A professor knew a colleague who was quite ill. The professor ...

[Chloeellawright]

A professor knew a colleague who was quite ill. The professor applied for life insurance on the colleague's life and named himself as beneficiary. Because of a similarity in the names of the professor and the colleague, an error was made and the policy was issued. The professor also sold his car to a student. When the student drove away, it was clear that the student was an extremely reckless driver. The professor decided not to cancel his property insurance policy that he had maintained on the vehicle that he sold to the student. Shortly thereafter, the colleague died and the student demolished the car. The professor applied for insurance benefits under both policies and each of the insurers resisted payment. Decide both cases.

Question 2

The Judds purchased a home in a subdivision in Arizona that was designated as one for those age 55 and over. The restrictions on the subdivision also provide that only children over the age of 18 can reside with their parents. The Judds' daughter was recently divorced and has asked to live with them for a few months until she is financially stable again. The Judds' 12-year-old granddaughter will also be moving in. Can the neighbors obtain a court order to require the daughter and granddaughter to move out? Riley v. Stoves, 526 P.2d 749 (Ariz. 1974)

[IAPPLET]

Answer to Question 1

The professor loses both cases because the professor had no insurable interest in either case. In the life insurance matter, there was no expectation of gain if the colleague continued to live and there was no pecuniary loss suffered by the death. As to the car, because the professor had no monetary or pecuniary interest in the vehicle when the loss occurred, there was no insurable interest.

Answer to Question 2

The court permitted the daughter and granddaughter to reside there for only a limited time. Most age restrictions now provide for temporary residence of underage individuals or set an appropriate age limit such as 18 for residents.