G.R. No. L-9401 – 30 Phil. 537 – Mercantile Law – Insurance Law – The Policy – Insurance as a Contract between Insurer and Insured Only
In 1912, Placida Jose contracted with Mariano Barreto for the construction of a house worth P6,000.00. While the house is under construction, Barreto, with the consent of Jose, took out an insurance policy in his own name on the said building. Barreto paid the corresponding premium.
Later, Jose sold the house to Antonina Lampano for P6,000.00. In 1913, the house was gutted by fire. Barreto was able to collect P3,600.00 from the insurance policy. Lampano then demanded that Barreto hand her over the proceeds because she alleged that Jose verbally agreed to transfer to her the said insurance policy along with the property.
ISSUE: Whether or not Lampano has a right to collect from the insurance policy.
HELD: No. In the case at bar, Barretto assumed the responsibility for the insurance. The premiums were paid by him without any agreement or right to recoup the amount paid therefor should no loss result to the property. It would not, therefore, be in accordance with law and his contractual obligations to compel him to account for the insurance money, or any part thereof, to Lampano, who assumed no risk whatever. It is well settled that a policy of insurance is a distinct independent contract between the insured and insurers, and third persons have no right either in a court of equity, or in a court of law, to the proceeds of it, unless there be some contract or trust, expressed or implied, between the insured and third persons.
As to the question whether or not Barreto has an insurable interest on the house, the answer is in the affirmative. He constructed the building, furnishing all the materials and supplies, and insured it after it had been completed. Further, it appears that Jose has not fully paid Barreto as she has an outstanding balance of P2,000.00.
