Robert L. Kemp and Fred E. Cooper, Inc. v. American Universal Insurance Company

HANNAY, District Judge:

This appeal is from a denial by the trial court of insurance coverage to a damaged oil drilling rig owned by the Appellant Robert L. Kemp. Federal jurisdiction is based upon diversity of citizenship between Appellants and the insurer — Appellee. The case was tried before the District Court without a jury.

The policy in question contained a loss payable clause in favor of Fred E. Cooper, Inc., from whom Kemp purchased the rig, and the C.I.T. Corporation, the chattel mortgagee, who would be entitled to share in the proceeds in the event of judgment from the Appellants.

There…