Edlin v. Security Insurance Company

• Decision Date: 02 October 1957
• Docket Number: Civ. A. No. P-1495.
• Citation: 160 F. Supp. 487
• Parties: Max EDLIN and Ida Edlin, Plaintiffs, v. SECURITY INSURANCE COMPANY, Philadelphia Fire and Marine Insurance Company, The Home Insurance Company, The Standard Fire Insurance Company, Milwaukee Mechanics' Insurance Company, Defendants. PEORIA HOUSING AUTHORITY, a Municipal Corporation and Body Corporate and Politic, Intervening Petitioner, v. SECURITY INSURANCE COMPANY, Philadelphia Fire and Marine Insurance Company, The Home Insurance Company, The Standard Fire Insurance Company, Milwaukee Mechanics' Insurance Company, Max Edlin and Ida Edlin, Defendants.
• Court: U.S. District Court — Southern District of Illinois

160 F. Supp. 487

Max EDLIN and Ida Edlin, Plaintiffs, v. SECURITY INSURANCE COMPANY, Philadelphia Fire and Marine Insurance Company, The Home Insurance Company, The Standard Fire Insurance Company, Milwaukee Mechanics' Insurance Company, Defendants.

PEORIA HOUSING AUTHORITY, a Municipal Corporation and Body Corporate and Politic, Intervening Petitioner, v. SECURITY INSURANCE COMPANY, Philadelphia Fire and Marine Insurance Company, The Home Insurance Company, The Standard Fire Insurance Company, Milwaukee Mechanics' Insurance Company, Max Edlin and Ida Edlin, Defendants.

Civ. A. No. P-1495.

United States District Court S. D. Illinois, N. D.

October 2, 1957.

Cassidy & Cassidy, Peoria, Ill., for plaintiffs.

Willard B. Gaskins and Edwin V. Champion, Peoria, Ill., for intervening petitioner.

Clausen, Hirsh & Miller, Donald N. Clausen and John P. Gorman, Chicago, Ill., Miller, Westervelt, Johnson & Thomason and Eugene R. Johnson, Peoria, Ill., for defendants.

MERCER, District Judge.

This is an action based upon policies of fire insurance issued by the defendant insurance companies to the plaintiffs seeking a recovery of alleged damage by fire to the buildings described in the policies, said buildings being located at 600-608 North Adams Street, Peoria, Illinois. The fire occurred on November 28, 1952 and it is alleged that the resulting damage thereby exceeded the total of the face amount of defendants' policies of insurance, the total amount of insurance being in the sum of $24,000. Five insurance companies are involved as defendants herein.

On September 3, 1952, prior to the date of the fire, the Peoria Housing Authority, a Municipal Corporation, and the intervening petitioner herein, filed in the County Court of Peoria County, Illinois, a petition for condemnation of the real property upon which the buildings described in defendants' policies of insurance were located. The plaintiffs herein, Max Edlin and Ida Edlin, were named as defendants in the condemnation proceeding and were duly summoned to appear in the condemnation action. This suit proceeded to trial on January 6, 1953 in the County Court of Peoria County, Illinois and on January 10, 1953 the jury returned a verdict therein in favor of the said Max Edlin and Ida Edlin in the sum of $43,500. Subsequent thereto and on January 20, 1953 a final order and decree was entered on this award and on the same day the award was thereupon paid to Max Edlin and Ida Edlin by the Peoria Housing Authority.

A long and well-established rule in the State of Illinois in a condemnation proceeding provides that the value of property sought to be condemned is to be determined as of the date of the filing of the petition without regard to any increase or decrease in the value of the property between that date and the date of trial or the date of judgment or the date of payment. This rule of law was invoked by the County Court of Peoria County, Illinois in the condemnation proceeding, the presiding judge in the condemnation proceeding having instructed the jury in this regard. Consequently, the verdict of the jury was based exclusively on evidence of the value of the property in question as of September 3, 1952, being the date of the filing of the petition, and therefore, it must be concluded that the jury did not take into account any decrease in the value of the property by reason of the fire of November 28, 1952. The question presented by the foregoing facts is whether the insured, being the plaintiffs herein and being named in the defendants' policies of insurance, has sustained a pecuniary loss by reason of the damage to the property in question by fire and if no such pecuniary loss appears whether the plaintiffs may nevertheless recover under the said policies to the extent of the damage sustained.

It is the opinion of the Court that the condemnation award, which has been paid by the Housing Authority and received by the plaintiffs, was based exclusively upon evidence of value of the property prior to the date of the fire and it is the further opinion of the Court that the plaintiffs have not sustained a pecuniary loss by reason of the fire. The Court is required to answer the further question as to whether the plaintiffs may, in spite of the fact that they have suffered no pecuniary loss, recover under said policies. There appears to be a conflict of authority in answer to the latter question. One line of authorities which for convenience may be called the "New York Rule" holds that the rights of an insurer and the insured under a fire insurance policy are established as of the time of the fire and loss and that the fact that the insured has ultimately recouped his loss from another source does not relieve the insurer of its liability. There are also cases in other states which follow the New York rule, including Massachusetts, Michigan, Pennsylvania and others. There is, however,...