Barrett v. Iowa National Mutual Insurance Co.

• Decision Date: 26 February 1959
• Docket Number: No. 16101.,16101.
• Citation: 264 F.2d 224
• Parties: Henry H. BARRETT, Appellant, v. IOWA NATIONAL MUTUAL INSURANCE COMPANY, a corporation, Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

264 F.2d 224 (1959)

Henry H. BARRETT, Appellant, v. IOWA NATIONAL MUTUAL INSURANCE COMPANY, a corporation, Appellee.

No. 16101.

United States Court of Appeals Ninth Circuit.

February 26, 1959.

Brown, Sande, Symmes & Forbes, Weymouth D. Symmes, Billings, Mont., for appellant.

Coleman, Lamey & Crowley, Cale Crowley, Billings, Mont., for appellee.

Before MATHEWS, ORR and POPE, Circuit Judges.

MATHEWS, Circuit Judge.

On and after November 30, 1953, appellant, Henry H. Barrett, a citizen of Montana, owned a building at 15 North 32d Street in Billings, Montana. On November 30, 1953, appellee, Iowa National Mutual Insurance Company, an Iowa corporation doing business in Montana, issued to appellant in Montana a liability insurance policy reading, in part, as follows:

"Iowa National Mutual Insurance Company appellee * * *

"Agrees with the insured appellant, * * * subject to the limits of liability, exclusions, conditions and other terms of this policy: * * *

"Coverage C — Property Damage Liability — Except Automobile: To pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of injury to or destruction of property, including the loss of use thereof, caused by accident."

The limits of liability applicable to Coverage C were stated in a part of the policy called the declarations. The limits so stated were as follows: "$1,000.00 each accident," "$10,000.00 aggregate operations," "$10,000.00 aggregate protective" and "$10,000.00 aggregate contractual."

On May 14, 1954, portions of the building were occupied by tenants to whom they had been leased by appellant,¹ and each of the leased portions of the building, except the one leased to E. W. Haws,² contained personal property owned by the tenant or tenants thereof. On May 14, 1954, while the policy was in force,³ a fire of unknown origin destroyed the building and all personal property therein.⁴ Thereafter, prior to February 29, 1956, the tenants other than Haws claimed damages of appellant⁵ in sums aggregating $42,677.87 because of the destruction of their personal property; actions on some of the claims were commenced in a State court of Montana; and one of the State court actions was brought to trial.

In the course of that trial, it was learned that all the claims could be settled for a total of $5,000. Appellant and appellee agreed that the claims should be so settled,⁶ and the claims were so settled, but appellant and appellee disagreed as to the extent of appellee's liability. Appellant contended that appellee was liable for the entire $5,000. Appellee contended that it was liable for only $1,000 thereof. It accordingly contributed only $1,000 to the settlement. Appellant contributed the remaining $4,000 and demanded that appellee reimburse him therefor. Appellee refused.

Thereafter, on July 25, 1957, in the United States District Court for the District of Montana, an action on the policy was brought by appellant against appellee to recover the $4,000, with interest and costs. On August 29, 1957, appellee filed an answer admitting some of the allegations of appellant's complaint and denying others. On January 14, 1958, appellant and appellee filed a stipulation entitled "Stipulation and Agreement with Respect to Facts." Thereby appellant and appellee agreed to, and did, submit the case to the District Court on the facts admitted in the answer and the facts stated in the stipulation. The facts so admitted and the facts so stated were, in substance and effect, the facts we have stated in this opinion.

From these facts the District Court concluded that the fire constituted a single accident, within the meaning of the policy, and that, therefore, the limit of appellee's liability under the policy as a result of the fire was $1,000. Thus, in effect, the District Court concluded that, having contributed $1,000 to the settlement of the claims for damages resulting from the fire, appellee was not liable for the $4,000 contributed by appellant or any part thereof. Accordingly, on May 1, 1958, a judgment was entered ordering, adjudging and decreeing that appellant take nothing, and that appellee recover its costs. This appeal is from that judgment.

As indicated above, there was only one fire. However, as indicated above, the fire destroyed property owned by the tenants of seven of the leased portions of the building, and the tenants made seven claims for damages. Appellant therefore contends that the fire constituted seven accidents, within the meaning of the policy. There is no merit in this contention.⁷

As indicated above, three of the limits of liability stated in the declarations of the policy were: "$1,000.00 each accident," "$10,000.00 aggregate protective" and "$10,000.00 aggregate contractual." Appellant contends that the phrase "each accident" was ambiguous and required construction. There is no merit in this contention.⁸

Appellant contends that the phrase "each accident" was modified by the phrases "$10,000.00 aggregate protective" and ...