Kalpakian v. Oklahoma Sheraton Corporation

• Decision Date: 22 July 1968
• Docket Number: No. 9641.,9641.
• Citation: 398 F.2d 243
• Parties: Edward KALPAKIAN, Lucy Kalpakian, Fidelity and Guaranty Insurance Underwriters, Inc., Employers' Surplus Lines Company, Seven Provinces Insurance Company, Ltd. and Mission Insurance Company, Appellants, v. OKLAHOMA SHERATON CORPORATION, a corporation, Appellee.
• Court: U.S. Court of Appeals — Tenth Circuit

398 F.2d 243 (1968)

Edward KALPAKIAN, Lucy Kalpakian, Fidelity and Guaranty Insurance Underwriters, Inc., Employers' Surplus Lines Company, Seven Provinces Insurance Company, Ltd. and Mission Insurance Company, Appellants, v. OKLAHOMA SHERATON CORPORATION, a corporation, Appellee.

No. 9641.

United States Court of Appeals Tenth Circuit.

July 22, 1968.

J. M. Sheehan, of McClelland, Collins, Sheehan, Bailey & Bailey, and John B. Hayes, of Watts, Looney, Nichols & Johnson, Oklahoma City, Okl. (Robert Blanchard, of Hastings, Blanchard & Hastings, Los Angeles, Cal., with them on the brief), for appellants.

Wm. J. Holloway, Jr., Oklahoma City, Okl. (L. E. Stringer, of Crowe, Dunlevy, Thweatt, Swinford, Johnson & Burdick, Oklahoma City, Okl., and N. Ronald Silberstein, Boston, Mass., with him on the brief), for appellee.

Before MURRAH, Chief Judge, and PICKETT and SETH, Circuit Judges.

PICKETT, Circuit Judge.

Appellants, Edward Kalpakian and Lucy Kalpakian, instituted this action to recover damages in the amount of $286,546.00, incurred as a result of the disappearance of jewelry belonging to them from a safety deposit box provided for guests by appellee, Oklahoma-Sheraton Corporation, the operator of a hotel in Oklahoma City, Oklahoma. The insurance carriers partially indemnified Kalpakian for the loss and are now appearing as subrogees to the extent of their payments. Upon consideration of the pleadings, affidavits and depositions, the trial court concluded that a recovery by Kalpakian could not exceed $1500.00, and granted the hotel's motion for summary judgment. Leave was given at that time to file an interlocutory appeal, and upon denial of that application by this court,¹ the judgment dismissing the action was made final. The principal issue raised on this appeal is whether the Oklahoma statutes relating to liability of hotel operators preclude recovery by a hotel guest for loss of property from the hotel's safety deposit boxes resulting from negligence of the hotel.

While on a selling trip, Edward Kalpakian, who with his wife Lucy is engaged in the wholesale and retail jewelry business, registered at the Sheraton in Oklahoma City on the evening of September 25, 1962.² He immediately requested a deposit box in the hotel vault in which to deposit his jewelry. Apparently he informed the hotel employee at the cashier's cage that he had "valuables" he wished to protect. The hotel maintained several sizes of deposit boxes, and at that hour no box of sufficient size to hold the case containing Kalpakian's jewelry was available.³ It was necessary, therefore, to use a smaller box, which entailed removing the chamois rolls containing the jewelry from the bag prior to placing them in the safety deposit box. The following morning a larger box became available, and after removing his jewelry from the smaller box, he reserved the larger box for use later that day. A different employee was on duty at that time, and upon request Kalpakian signed a printed form then used by the hotel in connection with its safety deposit service. The form was designated "Oklahoma Biltmore Hotel Safe Deposit Box Agreement." In addition to stating that safety deposit boxes were available for hotel guests and referring to the return of the key, the instrument contained the following statement: "The maximum value of the property deposited shall not exceed $1500.00." The boxes could be opened only by the joint use of the hotel's master key and the key to the particular box issued to the guest. When Kalpakian returned later in the day, this procedure was followed and the case containing the jewelry was deposited. After the box was locked, Kalpakian retained his key. Upon opening the box the next morning, the case and jewelry had been removed and have not been subsequently found. It appears from the record that during the night a person other than Kalpakian appeared at the clerk's desk with a key to Kalpakian's box and requested entrance thereto, which was granted by the clerk.

The prevailing view at common law was that an innkeeper was liable as an insurer for the property lost by a person while a guest in the inn. 43 C.J.S. Innkeepers § 15. This view was reflected in the Oklahoma Statutes, 1890, § 2752, (see Busby Hotel & Theatre Co. v. Thom, 125 Okl. 239, 257 P. 314), and in the same year the Oklahoma legislature provided a means by which an innkeeper might limit his liability by providing a safe for the valuables of his guests.⁴ Implicit in the opinions of the Oklahoma Supreme Court construing this first statutory modification of the common law rule was the view that even though the hotel complied with the provisions of the statute, it would remain liable to guests for the negligent loss of their property. Ketchum v. Gordon, 151 Okl. 240, 298 P. 605; Huckins Hotel Co. v. Hooper, 44 Okl. 307, 144 P. 177. Following these decisions, the statutes under consideration here were enacted in 1939 significantly changing the liability of a hotel for the loss of a guest's property.

15 Okl.St.Ann. §§ 501, 503, 503a and 503b fix the liability of the operator, manager or owner of a hotel in Oklahoma for loss of personal property belonging to guests. Section 503 makes it the duty of the hotel to equip the doors of all guest rooms with suitable night latches, night chains or bolts, placed on the inside of the doors to prevent opening from the outside by key or otherwise. Section 503a⁵ relates to hotels which provide a safe, vault or other depository for the safekeeping of valuables described therein. Notice that such safe, vault or other depository is available to guests shall be given by posting a notice in a public and conspicuous place and manner in the office or public rooms, or in the parlors or guest rooms of the hotel. The statute provides that if after notice, a hotel guest neglects to deposit valuables in the hotel depository, the hotel shall not be liable for any loss of property belonging to a guest, regardless of the cause. But when valuables are delivered for deposit, the statute requires that the guest shall at that time advise the person in charge of the hotel office of the actual value of the property, and the hotel is not required to accept property for deposit exceeding the value of $300. If there is a loss of deposited property, the hotel is liable only for the actual value thereof "in no event exceeding the sum of Three Hundred Dollars ($300.00)." The hotel, however, may by special agreement in writing with a guest, receive property of greater value than $300 and assume liability as shall be provided for in the written agreement.

The manifest purpose of Section 503a is to protect a hotel against undisclosed excessive liability when it furnishes for its guests safety deposit facilities, and to provide a method for accepting greater liability by written agreement if the hotel management desires. The decision to accept greater responsibility can be made only after the hotel guest has...