Baumgarten v. Alliance Assur. Co.

• Decision Date: 27 January 1908
• Docket Number: 14,234.
• Parties: BAUMGARTEN et al. v. ALLIANCE ASSUR. CO.
• Court: U.S. District Court — Northern District of California

159 F. 275

BAUMGARTEN et al. v. ALLIANCE ASSUR. CO.

No. 14,234.

United States Circuit Court, N.D. California.

January 27, 1908

Bertin A. Weyl and Edward Lynch, for plaintiffs.

T. C Van Ness, for defendant.

VAN FLEET, District Judge.

The defendant moves to strike from the complaint certain paragraphs thereof as constituting redundant matter, and also demurs specially to the same matter as constituting no cause of action. The action is one to recover on certain policies of fire insurance, and, after making the averments usual in such an action, the complaint proceeds to set up the matter objected to, which, so far as material to be stated, is in substance that defendant refused to pay plaintiffs more than 50 per cent. on the dollar of their loss under the policies sued on, and threatened that unless such payment was accepted within a certain time it would not pay anything on said loss, but that plaintiffs would be compelled to resort to the courts for relief, and that defendant intended to withdraw from the state and cease to do business therein; that defendant has, and at all times has had property and available money sufficient to pay all of its obligations in full, including its liability to the plaintiffs, and that its refusal to pay the loss sustained by plaintiffs is not due to financial embarrassment nor to any other cause than the arbitrary decision of defendant not to pay more than 50 per cent. of such liability as hereinbefore stated; that plaintiffs were greatly injured financially by their loss in the destruction of their property, and by the acts of the defendant in so refusing to pay their loss under said policies, and 'that the acts of defendant in refusing to pay said loss were willful and fraudulent, and were done solely with the desire to take advantage of the necessities' of plaintiffs 'for ready money wherewith to re-establish their business. ' It is alleged that by reason of these facts plaintiffs were damaged in certain sums in addition to the amount of the policies.

It is somewhat difficult to understand the theory upon which the plaintiffs proceed in making the averments the substance of which is thus stated. If by the matter thus alleged it is sought or intended to recover exemplary damages for a willful or malicious breach of the contract sued on, such damages cannot be recovered, since the case is not one in which such relief may be had. Civ. Code Cal. Sec. 3294. If it is intended thereby to lay a claim for damages for the mere nonpayment of money due under the contract, above or in addition to interest, such damages cannot be recovered. Civ Code Cal. Sec. 3302; New Orleans Ins. Co. v Piaggio, 16 Wall. (U.S.) 378, 21 L.Ed. 358; Loudon v. Taxing Dist., 104 U.S. 771, 26 L.Ed. 923.

If the theory of the plaintiffs is that the facts alleged show circumstances entitling the plaintiffs to damages in addition to interest for the breach of the contract, they are obviously not such as are contemplated by the parties; nor are they the proximate result of the breach. Savings Bank, etc., v. Asbury, 117 Cal. 96, 48 P. 1081. There may be cases where damages...