Acree v. Hanover Insurance Company

561 F.2d 216 (10th Cir. 1977)

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Nature of the Case

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Facts

On March 8, 1974, P contracted to sell his home to Ds, for $125,000. The sale was to be completed and possession delivered on July 8, 1974. On June 18, 1974, Seller renewed two insurance policies on the premises. On June 23, the premises were damaged by fire and vandalism. Under the sales contract, D had a right to refuse to complete said sale, and said escrow money shall be returned to him and the contract shall be null and void. The contract did not mention any obligation on the part of either party to keep the premises insured. After the fire, D elected to complete the contract paid the full purchase price, and took possession. D claims and P denies, that the sale was completed with the understanding that D would receive the proceeds from the insurance policies. Hanover Insurance Company and Fireman's Fund Insurance Company insured the premises. Hanover Insurance Company and Fireman's Fund Insurance Company insured the premises. They refused to pay P, who then sued them in federal court. D intervened. The district court gave judgment for D against the insurers for $13,000. The insurers paid that amount into the court registry and do not participate in this appeal by P. P contends that the insurance policies are personal contracts of indemnity for the benefit of the insured and that D has not bargained for the benefit of P's insurance and is not entitled to the proceeds arising from the fire damage. D says that the insurance is to indemnify for damage to the insured property and that, because he has paid the full purchase price, recovery of the insurance proceeds by P would inequitably and unjustly enrich P.