
    George Hoffman et al. plaintiffs and respondents, vs. The Ætna Fire Insurance Company, defendant and appellant.
    1. A policy of insurance in favor of a firm, containing a clause declaring it to be void in case of “ a sale” of the property insured, without the consent of the insurers, is not annulled by a release by one partner, of all his interest, to the others. (Babboür, J. dissented.)
    2. The cases of FUlou v. Kingston Mki. Ins. Co., (7 Bari. 70,) and Wilson v. Gene-see Mut. Ins. Co., (16 id. 511,) upon this point approved.
    3. Upon a loss after such release, the partners to whom the release was given can recover, in their own names, the whole loss under the policy, including not only the interest released, but also any loss to goods bought by them after the release, coming within the description in the policy.
    4. Where the policy declares that the value of the property shall bo deemed what it may cost at the time of the fire to replace it, although it also requires the preliminary proofs to state the actual cost of the articles, the insured are not barred by-their statement in such proofs of the actual cost, from claiming that the value was a greater sum.
    5. If the goods were those which the insured dealt in at wholesale, or manufactured, the price for which similar goods were generally sold by wholesale dealers or manufacturers may be considered by the jury in estimating such value. "
    6. The failure of the insured to specify any of the goods, “ with particularity,” in their proofs of loss, if caused by their inability to do so in consequence of the total destruction thereof, does not preclude them for recovering for such goods.
    7. The usual clause in a policy that upon the happening of a fire the insured shall use all reasonable means for “ the protection” of the property, does not require them to use means to restore it to its condition before the fire, but only to take the necessary steps to prevent its final destruction or further deterioration, and to put it in a condition to be examined.
    8. Thus, where a large part of the goods were shuts, bosoms and collars, most of which were injured only by water or by handling; Held that the insured were not bound to have them relaundried.
    9. An erroneous assumption by the judge, in charging the jury, that there is no controversy upon a particular matter of fact, is to be corrected not by an exception, but by calling his attention to it that he may then correct it.
    10. The practice of including in a case, questions withdrawn, answers excluded without objection, and testimony not necessary to raise the questions on the exceptions, or stated in too voluminous a form, reprehended by the court.
    (Before Robertson, White and Barbour, JJ.)
    Submitted June 12,1863;
    decided December 26, 1863.
    
      This was an appeal by the defendants from a judgment on a verdict recovered by the plaintiffs.
    The action was brought by the plaintiffs (Hoffman and Place,) to recover on a policy of fire insurance issued by the defendants.
    The policy was issued in February, 1861, to the firm of “Hoffman, Place & Co.,” a partnership then existing, composed of the plaintiffs and one Silvernail. The latter withdrew from the business in March, 1862, and then released his interest in the partnership property to the plaintiff, Hoffman, who, with Place, continued the business, which was that of manufacturers of, and wholesale dealers in gentlemen’s furnishing goods, under the firm name of “ Hoffman & Place.” Subsequently to this change in the partnership, the loss occurred.
    The policy expressed that the defendants insured “ Hoffman, Place & Co.” against loss or damage by fire to the amount of §6000, on merchandise, hazardous and not hazardous, their own, or held by them in trust or on commission, or sold but not delivered, contained in their store in the city of Hew York, and that such company thereby promised and agreed to make good unto the insured, their executors, administrators and assigns, all such loss or damage, not exceeding in amount the sum insured, as should happen by fire to.the property as above specified, during the term of one year, such loss or damage to be estimated according to the actual cash value of the said property at the time the same should happen ; and provided that if such property should “ be sold or conveyed, or if” that policy should “ be assigned without the consent of the company obtained in writing ” thereon, the policy should be null and void.
    The conditions annexed contained, among others, the following usual provisions:
    “ VIII. In case of fire, or exposure to loss or damage thereby, the insured shall use their best endeavors to save and protect the property, and the company shall not be liable for any loss sustained in consequence of neglect to do so.” * * *
    “ When merchandise or other personal property is partially 
      
      damaged, the insured shall forthwith cause it to he put in as good order as the nature of the case will admit, assorting and arranging the various articles according to their kinds, separating the damaged from the undamaged ; and shall cause an inventory to be made and furnished to the company of the whole, naming the quantity and cost of each. ® ■ ® * ”
    
      “ IX. Persons sustaining loss or damage by fire, shall forthwith give notice thereof, in writing, to the company, and as soon after as possible they shall deliver as particular an account of the loss and damage as the nature of the case will admit,, sighed with their own hands. * ® ® ”
    “ The cash value of property destroyed or damaged by fire shall be deemed to be such as it may cost at the time of the fire to replace the same.”
    The proofs of loss submitted by the plaintiffs to the defendants, after the fire, referred to a schedule annexed, exhibiting the merchandise partially damaged. This schedule contained two prices, affixed to each item, in separate columns, one headed “cost,” and the other headed “cash value” The prices in the second column exceeded those in the former. The plaintiffs claimed to be indemnified according to the latter value. In addition to this statement of goods damaged, the proofs of loss contained a claim for goods lost and destroyed, which was made in the following terms :
    “There was also lost, and destroyed by the fire, and in removing the said merchandise from the building, at the time of the fire, merchandise belonging to the undersigned, so far as can be ascertained, of about the value of §1307.66 ”,
    The cause came on for trial on the 16th of February, 1863, before Justice Monell and a jury.
    At the close of the evidence, the defendants’ counsel requested the court to instruct the jury as follows :
    1. That the sale to Hoffman by Silvernail of his entire interest in the copartnership property, before the fire, without the knowledge or consent of the defendants, rendered the policy void; and that the plaintiffs could not recover.
    2. That, should it be held that the sale of SilVernail’s inter-6st to Hoffman did not render the policy void, then Hoffman & Place' could recover only to the extent of their original interest in the property of Hoffman, Place & Oo., and not on account of any portion of the interest of Silvernail conveyed to Hoffman.
    4. That' the plaintiffs, could not recover in this action on account of the loss or injury to any goods or property purchased or acquired by them subsequent to the dissolution of the firm of Hoffman, Place & Oo., and the sale of Silvernail’s interest to Hoffman.
    5. That the plaintiffs having stated the cost of the goods in the preliminary proofs of loss, are bound thereby, and can not now claim that they cost any greater or higher amount.
    These requests the court refused,' and the defendants excepted.
    . ¡The defendants’ counsel also requested the court to charge that the plaintiffs could not, in any event, recover for damage or injury to any goods other than those set forth in the schedule attached to, and forming á part of the proofs of loss.
    ¡ The court refused so to charge, except by adding thereto the words, “ except such as from their total-destruction they could not specify with more- particularity than they have done,” to which addition the défendants’ counsel excepted.
    The defendants’ counsel then further requested the court to charge, - -
    I. That if, at or about the time of the fire, it "would have cost the plaintiffs the several .sums - mentioned in the proofs of loss to manufacture or procure the-goods therein named, then the amount of the loss may be determined by deducting from the cost amount specified in the proofs of loss, the amount of the value ¡of the goods in their damaged condition after the fire. - 1
    ' ¡¡2. -That the price for Which goods similar to the stock in question were generally sold by, or purchased from wholesale dealers and manufacturers, "can not. he taken by the jury as the basis from which the cost to replace those goods can he calculated. ¡ ■ -
    
