9 Fowler v. N. Y. Indemnity Ins. Co., 26 N. Y., 422. 8 as possible, to wit, on the 18th day of July, 1853, the plaintiff delivered to the defendants as particular an account of said loss as the nature of the case would admit, which account was signed by the said Robert Caldwell and verified by his oath, declaring the same to be true and just; and on the 22d day of August, 1853, the plaintiff delivered to the defendants a further account of said loss, which account was signed by the said Robert Caldwell, with his own hand, and verified by his oath, declaring the same to be true and just, which said account contained all the particulars required to be stated therein by the conditions annexed to said policy, and the account herein first mentioned was accompanied with the affidavit of two disinterested respectable persons, not contiguous to the place of the fire, and not concerned in the loss as creditors or otherwise, or related to the insured or sufferer, to the effect that they had made due inquiry into the cause and origin of the fire, and also as to the value of the property destroyed, and that they were acquainted with the circumstances and character of the said insured, and they verily believed that he had really, and by misfortune, and without 10 fraud or evil practice, sustained by such fire loss and damage to the amount of not less than $2,200 on the said property insured as hereinbefore set forth, and was likewise accompanied by a certificate of a resident magistrate to the effect that he was acquainted with the two persons making such affidavit, and that he believed them to be men of honor and integrity; and that the statement and account herein secondly mentioned, and so signed and verified, stated that the withholding of the payment of the amount due and owing on the said policy of insurance from the plaintiff, the assignee of the same, would greatly prejudice the interest of the said Robert Caldwell, the assignor thereof, and was accompanied by the written assent of the said Chauncey F. Belknap, assignee of said policy as aforesaid, that the plaintiff might receive the amount of said policy from the defendants; and this complaint further shows that the withholding of the payment to the plaintiff of the amount insured as aforesaid, to wit, the sum of $2,000, will prejudice the interests of the assignor of said policy from the defendants. 11 [X.] That although more than sixty days have elapsed since Fowler v. N. Y. Indemnity Ins. Co., 26 N. Y., 422. the said notice and proof were delivered to the defendants, yet 12 the defendants have hitherto wholly neglected and refused, and still do neglect and refuse, to pay the plaintiff the amount of said policy of insurance. [XI.] That the defendants, by reason of the premises, have become and are indebted to plaintiff in the sum of $2,000, with the interest thereon, from the 18th day of September, 1853. FOR WHICH SUM of money with interest as aforesaid the plaintiff demands judgment against the defendants, besides the costs of suit. Defendants demurred, assigning as ground that the complaint "does not state facts sufficient to constitute a cause of action." The Supreme Court at Special Term (BROWN, J.), overruled the demurrer, holding (1) that the allegation that the policy was on "his" (Caldwell's) "three-story building," etc., was a sufficient allegation that Caldwell had an insurable interest, and that his interest was as owner. (2) That in alleging the assignment it was not necessary to state any consideration. The General Term affirmed the judgment without further opinion. The Court of Appeals reversed the judgment. 13 14 DAVIES, J. The radical defect in the complaint is, that it contains no averment of interest, either in the plaintiff or in his assignor, in the subject matter of the insurance. This court, in the case of Ruse v. Mutual Benefit Life Insurance Company (23 N. Y., 516), distinctly enunciated the proposition that a 15 policy obtained by a party who has no interest in the subject of insurance is a mere wager policy. It was said in that case that, aside from authority, this question would seem to be of easy solution. Such policies, if valid, not only afford facilities for a demoralizing system of gaming, but furnish strong temptations. to the party interested to bring about, if possible, the event insured against. In respect to insurances against fire, the obvious temptation presented by a wagering policy to the commission of the crime of arson, has generally led the courts to hold such 17 Fowler v. N. Y. Indemnity Ins. Co., 26 N. Y., 422. 16 policies void, even at common law. It was so held in England at an early day by Lord Chancellor King, in Lynch v. Dalzell (4 Bro. P. C., 431), and by Lord Hardwicke in Saddlers' Company . Budcock (2 Atk., 557); and the courts in this country have generally acquiesced in and approved of the doctrine. In this state such policies would fall under the condemnation of our statute avoiding all wagers and gambling contracts of every sort; but they would, no doubt, also be held void, independently of the statute, at common law. In Howard v. The Albany Insurance Company (3 Denio, 301), BRONSON, Ch. J., asserted the necessity of an interest in the assured in all cases, referring, in support of the doctrine, not only to the statute, but to the decisions of Lords King and Hardwicke (supra); and, in this latter case, Judge Bronson insisted that, in fire policies, the assured must have an interest at the time of the loss, as well as when the contract is made. I understand the same doctrine to be distinctly affirmed by this court in the case of Murdock v. Chenango Mutual Insurance Company (2 N. Y., 210), viz., that upon a policy against loss by fire, no recovery can be had unless the 18 insured has an interest in the subject insured at the time of the loss; and an established rule in pleading was enunciated in that case, that the plaintiff or plaintiffs must aver every fact necessary to show a right to recover, and every such necessary averment must be proved. 