North River Ins. v. Clark

Guy H. Clark, as receiver of the Montborne Lumber Company, brought this action to recover on a fire insurance policy issued by the appellant to the Montborne Lumber Company. The facts were stipulated and the case was tried by the court without a jury. The lumber company operated a short logging railway. It owned a Shay locomotive covered by the policy which it alleged was “damaged by fire and by the collapse of bridges resulting from such fire to the amount of $15,000.” The stipulated facts showed that the locomotive was untouched and undamaged by the fire, but that it was so isolated as a result of the forest fire which destroyed the railroad bridges that it would cost all the locomotive was worth to rebuild the trestles or bridges so as to make the locomotive accessible for use. The court therefore held that this rendered the locomotive useless and awarded judgment for its stipulated value of $7,000. The alleged loss results from the unwillingness or inability of the insured to rebuild the bridges, and was not caused by the fire. Can it fail or refuse to rebuild its bridges and claim that the locomotive was thereby lost because of the fire? Suppose the bridges were fully insured…