Close-Smith v. Conley
Citation | 230 F. Supp. 411 |
Decision Date | 20 May 1964 |
Docket Number | Civ. No. 61-381. |
Parties | C. N. CLOSE-SMITH, an Underwriter at Lloyd's, London, in behalf of himself and those other Underwriters at Lloyd's subscribing Certificate L 60585, and A. G. Wrightson, an Underwriter at Lloyd's, London, in behalf of himself and those other Underwriters at Lloyd's subscribing Certificate L 60586, and J. E. Green, an Underwriter at Lloyd's, London, in behalf of himself and those other Underwriters at Lloyd's subscribing Certificate LM 22192, Orion Assurance Company, Ltd., London and Overseas Assurance Company, Ltd., Excess Insurance Company, Ltd., and World Auxiliary Assurance Company, Ltd., each subscribing Certificate LM 22192, Plaintiffs, v. J. N. CONLEY, Defendant. |
Court | U.S. District Court — District of Oregon |
COPYRIGHT MATERIAL OMITTED
Robert T. Mautz, Mautz, Souther, Spaulding, Kinsey & Williamson, Portland, Or., for plaintiffs.
Leo Levenson, Portland, Or., for defendant.
Plaintiffs, in this cause, and in a similar action against J. W. Briggs, seek a determination of their liability, if any, under certain insurance policies. Jurisdiction is grounded on diversity of citizenship and the Federal Declaratory Judgment Act, 28 U.S.C. § 2201.
On January 1, 1959, plaintiff I issued to defendant, a certificate of third-party property damage insurance, effective for the policy period to January 1, 1962. In said certificate, within a limit of liability of $50,000.00, the plaintiff I, among other things, made certain agreements.1
An attached endorsement carried other important provisions.2 Contemporaneously with the issuance of the above certificate, plaintiff II issued to defendant another certificate which provided excess third-party property damage insurance, over and above the insurance covered by plaintiff I, with a limit of liability to $50,000.00 for the same policy period. Said certificate used the same language as used in number I, with the exception that it contained no obligation to investigate or defend.
At the same time, plaintiff III, issued to defendant what is termed an "umbrella policy" with a limit of liability of $1,000,000.00, to insure third-party damage liability of defendant. This last mentioned certificate did not require the assured to investigate or defend, and had a special limit of liability clause.3
The liability assumed by plaintiff III is couched in different language than that used in the first two certificates.4
Prior to June 28, 1960, defendant and J. W. Briggs were licensed, as a joint venture, by the Contractors License Board of the State of California, for the purpose of submitting a bid to the Department of Public Works of that state to do certain work on its Highway 40. Said joint venture was the successful bidder on said project, and, on June 28th, of that year, entered into a contract with said department for the prosecution of such work.
On or about June 29, 1960, in compliance with an oral agreement previously existing, defendant, J. W. Briggs and G. D. Dennis & Sons, Inc., a corporation, created another joint venture, in writing, for the purpose of completing the aforesaid contract, which contract, with the consent of the State of California, was assigned to the said joint venture which included G. D. Dennis & Sons, Inc. The said association thereafter being known as Briggs-Conley-Dennis, a licensee of the Contractors License Board of California, the same being the joint venture subsequently herein mentioned.
Said venture thereafter procured third-party property damage insurance in the aggregate amount of $1,000,000.00, in the Industrial Indemnity Co., to insure and protect the joint venture and its members for legal liability arising from third-party property damage growing out of the operations of the joint venture in the performance of the contract aforesaid.
The premium on each of the certificates issued by plaintiffs I and II was partially paid in advance, with an additional premium to be based upon audits of the payrolls of defendant, as submitted by him to the insurance brokers, through whom said certificates were purchased.
During the course of the operations of the joint venture, a forest fire occurred in the work area. On the theory that the fire started through the negligent operations of the venture, and, the individual members thereof, a number of law suits were instituted in the Superior Court of the State of California, the demands in said actions aggregating approximately $6,000,000.00. The defendants in said actions have denied responsibility for said fire and the resulting damage.
Plaintiffs contend that the parties never intended the certificates to cover a liability created by the operation of a joint venture, unless such venture was specifically included, by endorsement, on the certificates.
As evidence of the intentions of the respective parties, to exclude all risks which were not specifically endorsed on the policies, the plaintiffs point to the following endorsements attached to the respective policies.
Likewise, attention is called to the method, and manner, in which the premiums were to be paid on the respective policies:
Of great importance, argue the plaintiffs, are the actions of defendant and Briggs in connection with the California joint venture contract as follows:
To continue reading
Request your trial-
McNeilab, Inc. v. North River Ins. Co., Civ. A. No. 82-3934.
...135 (1949). See Pan American World Airways, Inc. v. Aetna Cas. & Sur. Co., 505 F.2d 989, 1001 & n. 10 (2d Cir.1974); Close-Smith v. Conley, 230 F.Supp. 411 (D.Or.1964); 13 Appleman § 7389 at 192-96 (1976 & 1986 Supp.); 2 Couch § 15:52 at 291 (1984 & 1985 Supp.); 11 Couch § 44.261 at 405-06 ......
-
Fred Meyer, Inc. v. Central Mutual Insurance Company
...are ambiguous, then the insurers carry an exceptionally heavy burden. That burden was carried by the insurers in Close-Smith v. Conley, 230 F.Supp. 411 (D.Or.1964), cited by the Direct Damage Insurers. There the court held, among other things, that the practical interpretation, as placed on......
-
First Far West Transp., Inc. v. Carolina Cas. Ins. Co.
...Or. at 319, 275 P.2d at 232. An endorsement becomes a part of the insurance contract and must be construed with it. Close-Smith v. Conley, 230 F.Supp. 411, 417 (D.Or.1964); 13A Appleman, Insurance Law and Practice § 7537 (1976). To the extent of any conflict between the policy and endorseme......
-
Royal Indemnity Co. v. John F. Cawrse Lumber Co., Civ. No. 64-201.
...an insurance contract, to the extent of the endorsement, modifies the terms and conditions of the original contract. Close-Smith v. Conley, 230 F.Supp. 411 (D. Or.1964). Any uncertainty in the meaning of a policy provision is to be resolved against the party responsible for the use of the q......