19 In Peabody v. Washington County Mutual Insurance Company (20 Barb., 340), the plaintiff, Peabody, sued as assignee on a policy issued to his assignor, one Riggs, who was also a coplaintiff. The complaint averred the insurance on the property of Riggs and the assignment of the policy to Peabody as collateral security. Demurrer, on the ground that the complaint did not state facts sufficient to constitute a cause of action. The court held the demurrer well taken as to the plaintiff, Peabody, as it did not appear by the complaint that he had any interest at any time in the property insured, and this was fatal to his right to recover; and the court repeats the well-established rule, that the insured must not only have an interest in the subject matter of the insurance at the time of insuring, but also at the time the loss happens-(citing 3 Kent's Com., 371, 375, 4th ed.) Fowler v. N. Y. Indemnity Ins. Co., 26 N. Y., 422. 21 The interest of the assignee must be stated in the complaint, 20 as well as the fire and other necessary facts, to make out a cause of action. (Granger v. Howard Ins. Co., 5 Wend., 202.) The learned judge who delivered the prevailing opinion in support of the complaint in the Supreme Court, says, it is not ordinarily necessary for the plaintiff to allege in his complaint anything which he is not bound to prove in order to make out his case. Hence, he says, it was held, and he believes very generally, that an averment of interest is unnecessary in declaring on a policy of insurance-citing, as authorities, Nantes v. Thompson (2 East, 385, per Grose, J.); Clendening v. Church (3 Caines, 141); Buchanan v. Ocean Insurance Company (6 Cow., 332). He says it is true that all these cases were before the passage of our statute to prevent betting and gaming. All of these cases, as is shown in the case of Freeman v. Fulton Fire Insurance Company (14) Abb., 398), decided by the General Term of the second district since this demurrer was overruled, were cases of marine insurance. In such cases an averment of interest was unnecessary, for such policies were valid as wager policies, although the plaintiff in fact had no interest in the subject insured. It fol- 22 lows, therefore, that neither an averment nor proof of interest could be required to sustain a recovery on such a policy. (Buchanan v. Ocean Ins. Co., supra.) In the case of Freeman v. Fulton Fire Insurance Company (supra), the Supreme Court held a complaint defective which did not contain on averment that the plaintiff had an interest in the thing insured at the time of the loss, unless the claim was assigned to him after the loss. In the present case, the policy was assigned before the loss; and, therefore, before the plaintiff could recover, he must prove his interest, and such proof being essential, the interest must be averred in the complaint. The judgment of the General and Special Terms must be reversed, and judgment for defendant, with costs. The plaintiff to have leave to apply to the Supreme Court to amend his complaint in proper terms. All the judges concurred. 23 1 Brown v. Champlin, 66 N. Y., 214. BROWN v. CHAMPLIN. New York Court of Appeals, 1876. [Reported in 66 N. Y., 214.] 1. A complaint on a sealed bond need not state who was the real as disdistinguished from an apparent principal in the obligation to secure which it was given. 2. An instrument or transaction may be pleaded by stating it according to its legal effect. 3. The complaint alleged the making of a bond by defendants, and its assignment by the obligors to plaintiff. The evidence showed that defendants made it for accommodation to enable the obligees to obtain a loan from the assignee, now plaintiff, and that the obligees before assigning it were required to indorse their consent to be jointly liable with the obligors. Held, not a variance, as defendants could not have been misled. Action on a bond. The allegations of the complaint were: First. That heretofore and on or about the 17th day of June, 1869, the defendants, Oliver H. P. Champlin, Seth Clark, Edwin A. Holbrook, Salmon Shaw and Henry S. Cunningham, executed under their hand and seal, and delivered to Frederick W. Breed and Charles E. Young a bond bearing date on that day in the penal sum of $10,000, with a condition thereunder written in 2 substance, that if the obligors in the said bond, their heirs, executors, administrators should pay or cause to be paid to the obligees in the said bond named, their executors, administrators or assigns the sum of $5,000 on or before the 15th day of August next thereafter following, then the said bond to be void, otherwise to be and remain in full force as by the said bond ready to be produced as this court shall direct, will more fully appear. 3 That thereafter and on or about the 17th day of June, 1869, the said Frederick W. Breed and Charles E. Young, did for a valuable consideration to them in hand, paid by this plaintiff, sell, assign, transfer to this plaintiff the said bond and the money and moneys due and to become due thereon; that the plaintiff is now the sole, true and lawful owner and holder of the said bond; that of the moneys secured to be paid by the said bond, there is now due and remaining unpaid the sum of $975 and interest |