Gailbreath

Appellees herein, The Homestead Fire Insurance Company, a Maryland corporation, and Sun Insurance Office, Limited, a corporation organized and existing under the laws of England, joined in an action in the United ' States District Court for the Northern District of California against the Signal Oil Company, a California corporation, and four fictitious party-defendants, citizens of California. Each appellee stated separately a claim arising out of the same occurrence and for an amount in excess of $3,000. Prior to trial the causes as against the Signal Oil Company were dismissed without prejudice. Sam Gailbreath answered the complaint and after trial to the court appeals from an adverse decision.

Sometime prior to October 31, 1946, the Herold Lumber Company, owner of a frame lumber storage and office building situated in California and of a stock of lumber on the premises, insured its properties through the above-mentioned insurance companies against loss and damage by fire. A fire occurred totally destroying the building and part of the lumber. The insurance companies paid in part for the loss and, under their rights of subrogation, sought in district court to recover from…