Cram v. Sun Insurance Office, Ltd.

• Decision Date: 29 March 1967
• Docket Number: No. 10824,10825.,10824
• Citation: 375 F.2d 670
• Parties: Henry S. CRAM, Appellant, v. SUN INSURANCE OFFICE, LTD., Appellee. Robert S. WAHAB, Jr., Appellant, v. SUN INSURANCE OFFICE, LTD., Appellee.
• Court: U.S. Court of Appeals — Fourth Circuit

375 F.2d 670 (1967)

Henry S. CRAM, Appellant, v. SUN INSURANCE OFFICE, LTD., Appellee.

Robert S. WAHAB, Jr., Appellant, v. SUN INSURANCE OFFICE, LTD., Appellee.

Nos. 10824, 10825.

United States Court of Appeals Fourth Circuit.

Argued February 8, 1967.

Decided March 29, 1967.

deRosset Myers, Charleston, S. C. (Henry B. Smythe, Pritchard, Myers & Morrison, and Buist, Buist, Smythe & Smythe, Charleston, S. C., on brief), for appellant, Henry S. Cram.

Henry B. Smythe, Charleston, S. C. (Pritchard, Myers & Morrison, and Buist, Buist, Smythe & Smythe, Charleston, S. C., on brief), for appellant, Robert S. Wahab, Jr.

Nathaniel L. Barnwell, Charleston, S. C. (Ben Scott Whaley, and Barnwell, Whaley, Stevenson & Patterson, Charleston, S. C., on brief), for appellee.

Before HAYNSWORTH, Chief Judge, and J. SPENCER BELL and WINTER, Circuit Judges.

J. SPENCER BELL, Circuit Judge:

Plaintiff, Henry S. Cram, brought a declaratory judgment action against Sun Insurance Office, Ltd., and Robert S. Wahab, Jr., to determine the rights and liabilities of the parties with regard to the loss of the yacht "Buck's Club," which was insured by Sun and which Cram had agreed to convey to Wahab. Jurisdiction is based on diversity of citizenship. Cram and Sun moved for summary judgment under Rule 56 of the Federal Rules of Civil Procedure based on the pleadings, written interrogatories, and affidavits. Cram and Wahab appeal from a district court order entering judgment for Sun in accordance with its motion under Rule 56.

Cram, a resident of Bluffton, South Carolina, owned a yacht known as the "Buck's Club," which he wished to replace with a larger boat, and Wahab, a resident of Virginia Beach, Virginia, owned a yacht called the "Recess," which he desired to sell. Brought together by a mutual friend, one Captain Hester, Cram and Wahab met in Norfolk, Virginia, on November 24, 1964, and executed the following two agreements:

"For and in consideration of $1.00 and other good and valuable considerations I hereby bargain, grant, sell, and convey all my right, title, and interest in one forty-one foot boat, now known as the `Recess' and documented in the U. S. Customs House as No. 295136.

"I warrant that this boat is free of all liens and encumbrances of all kinds.

"Given under my hand this twenty-fourth day of November, 1964.

/s/ Robert S. Wahab, Jr 957 Bobolink Drive Virginia Beach, Va."

"In part consideration of the sale to me of Documented Vessel No. 295136, I agree to assign all of my right, title, and interest in one 1962 Clayton 28 ft. Sea Skiff, now known as `Buck's Club' to Robert S. Wahab, Jr.

"I warrant that the said boat is free of all liens and encumbrances of all kinds and will be in operating condition when delivered.

"Given under my hand this 24th day of November, 1964.

/s/ Henry S. Cram."

Cram paid Wahab $19,500.00 cash, which together with the "Buck's Club" represented full consideration agreed upon for the "Recess." Cram then returned to South Carolina with the "Recess" and proceeded to have necessary repairs made on "Buck's Club" in order to put it in operating condition.

After repairs on "Buck's Club" had been completed, Cram notified Wahab of that fact. Wahab had originally intended to pick up the yacht in South Carolina but because of inclement weather decided not to do so. It was agreed that Cram would arrange for Captain Hester to deliver the yacht to Wahab in Virginia, with Wahab bearing the expense. There was no evidence that Hester had any authority to inspect and approve the condition of the "Buck's Club" on behalf of Wahab. Hester took charge of the yacht on December 5, 1964, and shortly thereafter the yacht was completely destroyed by fire while in the Beaufort River in South Carolina.

