University of Judaism v. Transamerica Insurance Co.

Opinion

ASHBY, J. This is an action to recover amounts alleged due on fire insurance policies issued by defendants insurance companies. After a court trial based on stipulated facts, the trial court entered judgment in favor of defendants.

Prior to December 23, 1970, defendants Transamerica Insurance Company, Union Insurance Society of Canton, and South Carolina Insurance Company issued fire insurance policies to Julius and Molly Fligelman covering certain premises on Huntington Drive in Los Angeles, as to which the Fligelmans owned an undivided one-half interest. The Fligelmans had paid premiums for the period October 1, 1970, to October 1, 1971.

The Fligelmans transferred their interest in the Huntington Drive property to plaintiff University of Judaism by grant deed dated December 23, 1970. On December 28, 1970, the Fligelmans transferred and assigned the insurance policies, with respect to their interest in the Huntington Drive property,1 to plaintiff.

The premises were destroyed by fire on February 1, 1971. Both before and after the transfer of the property and until its destruction by fire, the premises were leased to F. S. Rasco & Company, and the ongoing activity on the property remained the same. The fire was started as a result of widespread civil disorder on the east side of Los Angeles on February 1, 1971.

On February 2, 1971, Transamerica notified the Fligelmans’ insurance agent that Transamerica was going to cancel the policy as of February 9, [940197]1, and requested that the original policy be returned. The policy was not returned and on February 11, 1971, Transamerica gave direct notice of cancellation to all of the named insureds, to be effective March 15, 1971, to allow 30 days’ notice for the named insureds and mortgagees to protect their individual interests.

By letter dated February 12, 1971, defendants were notified that a loss had occurred, that the property had been transferred and that the policies had been assigned to plaintiff. The face page of the policies contains the following provision required by Insurance Code section 2071: “Assignment of this policy shall not be valid except with the written consent of this company.” Effective February 12, 1971, Transamerica endorsed its policy to change the name of the insured to read the plaintiff.

Only defendant Transamerica actually endorsed its policy to reflect the change. However, each of the defendants, had they been notified of the transfer prior to loss and without delay, would have consented to the change.2