The Chancellor.
In the argument of this motion, it has been urged on the part of the complainant, that' Jones, having put it in th'e power of his vendees to commit a fraud upon the complainants, he is responsible for the consequences.
I am unable to see any thing in this case to authorize this position in the argument. There is no showing that goes to charge Jones with fraud.
At the time of the execution and delivery of the conveyance by Jones, to Thompson arid others, Whiting was in possession and occupied the premises under the lease from Jones, and the vendees all knew that fact. Whiting was applied to, at the same time, to learn whether he wished or intended to occupy the premises the full term to which the lease had been extended, (to February 1, 1839,) and he replied that he did, and this fact was also communicated to the vendees of Jones.
There is, therefore, not only the absence of fraud on the part of Jones, in this respect, but Whiting’s right to occupy formed the subject of a positive agreement between Jones and his vendees.
The deed by Jones, the bond and mortgage on the premises by his vendees, and an instrument or agreement reciting and recognizing Whiting’s unexpired term, and his right to occupy under the lease, signed by all the vendees, wer? all executed and delivered at the same time; each of these instruments, therefore, must be regarded as a part of, and as constituting one and the same transaction. The vendees of Jones have [56]*56nothing to complain of, for Whiting was in possession wheri they purchased, and their right to possession was subject, by agreement, to his unexpired term. Disbrow, the complainant, was not an original purchaser from Jones, but- derived his title through the vendees of Jones, and clearly they could convey no greater interest than that which they themselves had in the premises.
Whiting was also in possession, and occupied the premises af the time of Disbrow’s purchase from Thompson, and Disbrow knew that fact, as he admits in his bill, and there is no principle better settled than that the possession of a tenant is notice' to a purchaser of the actual interest the tenant may have in the premises. Chesterman vs. Gardner, & John. Ch., 29; Daniels vs. Davison, 16, Ves., 249; Taylor vs. Stibbert, 2 Ves., 437.
In the case in 4 Hen & Munf., 120, which has been cited by the complainant, it does not appear that the purchaser had notice that Bibb was in possession before he received the first deed, of February 11, 1790, and this fact, on a careful examination of the case, will be found to form the basis of that decision. In the case of Grimstone vs. Carter, 3 Paige, 439, I have been able to find nothing conflicting with the rule above stated, but on the contrary, chancellor Walworth says, in that case, that it is the settled law of the land that the possession of premises by a third person is sufficient to put purchasers on inquiry, and to deprive them of the defence of bona fide purchasers, without notice of his_ rights.
From the answers of Jones and Whiting in this case, it is clearly to be inferred that Disbrow had, at the time of his purchase, not only notice of the existence and substance, but also of the details of Whiting’s lease.
It is, therefore, clear to my mind, that when Disbrow purchased the premises of Thompson, he took them not only subject to the mortgage, but also to Whiting’s term under the lease.
It is also insisted by the complainant, that the mortgage' is defective, there being but one witness to the execution of it [57]*57by Garrett and N. J. Brown. To this allegation the defendants answer, that the officer who took the acknowledgment must be considered a subscribing witness. It is not necessary now to decide how far the execution of the mortgage may be considered in compliance with the statute, for if the mortgage were defectively executed In this respect, it could form no ground in the present case for the interference of this court.
The complainant has recognized this mortgage in his purchase, and there is no pretence that the money is not due.
The tender alledged in the bill is not supported by any other evidence, and is positively denied in the answer.
That the whole of the premises are advertised to be sold for the first instalment due on the mortgage/furnishes no ground for the inteferenee of this court, as it is shown by the answer, that the premises are valuable ‘ principally for a wharf and storehouse, and the whole premises have heretofore been used and occupied for that purpose, and cannot be sold separately without injury to the whole.
After a careful examination of the whole matter, I have been irresistibly led to the conclusion that the case does not justify an interference with the policy of insurance.
The insurance is a personal contract, and does not pass with the title of the property insured. This doctrine is clearly laid down in Ellis on Insurance, page 72. The language of lord chancellor King is there quoted, and he says, in'reference to policies of insurance: “ these policies are not insurances of the specific things mentioned to be insured, nor do such insurances attach on the reality, or in any manner go with the same as incident thereto, by any conveyance or assignment, but they are only special agreements with the persons insuring against such loss or damage as they may sustain.” This doctrine is fully recognized, and stated to be the true one in the Saddlers' company, vs. Badcock, 2 Atk., 554, and in 1 Philips on Insurance, 27.