      3. That the proofs of loss in reference to -the sum of $1,307.66 are insufficient, and are not in compliance with the 9th condition of insurance ; and that, as to that sum, the plaintiffs are not entitled to recover.
    4. That the sale of Silvemail’s interest to Hoffman, and his withdrawal from the firm, was a dissolution of it; and that, therefore, any goods purchased by them and added to the stock, are not covered by .this policy.
    These several requests the court refused, and the defendants excepted.
    The couns.el for the defendants further requested the court to charge the jury that in determining the amount of the loss, they could not take into consideration, or allow for loss of business or trade resulting from the happening of the fire, nor for loss of profits which, in the regular course of their business, the plaintiffs might have made upon their stock of goods, had it not been injured by the fire, which the court refused, except by adding thereto the words, “ over and above the cash value thereof at the time,” to which the counsel for the defendants excepted.
    The court also instructed the jury as follows: “Where property has been totally destroyed, it is very difficult, if, indeed, it is not impossible, to furnish a particular description of the articles so destroyed ; especially in cases where the books and papers of the establishment are lost also. Although the law requires a compliance with the condition contained in the policy of insurance, yet the only obligation in that respect which it imposes is, that the party insured shall furnish the best preliminary proofs in his power ; and he is not required to do more than that. It will be for you to say whether or not sufficient evidence has been given here to satisfy you of the actual loss of that portion of the property. So far as the preliminary proofs are concerned, that being a question of law, I state to you that the objection raised by the defendants upon that point is unavailable here ; the preliminary proofs being sufficient to satisfy the conditions of the policy of insurance.
    In furnishing their preliminary proofs the plaintiffs gave both the cost or manufacturing price of their goods, and also the market value. Those distinct values were given in different columns in the same inventory. One of the conditions of the policy requires the holders of the policy to give the cost price of their property, and provides that, after that ds furnished, the insurers and the insured are to ascertain its cash value. Therefore the plaintiffs, in giving those two columns, did nothing more than they were required to do by the conditions of the policy.
    The only question of law necessary to state to you is the rule of damages. Testimony has been admitted as to both the market value of the property in question, and the cost of its manufacture. ,
    It is claimed on the part of the defendants that you are to take the cost of manufacturing the property as the basis of your calculation. That is not the correct rule. You are to take, as the basis of your calculation of damages, the market value of the property at or about the 9 th of April, 1862, the time of the happening of the fire. If you took the cost price of manufacturing goods of the character of those involved in this case as your standard, you would necessarily have to wait until the articles should be manufactured, and according to the testimony of a very intelligent witness, (Mr. Hyatt,) it would take three months to manufacture them, during which time there would probably be a great change in their market value. The insurers undertake by a policy of insurance, for a sufficient consideration, to make the insured good for any loss or damage by fire that may happen to the property upon which the policy is issued. The law makes general rules, and does not deal in exceptional cases ; and the only safe rule in a case of this kind is to hold the insurance company to their contract of indemnity to make good to the insured the loss suffered at the time of the fire. The market value, or in other words, what it would have cost the plaintiffs at that time to go into the market and purchase the same kinds and quantity of goods as those which they lost, is a basis upon which you can make your calculation of the damage sustained by the insured in this case.
    Evidence was given of the cost of relaundrying the goods injured by the fire. But the plaintiffs were not bound to relaundry the goods at all. They had a right, upon the happening of the fire, to claim the damages they had sustained by it. The condition of the policy which provides, that upon the happening of a fire, the insured shall use all reasonable means for “ the protection” of the property, does not mean that they shall apply any more labor'to the property than is necessary in assorting and arranging the goods so that an examination may be made to ascertain the damage done to them. If relaundrying were a matter to be taken into consideration, you would have to wait and see what effect it would have upon the goods, before you could fix the damage, and that could only be determined by the sale of the property afterwards. You are to take simply the market value of the property as the basis of your calculation.”
    To the several instructions in each of these paragraphs the defendants’ counsel excepted separately.
    The jury rendered a verdict in favor of the plaintiffs for $4,075.87, upon which judgment was entered ; and the defendants appealed.
    
