First Federal Savings & Loan Ass'n v. Hartford Fire Insurance

Each of the four defendant insurance companies issued a $5,000 policy insuring the owner of certain premises against loss by fire, with a standard mortgagee clause making the loss payable to plaintiff as its interest might appear. While the mortgage was under foreclosure, a fire caused more than $20,000 damage. Defendants denied liability as to the owner but, since there was $31,000 due on the mortgage, defendants admitted their liability to plaintiff. However, defendants refused to pay plaintiff the $20,000 unless plaintiff first gave them an assignment of an undivided $20,000 interest in…