendant.

TAFT, J. It is claimed that the declaration discloses no promise of the defendant to pay the plaintiff. The policy declared upon is set forth in words and figures, and shows a contract of insurance, the loss, if any, "to be paid sixty days after proof shall have been made." This at least is an argumentative way of alleging that the defendant promised to pay the plaintiff, and is sufficient as against a general demurrer. Can the plaintiff maintain this action? The contract was made with him, the consideration moved from him, the promise was made to him; and the decisions in this state are that a suit to enforce the contract must be brought in the name of the one to whom the promise is made, and from whom the consideration moves. Fugure v. Society, 46 Vt. 362. In Davenport v. Association, 47 Vt. 528, it was held that the beneficiaries could maintain the action, the court construing the contract as containing a promise to pay to them. Many cases from other states have been cited, but they are not authority here, and no reason is disclosed in any of them why we should overturn the well-settled practice and decisions of our own state. A policy of insurance is sometimes made payable to the insured and his assigns, sometimes to the mortgagee of the premises, naming him, and at other times to any one holding a mortgage upon the insured property at the time of the loss, whoever he may be. The effect of the provision is to give a mortgagee a lien upon the insurance money in case of loss, securing him by substituting the proceeds of the policy in place of the property, provided it burns, thus letting the property go to the substantial owner, if the property is mortgaged, as is often the case, to its full value. But this interest of the mortgagee in the policy is an equitable, not a legal, one, and will be protected in a law court. Upton v. Moore, 44 Vt. 552. If a policy is made payable to a mortgagee, the insurer is not at liberty to pay any sum due under the policy to the insured in disregard of the rights of the beneficiary. A policy of insurance is a mere chose in action; it is nonnegotiable; it is not assignable at common law, so that the assignee can sue in his own name; and, though it may be payable to the insured and his assigns, still, if a loss happens, an equitable holder of the policy must sue in the name of the original insured. Aldis, J., in Wood v. Insurance Co., 31 Vt. 552. Under our system of pleadings-and no better one has as yet been devised-the insurer cannot be subjected legally to any suit save the one in the name of the party to the contract, and the beneficiary can always protect his rights by suit in the name of the insured. This suit is brought, in accord with our system of pleadings, in the name of the party to the contract, for the benefit of the mortgagee, to the extent of its claims. This fact is alleged in the declaration in express terms. The mortgagee has the right to control the judgment, and any execution issued thereon, until

his claim under the policy is extinguished, after which the mortgagor (the plaintiff) is the only party in interest and of record. The judgment will be a complete protection to the defendant against any further suit in respect to all claims under the policy. Judgment affirmed, with directions to the clerk to deliver any execution issued thereon to the beneficiary under the policy until its claim thereunder is extinguished.

MACK V. CAMPEAU.

(Supreme Court of Vermont. Addison. July 17, 1897.)

PLEADING AVERRING CRIME.

1. Orator alleged that one E. had accused defendant of crime; that "E. was threatening legal proceedings *** to recover damages," and to subject him to criminal prosecution; and that defendant, realizing his liability thereto, and to save the expense and punishment incident thereto, besought the orator for his services in that behalf, and the latter thereupon interceded, and induced E. to refrain from prosecuting or instituting legal proceedings against defendant. These services formed the consideration for the contract sought to be specifically enforced. Held, that there was a sufficient allegation of a crime by defendant to warrant the court in treating it as committed.

2. Another allegation was: "And in consideration that the orator should intercede and use his influence with E. to dissuade him from instituting legal proceedings against," etc. Held, that this allegation must be taken in connection with the others, and that, so taken, the words "legal proceedings" imported criminal, as well as civil, proceedings, and hence the contract would not be enforced, because of the tainted consideration.

Appeal from chancery court, Addison county; Tyler, Chancellor.

Bill by Thomas Mack against P. A. Campeau to enforce a contract. A demurrer incorporated into the answer was sustained, and. the bill was dismissed, and orator appeals.. Affirmed.

The bill alleged that the orator had been for a long time in the business of buying and selling coal in the city of Vergennes, making therein a reasonable profit; that the defendant, Campeau, was the pastor of the Roman Catholic Church in the same city, and engaged in the coal business, which he conducted at such prices that the orator could not compete with him; that Campeau had been accused by one Egan of criminal intimacy with Egan's wife, and alienating her affections, and that Egan was threatening legal proceedings against him, to recover damages, and to subject him to criminal prosecution; that Campeau, realizing his liability to such proceedings, and desiring to avoid the expense and damage of the same, and to save the exposure, punishment,. and scandal that would be incident thereto, besought the orator's services in that behalf, and, in consideration that the orator would intercede and use his influence with the said Egan to dissuade him from instituting legal proceedings against Campeau upon said criminal relations, and in further consideration that the orator would purchase Campeau's

entire stock of coal, he, Campeau, promised the orator that he would not thereafter engage in the coal business in Vergennes in competition with the orator; that the orator had performed upon his part, but that Campeau was still competing with him in the coal busiress, and prayed for an injunction. The defendant, Campeau, answered, denying the principal allegation, and insisting that the contract set forth in the bill was illegal and void as against public policy, asking to have the same benefit thereof as if he had demurred to the bill for that cause.

