## Facts

- Ramon Tublitz owned three buildings insured under a standard fire policy issued by Glens Falls Insurance Co.
- The policy was in effect when a fire occurred.
- On November 14, 1979, Tublitz entered an executory contract to demolish the three buildings within ten days.
- On November 18, 1979, before any demolition work began, one building was destroyed by fire.
- Tublitz sought payment of the building’s actual cash value under the policy.
- Glens Falls denied coverage, arguing Tublitz suffered no compensable “loss” because the building was slated for demolition.

## Issues

1. Whether an owner who has signed an executory demolition contract retains an insurable interest in a building until demolition begins.
2. Whether a pre-demolition fire constitutes a compensable “loss” under a standard fire policy despite the insured’s intent and contractual commitment to demolish.

## Decision

- The court granted the insured’s motion for summary judgment as to liability.
- The court held that the insured sustained a compensable fire loss.
- The court ruled that an executory demolition contract, without commenced demolition, does not negate the insured’s insurable interest.
- The insurer was obligated to indemnify the insured for the building’s actual cash value under the policy.

## Legal Principles

- Recovery under a standard fire policy requires the insured to sustain a “loss,” but “loss” is not negated solely because the insured planned to demolish the structure.
- The existence of an executory contract to demolish a building generally does not deprive the owner of an insurable interest while demolition has not begun.
- A building subject to an executory demolition contract may still retain economic value (including potential market value, collateral value, or interim utility), supporting a finding of compensable loss upon accidental destruction.
- Insurance indemnity principles focus on placing the insured as nearly as possible in the position that would have existed absent the covered event; enforcing coverage under an in-force policy reflects the parties’ risk allocation.

## Conclusion

The court held that a building owner who has agreed to demolish a structure in the near future still has an insurable interest, and a fire occurring before demolition begins is a compensable loss under a standard fire policy, making the insurer liable for the fire damage.


Tublitz v. Glens Falls Ins. Co., 179 N.J. Super. 275, 431 A.2d 201 (Law Div. 1981)