Bicknell, Inc. v. Havlin

• Decision Date: 02 April 1980
• Citation: 402 N.E.2d 116,9 Mass. App. Ct. 497
• Parties: BICKNELL, INC. v. John J. HAVLIN et al.
• Court: Appeals Court of Massachusetts

Page 116

402 N.E.2d 116

9 Mass.App.Ct. 497

BICKNELL, INC. v.John J. HAVLIN et al.

Appeals Court of Massachusetts, Suffolk.

Argued Feb. 13, 1980.

Decided April 2, 1980.

James S. Dittmar, Boston, for plaintiff.

Alan G. Miller, Boston, for defendants.

Before HALE, C. J., and GRANT and NOLAN, JJ.

NOLAN, Justice.

The plaintiff(Bicknell) claims to be aggrieved by the direction of verdicts for the defendantsJohn J. Havlin and Corcoran & Havlin Insurance Agency, Inc.(Corcoran and Havlin), on counts one and three of its complaint alleging negligence in failing to place proper insurance coverage on two buildings leased to Bicknell and located in Middleton.As to count two, which alleges a breach of contract, the trial judge ordered judgment notwithstanding a verdict for the plaintiff in the amount of $40,000.00.At oral argument, the parties stipulated that the damages assessed by the jury on count two constitute the only recoverable damages under all counts.We reverse the judgment on count two.

The test for determining the correctness of the judge's action in directing verdicts requires us to examine the evidence, including all reasonable inferences, in the light most favorable to Bicknell.Howes v. Kelman, 326 Mass. 696, 696-697, 96 N.E.2d 394(1951).The same standard applies to the review of a judgment notwithstanding a verdict.SeeMinnefor v. Town Taxi, Inc., 4 Mass.App.Ct. 43, 44, 339 N.E.2d 925(1976);O'Shaughnessy v. Besse, --- Mass.App. ---, ---^a, 389 N.E.2d 1049(1979).CompareKraus v. Webber, 359 Mass. 565, 565, 270 N.E.2d 789(1971), which was decided under the former practice of entering a judgment under leave reserved, a practice not dissimilar to the entry of a judgment notwithstanding a verdict pursuant to Mass.R.Civ.P. 50(b), 365 Mass. 814(1974).

The jury could have found that Bicknell had been in the business of distributing swimming pools and their accessories and supplies since 1957.Havlin, treasurer of Corcoran & Havlin, and Corcoran & Havlin were independent insurance agents.Bicknell had been doing business with an insurance agency which was purchased by Corcoran & Havlin in 1969.At that time, Havlin met with the principals of Bicknell with a view toward a continuation of business with Bicknell.Havlin described himself as experienced in the insurance business.He told the representatives of Bicknell that he wanted "to handle (the Bicknell) account in a highly professional manner."Bicknell decided to retain Corcoran & Havlin and, thereafter, Havlin devoted himself to the Bicknell account.He procured from various insurance carriers all the insurance required by Bicknell casualty, liability, automobile, surety, fidelity bonds, workmen's compensation and other coverages, except life insurance.Havlin made recommendations for particular types of coverage and gave advice freely to Bicknell.One of the earliest recommendations which was adopted was for the purchase of a multiperil policy for Bicknell's commercial stock.At the end of each month, Bicknell sent Corcoran & Havlin a report disclosing the value of commercial stock at each warehouse location.Corcoran & Havlin would then review the report to make sure that Bicknell was reporting in accordance with the policy.If the report was in order, Corcoran & Havlin would transmit it to the carrier.

When Bicknell started making reports, it had one completed and one unfinished building in Framingham and one warehouse in Middleton.When the second building was completed in Framingham, Neal Smith, the vice-president and treasurer of Bicknell asked advice of Havlin as to how reports of commercial stock should be prepared.Stock was continually being moved from one building to another and from Framingham to Middleton.Havlin assured Smith that in Framingham there was no problem because there was blanket coverage under which the stock was covered up to a specified amount.

When Bicknell submitted its monthly report of inventory and its value on March 6, 1974, Havlin took notice that the value of the commercial stock at the warehouse in Middleton was $758,600.00.The limit of insurance coverage at that time for stock at this location was.$540,000.00.Havlin telephoned Smith to inquire about new limits, and Smith agreed that new limits should be purchased.As a result, Havlin increased the coverage at Middleton to $750,000.00, effective immediately.During this telephone conversation, Smith told Havlin that two new warehouses, in the style of Quonset huts, were then under construction in Middleton and that Bicknell would lease them from the owner of the Middleton real estate.

Approximately ten days later, Havlin called Smith and discussed the insurance provisions of the draft of the lease.Smith informed Havlin that the two new warehouses in Middleton were just about ready for use.After Smith told Havlin the value of certain heaters which would be stored in the new warehouses.Havlin asked Smith if he thought that $50,000.00 would cover the stock in each building.When Smith indicated that this would be sufficient "at this point," Havlin said, "Let's slap fifty-thousand on each building."Havlin did not...