
    Delahay vs. Memphis Ins. Co.
    Covenant on a policy of insurance. A failure on the part of the assured to disclose the existence of a mortgage on the property, is not a circumstance material to the risk, and will not avoid the policy.
    In this case a verdict and judgment were rendered in favor of the defendant, in commercial and criminal court at Memphis, King, judge, presiding. The plaintiff appealed.
    
      McClanahan, Barry, and I)ekfield,. for the plaintiff.
    
      E. M. Yerger, for the defendant.
   Gkeen, J.,

delivered the opinion of the court.

This is an action of covenant, on a policy, of insurance.

On the trial, a mortgage, executed by the plaintiff to secure a debt due by him to the mortgagee, and in full force at the date of the policy, was given in evidence by the defendant. The plaintiff did not disclose to the underwriters, the existence of the mortgage when he made his application for insurance. The court charged the jury, among other things, “that they must enquire, if, at the time of insurance, there was any incumbrance, or mortgage on the property insured, and whether plaintiff had informed defendant of the same. If a mortgage, or trust deed, or other incumbrance did exist, which the plaintiff did not communicate to defendant, it was such a concealment as would have rendered the policy void.” The jury found for the defendant, and the plaintiff moved for a new trial, which was refused, and he prosecuted this appeal in error.

We think his honor erred in the instruction to the jury. A mortgage or deed of trust, is only a security for the debt, and if the property be destroyed, the debt remains; so that the assured has as much interest in protecting the property, as if there were no incumbrance on it. It may be that, practically, some bad men might be willing, that property insured by them, on which was an incumbrance, should be destroyed, intending to act dishonestly with the creditor, and to pocket the insurance money — but we cannot make the assumption that such would be the case, and establish it as a yule of decision. The case of Strong vs. The Manufacturing Insurance Company, 10 Pick. R. 40, is refered to in the case of Catron vs. Ins. Co. 6 Hump. R. 176, and the principle there adjudged is recognized. Upon reviewing those cases, we re-affirm the principle, that a failure on the part of the' assured, to disclose the existence of a mortgage on .the property, is not a circumstance material to the risk, and will not avoid the policy.

The judgment must be reversed, and the cause remanded for another trial.  