Board of Ed. of Hancock County v. Hartford Fire Ins. Co.

• Decision Date: 17 March 1942
• Docket Number: 9232.
• Citation: 19 S.E.2d 448,124 W.Va. 163
• Parties: BOARD OF EDUCATION OF HANCOCK COUNTY v. HARTFORD FIRE INS. CO. et al.
• Court: West Virginia Supreme Court

19 S.E.2d 448

124 W.Va. 163

BOARD OF EDUCATION OF HANCOCK COUNTY v. HARTFORD FIRE INS. CO. et al.

No. 9232.

Supreme Court of Appeals of West Virginia.

March 17, 1942

William J. Moore, of Weirton, and T. F. McKenzie, of Hollidays Cove for plaintiff in error.

Riley & Riley, of Wheeling, for defendant in error.

KENNA Judge.

Forty-two actions in assumpsit were brought in the Circuit Court of Hancock County by the Board of Education of that county against various fire insurance companies to recover under the blanket policies issued by each for the loss by fire of the New Cumberland Graded School on January 20, 1938. It was found that there was no denial of liability, and that the only issue in any case concerned only the quantum of damages and rested upon the question of whether the building destroyed by fire and its contents was to be valued as a building for the purpose of arriving at its actual cash value, less depreciation, or was to be treated simply as a collection of material, the use of which as a building had terminated, and hence the cost of construction was not an element to be considered in arriving at that value.

It was ascertained that the defense in each case would rest upon an identical state of facts, and would concern only the amount of the recovery. The forty-two actions were consolidated in the circuit court, reserving to each defendant separately the right to apply for a review. The order consolidating the actions recites that there being no material controversy as to the facts, the consolidated cases were submitted to the trial judge acting in lieu of a jury.

The finding of the trial judge, upon which he proceeded to enter judgment, was that in

the consolidated cases the plaintiff recover $8,344.38, instead of the sum of $20,363 claimed by the board of education as its actual loss. From that judgment, the board of education was granted this writ of error, the sole question involved affecting only the amount of recovery.

In May 1938, the Board of Education of Hancock County adopted a building program based upon assistance which it hoped to procure from the Public Works Administration acting on behalf of the Federal Government. The sponsor's cost in the execution of this joint program, which included tearing down the old building of the New Cumberland Graded School and the construction of a building in its place, was estimated at $265,000, and on the basis of that requirement the board, in late June, called a special election to determine whether or not bonds should be issued for the purpose of financing the building program, and at approximately the same time applied for the grant from the Public Works Administration. The election was held in July, and the issuance of the bonds authorized. In late August, the board received and accepted the P.W.A. offer and filed its application for the fifteen per cent advance. The board was promptly advanced $38,800.

There seems to have been nothing consequential affecting this matter that happened between late August and the first of December, when the Board of Education approved plans for the New Cumberland School and other buildings to be erected in the course of the program. Around the middle of December, they advertised for bids and on the 28th entered into a contract with Elm Grove Building Material Company which involved the removal of the old New Cumberland School building, and the construction of a new school house upon the same site for the sum of $75,800, the builder being permitted to use the material from the old building with the exception of desks, heating appliances, etc. On the same date, the contract covering the plumbing and heating of the new building was entered into. On December 29th, the board notified the Elm Grove Company to proceed at once to execute the contract, which the construction company did on the following day to an extent that seemed to comply with the P.W.A. requirement, by having their engineer locate and mark the site of the new school building, embracing that of the old, by placing stakes upon the ground. The Board of Education removed their office equipment from the old New Cumberland building, rented space in other buildings to be used as class rooms, and had the desks provided for pupils unbolted from the floor in each schoolroom. On January 16th, the contractor was notified that on January 23rd the old building would be entirely vacated and turned over to them, and in the same letter it was requested to proceed with the demolition of the building. On January 18th, classes were dismissed to reconvene in the rented quarters on January 23rd. On January 20th, the old building's practically complete destruction by fire occurred.

As we have already stated, the controversy before us hinges upon the question of whether the term used in the standard form of fire insurance policies of "actual cash value (ascertained with proper deductions for depreciation)" on the state of facts before us justifies a recovery of what may be termed "going value", or restricts that right of recovery to the value of the material destroyed, eliminating entirely the costs of construction. It is admitted that if its use as a building had actually been permanently terminated, the recovery is limited to salvage value. The principal source of controversy seems to be whether the abandonment of use and the time it takes effect is to be determined by the owner's announced purpose and intention, or rests upon the owner's actual conduct respecting the...