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AVONDALE CUT RATE v. ASSOCIATED EXCESS UNDERWRITERS (03/13/62)

March 13, 1962

AVONDALE CUT RATE, INC., APPELLANT,
v.
ASSOCIATED EXCESS UNDERWRITERS, INC.



Appeal, No. 143, Jan. T., 1962, from order of Court of Common Pleas No. 5 of Philadelphia County, Dec. T., 1960, No. 853, in case of Avondale Cut Rate, Inc. v. Associated Excess Underwriters, Inc. and Indemnity Insurance Company, Ltd. Order reversed with directions to enter judgment for plaintiff.

COUNSEL

Harry Lore, for appellant.

No argument was made nor brief submitted for appellee.

Before Bell, C.j., Musmanno, Jones, Cohen, Eagen and O'brien, JJ.

Author: Musmanno

[ 406 Pa. Page 494]

OPINION BY MR. JUSTICE MUSMANNO

The Avondale Cut Rate, Inc., plaintiff in this case, owns the Avondale Farmers' Market in Londongrove Township, Chester County. Like every other business establishment possessing material wares subject to destruction by fire, it made arrangements to buy fire insurance to cover its property and, in doing so, dealt with the Associated Excess Underwriters, with offices in Philadelphia, which engages in placing fire insurance. After preliminary conversations, the Avondale Cut Rate, Inc. (hereinafter to be called Avondale), paid to Associated Excess Underwriters, Inc. (hereinafter to be called Associated), the sum of $390 as premium on a certain fire insurance policy. On November 25, 1959 it received from Associated its Cover Note which showed that Associated had effected insurance on the Avondale Farmers' Market through the Indemnity Insurance Co., Ltd., for one year from November 6, 1959 in the maximum amount of $6500.

On April 26, 1960, the Avondale Farmers' Market was consumed by flames, with losses amounting to $10,755.65. Avondale immediately notified Associated and the Indemnity Insurance Company and filed the required proof of loss with both companies. Neither company made any offer of payment and, after waiting eight months for the offer which never arrived, Avondale

[ 406 Pa. Page 495]

    brought suit in assumpsit against both Associated and the Indemnity Insurance Company for the face value of the policy, $6500.

The Indemnity Insurance Company filed neither appearance nor answer, but Associated filed an answer in which it admitted issuing the Cover Note above indicated but, in spite of this, denied that it was an agent of Indemnity. On the contrary, it averred that in accordance with the customs of the trade it had requested the Realdo Insurance Brokers, an insurance brokerage company with offices in Quebec, Canada, to obtain and provide coverage for Associated in accordance with its needs. Associated said further that Realdo issued its Cover Note showing that it had obtained insurance coverage for Avondale through the International American Insurance Company, Ltd. A copy of the Realdo Cover Note was attached to the answer and it showed that it was dated May 9, 1960, or thirteen days after the fire had occurred! Parenthetically it may be said that the Court will take judicial notice of the fact that no insurance company would knowingly issue a policy to cover losses on goods which were already in ashes before application for insurance was made.

Avondale filed preliminary objections which were in the nature of a motion to strike, a demurrer,*fn1 and a motion for a more specific pleading. The objections in the nature of a motion to strike and for a more specific pleading were sustained, but the Court ...


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