AST OPTIONEE   723 (c) A MORTGAGEE CREDITOR.

[See Infra, Part II, Chap. 4, See. 2(b), p. 751.]

Section 5.-An optionee.

CROSSMAN v. AMERICAN INS. CO.

Supreme Court of Michigan, 1917. 198 Mich. 304, 164 N. W. 428.

Action by John M. Crossman against the American Insurance Company of Newark, N. J. To review a judgment for plaintiff, defendant brings error. Affirmed.

On April 3, 1912, Maria McDonald was the owner of a land con-tract for the purchase of certain premises in Highland Park, located on Hamilton boulevard, consisting of two stores, with apartments then occupied by her, on the second floor. She was in arrears on her contract, and on this day surrendered it to plaintiff, taking back an option to purchase it at any time within one year upon payment of $5,261, with interest at 6 per cent. By the terms of this option she was to pay $10 per month for the dwelling part of the property, and after May 6th plaintiff was to collect the other rents, for which he was to account on her paying the amount above men• tioned. Daniel McDonald, a son of Maria McDonald, was indebted to Donaldson Craig, and on November 20th they came to an ac-counting, and there was found due Mr. Craig $2,531.28. To pay this sum Mrs. McDonald then assigned and transferred her option on the Hamilton boulevard property to him. He informed plaintiff of this assignment, and learned in the conversation the amount of insurance carried on the building. On January 24, 1913, the policy of insurance here involved was issued through Eliot and Haviland, defendant's local agents. The application for the insurance was verbal, and no inquiry was made as to the condition of the title. Mr. Craig, however, voluntarily and fully told the agents the state of the title as he had learned it, and the policy was issued to him as the assured "on property sold to assured on contract; loss, if any, payable first to John M. Crossman and then to assured as their interest may appear." Mr. Craig did not read the policy, which was the Michigan standard form. After the assignment from Mrs. McDonald to Craig, and after plaintiff knew of it, he gave Mrs. McDonald notice to quit, but nothing further seems to have been done, and she remained in the apartments until the fire. The record discloses that although plaintiff was the owner of the record title of the premises, he had given to one Campbell the right to re. deem, on payment of the amount due from Campbell to plaintiff. On January 29, 1913, the fire occurred, and proof of loss was seasonably filed. On April 3, 1913, Craig tendered to plaintiff $5,700, and requested a deed. The parties disagreed as to the amount due, and a bill was filed for specific performance. Pending that suit, by