Berman v. PALATINE INSURANCE COMPANY

• Decision Date: 01 June 1967
• Docket Number: No. 15855.,15855.
• Citation: 379 F.2d 371
• Parties: Maurie H. BERMAN, Plaintiff-Appellant, v. The PALATINE INSURANCE COMPANY, Limited, the Home Insurance Company, and Rochester American Insurance Company, Defendants-Appellees.
• Court: U.S. Court of Appeals — Seventh Circuit

379 F.2d 371 (1967)

Maurie H. BERMAN, Plaintiff-Appellant, v. The PALATINE INSURANCE COMPANY, Limited, the Home Insurance Company, and Rochester American Insurance Company, Defendants-Appellees.

No. 15855.

United States Court of Appeals Seventh Circuit.

June 1, 1967.

George C. Rabens, Chicago, Ill., for appellant.

John P. Gorman, Chicago, Ill., Jacob T. Pincus, James T. Ferrini, Clausen, Hirsh, Miller & Gorman, Chicago, Ill., for appellees.

Before HASTINGS, Chief Judge, MAJOR, Senior Circuit Judge, and SCHNACKENBERG, Circuit Judge.

MAJOR, Senior Circuit Judge.

Plaintiff, on and prior to October 10, 1959, was the owner and operator of a drive-in restaurant on North Milwaukee Avenue, Chicago, Illinois, known as the "Superdawg Drive-In." On that date the building and contents were destroyed by fire, resulting in an interruption of his business. Prior to the date of the fire, defendants issued to plaintiff their policies of insurance, insuring him against loss and damage to the building and contents as well as loss resulting from the necessary interruption of business. The loss for damage to the building and contents was adjusted and settled December 21, 1959, more than sixty days following the loss. For one reason and another plaintiff failed to furnish to defendants' adjusters adequate financial information relating to his claim for business interruption, until January 11, 1961, approximately fifteen months after the fire. The instant suit was commenced September 9, 1964, almost five years after the fire.

The policies contained two provisions specifying conditions precedent to plaintiff's right to maintain an action on the policies: (1) that he render a sworn proof of loss within sixty days after the inception of the loss (the 60-day provision), and (2) that no suit or action on the policies for the recovery of any claim is sustainable unless all the requirements of the policies are complied with and unless commenced within twelve months after the inception of the loss (12-month provision). Admittedly, plaintiff did not comply with either the 60-day or the 12-month provision.

Plaintiff on brief states the contested issues as follows:

"The contested issues are whether the acts and conduct of the defendants constituted a waiver or estoppel with respect to the policy provisions requiring the plaintiff to furnish sworn proof of loss within sixty days, and to file suit within one year following the fire, or whether the failure of the plaintiff to comply with either of those provisions barred the action."

At plaintiff's request, the case was tried to a jury only on the issue of liability. The jury returned a verdict favorable to defendants, upon which judgment was entered. The only post-trial motion made by plaintiff requested vacation of the judgment and a new trial, which was denied. From the judgment thus entered and the denial of the motion for new trial, plaintiff appeals.

The Supreme Court of Illinois has held that issues of waiver and estoppel are issues of fact and not of law. Dickirson v. Pacific Mutual Life Insurance Company, 319 Ill. 311, 319, 150 N.E. 256. Such issues were so treated in the instant case, both by counsel and the Court. In opposing defendants' motion for a directed verdict, plaintiff's counsel stated to the Court, "I believe that we very definitely have a case for the jury to determine so far as waiver is concerned." In his argument to the jury he stated, "The only question for determination revolves around whether or not Mr. Berman was led to believe that those provisions of the policy did not require that he strictly comply with them, so that is what is involved." Plaintiff also recognized the issues were for the jury by submitting an instruction, approved by the Court, as follows:

"They defendants charge that the plaintiff has failed to comply with certain conditions of the policies requiring the plaintiff to furnish them with sworn statements in proof of loss within sixty days following the fire and to commence suit against them within one year following that occurrence, and that because of those violations of the policy provisions the plaintiff can recover no amount from them for any loss he may have sustained in the interruption of his business."

Thus, it is indisputable that plaintiff not only requested but insisted that the issues of waiver and estoppel be submitted to the jury.

