Vlastos v. Sumitomo Marine & Fire Insurance Co.

707 F.2d 775 (3rd Cir. 1983)

Purchase the Printed Copy at bsmsphd.com

Nature of the Case

To access this section all you need to do is click here and register.

Facts

P owned a four-story building. P and her son operated a luncheonette and a bar on the first floor of the building. The second and third floors were leased to Spartacus, Inc., which conducted a massage parlor on the second floor. Evidence was introduced at trial tending to show that the massage parlor also utilized at least a portion of the third floor. At the rear of the third floor, there was a padlocked room or a section partitioned off from the remainder of the floor. Philip 'Red' Pinkney, P's handyman and janitor lived there. P kept supplies on the fourth floor and maintained a small office there as well. She occasionally remained overnight on the fourth floor rather than return to her residence. P was not staying there the night of the fire, but two friends of hers were residing there temporarily and were killed. A third person was also killed in the fire. The insurance policy in question provided $345,000 of fire insurance with a $1,000 deductible provision. It contained a section, Endorsement No. 4, expressly incorporated into the policy, which stated in part: 'Warranted that the 3rd floor is occupied as Janitor's residence.' D refused to pay the claim, citing an alleged breach of the warranty. P sued D. The court denied P's motion for a directed verdict and proceeded to charge the jury that the warranty regarding the third floor was breached if a massage parlor occupied any significant portion of the floor, regardless of whether the janitor had a residence there as well. The jury was also instructed that if the third floor was totally unoccupied this too would constitute a breach of the warranty. The jury found that D proved by a preponderance of the evidence that P breached the warranty. P appealed.