      A, Wakeman, for the defendants, appellants,
    I. The judge erred in refusing to charge as first requested, that the sale to Hoffman by Silvernail of his entire interest in the partnership property before the fire, without the knowledge of the defendants, avoided the policy. 1. The defendants, by the policy, insured “ Hoffman, Place & Co.” against loss or damage by fire, on merchandise, their own or held by them in trust. That is the property of this firm or association, having an existence in law as a single entity, known and referred to by the name of “ Hoffman, Place & Co.” The sale by Silvernail of his interest to Hoffman operated as a dissolution of the firm. From that moment the existence of this single legal entity, known by the name of “ Hoffman, Place & Co.” was arinihilated. And thereupon George Hoffman and William Place, by contract under the law, created a new, separate legal entity, with entirely other and very different rights, known by the name of “ Hoffman & Place.” These defendants never insured the property of this new legal being or firm ; they never contracted with it, or even knew of its existence until after the fire. This new legal entity or firm having purchased the property of the old firm, now seeks in its own right to enforce this contract against these defendants. This we insist they can not do. If Hoffman, Place & Silvernail had been incorporated under the name of “Hoffman, Place & Co.” and these defendants had by that name insured its property as such, and subsequently George Hoffman & William Place should have been incorporated by the name of Hoffman & Place, and should then purchase the property of the former corporation, without the knowledge of these defendants, and a loss should occur, will it be contended that the latter corporation could recover upon the policy issued to the former ? Upon the same principle, one firm can not recover upon a policy issued to another, except under a recognized assignment.
    2. If Hoffman, Place & Silvernail were simply joint contractors with these - defendants, then the sale of Silvernail to Hoffman was a termination of his rights and interests in the property. Of course he could not be damaged by the fire. The sale operated as a pelease of the defendants from any interest or rights he may have had under the contract. A release of one in a joint contract, is a release of all. (Murdock v. Chenango Mutual Ins. Co., 2 N. Y. Rep. 210, 216, 218.)
    3. The policy expressly provides that if the property should be “ sold or conveyed” without the consent of the company obtained in writing upon the policy, the policy should be null and void. The dissolution of the firm of H. P. & Co. and the transfer of the whole property to the new firm of Hoffman & Place, was such a sale or conveyance as rendered the policy void. (Murdock v. Chenango Mut. Ins. Co., 2 N. Y. Rep. 216, 218.) While it may be said that this was a case of misjoinder, yet we submit the reasoning of the court covers this precise point, and is conclusive. See Tillou v. The Kingston Mutual Ins. Co. (5 N. Y. Rep. 1 Seld. 405,) in which the decision in the general term of the 2d district, upon this point in the same case, (7 Barb. 570,) is reversed. See, also, Grosvenor v. The Atlantic Ins. Co. (17 N. Y. Rep. 391,) where the case of Tillou, (5 N. Y. Rep.) is reversed, hut not upon the point that the sale of the interest of one partner to his copartners, vitiates the policy. (Finlay v. The Lycoming Co. Mutual Ins. Co., 30 Penn. 6 Casey, 311, 313, and authorities cited by Mr. Parsons arguendo.) Dreher v. Ætna Ins. Co., 18 Missouri, 3 Bennett, 128, 135,136, citing the opin. of Cady J. in 2 Comst. in the Murdock case as conclusive. Dix and others v. The Mercantile Ins. Co., 22 Ill. Rep. 272,276, 278, opin. of Breese, J. Wood v. The Rutland Ins. Co., 31 Verm. Rep., 552, 563, citing the N. Y. cases as authority.) Justice Roosevelt, in his opinion in 16 Barb. 512, does not cite a single authority.
    Although this case is referred to with approval, in Dey v. Poughkeepsie Ins. Co. (23 Barb. 623, 627,) the point was in no way involved in that case. Upon this point we respectfully submit that the law and reason are both with the defendants.
    II. The judge erred in refusing to charge that if the plaintiffs could recover at all, it could only be done to the extent of their original interest upon which the sale only operated as if Silvernail had sold to a stranger. (Howard v. The Albany Ins. Co. per Bronson, J., 3 Denio, 301, 305.) He should have instructed the jury to deduct from the amount of goods claimed in the proofs of loss to have been on hand at the time of the fire, the amount of the Silvernail interest conveyed to Hoffman, being a quarter of the whole concern.
    III. The judge erred in not charging the jury that the plaintiffs can not recover on account of the loss or injury to any goods acquired by them subsequent to the dissolution of the firm of “ Hoffman, Place & Co.” (Wood v. Rutland Ins. Co. 31 Verm. Rep. 552, 563.) The business of Hoffman & Place was a new one. They were new parties. To make these defendants liable for their loss, it must he shown that they have contracted with them. The new firm purchased $8,023.78 in new goods before the fire.
    
      IY. The judge erred in not charging that the plaintiffs having stated the costs of the goods in the preliminary proofs of loss, are hound thereby, and can not now claim that they cost any greater or higher amount. (Irving v. The Excelsior Fire Ins. Co., 1 Bosw. 507, 514.)
    Y. The judge erred in amending the eighth request to charge, by adding thereto the words “ except such as, from their total destruction, they could not specify with more particularity than they have done.” There was no pretense that the plaintiffs could not describe or designate all the goods. Their books, papers, bills and accounts were' saved, and from them they could have made up, and did make up their proofs of loss. The exception tended to lead the jury to suppose that other goods than those set forth in the proofs of loss might have been destroyed, and for which they were at liberty to make an allowance.
    YI. The judge erred in refusing to charge the jury as ninthly requested, to wit:' “ That if at or about the time of the fire, it would have cost the plaintiffs the several sums mentioned in their proofs of loss to manufacture or procure the goods therein named, then the amount of the loss may be determined by deducting from the cost the amount specified in the proofs of loss, the amount of the value of the goods in their damaged condition after the fire.”.
    1. On the 24th of April, the plaintiffs furnished the defendants with a sworn statement of the property injured by the fire ; in this statement they stated the total, just and true cost of the goods. . -
    2. By the terms of the policy, the cash value was the cost to replace them. The cost was fixed in the proofs by the plaintiffs. They swear this cost was just and true, and should be bound by it, and the court should have so instructed the jury. After deducting the actual value of the goods in their damaged condition, the balance would then have been the actual loss.
    YII. The judge erred in refusing to charge that the price for which such goods were generally sold by or purchased from wholesale dealers and manufacturers, could not he taken as the basis from which the cost to replace the goods could be calculated.
    1. These plaintiffs were wholesale dealers in, and manufacturers of furnishing goods. In the proofs of loss, the first column of the statement showed the cost, and the other the selling price or cash value as the plaintiffs termed it. The cash-value was the plaintiffs’ selling price, as they claimed.
    2. The words “cost to replace the goods,” as used in the policy, does not mean what it would cost wholesale manufacturers and dealers to replace the goods by purchases at retail, nor what it would cost wholesale dealers to replace the goods by purchases from wholesale dealers. The cost to replace them means, in this case, the cost of reproduction or importation. The rule that the cost to replace the goods, means what it would have cost the plaintiffs to have gone into the market and purchased similar goods from similar wholesale dealers, would be unjust,.
    3. Should this construction prevail, and had the plaintiffs’ entire stock been destroyed, they would recover' not only the cost of the goods, but thirty per cent profit upon the whole amount, without giving any credit or suffering losses from bad debts.
    4. The judge not only refused to charge as requested under this point, but actually charged “that the jury should take what it would have cost the plaintiffs, at that time, to have gone into the market and purchased the same-kinds and ¿quantities of goods they had lost, as a basis upon which they should calculate the amount of the damage sustained.” e
    The proper basis was not the cost in the market by purchase. The contract says it shall be, what it would cost to “ replace ” them. That is, as they were “placed” before in the ordinary way in which the plaintiffs created and provided their stock for sale, to wit, by manufacture and importation. Certainly the word “replace,” in this connection, can mean nothing else. It is absurd to suppose it means the purchase in the market at a profit of thirty per cent on the manufacturer’s price, when the plaintiffs’ business was manufacturing.
    VIII. The judge erred in refusing to charge that the proofs of loss in reference to the sum of $1307.66, were insufficient, and as to that sum the plaintiffs were entitled to recover.
    1. No portion of the books, inventories, hills, or memoranda of the plaintiffs was injured or destroyed by the fire. They could tell what goods they had in the store the night of the fire. 2. The 9th condition requires that, as soon as possible after the fire, the insured shall deliver as particular an account of the loss and damage as the nature of the case will admit. 3. The plaintiffs, having all their hooks, inventories, and hills, were as able to give a detailed account of the particular goods making up the $1307.66, as they did in making up the other amounts. After having given a detailed inventory from the books, of all the goods they had on hand on the night of the fire, they insert in a lump $1307.66 for goods “ lost.” They could not know that they had been lost except by the books. If they appeared on the hooks, then they could have given the particulars of them, as they did of the other goods entered there.
    The proofs, in relation to this round sum of $1307.66, do not comply with the terms of the policy. The amount should have been rejected.
    IX. The judge erred in refusing to charge that the sale of Silvernail’s interest to Hoffman, and his withdrawal from the firm, was a dissolution of it—and that, therefore, any goods purchased thereafter by them, and added to the stock, were not covered by this policy.
    X. The judge erred in amending the thirteenth request. Because the cash value was not, as ordinarily understood, the measure of the loss. The true measure was what it would cost to replace the property. The amendment was an indication to the jury to allow for loss of trade and profits, provided they did not in the total amount exceed the cash value of the property at the time.
    This tended to mislead the jury.
    