Plaintiff argues here, as he pointed out below in his motion for new trial, that the verdict is contrary to the manifest weight of the evidence. In support of such argument he makes a detailed statement on the issues under discussion, based on evidence most favorable to him. To the contrary, defendants state the evidence most favorable to them. After a careful consideration of the conflicting views in this respect, we think it not inappropriate to observe that the relevant factual issues are argued here as though this were a trial de novo. While plaintiff's argument on these factual issues is not without merit, we think that the verdict has substantial support and must prevail on this appeal.

Moreover, on the state of the record plaintiff has not preserved and is not entitled to question here the sufficiency of the evidence to support the verdict. At the trial plaintiff made no motion for a directed verdict but, as shown, in resisting defendants' motion for such a verdict insisted that the issues be submitted to a jury. Subsequent to the judgment he made no motion for a judgment notwithstanding the verdict, but moved only for a new trial, inter alia, that the verdict was not supported by the evidence and that it was contrary to the manifest weight of the evidence. Plaintiff's motion for a new trial was denied. Having failed to test the legal sufficiency of the evidence below in any manner available to him, he is now precluded from a review by this Court relating to the sufficiency of the evidence to support the jury's verdict. This principle has often been recognized by this and other courts. In Irvin Jacobs & Co. v. Fidelity & Deposit Co. of Maryland, 202 F.2d 794, 799, on a record quite similar to that here, this Court stated:

"Prior to the time that the jury returned its verdict the plaintiff did not move for a directed verdict or otherwise question the sufficiency of the evidence to support a verdict if returned in favor of the defendant. Under well established principles, the sufficiency of the evidence to support the verdict is not preserved for review, Flint v. Youngstown Sheet & Tube Co., 2 Cir., 143 F.2d 923; Miller v. Maryland Casualty Co., 2 Cir., 40 F.2d 463, 465, unless this is one of those exceptional cases, Charles v. Norfolk and Western Ry. Co., 7 Cir., 188 F.2d 691, 695; Commercial Credit Corp. v. Pepper, 5 Cir., 187 F.2d 71, which render inapplicable the general rule."

This Court recognized and gave effect to the general principle in Hamblen v. Kazlauski, 259 F.2d 754, 756, and Silbernagel v. Voss, 265 F.2d 390, 391. In the latter case we stated:

"However, the defendant made no motion for a directed verdict at the trial; and, under well-established principles, questions as to the sufficiency of the evidence to support the verdict are not preserved on this appeal. Citing cases."

Among the numerous other cases which have recognized this principle is United States v. Socony-Vacuum Oil Co., Inc. et al., 310 U.S. 150, 247, 60 S.Ct. 811, 855, 84 L.Ed. 1129, wherein the Court stated:

"Hence this case falls within the well established rule that neither this Court nor the Circuit Court of Appeals will review the action of a federal trial court in granting or denying a motion for a new trial for error of fact, since such action is a matter within the discretion of the trial court."

Plaintiff recognizes the general rule as urged by defendants but relies upon exceptions to such rule, citing Commercial Credit Corp. v. Pepper et al., 5 Cir., 187 F.2d 71, 75, and Charles v. Norfolk & Western Ry. Co., 7 Cir., 188 F.2d 691, 695. In Commercial Credit, the Court held that under the circumstances of the case the District Court abused its discretion in denying a motion for a new trial. Plaintiff had questioned the sufficiency of the evidence by a motion for judgment notwithstanding the verdict. In Charles, this Court recognized the general rule but held that the District Court had abused its discretion in its denial of a motion for a new trial. In doing so we described the situation (page 695):

"In the instant case, the trial judge expressed his dissatisfaction with the verdict and felt that an injustice had been done; an erroneous instruction was given the jury imposing a burden of proof upon plaintiff not required by the applicable law; the resulting judgment denied plaintiff even compensatory damages for her out-of-pocket expense which had resulted from her false arrest and imprisonment, and imposed upon her the costs of the suit. In this situation, we think there was a miscarriage of justice. It is one of the exceptional cases which call for a reversal."

In Irvin Jacobs,Hamblen and Silbernagel, supra, this Court considered the exception to the general rule as applied in Commercial Credit and Charles, and held the exception inapplicable. We hold here that under the circumstances the general rule is controlling, in other words,...