Fidelity-Phenix Fire Insurance v. Brennan

The plaintiffs contend that inasmuch as the policies are void as to the owners of the damaged property, the amount of the loss should not be applied either to reduce the mortgage indebtedness or to repair the property, that their position is in reality that of sureties, and that before payment of the loss be required of them, the defendant bank should first exhaust its remaining security under the mortgage.

Each policy conforms to the standard requirements of this state and contains the following provision, frequently called the union mortgage clause: “If this policy shall be made payable to a…