On June 18, 1964, Sun had issued to Cram a policy insuring the "Buck's Club" for $12,200.00, the agreed valuation, and Cram had paid the full premium for one year. On November 24, 1964, the day Cram took possession of the "Recess," he had insured that vessel for $24,500.00. On the same day, Wahab had telephoned his own insurance company, Hanover Insurance Company, and arranged to have a binder placed on "Buck's Club" for $5,000.00, to become effective when title passed to him.

After the destruction of the "Buck's Club," Cram and Wahab, assuming the $12,200.00 policy issued by Sun to be clearly collectible, began to dispute over the question of who was entitled to the insurance money. Cram paid Wahab $5,000.00, contending that that amount was the trade-in value allotted to the "Buck's Club" under the contract, since Wahab had originally stated that he would accept $24,500.00 for the "Recess" and Cram had already paid $19,500.00 cash. Wahab's position, on the other hand, was that he had bargained not for $24,500.00, but for $19,500.00 cash, plus the "Buck's Club," whatever its value, and that its value was the value agreed upon by Sun and Cram — $12,200.00.

Sun, however, refused to pay the amount of the policy on the ground that the policy had become void under the following provision:

"This insurance shall be void in case this policy or the property insured shall be sold, assigned, transferred or pledged without previous consent in writing of the company."

Sun contended that at the time it was destroyed, title to the yacht had passed from Cram to Wahab. Cram brought this declaratory judgment action against Sun and Wahab, and Wahab brought in its insurer, Hanover Insurance Company, as a third-party defendant, contending that if title had passed, then Hanover was liable under the binder agreement.

Cram and Sun both moved for summary judgment, Cram and Wahab stated that if the court granted Cram's motion for summary judgment, then the lawsuit would be entirely resolved, since they had reached an amicable agreement as to their dispute in that event. The district court, however, granted Sun's motion for summary judgment, which left the issues between Cram and Wahab and between Wahab and Hanover undecided.

It is obvious from the recitation of the facts of this case that this is a many-faceted lawsuit and that only one facet has as yet been resolved. Thus, even though the appealing parties have not raised the question, it is necessary for us to consider whether this court has jurisdiction to hear this appeal at this time. We have concluded that the appeal must be dismissed as premature.

With a few exceptions not relevant here,¹ this court has jurisdiction of appeal from "final decisions" only. 28 U.S.C. § 1291 (1964). Under Rule 54(b) of the Federal Rules of Civil Procedure, no order of the district court involving less than all claims and parties is final unless the court directs entry of judgment "upon an express determination that there is no just reason for delay and upon an express direction for the entry of judgement." The district court did not make such an express determination, nor has there been any attempt by the parties to have the matter certified to this court in accordance with 28 U.S.C. § 1292(b) (1964). Moreover, it is clear that a summary judgment as to one of the parties is no exception to the rule. See United States to Use of Mustin Bros. Plastering Co. v. Al-Con Dev. Corp., 271 F.2d 901 (4 Cir. 1959). The appeal must therefore be dismissed.

Since this case is still pending in the district court and trial must be completed, we point out that we do not think the dispute involving Sun is one that can properly be disposed of by summary judgment.

The summary judgment procedure is available only in cases where there is no genuine issue of material fact. Fed.R.Civ.P. 56(c). Whether or not a genuine issue of material fact exists is a determination for the court, not the parties, and the fact that the parties may have thought there was no material fact in issue is in no way controlling. See Brawner v. Pearl Assur. Co., 267 F.2d 45 (9 Cir. 1958). "The fact that both sides moved for summary judgment does not establish that there is no issue of fact and require that judgment be granted for one side or the other." American Fid. & Cas. Co. v. London & Edinburgh Ins. Co., 354 F.2d 214, 216 (4 Cir. 1965). See 3 Barron & Holtzoff, Federal Practice and Procedure § 1239 (Wright ed. 1958...