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Henry Heide, Inc., received a warehouse receipt for 3,200 100-pound bags of sugar that it bought from Olavarria. The corporation withdrew 800 bags of the sugar from the warehouse (where thousands of pounds were stored), but when it returned for the balance, it discovered that the warehouse was padlocked and empty. Some 200,000 pounds of sugar had mysteriously disappeared from it.
Henry Heide, Inc., carried insurance for such a loss, but its insurance company refused to pay, claiming that the corporation had no insurable interest in the sugar. Do you agree with the insurance company? Why or why not?
Henry Heide, Inc., v. Atlantic Mut. Ins. Co., 363 N.Y.S.2d 515 (NY).
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