Schleimer v. Strahl

GRIFFIN, P. J.

Plaintiff-respondent, Albert I. Schleimer, as trustee under the last will and testament of Nellie F. Schleimer, deceased, owned two stores under an old hotel operated by plaintiff. Plaintiff leased them to defendant under a lease dated July 1, 1955, and to expire May 31, 1964.

Plaintiff brought this action for rents, etc., and for declaratory relief to determine, among other things, the question of his liability for insurance premiums on a water damage policy under the lease provisions. The lease with its amendments provided as follows:

“It is agreed between the parties hereto that henceforth the Lessor shall not be liable for any damage caused by the failure of the sprinkler system or because of any breaks or leaks in the boiler, water or steam lines, or for any other damage caused by water or floods, or because of the inadequacies of said premises in any manner whatsoever. ’ ’

Paragraph seventh provided as follows: “Lessor agrees that Lessee may purchase a commercial block policy to cover such water damage to Lessee’s store equipment, fixtures, furniture and stock of merchandise located in the above premises so leased, as well as in the premises at 1170 and 1174 Third Avenue, San Diego, and 231 ‘B’ Street, San Diego, and the space occupied by the Lessee in the basement of the above-numbered store rooms. ’ ’

In addition, an addendum to the lease provided: “That Lessor shall pay to Lessee, during the term of this lease, the additional premium, if any, charged by the insurance carrier to cover said additional insurance coverage.”

The water damage coverage under a commercial block policy was in effect for a period of approximately four years

[615]

ending December 31, 1959. The premiums for water damage coverage under the commercial block policies for the period from February 1956 to December 1959 were only $1,530.99. Thereafter, the lessee could not obtain water damage coverage under a commercial block policy. This was because there had been frequent water damage claims on the premises. Thereafter the lessee could obtain water damage insurance coverage only from Lloyd’s of London at a substantially larger rate. That rate was approximately $1,600 per year, an amount which was about four times greater than the cost of the earlier coverage.