Royal Ins. Co. v. Smith

• Decision Date: 22 April 1935
• Docket Number: No. 7401.,7401.
• Parties: ROYAL INS. CO., Limited, v. SMITH.
• Court: U.S. Court of Appeals — Ninth Circuit

77 F.2d 157 (1935)

ROYAL INS. CO., Limited, v. SMITH.^*

No. 7401.

Circuit Court of Appeals, Ninth Circuit.

April 22, 1935.

Percy V. Long and Bert W. Levit, both of San Francisco, Cal., for appellant.

James M. Hanley, of San Francisco, Cal., for appellee.

Before WILBUR and GARRECHT, Circuit Judges, and FEE, District Judge.

JAMES ALGER FEE, District Judge.

The complaint in an action at law on a valued fire insurance policy upon a leasehold of plaintiff from the city (formerly town) of Belvedere, after a statement of the corporate capacity of defendant, which is appellant here, sets out that plaintiff, who is respondent in this court, "applied to the defendant for a valued policy of insurance covering loss by fire of plaintiff's interest in that certain real property in the County of Marin, State of California," which is then described. The derivation of plaintiff's supposed interest in said land from one Keil, who was the owner of "Keil Cottage" by deed conveying only the structure itself to Flora G. Bland and thence to plaintiff, is detailed. It is stated that from the time of the last conveyance until the date of the destruction of the cottage by fire plaintiff paid the sum of $3 per month "as and for rent for the use of said real property." The crucial paragraph of the complaint is as follows:

"III. * * * That title to the aforesaid real property is vested in the Town of Belvedere; said Town of Belvedere having acquired said title by virtue of an instrument dated September 14, 1896, recorded May 14, 1897, in Liber 45 of Deeds, Page 176, a copy of this instrument is annexed hereto, and made a part hereof and marked Exhibit `B.'

"That under the provisions of said instrument dated September 14, 1896, the said real property hereinabove described is referred to as the `Keil Cottage,' and the following conditions are imposed:

"`Subject to the following reservation * * * 5th: Of all rents collected by the said town for the use of any portion of said strip of land, and particularly of the land rents paid by the Keil and Magill Cottages, and the owners of the Red and White Cottages * * * also subject to the following conditions:

"`1st: That no private structure other than private wharves, out houses or bathing houses and other than the structures now upon said beach, and the structures of this company to be erected thereon, pursuant to the foregoing reservations shall ever be permitted to stand wholly or partially upon said land, and that neither of the five private residences or cottages now standing upon said beach shall be renewed in case of destruction by fire or otherwise, and that said cottages shall remain thereon as long, and subject to such conditions as shall be determined by said Town.'"

It is then alleged that plaintiff, prior to issuance of the policy, presented to defendant the documents showing his chain of title, "and particularly the instrument * * * Exhibit `B' as representing the source and extent of his interest in the real property. Plaintiff requested the issuance of a valued policy of insurance to cover the contingencies of the loss of plaintiff's interest in the real property by the destruction of the cottage thereon by fire under the provisions of Exhibit `B,' as set forth hereinabove in Paragraph III. That said insurance was intended to protect the plaintiff from the loss of the use and occupation of the said real property under the reservations and conditions of the said Exhibit `B.'

"That at the time said plaintiff applied for said insurance and presented to the defendant the aforesaid instruments as representing the extent of his interest in said real property, he knew of no other instrument, creating any other or different interest therein."

Thereupon, after an examination and investigation of these documents, the defendant issued a policy of insurance, described as Exhibit D, upon which action is brought. The following excerpt then appears:

"That the following insuring clause of said Exhibit `D' reads as follows:

"`This insurance is predicated upon lease to land above described held by assured from the Trustees of the City of Belvedere, California, to which there is paid a monthly rental of three (3) dollars.'

"That at all times said lease was created and arose out of the said Exhibit `B' and the reservations contained therein as hereinabove set forth in Paragraph III, and the said policy of insurance was predicated upon the said lease as it existed under the said Exhibit `B.'"

The allegations of performance of conditions precedent, denial of liability by defendant, and nonpayment then follow:

A demurrer to this complaint was filed and overruled. The cause was then tried before a judge without a jury, and judgment rendered for said plaintiff.

1. The complaint is so founded upon the terms and conditions of the deed from the Belvedere Land Company to the town (now city) of Belvedere alone that, if that basis fail and neither leasehold nor lease to plaintiff can be spelled out between the lines thereof, no recovery can be had upon the policy under the present pleadings.

A casual reading of the applicable provisions of the deed itself makes it patent that no tenure of any kind was created in plaintiff or any of his predecessors by its terms alone. It is definitely stated therein, on the...