the purchaser the benefit of the insurance. A policy of fire insurance, unlike a marine policy, is not assignable as of right (z), and the assignee cannot sue on the policy unless the company has declared its assent to the assignment by a memorandum indorsed on the policy. If the fire occurs after the purchase has been completed and the purchase money paid, neither vendor nor purchaser can sue the company on the policy unless a proper assignment thereof has been made (a).

It is submitted that the proper remedy of the purchaser is to require the company to apply the purchase money in reinstating the premises. This the purchaser has power to do, at any rate within the metropolitan district (b), under 14 Geo. 3, c. 78, s. 83, since it seems clear that he is a "person interested" within the meaning of that statute (c). He must, of course, make this request before the company have settled with the vendor (d).

In order to avoid litigation, however, it is desirable that the purchaser, immediately upon entering into

(z) Sadlers' Co. v. Badcock (1743), 2 Atk. 554.

(a) Ecclesiastical Commissioners v. Royal Exchange Assurance Corporation (1895), 39 Sol. J. 624.

(b) Lord WESTBURY held that the Act was of universal application (Ex parte Gorely (1864), 4 De G. J. & S. 477), but this has been doubted by Lord WATSON in Westminster Fire Office v. Glasgow Provident Investment Society (1888), 13 App. Cas., at p. 716.

(c) The application of the Act has been confined to cases between landlord and tenant, and probably does not apply as between mortgagor and mortgagee. See Westminster Fire Office v. Glasgow Provident Investment Society (1888), 13 App. Cas., at p. 714.

(d) Simpson v. Scottish Union Insurance Co. (1863), 1 H. & M.

the contract, and thereby obtaining an insurable interest, should himself effect an insurance (e).

SECTION 2.

LUNACY OF THE CONTRACTING PARTIES.

The fact that one of the contracting parties becomes a lunatic during the interval before completion does not avoid the contract, for if there was a valid and binding contract, the supervening incapacity of one party cannot deprive the other of the benefit (ƒ). If the vendor becomes a lunatic after the whole of the purchase money has been paid (g), or after the contract has been so acted upon that a decree for specific performance would be a matter of course (h), the purchaser should present a petition (2), intituled "In Lunacy," praying for a vesting order under s. 135 of the Lunacy Act, 1890 (k). But where the contract is purely executory, the court will not make a vesting order until the right to specific performance has been settled by a decree (1). In such cases the purchaser must proceed by an action for specific performance in the Chancery Division, and obtain a

(e) A “cover note" is now issued by some insurance companies. See 46 Sol. J. 150.

(f) Owen v. Davies (1748), 1 Ves. 82.

(g) In re Cuming (1869), L. R. 5 Ch. 72.

(h) In re Pagani, [1892] 1 Ch. 236; Re Bradley's Settled Estate (1885), 54 L. T. (N.s.) 43.

(i) Now a summons, unless the judge or master directs a petition see Lunacy Rules, 1900.

(k) 53 & 54 Vict. c. 5.

(1) In re Carpenter (1854), Kay, 418; In re Colling (1886), 32 Ch. D. 333.

declaration that the lunatic is a trustee for him of the property (m).

The High Court has jurisdiction under the Trustee Act, 1893 (n), to appoint a new trustee in the place of a sole surviving trustee who is a lunatic, not so found by inquisition, but where a vesting order is required, resort should be had to the Lunacy jurisdiction (o).

It must, however, be remembered that the committee of the lunatic's estate has to obtain the sanction of the Court of Lunacy before defending the action (p). If the purchaser obtains a decree, it is clearly the duty of the committee or guardian ad litem (q) to apply to the Court of Lunacy, by summons, for a direction to execute the conveyance to the purchaser (»).

By s. 120 of the Lunacy Act the judge in lunacy may direct the committee to " perform any contract relating to the property of the lunatic entered into by the lunatic before his lunacy"; and s. 124 enacts that the committee shall, in the name of, or on behalf of, the lunatic, execute all such assurances for giving effect to any order under this Act as the judge directs, and every such assurance shall be valid and effectual, and shall take effect accordingly.

(m) Cowper v. Harmer (1887), 57 L. J. Ch. 460.

(n) 56 & 57 Vict. c. 53, s. 25.

(0) Re M., [1899] 1 Ch. 79.

(p) In re Manson (1852), 21 L. J. Ch. 249.

(q) See R. S. C., Order XVI. r. 17; Order XIII. r. 1 ; and Order IX. r. 5; cf. also Lunacy Act, 1890, s. 116.

(r) Cf. Baldwyn v. Smith (1900), 1 Ch. 588.

SECTION 3.

BANKRUPTCY OF CONTRACTING PARTIES.

The bankruptcy of either the vendor or the purchaser will not avoid the contract (s), provided that the contract was entered into before a receiving order had been made, and that the other party had no notice of an available act of bankruptcy (t).

Bankruptcy of Purchaser.-With regard to the bankruptcy of the purchaser, it is clear that the trustee may elect to fulfil the contract and pay the purchase money provided that he does so within. a reasonable time (u): but specific performance will not be granted against the purchaser's trustee in bankruptcy (x). It is, moreover, presumed that the trustee can disclaim the contract and the equitable interest of the bankrupt purchaser in the land under the provisions of the Bankruptcy Act. The Bankruptcy Act, 1883, provides (y) that when any part of the property of the bankrupt consists of unprofitable contracts, the trustee in bankruptcy, notwithstanding that he has endeavoured to sell or has taken possession of the property or exercised any act of ownership in relation thereto, may, by writing signed by him at any time within twelve months after the first appointment of a trustee, disclaim the

(8) Bankruptcy Act, 1883 (46 & 47 Vict. c. 52), s. 49 (d). (t) But see post, p. 368, as to repudiation by the purchaser. (u) Ex parte Stapleton (1879), 10 Ch. D., at p. 590.

(x) Holloway v. Yorke (1877), 25 W. R. 627.

(y) 46 & 47 Vict. c. 52, s. 55 (1), as varied by s. 13 of the Act of 1890.

property. Provided that when any such property shall not have come to the knowledge of the trustee within one month after such appointment, he may disclaim such property at any time within twelve months after he first became aware of it.

The disclaimer operates as from the date of disclaimer (z), and the only remedy of the other contracting party is to prove in the bankruptcy as a creditor for the injury which he has suffered by the disclaimer (a).

The other contracting party may, however, make an application in writing to the trustee requiring him to decide whether he will disclaim or not; and if, after the period of twenty-eight days, or such extended period as may be allowed by the court, the trustee does not give notice of his intention to disclaim, he will be deemed to have adopted the contract (b). If the trustee disclaims the contract, the vendor is, of course, entitled to retain the deposit even in the absence of an express stipulation as to forfeiture (c).

Bankruptcy of Vendor.-If the property which is the subject of the sale is freehold, it would seem that the trustee in bankruptcy of the vendor cannot disclaim. A contract to sell land is not included in the class of property referred to in s. 55 of the Bankruptcy Act (d). If the property is leasehold the trustee cannot disclaim the contract without

(z) 46 & 47 Vict. c. 52, s. 55 (2). (a) Ibid., s. 55 (7).

(c) Ex parte Barrell (1875), 10 Ch. 512. (d) In re Bastable, [1901] 2 K. B. 518.

(b) Ibid., s. 55 (4).