Exchange Lemon Products Company, a Corporation v. The Home Insurance Company

In the Kansas City floods of July, 1951, the appellant, Exchange Lemon, lost $162,000 worth of lemon products, principally lemon juice concentrate contained in barrels. There was no salvage on the commodities which were on the floors of the Crooks Terminal Warehouse in Kansas City, Missouri, when the rising waters of the river enveloped the warehouse.

The products were “earmarked” for the Puritan Company of America of Chicago, Illinois, but Exchange Lemon (a part of the large California organization popularly known as Sunkist) did not yet have orders for the purchase of any part of them. The goods were being held awaiting sale. Title was still with Exchange Lemon or its bailors (lemon producers) for whom, it is agreed, it had an insurable interest.

The goods had been shipped about eight months previous to the flood from Corona, California. American freight tariffs permit unloading en route and processing or holding of goods for varying periods of time at intermediate points which are not the ultimate destination. Perhaps, at the time of intermediate unloading the ultimate destination may not be known. If known, it has not been finally designated. The financial purpose recognized…