Pape v. Home Ins. Co., Civil Action No. 8 — 166.

• Decision Date: 16 February 1943
• Docket Number: Civil Action No. 8 — 166.
• Citation: 48 F. Supp. 754
• Parties: PAPE et al. v. HOME INS. CO.
• Court: U.S. District Court — Southern District of New York

48 F. Supp. 754

PAPE et al. v. HOME INS. CO.

Civil Action No. 8 — 166.

District Court, S. D. New York.

February 16, 1943.

Hill, Rivkins & Middleton, of New York City, for plaintiff.

Duncan & Mount, of New York City (Frank A. Bull, of New York City, of counsel), for defendant.

BYERS, District Judge.

The plaintiffs seek to recover $12,167.61 as for a loss arising under the defendant's fire insurance policy No. 11637, dated October 13, 1934, expired October 18, 1936.

The policy covered cotton wherever located in Europe, except Russia and Germany, and the 350 bales involved were in Barcelona, Catalonia, Spain, on October 6, 1936, when the incidents upon which plaintiffs rely had their inception.

The evidence consists solely of the recitals in a stipulation of facts which constitutes Exhibit 1.

An epitome of the material happenings may be thus stated as the findings of fact:

These bales had been stored in a "location" known as Muelle de Espana since about June 24, 1936, and were the property of the plaintiffs in trust for their bank, Guaranty Trust Company of New York, and were covered by the terms of the said policy.

Civil war in Spain broke out about July 19th of that year, and brought in its train the conventional disorders of riot, robbery and bloodshed. Police and military protection were insufficient to cope with the conditions which thus came to pass, and neither life nor property was safe or reasonably secure.

On October 6, 1936, a Committee representing the National Confederation of Labor, which itself possessed no governmental status, notified public warehouses, cotton importers and banks in Barcelona that it was taking over all cotton in that city for delivery to Industrial Cotton Committee; as to that body the stipulation is that it was "a semi-official duly constituted body depending from the Spanish Government at Madrid".

If the case were to turn upon the constituency of that Committee as an instrumentality of government, there would be such a deficiency of proof as to cause a derail of decision for inability to arrive at destination.

Catalonia was an autonomous republic in northeastern Spain, which is stipulated to have been dependent upon and cooperating with the Spanish Republican Government, but what that means in terms of the episodes here involved is not made to appear.

The notice given by the Labor Committee is assumed to have been given to the plaintiffs in legal effect, although the actual recipient is not named. Perhaps it was Banco de Vizcaya of Barcelona, which seems to have caused the cotton to be delivered on June 24, 1936, at Muelle de Espana.

A printed notice was posted on warehouses and other places containing cotton, dated October 8, 1936, reading: "All stocks of cotton stored in this deposit are taken over by the National Committee of Relations of the Fabrile and Textile Industry — C N T".

That was the Committee duly appointed by and representing the Labor Committee.

The control thus asserted was the subject of an undertaking to transfer to the said Cotton Committee on October 6, 1936 (Stipulation, Par. 12).

The United States Consul at Barcelona conferred on October 8, 1936, with the Catalan Counselor of Economy, and two days later an official thereof assured the United States Consul that the Catalan Government would guarantee payment for all cotton that was or might be taken over. On October 17, 1936, this undertaking was formally stated in a communication to the United States Consul which refers to "the bales of raw cotton belonging to North American citizens, which have been the subject of attachment in the Catalan region, and take pleasure in advising you, with the object of tranquilizing you and the parties concerned, that while the recording and checking of the said attachments is being made, this Cheralitat of Catalonia takes upon itself the care of North American interests and will in due time determine definitely the reimbursement of the amount represented by the said attachments."

The undertaking was performed in this wise: On December 16, 1936, 292,206.45 free pesetas were paid by the Catalan Government for said 350 bales of cotton through International Banking Corporation to whom plaintiffs' Barcelona agent delivered bills of lading covering the said bales. That corporation acted for the plaintiffs in receiving the money, and apparently for the Cotton Committee in receiving the bills of lading.

The pesetas realized $18,632.39 United States currency, and the September, 1936, value in Barcelona of the 350 bales @ $88.00 would have been $30,800.00 expressed in dollars, and there is no evidence that it was less in the following month. The action is to recover the difference between these sums, or $12,167.61.

The evidence unmistakably establishes that the cotton was not destroyed by fire or otherwise; it was simply taken into custody, then into possession — attached is the term which has been quoted — first by a nondescript but potent instrumentality, and later possession is shown in a Cotton Committee having some official status, and then the Government of Catalonia assumed financial responsibility for what had taken place to the extent and in the manner which has been stated. It may be inferred that but for an unfavorable fluctuation in foreign exchange the loss would not have been sought to be visited upon the defendant under its policy of fire insurance.

That such was the nature and character of the policy is too clear for argument or discussion. It is called a fire insurance policy and provides that the insured (the plaintiffs) having paid the defendant $500.00 "for insuring against loss or damage by Fire, as hereinafter provided, the property hereinafter described, in the sum or several sums following, namely:"

Then follow three typewritten sheets, to the last of which are attached five typed riders, all of which are inserted prior to some...