      XI. The judge erred in. charging the jury substantially that the relaundrying of the shirts was a matter not to be taken into consideration by them. The principal portion of the stock was shirts, bosoms and collars—from two thirds to three quarters in amount. It was proved that these goods could have been relaundried at a small expense, and when so done would have been just as good as new. These facts should have been taken into consideration by the jury in determining what it would cost to replace them.
    XII. The judge erred in instructing the jury that they should take his figures as stated by him as the basis of their calculation, if they concluded to find a per centage of damage.
    
      B. Sandford, for the plaintiffs, respondents.
   By the Court, Robertson, J,

The policy in this case declares the subject insured by it, to be merchandise, contained in a certain building, of either “Hoffman, Place & Co.” or held by them in trust or on commission, even if sold, provided it was not delivered. The defendants, also by it, agree to make good not only to the insured, (H. P. & Go.,) but also to their executors, administrators, and assigns, any loss by fire to the property insured, for a year. Another clause in the policy declares it to be null and void, if the property insured is sold or conveyed. This conflicts with the description of the subject of insurance, which permits the property to be sold, provided it was not delivered. If they are to be reconciled by supposing the description to create an exception to the annulling clause, the difficulty still remains of the kind of sale intended. It would be superfluous to provide for a sale to customers, if thereby the assured lost their insurable interest. The annulling clause, which is printed, seems to have been intended for subjects of insurance existing when the policy was executed, and not for a suspended policy like the one before us, which had no vitality until some merchandise was brought into the building in question to which it could attach. (Hooper v. Hud. Riv, Fire Ins. Co. 17 N. Y. Rep. 424. Dey v. Poughkeepsie Ins. Co. 23 Barb. 623.) And yet, what it is provided may be sold is not the mere interest of any of the assured, but the property itself. The loss to be paid for is not the damage to such interest but to the “property ” itself, and the parties whose loss is to be made good are not merely the assured, but their representatives if they die, or their assigns if they live. These provisions certainly look to a sale of the goods out and out; particularly in connection with such permission to sell without delivering, and not a mere change of interest among the parties. In fact the clause itself, which thus renders the policy null and void, is so wholly inappropriate, as applied to a shifting policy on a fluctuating stock of goods, that it could be entirely rejected as inoperative without great violence to any rule of law.

Whatever, however, the meaning of the term “sold” may be, the annulling clause must be strictly construed. (Livingston v. Stickles, 7 Hill, 253. S. C. 8 Paige, 398. Jackson v. Harrison, 17 John. 66.) Under a similar one, both an executory contract of sale and a mortgage have been held not to be a sale. (Masters v. Madison Co. Mut. Ins. Co., 11 Barb. 624. Conover v. Mut. Ins. Co., 1 N. Y. Rep. 290.) There would be no entire sale, even of the interest of any joint assured, while he retained the slightest interest in the property. The only purpose of prohibiting such a sale by any of the parties would be to compel each one to retain some interest. It is difficult to perceive what benefit that would bestow on the insurer, unless it were accompanied by a positive obligation by each of the assured to be constantly and actively employed in taking care of the property. Otherwise it would only increase the number • of persons having an interest to commit a fraud. It is supposed by the author of a note in the second volume of Parsons on Maritime Law, (p. 46,) that the fatal effect of a release by one partner to others of his interest in goods insured in a policy having such a clause in it is owing to the loss by the underwriter of the character, exertions and vigilance of every, assured to prevent a fraud. But unless there is something" in the policy entitling the insurer to the-positive efforts of each assured to prevent fraud, I do not see how the possibility of a contracting party being so honest and vigilant as to prevent fraud by his co-contractors, aids thé underwriters. All policies are framed on the. theory of their being temptations to commit fraud, and with a view to guard against it by positive stipulations and conditions. Otherwise the fact of making a contract at all with several persons constituting the assured, assumes that they are all fit to be trusted. The possibility of fraud arising from the increase of the number of persons to be tempted, is practically greater than the probability of the discovery and prevention of the fraud by the possible conscience and vigilance of the added parties against their own interest. The substitution of a new party by assignment, without the consent of the underwriters, but not the withdrawal of all of the original assured, may increase the-risk. In every case where the effect of a clause in a policy prohibiting alienation of the subject of insurance has been discussed, its purpose has been considered to be the same as that prohibiting underletting or assignment in a lease ; which was that the person who could avail himself of such a provision may know with whom he is dealing, and not be made to contract .with a stranger. This reason can only prevail when a new party intervenes, and never when one of the. former contracting parties merely releases his interest to his co-contractors.

