Before DUFFY, Chief Judge, and FINNEGAN and LINDLEY, Circuit Judges.
This is an action to recover upon four policies of fire insurance covering contents of plaintiff's manufacturing plant. The principal defenses raised by the insurers were that the property was covered only while in the building located at 5832 South Green Street, Chicago; that at the time of the fire, such property had been moved to and was located in a building at 5807 South State Street, Chicago, and that the insurers had expressly refused to consent to a transfer of the insurance coverage from the Green Street to the State Street building.The trial was to a jury. A previous trial to a jury had resulted in a verdict for the defendants but a new trial was ordered. At the close of plaintiff's evidence in the second trial, the plaintiff moved for a directed verdict which motion was denied. At the close of all the evidence plaintiff again moved for a directed verdict. This time the trial court granted the motion and directed the jury to render a verdict in favor of the plaintiff and against each of the four defendants. Judgment was entered upon the verdict and this appeal followed.
Plaintiff was a corporation engaged in the manufacture of mobile house trailers. From 1945 to February, 1951 plaintiff's operations were conducted in leased premises located at 5951 South State Street, Chicago. In March, 1951 plaintiff leased premises at 5832 South Green Street to which location most of its manufacturing operations were moved. Thereafter, plaintiff acquired title to the premises at 5807 South State Street, and by July 6 or 7, 1951, plaintiff had moved its operations to that building. The fire occurred on September 8, 1951.
For some years plaintiff had procured a substantial portion of its insurance through Joseph Lipshutz & Company, a firm of insurance brokers. All of plaintiff's dealings for insurance were handled on its behalf by its president, George Blosten. Blosten had been a friend of Joseph Lipshutz for some twenty years, and was also well acquainted with his son Ira who was likewise active in the insurance brokerage firm.
In March, 1951, plaintiff instructed the Lipshutz firm to procure $20,000.00 of fire insurance coverage on the contents owned by plaintiff at the Green Street building. The Lipshutz firm procured for plaintiff the four policies of fire insurance involved in this litigation; said policies were issued on April 26, 1951, and were procured through the L. G. Stewart Insurance Agency, a partnership conducted by L. G. Stewart and Charles LaBow. It is clear that in the transaction involving the four insurance policies, the Lipshutz firm acted as agents for the plaintiff, and the Stewart Agency acted as underwriting and issuing agents for the four defendant insurance companies. Each of the four policies contained a provision that the goods were insured at the Green Street address "and not elsewhere."
About July 10 or 11, 1951, Blosten gave the four policies to Joseph Lipshutz asking him to procure the transfer of the coverage from the Green Street Building to the State Street building. He also requested that the term of the policies be increased from one to three years.
About July 11, 1951, Lipshutz sent a written memorandum to the Stewart Agency, attention of Mr. LaBow, making a request to transfer the insurance coverage to the State Street location. Skerke, a fire insurance underwriter employed by the Stewart Agency, after discussing the matter with LaBow, called the Lipshutz firm's office by telephone and told Esther Rubins who was, at that time, in charge, that the Stewart Agency was unable to accept the transfer of the coverage to the new location. Blosten identified Esther Rubins as an employee or an associate of the Lipshutz firm who had worked there many years.
In the early part of August, 1951, Ira Lipshutz personally visited LaBow, and asked why the Stewart Agency would not grant the request for a transfer of the coverage. Prior to that time the Lipshutz firm had obtained other fire insurance for plaintiff through the Stewart Agency totaling $65,000 on the State Street building and $10,000 on the contents at that location. LaBow explained to Lipshutz that a total of $75,000 insurance was all that the Agency could handle at that location, explaining about an increase in fire hazards. Lipshutz requested LaBow to write him a letter explaining why the request for an additional $20,000 on the contents of the State Street building could not be granted. LaBow testified he wrote such a letter to Lipshutz, and he identified a copy of that letter which was marked "Exhibit 1" for identification. Blosten stated that he knew of the existence of such a letter. The Court admitted "Exhibit 1" in evidence, but later reversed its ruling stating that defendants had not laid a sufficient foundation.
The Lipshutz Agency never notified the plaintiff of the refusal of insurers to transfer the coverage. At the time of the trial herein, there was pending in the Superior Court of Cook County, Illinois, an action brought by plaintiff against the Lipshutz firm seeking recovery because of the negligent failure of its brokers to obtain a transfer of insurance coverage, and to keep the property of plaintiff insured. The Court, however, refused to receive in evidence the complaint in that action.
The Stewart Agency did not return to Lipshutz or the plaintiff the policies of insurance which had been handed to them for an endorsement of the transfer of coverage. Although some comment is made as to the alleged failure of defendants to return the unearned portion of the insurance premium, as a matter of fact, no premiums had been paid by plaintiff for the policies here in question. This point is not of great importance, however, because there was a credit arrangement existing between the Lipshutz firm and the Stewart Agency.
The District Court, relying upon Williamsburg City Fire Insurance Co. v. Cary, 1876, 83 Ill. 453, and Mandelovitz v. New Amsterdam Casualty Co., 216 Ill.App. 404, directed a verdict for the plaintiff holding that defendant insurance companies had waived the location of the property as a defense apparently on the ground the agent of the insurance companies retained possession of the policies and said policies had not been canceled.
We think it is settled law in Illinois and elsewhere that when personal property is insured under a fire policy at a designated location "and not elsewhere" the insurer is not liable if a loss occurs at a different location, unless the insurer has expressly consented to a transfer of such coverage or there is a waiver of this provision by the insurer or the insurer is estopped by its conduct from asserting such a defense. Liebenstein v. Aetna Insurance Co., 45 Ill. 303, 304; Jacobson v. Liverpool, London & Globe Insurance Co., 135 Ill.App. 20, 23, affirmed 231 Ill. 61, 83 N.E. 95; Couch "Cyclopedia of Insurance Law", Vol. 3, § 747c, Page 2441.
The court below and the plaintiff here rely principally upon Williamsburg City Fire Insurance Co. v. Cary, 83 Ill. 453. That decision was expressly approved in 1920 in Mandelovitz ...