
    William W. Henshaw, Plaintiff, v. Insurance Company of the State of New York, Defendant.
    (Supreme Court, Kings Trial Term,
    December, 1901.)
    Reinsurance, fire — Part of the property destroyed after application for and "before issue of the policy — Measure of damages — Ultra vires.
    A contract of insurance may be retrospective where by reason of the remoteness of the property it is not known to the insured whether it may not be already destroyed, but where the insured at the time of the contract knows that a part of the risk has already been burned the policy covers only so much of the risk as was in existence at the time when the contract of insurance was actually made.
    A contract of insurance where the insurer and the insured know that thé property insured has already been destroyed is ultra vires and void.
    
      Action upon a fire policy of reinsurance issued by the defendant to the plaintiff's assignor, the Virginia Fire and Marine Insurance Company of Richmond, Va. On June 30th, 1899, the said Virginia company mailed a letter to the agents of the defendant in New York city applying for a policy of reinsurance un a risk which said Virginia company had on buildings, machinery and other personal property in Virginia for one year from June 27, 1899, and enclosing forms therefor. Half an hour afterwards a fire broke out on the insured plant and destroyed and damaged part of it. The Virginia company was informed thereof on July 1st. On that same day the said agents of the defendant at New York received such application, and on July 3rd they mailed the policy applied for to the Virginia company with a letter saying that the morning newspapers of that day reported a considerable loss on the insured plant, and that “ as we understand it a portion of the property covered under the form sent has been destroyed, and it will be necessary for you to furnish us with corrected forms.” The Virginia company on receipt of such policy claimed that the defendant was hable for its share of the loss, and assigned the policy to the plaintiff to sue therefor.
    Eustace Conway for plaintiff.
    Coudert Brothers for defendant.
   Gayntob, J.:

As the insured knew at the time the policy of reinsurance was issued that some of the property had already been destroyed the contract of reinsurance did not cover the destroyed property, but only the part of it in existence. A contract of insurance may be retrospective where by reason of the remoteness of the property it is not known to the insured whether it is not already destroyed, a familiar case being the insurance of ships and cargoes at sea, lost or not lost ”; but if the insured know of Its loss, and does not reveal it, the contract is fraudulent and not-' binding (2 Parsons on Cont. 444; 3 Kent's Com. 258; Ins. Co. v. Folsom, 18 Wall. 237; Bentley v. Columbia Ins. Co., 17 N. Y. 421; Hallock v. Commercial Ins. Co., 26 N. J. L. 268; 27 N. J. L. 645; Security Fire Ins. Co. v. Kentucky Marine & Fire Ins. Co., 7 Bush (Ky.) 81; Hammond v. Allen, 2 Sumn. 387). The policy in this case by its terms covers a period prior to the fire, it is true, viz., from June 27th, 1899, but its legal effect can only be to insure the part of the property in existence at the time the contract of insurance was made, viz., on July 3rd, and in the condition it then was. Moreover, in this case the insurer also knew of the fire, and it would be ultra vires for it to insure property against damage or loss which it knew had already taken place. In addition to all this the letter sent by the defendant with the policy shows that the policy was expressly delivered as covering only the property then in existence and this was therefore the contract,

Judgment for the defendant.  