F. W. McGettrick and F. L. Fish, for appellant. Roberts & Roberts, for appellee.

ROSS, C. J. The orator contends that the demurrer should have been overruled, because the bill does not, in terms, allege that defendant, Campeau, had been guilty of criminal intimacy with the wife of Egan, and for that reason no crime is shown by the bill to have existed which could have been the subject of the negotiations between the orator and Campeau. The bill alleges that Egan had accused Campeau with having been criminally intimate with Egan's wife, and that he had alienated her affections; that Egan was threatening legal proceedings against him to recover damages, and to subject him to criminal prosecution; that Campeau, realizing his liability to such proceedings, and desiring to avoid the damage and expense of the same, and to save the exposure, punishment, and scandal that would be incident thereto, besought the orator for his services in that behalf. The bill further alleges that the orator entered upon the employment, and did intercede with, influence, persuade, and induce Egan to forego and refrain from prosecuting or instituting legal proceedings against Campeau on account of the alleged criminal relations. Under the decisions of this state, these allegations are a sufficient setting forth that Campeau had been guilty of the alleged criminal intimacy. By his employment of the orator to dissuade Egan from prosecuting or instituting legal proceedings against him on account of his alleged criminal relations with Egan's wife, he admitted that he was guilty of the crime charged. Dixon v. Olmstead, 9 Vt. 310; Bowen v. Buck, 28 Vt. 308. Dixon v. Olmstead is trover to recover for the conversion of a horse. To sustain the action, these facts, in substance, were shown: The defendant, residing in New Hampshire, sent his agent into this state, who, after procuring a warrant for the plaintiff's arrest and surrender to the authorities of New Hampshire, to be tried on an alleged charge of forgery committed in that state, induced the plaintiff, who denied the charge, and declared himself innocent of it, to settle by giving the defendant the horse, among other things. No other evidence that a forgery had been committed by the plaintiff in New Hampshire was given. The defendant contended that the alleged

crime must be established, and that the horse had been given in settlement of the crime, to entitle the plaintiff to recover. But the court said: "For the purposes of this trial, it must be considered, first, that the plaintiff was guilty of the offense; for if, when he was threatened only with legal process and the ordinary proceedings in such cases, he saw fit to to come forward, and compromise the matter, it is not in his mouth to deny his guilt." Bowen v. Buck follows the doctrine announced in Dixon v. Olmstead, and holds that the parties to such transactions are to be held and treated as they treat themselves; that if they enter upon negotiations and settlements in which they treat themselves as guilty of the alleged crime, they will be so treated when those negotiations and settlements are brought under legal investigation. Hence the bill alleges sufficient facts to have the court treat the transactions between the orator and Campeau as they treated them, as of and concerning criminal relations existing between Campeau and the wife of Egan.

The orator also contends that if Campeau had been guilty of having criminal relations with Egan's wife, Egan would have a valid claim against him, growing out of those relations, and that Campeau could lawfully employ the orator to settle or adjust the claim of Egan growing out of the same. The contention is sustainable, if the allegations of the bill do not fairly include in the orator's employment the prevention of a criminal prosecution to be set on foot by Egan. To support his contention, the orator relies upon this allegation: "And in consideration that the orator should intercede and use his influence with Egan, to dissuade him from instituting legal proceedings against Campeau, based upon the aforementioned criminal relations," etc. He contends that the only legal proceedings Egan could institute against Campeau, growing out of such relations, were those to recover private damages. This construction possibly might be given to this allegation if it stood alone; yet it must be remembered that Egan might, by complaint to the proper officer, be instrumental in commencing a criminal prosecution against CamIt was his duty, as a citizen, to make such complaint, if he had knowledge of the commission of the crime. But when this allegation is read in connection with that which immediately precedes (that Egan had threatened to subject Campeau to criminal prosecution; that Campeau, desiring to save the exposure, punishment, and scandal that would be incident thereto, sought the orator's services in that behalf), and in connection with what follows (that the orator did induce Egan to refrain from prosecuting and instituting legal proceedings), it fairly imports that the orator was employed, not only to prevent Egan from instituting a civil suit, but also to prevent him from causing to be commenced a criminal prosecution. The meaning of words and phrases in pleadings very fre

peau.