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There are cases allowing full recovery to the
owner of a qualified or limited interest. These cases either draw a distinction to justify the divergence, or are distinguishable on their facts or on some fundamental legal principle rendering a contrary view
inequitable and unjust. In some instances, the ruling is clearly because the limited interest of the insured was only temporary, and was made complete before the insured claimed the proceeds. [FN29] Other rationales are
less clear. Thus, where a building supported by a party wall is insured and such wall is destroyed, the insured may recover the diminution caused thereby in the value of its building, which may include the full value of
the wall, since the value of the building is dependent upon the full use of such wall. [FN30]
Observation: It is extremely difficult to reconcile this line of cases with the cases in the preceding division based upon traditional principles. The
practitioner should initially research the law in the particular jurisdiction and, if not satisfied with the holdings in that jurisdiction, review the cases in other jurisdictions to determine whether there is a
basis to argue for a change in the law.
Where the insured is merely the agent, bailee, consignee, factor, and so forth, of the owner and insures the property as such representative of the owner, he or she may recover the full value of
the property and hold the excess for the owner. [FN31] Some cases which allow full recovery to the qualified owner base their holdings upon elements of estoppel on the part of the insurer, as
where the insurer, with full knowledge of the nature of the insured's interest, insures the property for its full value and charges premiums accordingly. [FN32] |
