Commercial Union Assur. Co. v. Jass
| Decision Date | 03 December 1929 |
| Docket Number | No. 5482.,5482. |
| Citation | 36 F.2d 9 |
| Parties | COMMERCIAL UNION ASSUR. CO., LIMITED, OF LONDON v. JASS et al. |
| Court | U.S. Court of Appeals — Fifth Circuit |
T. A. Hammond, Daniel MacDougald, H. H. Hargrett, and W. L. Bryan, all of Atlanta, Ga. (Smith, Hammond, Smith & Bloodworth and Spalding, MacDougald & Sibley, all of Atlanta, Ga., on the brief), for appellant.
Reuben R. Arnold and B. P. Gambrell, both of Atlanta, Ga. (Reuben R. & Lowry Arnold, of Atlanta, Ga., on the brief), for appellees.
Before WALKER, BRYAN, and FOSTER, Circuit Judges.
Appellees brought suit on a policy of fire insurance, in the amount of $2,500, issued by appellant, covering a building occupied and used by appellees as a warehouse, and recovered judgment for the full amount. The policy in terms purported to insure appellees against all direct loss or damage by fire to the building, and contained clauses voiding it if the interest of the insured was not truly stated therein, or was other than unconditional and sole ownership, or if the subject of the insurance was a building on ground not owned by the insured in fee simple, unless otherwise provided by agreement indorsed on or added to the policy. The policy showed the following indorsement, "Notice accepted that building is on leased ground from Railroad and lease contains a waiver of subrogation." Appellant defended on the ground that appellees had no insurable interest in the property; that, if the insured had any interest in the property, it was not truly stated in the policy, was other than sole and unconditional ownership, and at most was nominal.
There was evidence tending to show the following facts: Appellees, Samuel Jass and Moses L. Jass, are partners, trading as the Jass Manufacturing Company, and are engaged in the manufacture of cotton mill waste for filling beds. They occupied the brick building described in the policy by virtue of a written lease from the Southern Railway Company, dated September 1, 1922, made to Moses L. Jass as "proprietor of and trading as Jass Waste Company," for a monthly rental of $30. The lease was indefinite as to term, but contained a clause giving the lessor the right to terminate it on 60 days' notice. The lease contained a clause obligating the lessee to make repairs necessary to put the building in suitable condition for the business, which appellees did, after which its fair rental value was between $150 and $200 per month, and it would have lasted for 30 or 40 years. The building was totally destroyed by fire on May 6, 1925. Its sound value at that time was $9,076.02, and its replacement cost was over $12,000. There was other insurance up to $5,000, making the total $7,500. Appellees rebuilt the building, and were still occupying it when the suit was tried. Their relations with the lessor were satisfactory. Moses Jass was 50 years of age, with an expectancy of life of approximately 20 years. The policy was issued on behalf of appellant by its agents, MacIntyre, Scott & Knight, who had full authority to do so. Before it was issued, the lease was fully disclosed to Mr. Scott of that firm, and he had the building inspected. The evidence above stated was uncontradicted, save that one witness for defendant testified the rental value of the building was $60 per month.
At the close of the evidence, the court overruled a motion to direct a verdict for defendant, and, construing the policy as covering any interest appellees might have had in the building, charged the jury substantially as follows: That appellees were entitled to recover the value of the use of the building; that, if the cost of the repairs appellees were obligated to make, together with the rent, equalled the value of the use of the building, it would be worth nothing, but, if the value of the lease was more than the rental and the burden of repairs, it would be worth something according to the length of time a person could expect to remain in the building and use it; that they might consider the possibility of the lease running for the life of Moses Jass; and that the fact that the railroad could terminate the lease on 60 days' notice at any time would tend to depreciate the value of the expectancy.
Error is assigned to the refusal to direct a verdict, to the giving of the portion of...
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