All the decisions I have been able to find conflicting with this principle, ai’ise under the builders’ act statute of 14 Geo. III., which empowers the governors or directors of the.insurance [58]*58offices within certain districts, upon the request of any persons interested in, or entitled to any houses or buildings which may be burned down, &c., or upon any grounds of suspicion that the person insured has been guilty of fraud or wilfully setting the houses or buildings on fire, to cause the insurance money to be laid out, as far as the same will go, towards re-building or repairing the property damaged, &c. Although, therefore, a policy as a personal contract does not pass with the property insured, yet a covenant to insure to a certain amount, entered into by a lessee or other person having an estate in land, is so far beneficial to the property, that in cases to which this statute applies, it will run with the land, and an assignee entitled to the benefits of covenants real, may maintain an action on the covenant to insure, if it be not observed. Hughes on Insurance, 393.
The case of Vernon vs. Smith, 5 Barn. & Ald. 1, was a case arising under the statute of 14 Geo. III., and the views expressed by Best, Ji, in that case, have not the authority of a decision, and the reasons upon- which those views were based, do not exist here.
If Jones had no remaining interest or liabilities, the case would present a different aspect.
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The Chancellor.
In the argument of this motion, it has been urged on the part of the complainant, that' Jones, having put it in th'e power of his vendees to commit a fraud upon the complainants, he is responsible for the consequences.
I am unable to see any thing in this case to authorize this position in the argument. There is no showing that goes to charge Jones with fraud.
At the time of the execution and delivery of the conveyance by Jones, to Thompson arid others, Whiting was in possession and occupied the premises under the lease from Jones, and the vendees all knew that fact. Whiting was applied to, at the same time, to learn whether he wished or intended to occupy the premises the full term to which the lease had been extended, (to February 1, 1839,) and he replied that he did, and this fact was also communicated to the vendees of Jones.
There is, therefore, not only the absence of fraud on the part of Jones, in this respect, but Whiting’s right to occupy formed the subject of a positive agreement between Jones and his vendees.
The deed by Jones, the bond and mortgage on the premises by his vendees, and an instrument or agreement reciting and recognizing Whiting’s unexpired term, and his right to occupy under the lease, signed by all the vendees, wer? all executed and delivered at the same time; each of these instruments, therefore, must be regarded as a part of, and as constituting one and the same transaction. The vendees of Jones have [56]*56nothing to complain of, for Whiting was in possession wheri they purchased, and their right to possession was subject, by agreement, to his unexpired term. Disbrow, the complainant, was not an original purchaser from Jones, but- derived his title through the vendees of Jones, and clearly they could convey no greater interest than that which they themselves had in the premises.
Whiting was also in possession, and occupied the premises af the time of Disbrow’s purchase from Thompson, and Disbrow knew that fact, as he admits in his bill, and there is no principle better settled than that the possession of a tenant is notice' to a purchaser of the actual interest the tenant may have in the premises. Chesterman vs. Gardner, & John. Ch., 29; Daniels vs. Davison, 16, Ves., 249; Taylor vs. Stibbert, 2 Ves., 437.
In the case in 4 Hen & Munf., 120, which has been cited by the complainant, it does not appear that the purchaser had notice that Bibb was in possession before he received the first deed, of February 11, 1790, and this fact, on a careful examination of the case, will be found to form the basis of that decision. In the case of Grimstone vs. Carter, 3 Paige, 439, I have been able to find nothing conflicting with the rule above stated, but on the contrary, chancellor Walworth says, in that case, that it is the settled law of the land that the possession of premises by a third person is sufficient to put purchasers on inquiry, and to deprive them of the defence of bona fide purchasers, without notice of his_ rights.
From the answers of Jones and Whiting in this case, it is clearly to be inferred that Disbrow had, at the time of his purchase, not only notice of the existence and substance, but also of the details of Whiting’s lease.
It is, therefore, clear to my mind, that when Disbrow purchased the premises of Thompson, he took them not only subject to the mortgage, but also to Whiting’s term under the lease.
It is also insisted by the complainant, that the mortgage' is defective, there being but one witness to the execution of it [57]*57by Garrett and N. J. Brown. To this allegation the defendants answer, that the officer who took the acknowledgment must be considered a subscribing witness. It is not necessary now to decide how far the execution of the mortgage may be considered in compliance with the statute, for if the mortgage were defectively executed In this respect, it could form no ground in the present case for the interference of this court.
The complainant has recognized this mortgage in his purchase, and there is no pretence that the money is not due.
The tender alledged in the bill is not supported by any other evidence, and is positively denied in the answer.