The foregoing views are applicable to every case of an insurance of several persons, but in the present one the assured were partners, and insured as forming a partnership. They were, therefore, entitled to exercise all the rights of partners, and were to be subject to all their responsibilities. One of the consequences of a partnership is that the interest of any partner may be virtually transferred by operation of law to the others, by his taking more than his share of the partnership profits to his own use, or by his insolvency, may go to his creditors, or by his death to his representatives, j The representatives of any who die become joint owners with the survivors. The annulling clause in question' could never .have been intended to reach such a change of interest, .and if not, such, why should it be supposed to have been intended for any release by either partner to any of the others ? It should require the most explicit expression of such an intention before it could be assumed that the assured intended to lose all benefit of the policy, after having paid the premium, in case either of them relinquished his interest to his associates. (Wilson v. Genesee Mutual Insurance Co., 16 Barb. 571.)

The question of the effect of the release by one of the assured to his co-assured of his interest in the subject insured, where a policy contains a provision avoiding it in case of a sale of such subject, has not yet been definitely settled in the court of dernier resort in this state. But the reversal by it of the judgment of the Supreme Court in the two cases of Tillou v. Kingston Mutual Insurance Co., (7 Barb. 570 ; S. C. 5 N. Y. Rep. 405,) and Wilson v. Genesee Mutual Insurance Co., (ubi sup. S. C. 14 N. Y. Rep. 418,) where that question had been raised and passed upon in the court below, without disposing of it, is strong evidence of the leaning of that court. There was not even a word of disapprobation of the doctrine of the court below in regard to it. Moreover, in the two cases of Howard v. Albany Insurance, Co., (3 Denio, 301,) and Murdock v. Chenango Insurance Co., (2 N. Y. Rep. 210,) cited as authority to the contrary, in which the question in fact arose, the respective courts before whom they were, placed their decision upon the ground merely of the improper joinder as plaintiff, of the party who had released his interest to the others. Yet, strange to say, three separate cases, decided in Illinois, Missouri and Pennsylvania, respectively, by some misapprehension have held that such a release made a policy containing 'such a clause void, upon the authority of the two cases last cited. (Dix and others v. The Mercantile Insurance Co., 22 Ill. Rep. 277, 278. Dreher v. Etna Insurnce Co., 18 Miss. Rep. 135, 136. Finlay v. Lycoming Mutual Insurance Co., 30 Penn. Rep. 311-313.)

Ho reason derived from authority warrants any departure, therefore, from the doctrine as laid down in Tillou v. Kingston Mutual Insurance Co., and Wilson v. Genesee Mutual Insur ance Co., in. the Supreme Court, strengthened as they are by. the subsequent approbation of that doctrine in the cases of Dey v. Poughkeepsie Mutual Insurance Co., (23 Barb. 623,) in the Supreme Court, and Buffalo Steam Engine Works v. Sun Mutual Insurance Co., (17 N. Y. Rep. 412,) in the Court of Appeals.

The refusal of the judge, at the trial of this cause, to charge that the release of one partner to one of the plaintiffs avoided the policy as to all, was therefore correct.

The next question that arises is whether the plaintiffs can recover for the interest in the merchandise assigned to one of them by his copartner—in other words, for the whole of the damage of the property. This is equally involved in the damage to the merchandise bought by them after his retiring from the firm, and must turn, not upon the question of a sale by him, but of the, acquisition by them of his interest and his losing it. As the policy is a contract of indemnity, and the present plaintiffs are injured to the extent of the whole damage to the property insured, if they can maintain an action in their own names alone, there would seem to be no reason why they ■should not recover the whole of their loss. The cases last referred to, which pass upon the fact of a release by a joint owner to his co-owners, in case of a similar clause, put the deprivation of .the party who has parted with his interest of all right to join as plaintiff, upon the ground that he has parted with his interest. This recognizes a fire policy as being a contract with the assured named in it, only so long as they have an insurable interest, and with such of them as retain such an interest after the others have parted with theirs. If the assured, having an insurable interest, are entitled to join in an action, and are entitled to recover at all, I see no reason why they should not recover the damage to the whole property, from whomsoever they derived it. If- new merchandise, bought by them, could be covered by the policy, certainly, although the plaintiffs acquired the title to what they had on hand by two purchases, the latter must be equally protected.

Besides this, the policy expressly provides that the defendants shall pay any loss “to the property insured,” and not merely to the interest of the plaintiffs therein. Any limitation of the recovery of parties insured to the extent of their interest, is derived from general principles of law alone. That interest in this case was equivalent to the entire ownership of the goods. The policy also provides for any loss to the successors and assigns of the assured, as well as 'the latter themselves, on all of these grounds ; therefore the refusal of the judge on the trial to direct the jury to disregard the interest assigned by the retiring partner, and not to allow for goods bought after he retired, was correct.

I am unable to perceive any connection between the proof of the cost of manufacturing articles similar to those injured by the fire in question, and the actual cost of those articles as stated in the inventory. Although the latter is required by the ninth condition attached to the policy, to be stated in the preliminary proofs, the same condition provides that the amount of sound value shall be ascertained by appraisers, and that such sound or cash value of the property destroyed or damaged by fire shall be what it may cost at the time of the fire to replace it. No evidence was offered of a different actual cost than that stated in the inventory in the preliminary proofs. If it had been, I am not prepared to say that the case of Irving v. Excelsior Fire Insurance Co., (1 Bosw. 507,) would have excluded the correction of mistakes. (American Insurance Co. v. Griswold, 14 Wend. 399.) The defendants were not bound by the policy to pay the actual cost, nor were the plaintiffs limited to it when furnished ; it afforded some criterion as to the value of the articles at the time of the loss. " Indeed the plaintiffs furnished the cash value as' well as ■ the cost in their inventory. The request to charge that the plaintiffs could not claim that the merchandise cost any more than they stated it to have cost in their preliminary proofs, was, therefore, ambiguous in not defining what kind of cost was meant; if it meant the cost of similar articles in the market, it was properly refused as not. warranted by law, and if it meant actual cost of these identical articles, there was no aliment for the instruction in the evidence.

