Misc.] Supreme Court, December, 1921. counsel urge that even though it may not have been the duty of the defendant company, under the mortgage, to take out insurance for the benefit of the plaintiff, yet by reason of its alleged recognition of such duty by actually taking out insurance for the plaintiff's benefit and thereby obtaining for itself pecuniary benefit from a three-year rate in place of an annual rate, which would have been required had the plaintiff been compelled to take out insurance, the plaintiff was entitled to rely upon the assumption of such obligation by the said defendant, and that the defendants are estopped from denying the existence of the said alleged duty under the mortgage, when, as plaintiff claims, to do so will result in serious loss to her. Rothschild v. Title G. & T. Co., 204 N. Y. 458; White v. Kenyon, 33 App. Div. 623; affd., 164 N. Y. 590; 2 Pom. Eq. Juris. (3d ed.) § 965, and Hathaway v. Payne, 34 N. Y. 92, 109, are cited in support of such contention, but I fail to see the application of such authorities. The mere fact that the defendant company may have had a pecuniary advantage by insuring the property for three years instead of one year did not create any personal obligation on its part to insure for the plaintiff's benefit. If the defendant company was able to obtain such a reduction in the rate it was not, as plaintiff claims, at her expense. The rights of the plaintiff could not be impaired by policies for a longer period than one year if they were sufficient in amount and form and issued by a solvent insurance company. During the existence of the mortgage debt she was entitled at all times to be fully and abundantly protected, and if the policies conformed to these requirements she was fully protected, even though the property was insured for a longer term than one year, and the defendant company thereby obtained the benefit of a lower insurance rate. While it is true that under subdivision Supreme Court, December, 1921. [Vol. 117. four of section 254 of the Real Property Law the plaintiff, had the defendant company failed to insure the property, would have been permitted to insure it "from year to year " only (Bieber v. Goldberg, 133 App. Div. 207), such provisions, nevertheless, do not prohibit the owner of the property from tendering to the holder of the mortgage a policy for a longer term. The latter has, of course, a right to approve or disapprove of the amount of the insurance and the company in which it may be carried (Real Prop. Law, § 254, subd. 4. See Heal v. Richmond County Savings Bank, 127 App. Div. 428), and if the policy tendered is not in these respects satisfactory, or if the form thereof does not fully protect the holder of the mortgage (Real Prop. Law, § 254, subd. 4) and the property owner refuses to furnish a satisfactory policy, the holder of the mortgage may insure the property pursuant to the provisions of the said subdivision at the expense of the property owner. So far as I can gather there was nothing in the conduct of the defendant company in taking out the two policies in question and delivering them to the plaintiff's attorneys which would estop it from denying the existence of its alleged duty under the mortgage to insure the property for the protection of the plaintiff. Neither was there anything in the conduct of the defendant company in furnishing such two policies to the plaintiff's attorneys to lull them into inaction. Moreover, I am unable to discover in the record any evidence from which it may fairly be inferred that the defendant company in so furnishing the plaintiff's attorneys with the two policies did anything to mislead them or to cause the plaintiff to change her position. If, as plaintiff claims, no examination of the two policies which were delivered to her attorneys was ever made, the failure to do so is not, so far as the evidence dis Misc.] Supreme Court, December, 1921. closes, due to any fault on the part of the defendant company or Wolff, its agent. Another point urged on behalf of the plaintiff is that, even if it is assumed that the defendant company was under no obligation to take out insurance for the benefit of the plaintiff, nevertheless, when it in fact did so, it at least acted as agent of the plaintiff in so doing, and having so acted, it will not be permitted to make a profit for itself out of the transaction at the expense of the plaintiff, and that equity will treat it as a trustee for the benefit of the plaintiff. There is no question as to the correctness of the rule relied on by the plaintiff, that an agent undertaking any business for another is disabled in equity from dealing in the matter of the agency upon his own account or for his own benefit; and if he does so in his own name he will be considered as holding in trust for his principal. 39 Cyc. 188; Densmore v. Searle, 7 App. Div. 45, 46; 2 Pom. Eq. Juris. (3d ed.) § 959. Such rule, however, is not applicable to the present case. It appears from the stipulation as to the facts that Wolff, as the agent of the defendant company, obtained for it the two policies in question, which were delivered by the said defendant company to the attorneys for the plaintiff at or about the time of their issuance and that the premiums thereon were paid by such defendant. The record, however, is silent as to the circumstances under which such insurance was obtained and the policies were delivered. There is thus no evidence în the case that the defendant company or Wolff, its agent, was requested by the plaintiff or her attorneys to procure the policies and deliver the same to her or them. For aught that appears the insurance may have been procured and the policies delivered without a previous request from or understanding with the plaintiff or her attorneys. In this connection it Supreme Court, December, 1921. [Vol. 117. should be borne in mind that although not in duty bound to insure, the defendant company, nevertheless, had the right in order to avoid liability to have added to the mortgage debt any sum which the plaintiff might pay for premiums on insurance for her security to insure the property for her benefit and tender the policies to her or her attorneys, which she or they had a right to disapprove for any sufficient cause. The stipulated facts are therefore wholly insufficient to justify a finding that the defendant company acted as agent for the plaintiff when it took or caused to be taken out insurance for her benefit. In order to justify such a finding it must be apparent from the facts and circumstances that there was an express or implied intention to create the relation of agency. 2 C. J. 437. The plaintiff claims, furthermore, that her right to the relief sought is in no way affected by the retention of the two policies which were delivered to her attorneys because, as claimed, there was no obligation on her or their part to examine them. In support of the point so raised the argument is advanced that the only thing that the plaintiff was required or permitted to do was the affirmative act of approving the amount of the insurance and the company in which the same should be carried and that she was not required to approve the form of the policies. With this argument I cannot agree. Subdivision 4 of section 254 of the Real Property Law, among other things, provides that a covenant to insure" must be construed as meaning that the mortgagor, his heirs, successors and assigns will, during all the time until the money secured by the mortgage shall be fully paid and satisfied, keep the buildings erected on the premises insured against loss or damage by fire, to an amount and in a company to be approved by the mortgagee, and will assign and 1 Misc.] Supreme Court, December, 1921. deliver the policy or policies of such insurance to the mortgagee, his executors, administrators, successors or assigns, so and in such manner and form that he and they shall at all time or times, until the full payment of said moneys, have and hold the said policy or policies as a collateral and further security for the payment of said money, and in default of so doing, that the mortgagee or his executors, administrators, successors or assigns, may make such insurance from year to year, in the sum not exceeding the principal sum for the purposes aforesaid, and pay the premium or premiums therefor, *." As I construe these provisions the words "in default of so doing," which refer to the first portion of such subdivision and to all that precede such words, mean, that the mortgagee has the same remedy in the event that the policies, so far as concerns amounts and companies, are not satisfactory to him as he has for their failure to be in proper form to protect him. I fully agree with the plaintiff's counsel, that the clear purport of the said subdivision 4 of section 254 of the Real Property Law is to protect the mortgagee in every way possible. Under its provisions the plaintiff, in case the policies were insufficient to protect her, and the defendant company refused to obtain further insurance, could have procured new or additional insurance and added the premiums paid therefor to the mortgage debt. The plaintiff, however, did not avail herself of such remedy. It may be true, as contended for by the plaintiff, that she was under no obligation to examine the two policies in question. Had she done so the mistake in the said policy issued by the Phoenix Assurance Company, Lim., of London, in naming the American Mortgage Company as the mortgagee instead of the plaintiff to whom the mortgage had theretofore been assigned, would no doubt have been |