That the whole of the premises are advertised to be sold for the first instalment due on the mortgage/furnishes no ground for the inteferenee of this court, as it is shown by the answer, that the premises are valuable ‘ principally for a wharf and storehouse, and the whole premises have heretofore been used and occupied for that purpose, and cannot be sold separately without injury to the whole.
After a careful examination of the whole matter, I have been irresistibly led to the conclusion that the case does not justify an interference with the policy of insurance.
The insurance is a personal contract, and does not pass with the title of the property insured. This doctrine is clearly laid down in Ellis on Insurance, page 72. The language of lord chancellor King is there quoted, and he says, in'reference to policies of insurance: “ these policies are not insurances of the specific things mentioned to be insured, nor do such insurances attach on the reality, or in any manner go with the same as incident thereto, by any conveyance or assignment, but they are only special agreements with the persons insuring against such loss or damage as they may sustain.” This doctrine is fully recognized, and stated to be the true one in the Saddlers' company, vs. Badcock, 2 Atk., 554, and in 1 Philips on Insurance, 27.
All the decisions I have been able to find conflicting with this principle, ai’ise under the builders’ act statute of 14 Geo. III., which empowers the governors or directors of the.insurance [58]*58offices within certain districts, upon the request of any persons interested in, or entitled to any houses or buildings which may be burned down, &c., or upon any grounds of suspicion that the person insured has been guilty of fraud or wilfully setting the houses or buildings on fire, to cause the insurance money to be laid out, as far as the same will go, towards re-building or repairing the property damaged, &c. Although, therefore, a policy as a personal contract does not pass with the property insured, yet a covenant to insure to a certain amount, entered into by a lessee or other person having an estate in land, is so far beneficial to the property, that in cases to which this statute applies, it will run with the land, and an assignee entitled to the benefits of covenants real, may maintain an action on the covenant to insure, if it be not observed. Hughes on Insurance, 393.
The case of Vernon vs. Smith, 5 Barn. & Ald. 1, was a case arising under the statute of 14 Geo. III., and the views expressed by Best, Ji, in that case, have not the authority of a decision, and the reasons upon- which those views were based, do not exist here.
If Jones had no remaining interest or liabilities, the case would present a different aspect. But if the views heretofore taken are correct, that the execution and delivery of the deed, bond and mortgage and agreement, were all at the same time, and formed parts of one and the same transaction, and that Dis-brow had legal notice of the existence of the lease, it follows that both Whiting and Jones had an insurable interest. Jones is bound to pay $1,400 per year for the two years, and is bound by his contract with Whiting, to re-build in six months, and Whiting is to pay rent for the two years.
Whether the doctrine of Best in 5 Barn, and Ald,., be correct or not, it would be going further than any case I have been able to find, to interfere by injunction in cases like the present. The legal rights of the parties should be carefully guarded, and seldom interferred with by injunction.
As to whether Jones may not be compelled to apply the insurance money, at or before the expiration of Whiting’s term, [59]*59need not now be decided. The dissolution of this injunction does not prevent Disbrow’s recovery of Jones, if he is liable to him for any portion of the insurance money; and there is no allegation in the bill that Jones'is insolvent or-unable to pay any amount which may be recovered against him.
Upon the whole then, Jones seems to have acted fairly, so far at least as regards the sale to his vendees. All of the facts in relation to the premises, were at that time disclosed by Jones, and Whiting’s right to occupy under th&. lease, was made the subject matter of a positive agreement between Jones and his vendees.
Whiting continued to occupy and was in possession when Disbrow purchased from Thompson, and Disbrow knew that fact, and this the law' regards as notice to him of Whiting’s rights in the premises.
If a fraud has been practiced upon the complainant at all, it Is by his immediate vendees, and as against them he has an adequate remedy.
Jones is, therefore, clearly entitled to his remedy to collect Ms money which is due; he has not been in fault, and it would be unjust to restrain him from doing so. Jones and Whiting had an insurable interest to more than the amount insured, and they have earned the benefits to be derived from the policy, for they have paid the premium on the insurance.
Some other points have been made in the argument, and they have all been carefully considered, and I have been irresistibly lead to the conclusion, above stated.
This ease may be like the case in the 3 of Paige's Reports, a hard one; but this court is bound by the rules of law, and whenever courts shall undertake to judge according to the convenience of parties in each case, there is an end to all fixed and settled rules, and the rights of parties will be left to the caprice of whomsoever may occupy the seats of justice at the time. The injunction in this case must be dissolved.
Injunction dissolved.