The learned judge before whom the cause was tried was correct in qualifying his instruction that the plaintiffs could only recover for the goods set forth in their schedule, with the exception that those might be recovered for whose total destruction presented more particularity in specifying them, accompanied as it was by a reference to the destruction of books and papers in his charge. (Norton v. Rensselaer and Saratoga Insurance Co., 7 Cowen, 645. McLaughlin v. Washington Co. Mutual Insurance Co., 23 Wend. 525. Bumstead v. Dividend Mutual Insurance Co., 12 N. Y. Rep. 81.) The policy itself, in its ninth condition, required only as much particularity as the nature of the case, would admit of. The original actual cost of the goods not being the standard of value agreed'upon by the parties, it would have been error to have charged as requested, that the loss of the plaintiffs was to be ascertained by deducting the value of the goods in their damaged state from their original cost, and the refusal so to charge was proper. The price for which wholesale dealers and manufacturers sold similar goods, was one mode of aiding in arriving at their market value, and instructing the jury to the contrary would have been erroneous; the direction actually given in that respect was proper. So far as any loss in the business of the plaintiffs, or of profits in the course of their business, was embraced in the difference between the cash value of the articles damaged and their actual cost, the plaintiffs were entitled to recover, because the measure of their indemnity was present cash value, not original cost; and by whatever name the difference may be called, the plaintiffs are entitled to it. To have instructed the jury as requested, that they were not, would have been erroneous, and: was properly withheld. The plaintiffs, of course, Were entitled to interest on the amount of their claim from June, 1862, being thirty days from the day of presenting the claim, at' which time, by the terms of the policy, it was payable. (Vandenheuvel v. United Insurance Co., 1 John. 406. Van Rensselaer v. Jewett, 2 N. Y. Rep. 141. Livingston v. Miller, 11 N. Y. Rep. 80.)

The clause in the policy respecting the duty of the assured, in regard to the protection of the property insured, was properly interpreted by the learned judge in his charge. They were not bound to use any means, or incur any expense to restore the merchandise injured to its previous condition ; they were only bound to take the - necessary steps to prevent deterioration, and place it in a condition to be examined. If the attempted use of sdch means should result in a deterioration of the article, the defendants would not be liable for that injury. . The jury had a right to take into consideration the probability of the use of such means in restoring the goods, and its expense in fixing the market value. But the defend-' ants, in the absence of any stipulation, to that effect, had no right to impose on the plaintiffs the burden, risk and delay of relaundrying the damaged articles for their benefit. The exception to the charge in that respect was not well taken, besides being to a whole paragraph, some parts of which, at least,- were correct beyond all question.

' An exception was taken on the trial to a part of the charge to the jury, consisting of a statement of figures upon the basis which they were instructed to proceed to estimate the damage done: to the goods, in case they took a per centage of injury as the-inóde of arriving at it. This statement consists, in a great measure, of facts. Some of the propositions contained in it are unquestionble; no objection was made to it upon the ground that the facts were misstated, and no particular instruction contained in- it as regards the- law of it was singled out as an object of exception.- ■' The exception taken should fail upon that ground. The jury ' was in such, statement substantially directed to take the- market' value of the injured goods, and the value of those entirely destroyed, as the basis of their calculation of damage. The1 market value, as placed upon them in the preliminary proofs 'of loss, was .stated not to be- contested, and the residue of that valúe, after deducting the value of goods uninjured, was required to be part of such basis, and the jury were directed to take a certain other sum as the value of goods entirely destroyed, for the other part of such basis. That sum was stated to be arrived at by taking the value or an inventory made at the time of the retiring of one of the partners, and adding to it purchases to the time of the fire, deducting from such sum the amount of subsequent sales and goods subsequently discovered, which the learned judge stated would leave such value as that of the destroyed goods. Of course he did not add that from such difference was to be deducted the value of the remaining goods, it being plain that such was his meaning. It is true the calculation would make a larger amount destroyed than was stated by the learned judge, but that is no cause of exception by the defendants. There was, it is true, evidence adduced of other injured goods belonging to the plaintiffs, in the building in question, besides those contained in their first schedule of loss, whose value was given at cost prices, hut there was no request to the judge .to instruct the jury that they were to be taken into consideration in estimating the goods totally destroyed. It does not clearly appear what kind of estimate was put on the stock on hand when one partner retired and assigned to the others. The jury, certainly, had a right to determine from the value of the goods at that time, subsequent sales and purchases and the value of the goods on hand after the fire, if uninjured, if such values were estimated by the same standard, whether the difference was caused by an. actual destruction of property by the fire, or any other cause, and if by an actual destruction, the extent of it. If there was no dispute about such values, and no evidence to account for the existence of such difference, it was a mere matter of calculation. If the learned judge assumed, as the foundation of his instruction, that there was no such dispute erroneously, that error should have been corrected, not by an exception, but by calling his attention to it to have the correction made; and if he overlooked the supplementary statement in the preliminary proofs as an element in determining the actual destruction of property and its value, his attention should have been called to such omission. The value of the property uninjured, in making such calculation, was immaterial, as it ought not to he deducted at all from the sound value of the remaining goods in ascertaining the complete destruction of property, since it still remained in existence. The value of the destroyed property does not seem to have been questioned at all throughout the trial and was sustained by evidence, and if any error was made in that respect, it is not to be questioned for the first time now, on exceptions. However, there was no direction given to the jury to allow that amount of damage, but merely that they were to take it as part of the basis of their calculation in finding a per centage of damage along with the value of the goods remaining in existence, which they had a right to do. The loss with interest appears, from the verdict of the jury, to have been estimated by them at about $8,150, or with the interest for eight months deducted, about $7,800. The estimated cash or present market value of all the injured goods, if sound, was nearly $17,700. Deducting $1,300, as the value of the destroyed goods from the estimate of damage by the jury, leaves $6,500 as their estimate of damage to the injured .articles, being less than forty per cent, and less than the average between ten and seventy-five per cent, the extreme rates furnished in the testimony given on the trial. Including the entirely destroyed property, the estimated rate of damage would be about forty-six per cent. Unless the jury were bound to ■take the cost of the articles instead of their cash or market value as the basis of computation, no great injury was done to the plaintiffs by the direction to assume the value of property destroyed as that testified to and apparently undisputed on the trial.

