Court Opinion

ID: 9650693
Source: CourtListenerOpinion
Date Created: 2023-08-23 15:48:59.009674+00
Date Added: 2024-06-11T18:12:25.242854
License: Public Domain

HUXMAN, Circuit Judge
(dissenting).
I think the judgment of the trial court should be affirmed. In the ultimate, the only question presented is the measure of damages for ascertaining the loss of appellant resulting from the established fraud of the Laundry Company. There is nothing new, novel or difficult in this problem. While the type of insurance involved in this case is new and whilé there are no cases directly in point dealing with the measure of damages flowing from the breach of such contracts or from fraud in such transactions, the gauge to be applied is the same as in other cases.
The general rule in cases of fraud is that the defendant is liable for damages that are the natural and proximate result of his wrong-doing. The damages which are the proximate result of the wrong are those which must be presumed’to have been within the wrong-doer’s contemplation at the time he committed the fraud. In other words, they are such as he knew or is presumed to have known would result from his wrongful conduct.1
Appellant offered the deposition of Welk, its chief underwriter, who testified that his company would have carried a maximum risk on this business limited to $65,-000.00, and that it would have either re-insured anything above that or canceled the policy if the risk exceeded such amount. This testimony was properly rejected by the court. What appellant would have done i= incompetent to establish the measure of damage. If it were established or testimony had been offered to prove that it was the common practice of insurance companies to reinsure a portion of such a risk as was assumed'under this policy and the amount thereof which ordinarily would have been reinsured and that the Laundry knew of such practice, we would have an entirely different question. It is sufficient to say that there is not a scintilla of evidence tending to establish such a state of facts nor was any evidence offered to this effect.
Under the undisputed evidence in this case, the only damage which was established resulting from the wrong of the Laundry was the loss of premiums and the court correctly entered judgment for such amount.

 See 37 C.J.S., Fraud, Section 141; Kornblau v. McDermant, 90 Conn. 624, 98 A. 587; Smith v. Bolles, 132 U.S. 125, 10 S.Ct. 39, 33 L.Ed. 279; Lowrie v. Castle, 225 Mass. 37, 113 N.E. 206.