Gayle v. Commercial Union Assurance Co.

LOTTINGER, Judge.

This concursus proceeding1 presents an issue which has not been addressed in Louisiana jurisprudence: If fire destroys a building which is leased by a lessee with an option to purchase and if the option to purchase is not exercised before the fire, who, between the lessor and lessee, is entitled to the fire insurance proceeds?

James P. Cox and L. J. Harding leased a certain tract of land with a building thereon from Lawson Gayle on June 8, 1976. The “Act of Lease and Agreement to Purchase” contained a provision giving the lessees an option to purchase the property for…