Facts:

• The case involves a dispute over a contract of insurance for a cargo of rice.
• The plaintiff, Lim-Juco, applied for insurance on the cargo of rice with an insurance company, but no policy was issued.
• Instead, the agent of the insurance company gave him a letter stating that the cargo was insured.
• The plaintiff then applied to the defendant, Lim-Yap, who was the agent of another insurance company, and obtained a policy of insurance for the same cargo.
• However, this policy was not drawn in the prescribed form according to the Code of Commerce.
• The cargo was later lost, and the first insurance company paid the loss.
• The plaintiff then sued the agent of the second insurance company for the value of the lost rice, claiming that the policy issued by him was unenforceable due to noncompliance with legal requirements and that the agent had failed to bind his principal with the policy.

Issue:

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Ruling:

• The court ruled in favor of the defendant, stating that the prohibition against double insurance prevents the plaintiff from recovering damages for the lost cargo of rice, as they had already been completely indemnified by the first insurance company.
• The court held that the unenforceabi...(Unlock)

Ratio:

• The court based its decision on Article 782 of the Code of Commerce, which provides that if different contracts of insurance have been entered into concerning the same thing, only the first contract shall subsist, provided it covers the full value of the insured property. Subsequent insurers shall be relieved from responsibility.
• In this case, the plaintiff had already recovered the entire amount of the value of the lost rice from the first insurance company. Therefore, the second insurance company, represented by the defendant, was freed from liability by operation of law.
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