H. K. H. Co., a Partnership, Consisting of Henry S. Hendler and J. M. Hendler v. American Mortgage Insurance Company

The appellant, H.K.H. Co., appeals from the district court’s order, after trial without a jury, that judgment be entered in favor of the appellee, American Mortgage Insurance Company. The question presented to this court is whether the appellee breached its contract to provide lease guarantee insurance by refusing to fulfill the terms and conditions of the guaranteed lease after becoming the defaulting lessee’s successor in possession.

The appellee, a Nevada partnership, filed this action on May 15, 1978, in the Second Judicial District Court of Washoe County, Nevada. The appellant, a North Carolina corporation, thereafter removed to the United States District Court for the District of Nevada, pursuant to 28 U.S.C. § 1441 (a). On May 2, 1980, the district court entered its memorandum decision and order granting judgment in favor of appellee and denying the award of attorney’s fees. 490 F.Supp. 1201 (D.Nev.1980). As discussed below, we affirm the district court’s order.

I.

In 1973, D.H. Overmeyer Co., Inc. (“Overmeyer”) sold its warehouse in Sparks, Nevada to Bergin Way Associates (“Bergin Way”) and then leased back the property on a “net-net-net” basis for twenty-five years.…