Texas Banking & Insurance v. Cohen

Citations

• 47 Tex. 406

Syllabus

<p>Insurance.—A partnership composed of three persons obtained a policy of insurance on a stock of goods for one year. The policy contained the following provision, viz : “ This policy is not assignable 'unless by consent of this corporation, manifested in writing; and in case of any transfer by sale or otherwise, without such consent, this policy shall from thenceforth be void and of no effect.” During the year, one of the three partners retired from the firm, selling his interest in the partnership to his copartners, after which, and while the business was being carried on by the remaining members of the firm, at the same place, the goods were destroyed by Are. In a suit by the two remaining members of the Arm to recover the amount of the policy: Held—</p> <p>1. That the sale by one partner to his copartners of his interest, did not, on account of the proviso in the policy, release the company.</p> <p>2. Considering the scope, object, meaning, and spirit of the contract, sucli a sale and retirement of one of the partners is not such a change in the persons to the contract, and in, the interest in the property lost, as to prevent a suit on the policy by the firm as it existed when the loss occurred; and the proviso in the policy must be understood as intended to prevent only the “ sale ” and “transfer” of the proprietary interest of those with whom the insurers contracted, to others, with whom they had not consented to contract.</p> <p>3. The insurance was intended to cover the mercantile stock of which the assured were proprietors, stored from time to time in the building in which that business was conducted. There was no substantial change caused by the sale by one partner to the others material to the risk, and clearly none within the intent of the proviso.</p> <p>4. Changes in a firm, of the character complained of by appellant, often occur from the deatli or bankruptcy of one of the parties ; and it was the duty of the company, in view of the conflicting opini