Gordon Mailloux Enterprises, Inc., and Merchants Wholesale Co., Inc. v. Firemen's Insurance Company of Newark, New Jersey

After typhoon Karen had devastated the Island of Guam on November 11 and 12, 1962, a number of persons demanded indemnity for property damage from Firemen’s Insurance Company. They rested their claims upon binders and policies of typhoon insurance made and executed on behalf of Firemen’s by one Edward Fritsche, a local insurance agent, who conducted business through a controlled corporation.

Firemen’s refused payment on the principal ground that it had not insured the property prior to the typhoon; additionally it commenced this action for a declaratory judgment of nonliability. The policy holders in turn sought affirmative relief. Trial to a jury resulted in verdicts for Firemen’s as to some defendants and against it as to others. This appeal concerns only the defendants Merchants Wholesale Co., Inc., and Gordon Mailloux Enterprises, Inc.

I.

The jury found for Merchants, but the court on Firemen’s motion entered judgment notwithstanding the verdict. This disposition was error, for consideration of the proof favorable to Merchants [Railway Express Agency, Inc. v. Mallory, 168 F.2d 426 (5th Cir. 1948)] reveals “substantial evidence” [Butte Copper & Zinc v. Amerman, 157 F.2d 457,…