The opinion of the court was delivered by: JACOB HART, Magistrate Judge
This case presents an insurance coverage question. Does the
resident of a home, on which he has paid homeowners' insurance
premiums, have an insurable interest in the home once a writ of
execution is issued on the property? Allstate contends that the
writ of execution divested the resident of his insurable
interest. Additionally, since the Plaintiff renewed the insurance
policy after the writ was executed, Allstate contends that there
is no coverage because Plaintiff failed to inform Allstate of the
transfer of ownership of the property. The Plaintiff argues that
the foreclosure action did not divest him of an insurable
interest in the property. Hoggard also claims that he was unaware
of the change in title. Therefore, no material misrepresentation
was made in the policy renewal.
On March 9, 2003, the house located at 15 Somerset Drive in
Coatesville caught fire. Both the dwelling and its contents
suffered significant damage. On March 13, 2003, Plaintiff, who,
at that time, lived in the house, contacted his homeowners
insurance company to report the fire loss. The Defendant denied
Prior to the fire, on June 24, 2002, a writ of execution was
issued to the sheriff, based on a foreclosure action filed by the
Plaintiff's mortgagee, Eastern Savings Bank, FSB. On November 8, 2002, the property was conveyed from the Office of
the Sheriff to Tiger Real Estate, Inc., a subsidiary of Eastern
Savings Bank. Plaintiff, who had been insured with Allstate for
approximately eighteen years, renewed his homeowners policy on
February 25, 2003. Citing the change of ownership and Plaintiff's
failure to notify Allstate of the change of ownership, the
Defendant denied Plaintiff's claim in an undated letter which is
attached to Plaintiff's complaint. Plaintiff filed suit in the
Court of Common Pleas and the Defendant removed the case to
federal court. Presently before the court is the Defendant's
Motion for Judgment on the Pleadings.
Federal Rule of Civil Procedure 12(c) permits a party to move
for judgment "after the pleadings are closed but within such time
as not to delay the trial." Fed.R.Civ.P. 12(c). A party moving
for judgment on the pleadings pursuant to Rule 12(c) must
demonstrate that there are no issues of material fact and that
judgment should be entered in its favor as a matter of law. See
Jablonski v. Pan Amer. World Airways, Inc., 863 F.2d 289, 290
(3d Cir. 1988). In evaluating a Rule 12(c) motion, a court must
view the pleadings in the light most favorable to, and draw all
inferences in favor of, the nonmoving party. See Soc'y Hill
Civic Ass'n v. Harris, 632 F.2d 1045, 1054 (3d Cir. 1980).
We must first determine if Mr. Hoggard had an insurable
interest in the property at the time of the fire. In making this
determination, Allstate has focused on the fact that Mr. Hoggard
was not the titled owner of the property. His name did not appear
on the deed at the time of the fire. Hence, according to
Allstate, he had no insurable interest in the property. Hoggard
argues that the policy does not require that the property be titled to
him. Rather, since it was his resident premises, he had an
insurable interest in the property.
We reject Allstate's theory that merely because Mr. Hoggard's
name did not appear on the deed he does not have an insurable
interest in the property. The courts of Pennsylvania do not limit
the classification of those with an insurable interest to those
who have legal title to a piece of property. Rather, the courts
follow the generally accepted rule that "anyone has an insurable
interest who derives pecuniary benefit or advantage from the
preservation or continued existence of the property or who will
suffer pecuniary loss from its destruction. . . . [A] fee title
is clearly not required of the insured, nor even a direct
property interest, the test of exposure to financial loss being
all important." Luchansky v. Farmers Fire Insurance Co.,
357 Pa.Super. 136, 138 (1986) (citing 43 Am.Jur.2d Insurance § 943;
4 Appleman, Insurance Law and Practice § 21).
In Luchansky, the Superior Court considered and rejected a
theory substantially similar to that made by Allstate today. In
Luchansky, parents transferred legal title of their property to
their son under an agreement providing for the reconveyance of
the property and the parents paid for the insurance on the
property and its maintenance. When a fire destroyed the property,
the insurance carrier denied the claim. The Superior Court held
that the parents had an insurable interest in the property
despite the fact that their names did not appear on the deed.
"[A] fee title is clearly not required of the insured. . . ."
Luchansky, at 139.
Similarly, in Shockley v. Harleysville Mutual Ins. Co.,
381 Pa.Super.287 (1989), the Superior Court found that the bona fide
purchaser of a stolen vehicle had an insurable interest in the
vehicle. "Having perfect legal title is not necessary [to
establish an insurable interest]." Id, at 291.
Thus, we are persuaded that the mere fact that Mr. Hoggard's
name did not appear on the deed is not dispositive of the
insurable interest issue. Therefore, we must determine if Mr.
Hoggard had any ...