Several exceptions were taken in the course of the trial to the admission of testimony and its exclusion. Most of such exceptions involved the same principles as those previously discussed, and the far larger part relating to-evidence of an advance of the goods in value after they were purchased by the plaintiffs up to the time of the fire. One was to an instruction by the learned judge in his charge that the plaintiffs were entitled to recover for damage to the subject of insurance by water used to extinguish, the fire, which of course was untenable. One of the witnesses was asked to state what was the whole cost value of the stock found after the fire, and was informed he could refresh his recollections by reference to a book, which was objected to ; whether this objection was made to his stating the cost value on looking at the book, does not appear, nor whether he looked at the book at all. The question as to the statement was undoubtedly proper, as the witness had shown a knowledge of the subject, and was properly admitted ; the objection was therefore properly overruled. On another occasion an inventory of goods of which the cost prices were taken from the plaintiffs’ bills and books of account was received under objection and exception. This had been admitted by the defendants to contain a correct statement of the stock of the plaintiffs, and the calculations of amounts in it were proved to be correct. No objection was taken to it specifically, that it was amode of leading the witness, or that it was mere secondary evidence, the original bills and books not being accounted for. If the objection had been stated on those grounds, the defect might have been cured on the trial, and the objection taken was properly, therefore, overruled.- A schedule marked <£ defendants’ answer,” of whose nature and contents there was no evidence, was also properly excluded.. Another witness (Cleveland,) who had testified to an appraisal of loss, made an inventory after examining the goods, and the total amount thereof was given by him; it consisted of nearly seven hundred items, and he was asked, by the party calling him, to read from it the names of every article and the per centage of damage upon it “ seriatim,” which was prevented by the court. As the only result of such a course would have been an unnecessary waste of time, had the threat been carried out, it was properly cut short; whether it could have been taken on a cross-examination under some possible condition of things is a different question. In like manner an inventory testified to by another witness, (Hyatt,) as made by him, was properly excluded, as he was able to and did testify to the estimate made by him of the loss, without it. Some questions were properly excluded as leading and others as irrelevant, not necessary to he passed upon separately.

The labor of examining in this case, the questions presented, by judges unfamiliar with the evidence on the trial, has been much increased by the unnecessary voluminousness of the case, caused by inserting questions withdrawn, answers excluded without objection, exceptions by the plaintiffs’ counsel, a great deal of testimony not necessary to raise the questions on the exceptions, contrary to general rule 36, and the whole testimony, in the form of question and answer, notwithstanding all the questions were not objected to. The labor of reducing the case to its proper proportions is thus thrown on the whole court at the hearing, when it should have been done on the settlement of the case. It would seem that the present case never had been submitted for settlement. The 36th rule just referred to seems to imply that this should be done in all cases.- The growing evil of improperly prepared cases, may call upon the court to refuse to hear causes where they are offered, and treat them as if no case had been made. The same inattention has been noticed before in other cases, hut without apparently any good effect.

The exceptions having been rightly disposed of on the trial, and there appearing no error in the charge of the court, or refusal to charge as requested, the judgment appealed from must be affirmed, with costs.

Barbour, J. (dissenting.)

It is an elementary principle that a policy of insurance is a personal contract, whereby the insurer engages to indemnify the assured for such loss as Tie may sustain by reason of the perils insured against, and that such contract is not assignable, before loss, without the consent of the obligor. (1 Arn. on Ins. §§ 1, 8, 9, 13. Skinner v. Somes, 14 Mass. R. 107. Jessel v. Williamsburgh Ins. Co. 3 Hill, 88. Wood v. Rutland & Add. Mutual Fire Ins. Co., 31 Verm. R. 552.) Besides, there is no pretense in this case that any assignment or transfer was ever attempted to he made by Silvernail of his interest in the policy to his partners, or either of them, so that it is quite clear that the plaintiffs are not entitled to recover, by virtue of any assignment of the policy, as representatives of the interest therein of the copartnership firm insured, and of which they constituted but two of the three members. If they can succeed at all, it must be upon the ground that the contract of indemnity enured to their individual benefit, as members of the firm, and that it covered all the property of which they, as copartners in another firm, were the owners when the loss occurred.

But, in the case before us, the insurance, it appears to me, was intended to be made with all the copartners, jointly, and covered their joint interest as such, in the property of the firm ; and nothing was designed to be included in the contract except such of the property described therein, as should continue to belong to them all, as copartners, at the time a loss should occur. The insurers took just this risk, and no other, and the assured accepted the policy with that understanding; and each and all of them must be held to have assumed with such acceptances, the legal obligation always incumbent upon parties procuring an insurance upon their property, that each of them would exercise reasonable and proper watchful care and prudence, for the protection of the property insured and intended to remain in their hands. In the event which has occurred in this case, therefore, I think the defendants may well say, in answer to the plaintiffs’ claim, confiding in the habits, good sense and prudence of Silvernail, and believing that the safety of the goods would be cared for by him, we executed the pol- ■ icy, when, without that, we would not have taken the risk; and we had; therefore, a legal right to expect a continuance of such care and prudence on his part. Our contract was made with him and his two partners, jointly, and not with either two of them without the other ; and we agreed to indemnify them for such of the goods, described in the policy only, as should belong to the firm of Hoffman, Place & Co. at the time a loss should occur.”

The authorities upon this point are not only numerous, but, in this state, somewhat conflicting. The first in time of those that 1 shall con.sid.er is Howard & Ryckman v. The Albany Ins. Co., (3 Denio, 301,) which was an action brought in the name of both of the parties insured, to recover for a loss alleged in the declaration to have been sustained upon a fire policy issued to them by the defendants. The defendants plead that, after the insurance, and before the loss, the plaintiff, Ryckman, sold and transferred all his interest in the property covered by the policy, to Howard; to which the plaintiffs demurred specially. The question thus brought directly before the court was precisely like this, except that, in the former case, the policy contained no restriction whatever, in terms, upon the sale of the subject insured, (a matter, by the way, which I will hereafter consider.) A majority of the court, Justices Beardsley and Smith, sustained the plea demurred to, upon the ground that the plaintiff for whose benefit the action was brought, could not recover for any portion of the loss, inasmuch as the persons insured had no joint interest in the property at the time such loss occurred ; and judgment was ordered for the defendants. Justice Brohson, however, dissented, holding that the contract of insurance was not terminated when the plaintiffs ceased, by a sale from one to the other, to have a joint interest. “ The case,” he says, is not free from difficulty ; but I think there may be a recovery on account of the interest which Howard had in the property at the time the contract was made, because that interest continued until the loss happened. But there can be no recovery on account of the interest which Ryckman had in the property at the time the contract was made, because he had parted with that interest before the loss.”

