Merchants' Cotton Press & Storage Co. v. Insurance Co. of North America

Citations

• 151 U.S. 368
• 14 S. Ct. 367
• 38 L. Ed. 195
• 1894 U.S. LEXIS 412

Syllabus

<p>A railroad company agreed with a cotton compress company that the latter should receive and compress all the cotton which the railroad might have to transport in compressed condition, and that it should insure the same for the benefit of the railroad company, or of the owners of the cotton, for a certain compensation which the railroad company agreed to pay weelily. It was further agreed that the compress company, on receiving the cotton, was to give receipts therefor, and that the railroad company, on receiving' such a receipt, was to issue a bill of lading in exchange for it. Cotton of the value of $700,000, thus deposited with the compress company for compress and transportation, was destroyed by fire. That company had taken out policies of insurance upon it, but to a less amount, in all- of which the compress company was named as the assured, but in the body of each policy it was stated that it was issued for tlio benefit of the railroad company or of the owners. The various owners of the cotton further insured their respective interests in other insurance oom-panies, called in tlie litigation tlie marine insurance companies. After the fire tlie amounts of the several losses were paid to the assured by the several marine companies. In an action in the-courts of Tennessee to settle the rights of the parties, the Supreme Court of that State held, (89 Tennessee, 1; 90 Tennessee, 306,) that the companies so paying were entitled to be subrogated to the rights of the owners or consignees against the railroad company under its bills of lading, and that the railroad company was entitled to have the insurance-which had been taken out by tlie compress company collected for its benefit. The railroad company not being party to those suits, the marine insurance companies filed their bill in equity in a state court in Tennessee against the com-. press company, the several persons who liad insured the destroyed cotton for it, and the railroad company, to reach and subject t