Goodman v. QUAKER CITY FIRE AND MARINE INSURANCE CO.

• Decision Date: 27 February 1957
• Docket Number: No. 5149.,5149.
• Citation: 241 F.2d 432
• Parties: Arnold GOODMAN, Plaintiff, Appellant, v. QUAKER CITY FIRE AND MARINE INSURANCE COMPANY, Defendant, Appellee.
• Court: U.S. Court of Appeals — First Circuit

241 F.2d 432 (1957)

Arnold GOODMAN, Plaintiff, Appellant, v. QUAKER CITY FIRE AND MARINE INSURANCE COMPANY, Defendant, Appellee.

No. 5149.

United States Court of Appeals First Circuit.

February 27, 1957.

Edward Wolper, Boston, Mass., Morrison, Mahoney & Pearlman, Boston, Mass., on the brief, for appellant.

Charles W. O'Brien, Boston, Mass., Brickley, Sears & Cole, Boston, Mass., on the brief, for appellee.

Before WOODBURY and HARTIGAN, Circuit Judges, and FORD, District Judge.

HARTIGAN, Circuit Judge.

This is an appeal by the plaintiff from a judgment entered by the United States District Court for the District of Massachusetts on April 18, 1956 for the defendant, after trial without jury, on an action for fire loss under an insurance policy.

The district court had before it, among other issues, that of insurable interest as it pertained to plaintiff's right to recovery. Since the court's conclusion, as detailed in its opinion, that a mortgagor's continuing liability on the first mortgagee's note is sufficient, even after foreclosure by the second mortgagee, to constitute insurable interest in the real estate covered, is not contested on appeal by either party, we need not present the facts pertinent thereto.

The only issues we find necessary to treat are whether sufficient notice of fire loss was given to the defendant so as to permit recovery by the plaintiff on the insurance policy and whether there was waiver of policy requirements, to any extent, by the defendant. The facts relevant to the above issues are as follows:

On August 5, 1953 upon application and payment of premium, the Quaker City Fire and Marine Insurance Company, defendant-appellee herein, issued a renewal fire policy, No. 107597, insuring John Julien Jenkins and Ruth R. Jenkins, former mortgagors, in the amount of $6,000 on a dwelling at 66 Crawford Street, Roxbury District, Boston, Massachusetts. The policy, a Massachusetts Standard Policy, became effective on August 30, 1953 and was to run for one year. By express provision the policy was payable to the Brighton Co-operative Bank, Allston, Massachusetts, first mortgagee, and Carl Goodman, c/o Milton Goodman, 27 School Street, Boston, Massachusetts, second mortgagee.¹

By this policy the insured in case of any loss or damage is required to render "forthwith" to the defendant "a statement in writing, signed and sworn to by the insured," setting forth the value of the property described, the interest of the insured therein, all other insurance thereon in detail, the purposes for which and the persons by whom the building described, or containing the property described was used, and the time at which and manner in which the fire originated, so far as known to the insured.

Further, the policy provides that the defendant, "within sixty days after the insured shall have submitted a statement, * * * shall either pay the amount for which it shall be liable, which amount if not agreed upon, shall be ascertained by award of referees * * *," or replace, rebuild or repair the damaged property. Moreover, by express provision in the policy, the mortgagee's right to recover in case of loss could not be affected by the act or default of any other person.

On October 13, 1953 the insured property was destroyed in major proportion by fire. Two or three days later Milton Goodman visited defendant's agent and informed him of the fire. In several conversations thereafter the question of defendant's liability under the policy was discussed.²

On November 25, 1953 Milton Goodman wrote to the defendant, notifying it of the loss, location, policy number and of those insured, and inquired of the defendant as to coverage under the policy. It is admitted by both parties that this letter, which is part of the record on appeal, is dated November 25, 1953, not November 25, 1954, as erroneously stated in the findings and opinion of the district court. In its reply of December 4, 1953 to this letter of November 25, 1953, the defendant stated: "In answer to your letter of November 25, we are sorry to inform you that we find this company has no liability at the location named in your letter."

At the trial Milton Goodman testified that he was representing the second mortgagee as well as the owner of the insured property in his negotiations with the defendant.

On March 4, 1954 the Brighton Co-operative Bank, first mortgagee, assigned to Arnold Goodman, plaintiff-appellant herein, the note, mortgage and all its right, title and interest in fire policy, No. 107597. On March 10, 1954 Milton Goodman wrote to the defendant making demand for payment on behalf of plaintiff, Arnold Goodman, as assignee of the first mortgagee. It is admitted by both parties that this letter, which is part of the record on appeal, is dated March 10, 1954, not March 10, 1955 as erroneously stated in the findings and opinion of the district court. The defendant in a letter dated March 23, 1954 again denied liability for any loss at the Crawford Street location.

This action was commenced by the plaintiff by a complaint filed November 4, 1954. The district court, after concluding by resort to Massachusetts law that Jenkins had an insurable interest in the insured property on August 30, 1953, held that sufficient notice of the loss had not been given to the defendant so as to permit plaintiff to recover in this action.

We believe that the issue of notice was sufficiently raised by the pleadings so as to permit the district court to pass on it. But, contrary to the district court, we believe that sufficient notice of the loss was given to the defendant under Massachusetts cases and statutes.

The fire policy in the instant case, in keeping with Mass.Laws Ann. c. 175, § 99, Cum.Supp.1955, provides that in case of any loss or damage the insured shall render forthwith to the defendant a sworn statement in writing setting forth certain details. "It is quite certain that the party referred to as the insured in these provisions is the mortgagor." Union Institution for Savings v. Phoenix Ins. Co., 1907, 196 Mass. 230, 233, 81 N.E. 994, 995, 14 L.R.A.,N.S., 459. Admittedly, the mortgagor in the instant case...