Murdock & Garrett v. The Chenango Mutual Ins. Co., (2 Comst. 210,) was an action upon a policy issued to the plaintiffs as owners of a mill. After the insurance, but before the loss, Garrett conveyed his interest in the premises to Murdock. Upon the trial, the defendants moved for a nonsuit upon the ground, among others, that the joinder of Garrett in the action was fatal to' a recovery; which motion was denied, and the plaintiffs had judgment. Upon appeal to the court of last resort, the judgment was reversed, and a new trial ordered. Judge Cady, in delivering the leading opinion in that case, remarked : “ The question is whether an action can he sustained in the names of both, when one has no legal interest in the suit. The joint interest in the property insured was destroyed when one conveyed all his interest to the other. That act, in which both concurred, rendered it impossible that a loss could after-wards happen within the meaning of the policy; the joint property of the insured could not thereafter be destroyed by fire, because they had no such property.” * * “ If one of two owners of a mill, who are jointly insured, sells his part to a stranger, it may appear like a hardship that such sale should destroy the policy, but it is no more than happens in all cases where there are joint promises, &c. and one of them discharges the promise.” * * “ In this case, both the promisees concurred in the act which destroyed the joint remedy on the contract.” This decision was subsequently discussed and its principle reaffirmed by the Court of Appeals, in Tillou v. The Kingston Mutual Ins. Co., (1 Seld. 405,) where it was held that the former case and Howard v. Albany Ins. Co., (supra,) were conclusive upon the subject;. thus reversing the decision of the general term in the second district, where Judge Barculo had expressed a contrary opinion.

These cases in our highest appellate court authoritatively overrule the evidently hasty decision of the Supreme Court, first district, in Wilson v. Genesee Mutual Ins. Co., (16 Barb. 512,) and they have been followed by the Supreme Court of Vermont in Wood v. The Rutland and Addison Mutual Fire Ins. Co., (31 Verm. Rep. 552,) a case, which, so far as the naked question now under consideration is concerned, seems to be precisely like this. There a policy upon merchandise in trade was issued to Wood & Co., a firm composed of Wood & Johnson. Afterwards, Johnson having died, Wood purchased the interest - belonging to his estate, and continued the business of buying and selling merchandise, on his own account, up to the time of the loss. The court, in an action brought by Wood upon the policy, held that if the plaintiff had continued in the cafe and possession of the goods as surviving partner only, an action might have been sustained by him as such survivor ; but that, as his claim rested upon his purchase of the interest of his deceased partner, and the continuance of the business for his own benefit, he could not recover. In speaking of the effect of a sale by one' of the assured partners to the others, and in approval of the decision in Murdock v. The Chenango Ins. Co., the court say : This has sometimes been put upon the ground that, at the time of the loss, the old firm had no insurable interest in the property. But, we think, where there is a voluntary change of the firm, the insurance company may, also, well say that the new firm is not the party with whom they contracted.” * * “ They might be willing to insure Wood while connected in business with Johnson, and wholly unwilling to insure or deal with him alone.”

Upon these authorities, and for the reasons I have suggested, I have no hesitation in holding, that, independent of the clause in the policy prohibiting the sale of the insured property, and, solely upon the principle that the risk only extends to such of th" property as continues to belong to all of the assured at "the-time of the loss, and that such assured and they alone can sustain an action upon the policy, the plaintiffs in this case can not recover, and that the refusal to charge as requested in this regard, was erroneous.

If such must be the result, in cases where no provision is contained in the policy, in terms, restricting the power of sale by the assured, a fortiori, it seems to me, we must arrive at the same conclusion where such prohibition is inserted and directly expressed in the contract itself, with the assent of the parties insured, as in this instance ;■ and so, we find, it has been decided in sundry cases in the highést courts of our sister states.

In Dix v. Mercantile Ins. Co., (22 Ill. Rep. 272,) an insurance was effected, by a firm, composed of three partners, upon its stock of merchandise. The policy. contained a condition that the instrument should be void in case of a transfer or change of title of the property insured, or of an "assignment of the policy. One of the partners sold his interest in the goods to the other two, previous to the los's. The Supreme Court of Illinois held that such sale avoided the policy, and terminated the liability of the insurers. Judge Bruce, in delivering the opinión of the court, uses this language: “ A contract, as well of insurance as in regard to any other matter, must be interpreted according to the intention of the parties making it; and that is to be gathered from the language employed and the objects contemplated by it. The intention of the company was, manifestly, that no strangers should come into the care and management of this property without their consent. Knowing the parties with whom they contracted, and relying upon the fidelity and circumspection of each and every one of them, they were willing to take the risk at the premium stipulated.” * * They were willing, for the premium, to entrust the property to the care-and guardianship of Sinclair, Dix and Harris, but not to the care and watchfulness of Dix and Harris alone. Is it not clear that the assurers may be as greatly prejudiced by removing one, to "whom, with others, they had entrusted the guardianship of valuable property, as by the introduction of a stranger ? The one removing from the concern, may have been the very one on . whose vigilance, fidelity, and care, the greatest share of confidence was reposed ; and, by so removing, the hazard is increased to the insurerj without any corresponding increase of premium.”

Finlay & Stanley v. The Lycoming Co. Mutual Ins. Co., (30 Penn. Rep. 311,) was an action upon a policy issued to a firm of two partners containing a similar provision, and where one of the partners had sold his interest in the insured property to the other, before the loss. The Supreme Court of Pennsylvania held that the plaintiff could not recover. Justice Thompson, in pronouncing the decision) after stating that it was a fundamental condition of the contract that alienation of the property should render the policy void, added: £{ It can not be doubted that a sale by one partner to another is within the prohibition.” * * ££ By the transaction, the one parted with all his interest, and the other acquired double what he previously possessed,”

A like conclusion was arrived at by the Supreme Court of Missouri, in a case of the same character. (Dreher & Bumb v. Ætna Ins. Co., 18 Mo. Rep. 128.)

These decisions of the ultimate appellate courts of Pennsylvania, Illinois and Missouri, it is unnecessary to say, are entitled to the highest respect as authorities ; and I have been unable to find in the books any opinion of a contrary tenor upon this particular point. Without examining, the further exceptions contained in the case, I am, therefore, in favor of reversing the judgment and directing a new trial.

Judgment affirmed. 
      
       The decision in this case has been affirmed in the Court of Appeals. (32 N. Y. Rep. 505.)
     